Gainesville Daily Register

Local News

April 29, 2011

How much will taxes increase with NCTC bond?

Gainesville — Replacing and renovating some buildings on the North Central Texas College campus won’t be accomplished without asking property owners to approve higher NCTC district taxes.

If voters approve the $32.5 million bond package, the exact amount of the tax increase is not yet set in stone.

NCTC President Dr. Eddie Hadlock noted that the monetary impact on taxpayers depends on interest rates at the time the bonds are issued.

If the package is approved, the college will issue bonds and sell them with the proceeds being used to pay for the proposed construction/renovation project.

As with any loan, a shorter term loan creates higher payments but results in a faster payoff.

Reference information released by the college provides some examples of how the bond would effect taxes for the owners of a $100,000 home.

A 25-year bond with a 4.9 percent interest rate would increase taxes on a home valued at $100,000 by $7.25 per month or approximately $87 per year, Hadlock said.

A 30-year bond with an interest rate of 5 percent would increase taxes on a home valued at $100,000 by $6.67 per month or $81 per year, Hadlock said.

He also noted that Cooke County homeowners 65 and older with an exemption would not have their homestead taxes increased by this tax bond.

Some Cooke County residents question the need for the bond election.

Dexter resident Ken Arterbury has been a strong opponent of the bond package.

Arterbury said he’s all for projects such as the new health sciences center. But he said he’s concerned that money that could have been used to build the health sciences center several years ago was spent on another project — The First State Bank Center for the Performing Arts.

The center was not built with taxpayer’s money. However, maintenance and other costs associated with the center are.

“The Performing Arts Center was built for $6 million that could have been better used for the Health Science building,” Arterbury said in a written response to questions about the bond issue. “While the PAC bond is not paid for out of taxes, the maintenance, utilities and insurance are paid for by the taxpayers. In addition to the PAC building, NCTC hired out-of-state architects which has led to several moisture problems, mold problems and water leaks because the architect was unfamiliar with our climate and soils. While the college has spent several hundred thousand dollars in trying to fix those problems, many of them remain unresolved.”

Like some other Cooke County residents, Arterbury also questions the need to demolish and replace the 300 and 600 buildings.

“While some of the buildings are 40 to 50 years old, they were built better than many modern buildings of today, the PAC for example,” he said.

Arterbury also contends that NCTC has estimates from engineering firms stating that the buildings could be fixed for a couple million dollars or less.

“Why would anyone tear down two solid buildings that can be remodeled, and usable for many more years with proper maintenance?” he said.

As for the NCTC administration claim that overcrowding is a problem in some classrooms, Arterbury said he doesn’t believe it.

“I believe that some local nursing candidates are getting turned away because people from outside the county are coming in and beating them out of the available slots,” he said. “Maybe NCTC tuition is too much of a bargain for out-of-county students. What if NCTC raised the health sciences tuition for out of county students? The out-of-county students would make a larger contribution to the cost of the facilities that are being subsidized by Cooke County taxpayers.”

Arterbury also has additional concerns about taxes for individuals 65 or older who homestead.

“Because property taxes are frozen on homesteads for people 65 and older, the bond payments have to be covered by a smaller group of taxpayers including those over 65 who own rental properties and agriculture,” he said. “What I have seen from the projection of the college is a tax rate of 9.4 cents and that is on top of the 7.2 we are now paying. What happens when property values go down as proposed by the Cooke County Appraisal District? That will result in the college tax rate more than doubling and it will stay there for the life of the bond. NCTC projection was for 25 years. For a $100,000 home, that would amount to $2,350.00 in additional taxes for that property owner.”

Hadlock noted that the NCTC tax rate is low compared to other Texas colleges.

“NCTC’s current tax rate ranks 49th lowest among all 50 community college districts in Texas,” he added. “Even if the proposed tax bond is approved by voters, the college tax rate would still rank below the state average.”

As for claims that the buildings could be fixed, NCTC Dean of Administrative Services Dr. Stephen Broyles said that’s not actually true. He said the state of the college’s 300 building exemplifies the need for a major construction/renovation project at the Gainesville campus.

Broyles said an assessment including rooftop photos of the 300 building, illustrates the dismal condition of the building.

“If we needed confirmation of the hopeless condition of our 300 Building, this is probably it,” he said.

NCTC officials have said estimates to repair the 300 building roof are around a quarter million dollars.

“I don't see how anybody could justify plowing nearly a quarter million dollars into a building that has so many other serious structural problems such as sinking floors,” Broyles said.

He also noted that questions have arisen about why NCTC administrators allowed buildings on the Gainesville campus to deteriorate in the first place.

“We've tried hard and spent a lot of money in recent years to maintain and keep our buildings viable — to hold them together so to speak,” he said. “But, some (like the 300 building) have simply come to the end of their useful lifetime — not from neglect, but (from) things like poor design, failure to take into account the horrible soil conditions resulting in bad foundations when they were built and so on. We've spent more money on engineers trying to figure an affordable, practical way to fix the sinking floors, but the cost was out of sight. Moreover, this would only have fixed the floors (maybe)— it would not have paid for remodeling, repainting, repairing the interior walls nor (would it have) rendered the building layout any more useful for our current needs.”

NCTC President Dr. Eddie Hadlock agrees with Broyles’ assessment.

“The roof (of the 300 building) is just an example of the condition that the overall building is in,” he said. “Raising the floors and rehabilitating that building doesn’t seem to be feasible or a wise use of the money.”

Even with roof repairs and other rehabilitation, the building is still not suitable for the college’s needs, he noted.

“Once we do (the repairs) we still don’t have a building that meets our needs,” he said, adding the air conditioning/heating system is obsolete and replacement parts have to fabricated.

Hadlock said he understands the public’s concern about higher taxes.

“I know that people don’t like to pay more taxes, but the tax support going to this college and what the college means to this community, I think far outweigh the cost,” he said. “When people examine their tax bill (they will) see that we are one of the lowest taxing entities within the county. The citizens have only been asked for a tax bond election one time in the last 30 years and that was to build the library back in 1988.”

Early voting begins May 2. The general election is set for May 14.

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