If you look at the current Facilities Development Report for WCC, you’ll find a list of projects. Some of them are neglect-based projects. Others are classified as maintenance and repair. The Health and Fitness Center occupies a large share of the list. And it puts a big strain on the budget. It also illustrates the inherent danger of using revenue backed debt to fund silly, expensive building projects.
The Facilities Development Neglect Report includes:
| Project | Budgeted Cost |
|---|---|
| HFC Domestic Hot Water System Replacement | $375,000 |
| HFC Family Locker Room Shower Stalls | $30,000 |
| HFC Chiller 10 Year Maintenance Package | $50,000 |
| HFC Defender Tank Replacement | $90,000 |
| HFC Repair Women’s Hot Tub | $300,000 |
| HFC Pool Chemical Systems Upgrades | $97,000 |
| HFC Pool Surface Refinishing | $200,000 |
| HFC Locker Room Renovation | $625,000 |
| HFC Flooring Replacements | $96,000 |
(Plain text = FY 19; Bold= current fiscal year)
The one listed repair project that doesn’t yet qualify for neglect is:
| Project | Budgeted Cost |
|---|---|
| Expand HFC Laundry Facilities | $61,000 |
If you’re math-inclined, the budgeted total for these projects (which span the 2019 and 2020 fiscal years) is $1,924,000.
Yep.
Nearly $2M. Of that, everything but the Laundry Room is neglect.
Now, to be fair, the $1.925M figure is just the budget for these things, which doesn’t always reflect the actual expenditures. For example, the HFC Chiller 10-year Maintenance Package was budgeted at $50,000 but was awarded as $63,868 – nearly 28% over budget. At times, the budgeted amount is well in excess of actual expenses. Since the FY 2015, WCC has budgeted $3.285M for HFC repairs and maintenance. Their data on actual project costs is …. incomplete.
What’s the risk of revenue backed debt?
If you think $3.3M in maintenance costs over 6 years is a lot, you should know that hotel maintenance is even worse. And, if as Trustee Richard Landau opined in the July 30, 2019 Board Meeting that WCC wants to own the building, WCC will be responsible for an unending litany of maintenance projects that cannot be neglected. WCC won’t even have the option of delaying maintenance on a hotel facility.
And WCC has the money to do maintenance, but it frequently chooses to do other things. However, maintenance that must be done requires money to be diverted from other operational priorities.
If debt service comes from the General Fund, it takes the highest priority. (Bond issues prevent debt service from becoming a drag on the operating fund, but the WCC Board prefers to use operating funds to finance debt.) Building maintenance that cannot be neglected comes next on the priority list. Keeping the carpet nice in the hotel will take precedence over other operating priorities, like educating students.
Higher-cost debt payments, hotel carpeting, and executive locker room renovations probably aren’t what the taxpayers of Washtenaw County had in mind when they authorized “operating funds” for WCC.
The Board of Trustees wants to limit voter input on WCC to millage requests once every 10 years. What happens when the taxpayers don’t want to fund high-maintenance boondoggles like the HFC? Or non-academic buildings the “Advanced Transportation Center?” What if the taxpayers don’t want a hotel? The only way the voters have to stop these projects is to stop funding the College.
Cutting voters out of the decision-making process on new construction is risky business.
Photo Credit: Nenad Stojkovic, via Flickr
