How school districts sell funding projects across Michigan

Next Tuesday, voters across 29 Michigan school districts will decide whether they want to support requests for more than $1 billion in new construction and athletic field improvements, and purchases like technology and school buses.

If past performance is any indicator, only half those requests will pass.

What separates winners from losers? A Bridge review of 20 years of bond issues shows funding requests in wealthier districts have a better chance of passing. But other, less obvious factors are also at play: the current economy, perceived need and how effectively, and honestly, districts communicate the value of the project to their communities.

For school districts, bond issues can be fraught with difficulty: convincing voters to pay more during a slow economic recovery for building renovations, new technology or ball fields. Over the last 20 years, the batting average of bond requests is pretty even: about 51 percent of nearly 1,600 bond issues studied gained voter support, a Bridge analysis found.

Consider: Out of more than 4.2 million votes cast since 1995, the ‘yays’ exceed the ‘nays’ by just over 8,800.

Passing a bond issue, said Don Wotruba, executive director of the Michigan Association of School Boards, “is an art form.” There is no shortage of blueprints for success.

A district has to make sure it can defend the request and clearly communicate the necessity of the additional money. Taxpayers don’t like to be fooled.

“You hope you’re not overshooting what they told you they wanted,” Wotruba said.

On Tuesday, the requests vary from $1.4 million to improve the football and track stadium in Adrian to $134.5 million that would allow Warren Consolidated Schools to renovate multiple schools, upgrade athletic fields and buy technology and school buses.

Over the years, the passage rate has fluctuated wildly. More bond issues failed than passed from 1996 to 2008; the worst year was 2003, as Michigan began its economic descent. Just over a third of the 70 bond issues passed. Paradoxically, one of the best years was 2009 when the jobless rate in Michigan first hit double digits.

(Bridge only reviewed ballot measures involving districts that sought more favorable credit terms under a program of the state Department of Treasury, which allows districts to obtain lower borrowing costs. Some wealthier districts with stronger bond ratings have chosen not to seek state qualification, and are not included in this analysis.)

Most successful districts

Least successful districts*

* Minimum of 10 bond issues since 1996

Source: Michigan Treasury Department's School bond election results.

Geographically, voters in some counties are more supportive than in others. Oakland County, the state’s wealthiest, has seen 80 percent of the 69 requests pass since 1996. Wotruba noted that wealthier districts have inherent advantages: A larger tax base means millage rates are smaller. But Wotruba also speculated that more educated voters may be more likely to back education efforts.

“In some ways they are valuing what’s needed in the pipeline for the job market,” he said.

East Grand Rapids, another of the state’s most educated and wealthiest districts, has passed eight of nine bond issues; while Troy, Rochester and Walled Lake have each approved multiple bond issues worth more than $200 million over the years. All are more affluent districts.

Another vote next week, in west Michigan, is also of note: In the small, 1,000-student Galesburg-Augusta district east of Kalamazoo district leaders are asking voters to extend an existing bond issue to cover more than $10 million in renovations and remodeling, along with technology for its three buildings.

It’s noteworthy because the district has had such trouble convincing voters in the past: Of 11 votes since 1996, only one, in 2000, passed. Since then, seven requests have failed, including one last November.

That proposal was similar to the one facing voters next week, save one obvious difference: The November proposal called for multi-million dollar improvements to the district’s athletics fields, raising the amount requested to $14 million. After that defeat, the district removed athletic field money, reducing the total request to $10 million.

“We found the biggest polarizing factor was the athletic fields,” said Dania Bazzi, the district superintendent.

Don Wotruba, of the Michigan Association of School Boards, said successful districts pay close attention to the needs and values of local residents.

This time, the district also brought in pollsters from Lansing who took the temperature of district voters. Although the district said it has always worked with the community, “this time we sought out their thoughts even more,” Bazzi said. (Update: The bond issue passed 777 to 682)

Promoting a successful bond issue often involves haggling, then scaling back. It’s quite common for bond issues to come in pairs – first one fails, then it shrinks and then the voters agree, Wotruba said.

“Every voter thinks the first bond issue is one that can be pared down,” Wotruba said. “But sometimes that isn’t the case.”

In Michigan, school districts can only raise bond money for capital improvements, such as new facilities, athletic field upgrades or school bus purchases. They cannot raise local bond money for teacher salaries or classroom operations.

For school boards to find success, they have to work with the community, said Dave Campbell, a former superintendent of Olivet schools who is now superintendent of the Kalamazoo Regional Education Service Agency.

“Ultimately, it really comes down to communication,” said Campbell, who oversaw three successful bond issues in 2002 and 2008 in Olivet.

Campbell’s hard-earned suggestion: If ballot language is wordy and confusing, break it down into a simple, clear message that anyone can understand. “Explain it in English,” he said.

School advocates say this kind of communication was threatened by passage of legislation last December that barred local officials from lobbying for issues involving tax dollars. Schools and other local officials, however, interpreted the law as a backdoor effort to discourage local communities from providing even basic, factual information to residents about a ballot or millage issue in the critical months before a vote.

After local officials howled about the measure, the legislature sought to change it almost immediately. School leaders filed a federal lawsuit, and a federal judge put a temporary halt on the law in February, allowing districts in March and in the upcoming vote to proceed as before.

Tell them ‘why’

Districts must make sure they are telling voters what’s at stake, why it’s needed and why they should raise their taxes, Campbell said.

“Why are we asking for this? Why are we asking for a technology wing?” Campbell said, recalling what a board and superintendent must always keep in mind.

“You have to answer the ‘why’ question. Which is why that legislation (regarding communication) was so problematic.”

If a district fails to make its point in casual meetings and in sessions before churches, the local business community and the like, anti-tax sentiment can win out. “Sometimes bond issues can sink more on emotion than the facts,” Campbell said.

In Galesburg-Augusta, Bazzi’s district is trying to overcome any resentment. The bond issue is billed as “zero millage,” meaning the district’s bond rate won’t change. But that doesn’t mean it’s free money: In its brochure the district makes it clear that if it fails, tax rates will go down.

It’s all part of being transparent, Bazzi said.

“We understand these are difficult economic times,” she said. “But at the same time, I have to advocate for the students of Galesburg-Augusta.”

On Tuesday, we’ll find out if voters agree.