Friday, October 26, 2007

Win-Win Pt II

At this week's "Meet the Candidates" night, a question was asked about our support of the Win-Win Agreement.

Part of Doug Maggied's answer was that we pay $1 million/yr to Columbus City Schools to satisfy the revenue sharing conditions of the Agreement, but that we get back $10 million/yr in tax revenue from the properties in the Win-Win area. Net is $9 million/yr in revenue to the school district. Doug seems to think that makes it a winning proposition for Hilliard City Schools. But that's not the end of the story.

The Win-Win areas are parcels of land that have always been in townships within Hilliard City Schools until annexed to the City of Columbus so developers could get water/sewer services for all the homes they built. These areas include a number of significant commercial parcels, include the massive Buckeye railroad yard and many of the businesses near the Rome-Hilliard and I-70 interchange.

But lots of kids live in those areas as well. The Win-Win area encompasses neighborhoods such as following (with the number of students, source = data provided to the Redistricting Committee):

Western Lakes: 401
Golfview Woods: 214
Village at Thornapple: 225
Saddlebrook Condos: 224
Hilliard Green: 203
Hilliard Village: 182
Sweetwater Estates: 164
Bayside Commons: 195
The Meadows: 123
River Run: 70
The Glen: 195
Stonewyck Manor: 23
Scioto Trace: 32
Cabot Cove: 55

The cost per student is $9,860/yr in our district, so we eat up that $9 million in net revenue if there are 1,000 or more kids living in the Win-Win areas. The list above adds up to more than 2,100 kids, and this is not complete. These 2,100 kids alone represent $20.7 million in annual cost.

That $9 million of net revenue we get out of the Win-Win area doesn't look so hot now.

So does this mean I think we should withdraw from the Win-Win at the next opportunity? No. Even if it seems to make sense from a fiscal standpoint, these neighborhoods are part of the Hilliard community. Hilliard City Schools did not annex the land these homes sit on - they were always part of the Hilliard School District. The people who bought those homes did so believing they were buying into the Hilliard Schools community. It is politically unthinkable to abandon our neighbors at this point.

These facts are part of the truth everyone needs to understand. It means that it's not just Mayor Schonhardt and the Hilliard City Council we have to hold accountable for letting developers build houses all over, it's also the decisions of the Mayor of Columbus and the Columbus City Council we need to influence. The terms of the Win-Win will need some significant changes next time around.

With your vote, I'd like to fight this battle from a seat on the School Board. But it will take the politicial might of our whole community to regain control over these politicians and developers.


  1. it's also the decisions of the Mayor of Columbus and the Columbus City Council we need to influence

    Pardon my ignorance here, but who made the (poorly named) "Win-Win" agreement? Columbus simply got the better of us. I agree we need to stick with the agreement but I don't know why lobbying Columbus would help given that they are the beneficiary. It seems to me we should hold accountable whomever it was in Hilliard made that deal (although I assume they are no longer in office.)

  2. An old business adage goes: "If you want to know the truth, follow the money."

    The Win-Win agreement is talked about like there were only two parties to the deal: Columbus Public Schools vs the suburban school districts. While these are indeed the parties that signed the agreement, the real motivators behind the Win-Win were the real estate developers and homebuilders.

    Columbus politics have been ruled by developers and homebuilders for decades, and it's an unholy alliance. Homebuilders need elected officials to grant annexations, provide services - especially water & sewer, build roads. The elected officials need campaign contributions to get elected, and will trade favors for money. No other industry around here has this level of symbiotic relationship with elected officials.

    In the end, the school systems all lost, and the developers won, along with their pet politicians. The truth of this is becoming apparent in many school districts in Central Ohio as the State of Ohio cuts back in funding to so-called wealthy districts to redirect funds to rural and urban districts.

    Nor is business growing sufficiently to take up the slack. For many years now, the municipalities in central Ohio have found themselves bidding against each other to keep their existing commercial tax base. Many companies have lowered their tax bills simply by threatening to move to another suburb. Some have actually moved (e.g. Gates McDonald from Hilliard to Columbus; BMW Financial from Dublin to Hilliard, etc).

    So little explosions have been going off all around 270 as suburbs run into a funding wall. Pickerington has perhaps had it the hardest, but Southwestern has struggled as well. I fear it is our turn next.

    And to your last question, none of the current Board members were serving when the original agreement was signed in 1986. However, it comes up for renewal every six years, and the last time was 2004. It may therefore be the case that Doug Maggied was on the Board then - I'm not sure.

  3. Thanks Paul, that makes sense. The only solution seems to be impact fees, but I worry about whether it will make home ownership even less affordable.

    I think the root problem with education (like health care) is that specialized human labor is getting increasingly expensive and will continue to do so.

    Concerning the human capital cost, Daniel P. Moynihan wrote years ago that the problem with health care and education is that new technology does not help make either profession more efficient. So while most industries constantly see productivity rise, it does not happen with human-intensive jobs like teachers and doctors because computers and robotics don't help (in fact, the need for schools to have computers and hospitals to have the latest incredibly expensive technology adds fuel to the fire). Education costs will continue to take up a higher percentage of most people's budgets simply because other costs have stayed the same or even gone down due to greater efficiencies.

    So, I wonder how willing are we to become partial serfs to the gods of health care and education? The general rule is that everything we give to the government becomes not less but more expensive.

  4. TS:

    I've proposed an impact fee mechanism which has zero net effect to affordability. The idea is the impact fee would be rolled into the mortgage, but the homeowner would be given a property tax credit that approximately offsets the increase to their mortgage payment (the credit would be based on 30yr fixed rate mortgage payments). In effect, it's a commitment to fund the cost of the facilities. Impact fees would be added only to new homes, not existing homes. The theory is that if the stock of housing stays the same, the population of the schools would be relatively constant as well.

    My impact fee plan would not however underwrite normal annual operating costs, 90% of which are the salaries and benefits for the teachers, staff and administrators. It would take an enormous impact fee to make a dent in these costs. The solution here is for the voters of our community to take back control of the city halls, and tell the mayors and the city councils that their job is to protect our wallets, not stuff the ones of the developers.

    The school board needs to be assertive in this stance, and quit acting like victims. The people of our community are smart, but they need to be educated in matters of funding, motivated to take action, and guided in what they should do.