VC Bond Election 2023

How does VC benefit the community?

• Seventy percent of VC graduates live, work, and remain in its seven-county service area
• VC provides affordable and accessible higher education opportunities at only one-third the cost of the average state university, allowing many students the opportunity to obtain college degrees, transfer to a university, or obtain career training and enter the workforce
• VC is a major provider of education in the community, serving over 7,000 students each year, including many students who graduate from one of the local high schools

What will the proposed bond do?

• Prepare area students for the future, whether graduating with an associate degree, transferring to a four-year institution, or entering the workforce
• Provide residents the opportunity to get the affordable education and training they need to get a job or to advance in their careers – at one-third the cost of the average state university
• Align with VC’s vision statement of improving lives and strengthening communities, which has enabled VC to be a catalyst for educational attainment, economic growth, and cultural enrichment for nearly 100 years
• Provide remaining funding needed for construction and renovations of a $36.5 million Student Success Center for which VC has already committed $26.5 million in grants, gifts, and institutional funds

Will students help pay for the facility?

• $6 million of total projected costs will be funded through a student Tuition & Fee Revenue Bond. As VC previously budgeted for this payment, the proposed bond will not result in an additional increase in tuition and fees for students.

What projects are included?

• Construction of a Student Success Center (threestory expansion and renovation of current facility)
• Central and easily accessible location for:
  » Learning services (library, tutoring, testing, academic success coaching)
  » Support services (veterans, disability, transfer, career, and counseling services; food pantry; health clinic)
  » Enrollment services (admissions, financial aid, payments center, advising)
• Infrastructure enhancements: Improve roads, walkways, signage, and parking
• Library demolition: Building constructed in 1975; highest energy usage of any building on the VC campus; costs outweigh the benefits of completely remodeling the facility

What are the projected costs?

• Estimated cost is $36.5 million for construction of a Student Success Center and related infrastructure enhancements
• VC has committed $26.5 million (nearly 3/4 of total project cost) in grants, gifts, and institutional funds (VC’s Campaign for the Future continues)
• VC’s Board of Trustees is asking voters to consider the bond issue to fund the remaining $10 million

Will taxes increase if the bond passes?

• The current debt service portion of the property tax rate is 3.20 cents per $100 of valuation
• The bond would result in a property tax rate increase of 0.21 cents per $100 of valuation for three years and then a decrease of 0.58 cents per $100 of valuation in 2027, due to voter-approved bond debt that will be paid off in 2026 » For a homeowner with residential property valued at $100,000, this would translate to an increase of $2.10 per year for three years and then a decrease of $5.80 in 2027

Where did the project originate?

• VC formed a 19-member Capital Improvement Input Team in 2016
  » Tasked with aligning capital improvements and facility needs with VC’s Strategic Plan
  » Identified the need for a Student Success Center and related infrastructure enhancements
• Based on team’s recommendations, VC’s Board of Trustees adopted the Facilities Master Plan in 2017
  » An integral part of that plan is the construction of a Student Success Center in the center of campus

Why are taxpayers being asked to consider funding the remaining $10 million?

• VC has done its due diligence by identifying institutional funds, raising funds through gifts and grants, and reducing costs through value engineering
• Students will pay for the “student center” portion of the facility, estimated at $6 million, through a student Tuition & Revenue Bond; VC previously budgeted for this payment, so the bond will not cause an increase in tuition and fees for students
• The longer construction is postponed, the more construction costs will rise; it is not fiscally responsible to postpone construction

What is a tax bond and why is it needed?

• Unlike Texas public universities that receive state funding for major construction projects, nearly all Texas community colleges rely on bonds approved by local taxpayers to fund major construction projects
• Texas community colleges are required to adopt a balanced budget each year and do not budget excess revenues to build up reserves (savings)
• A bond is similar to a home mortgage in that it allows the cost of a facility to be spread over several years
• It’s common for homeowners to take out debt at different times; similarly, VC is getting ready to pay off debt and will take on new debt for capital improvements if the bond is passed

How does the bond initially result in a tax rate increase and then a decrease in 2027?

• An existing voter-approved bond will be paid off in 2026
• The bond schedule is being structured to minimize impact on taxpayers the first three years
  » Principal payments will be reduced first three years
  » $610,000 in debt service reserves (savings) will be used to offset the first three years of lower payments

How are property taxes determined?

• Property values are determined by the Victoria County Appraisal District
• Property tax rates are set by local taxing units, including the VC tax rate set by VC’s Board of Trustees
• VC’s property tax revenue is separated into two “buckets,” including:
  » The Maintenance & Operations (M&O) tax rate, which funds day-to-day operations; VC’s current M&O tax rate is 16.4 cents per $100 of valuation
  » The Interest & Sinking (I&S) or debt service tax rate, which is used to repay debt for major capital improvements; VC’s current I&S tax rate is 3.2 cents per $100 of valuation
• VC’s total property tax rate is currently 19.6 cents per $100 of valuation

Does VC’s enrollment support the need for construction of the new facility?

• VC serves over 7,000 students each year through:
  » Traditional college classes leading to degrees, certificates, and transfer to a university
  » Workforce and continuing education leading to increased earnings
  » Adult education that prepares students for college-level coursework
  » Dual enrollment classes that allow students to earn college credit while in high school
• Since the pandemic, VC has seen workforce and continuing education enrollment shifting to a higher percentage of total enrollment, indicating a common need for students to earn a credential and enter the workforce quickly

How can I help?

• Everyone is encouraged to vote during early voting (April 24-May 2) or on Election Day (May 6)
• More info: www.VictoriaCollege.edu/Bond23
•  Have a question? Bond23@VictoriaCollege.edu