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Verona voters face epic choice with huge school referendum

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VERONA — At $162.8 million, a referendum here to build a high school, convert the existing high school to a middle school and complete several other projects is one of the largest in state history.

Yet, if the April 4 ballot measure passes, the tax bite on the average homeowner will be smaller than other recently approved referendums.

That’s because $140 million of the construction costs could be absorbed by a tsunami of new money that flowed into the district this year after Epic Systems Corp. was fully entered on the city’s tax rolls.

Since the first spade of dirt was turned in 2003, all of the medical software giant’s property taxes had been diverted into a tax incremental finance (TIF) district that was used to cover road, sewer and other infrastructure costs at the sprawling, fairyland-like campus.

The TIF closed at the end of 2016, meaning that revenue stream is now available to local taxing authorities to use as they wish. For officials in the Verona School District, that means addressing aging facilities, crowding and getting ahead of what the district expects to be more than 1,500 additional students by 2030.

To get a sense of the opportunity Verona faces, consider this: If the district does nothing, the school tax rate would drop from $11.98 per $1,000 of valuation to $9.45, saving the owner of a $250,000 home $527 a year.

But by tapping the Epic money to complete what district officials say is a much-needed expansion, the school tax rate would rise by 42 cents, costing the owner of a $250,000 home an additional $105 a year.

By comparison, a $75 million referendum approved in Hudson last year cost the owner of a $250,000 home about $180 a year. An $89.5 million referendum approved in Sun Prairie in November has a tax impact on a $250,000 home of about $125.

“It’s unusual. It’s truly epic,” said Michele Wiberg, a financial consultant for the Verona School District and a vice president at PMA Securities in Milwaukee where she advises other districts around the state. “No one has the opportunity, that I’m working with, that is being presented here. This is a unique situation.”

Not all of the projects’ costs are covered, and there is more the district wants to do. Two other questions on the ballot next month could ultimately drive up taxes on the average homeowner by $342 a year beginning in 2021.

Epic-driven growth

Suburban school districts throughout Dane County have expanded and upgraded facilities over the past 20 years as their communities have grown. Sun Prairie opened a new high school in 2010 and will likely go to referendum in 2018 to get permission to build a second high school. In the past three years, voters in McFarland ($65.1 million), DeForest ($41 million) and Waunakee ($44.8 million) approved school building proposals.

The Verona area is booming, too. Since 1989, the Verona School District has seen its enrollment more than double to 5,111 students. In that time, the district has built three elementary schools and two middle schools, but more students are on the way, according to district projections, with 4,400 housing units expected to be added by 2030.

Residents here have also witnessed one of the the largest private construction projects in state history develop at their back door.

The Epic development — with its own field of solar panels, an 11,400-seat auditorium and 27 buildings housing 9,600 employees — has helped fuel dramatic growth in Downtown Madison, where apartments and condominiums are being gobbled up by young Epic workers who want to live in a more urban setting close to restaurants, bars and shopping areas. Other communities, like Mount Horeb, Dodgeville and even Cross Plains have felt the impact of the growing workforce, but now the Verona School District has a chance to cash in on the success of Dane County’s largest private employer that in 2016 had $2.5 billion in revenue.

“Really, nobody understood what the impact of that would be, but we knew it would be big to a certain extent. I thought the three buildings they built in the beginning were phenomenal,” said Dennis Beres, 63, the Verona School Board president who was first elected to the board when the Epic campus was still farmland. “One of the things that was clearly brought forward by the community was that they wanted a comprehensive plan. They didn’t want a Band-Aid type of thing.”

Three options

That’s why, after more than 10 years of study, surveys and community meetings, the district is putting forth a referendum with three questions.

The $162.8 million proposal would construct a high school for 2,200 students on 108 acres of district-owned land along Highway 18-151 at West Verona Avenue on the city’s southwest side. The new high school, scheduled to open in fall 2020, would include a performing arts center, a field house with four full-size basketball courts, and a track and outdoor practice fields.

The existing high school on the city’s north side would be renovated for students now attending Badger Ridge Middle School and the K-12 Core Knowledge Charter School, and Badger Ridge, built in 1992, would be renovated for students from Sugar Creek Elementary.

The plan would also close Sugar Creek, built in 1956, and the adjacent New Century Elementary charter school, which was built in 1918 and is the district’s oldest facility. The two-story, split-level building along West Verona Avenue has wooden banisters and railings along its stairways but is cramped for space, has antiquated mechanical systems and is off limits for students with physical disabilities because there are no elevators or ramps.

If the referendum is approved, its students would move with the middle-schoolers and Core Knowledge students into what is now the high school.

The plan would also require redistricting measures that could shift some students to other schools.

A second question on the ballot asks for $18.5 million for an indoor swimming pool and new competition athletic fields at the new high school, while a third question requests $2.3 million each year to fund operating costs beginning in 2021 for the new facilities and grounds. If all three questions are approved, the taxes on a $250,000 home would increase by $342 a year beginning in 2021, the improvements to facilities would total $181.3 million and the high school would be on track to become one of the largest in the state.

“It’s a big ask,” said Superintendent Dean Gorrell. “You don’t see numbers that big, but across the board we have seen tremendous support from the community.”

‘Do they want to pay?’

At a recent forum by the school district to explain the referendum, around 20 people heard a brief presentation and then had the opportunity to ask experts detailed questions.

Greg and Mary Bauer have lived in Seminole Forest in Fitchburg for over 30 years and never had children. The couple came to get a better understanding of the tax impact of the proposal. They plan on voting in favor of the plans.

“We believe in educating our kids,” said Mary Bauer, 66, a retired nurse.

“You have to,” Greg Bauer, a retired pharmacist said when asked if he would support the plan. “You’ve got to be thinking ahead because it’s not going to get any cheaper.”

Derrick Cheng, 37, is a former software developer at Epic who now works for a start-up company. The Verona man has a 2-year-old daughter and is concerned about the cost of the proposals.

“Our property taxes are not cheap,” said Cheng, who was unsure how he will vote. “Everybody loves having a great facility, but do they want to pay? I’d rather spend the money on hiring great teachers and raise salaries.”

Anita Wozniak, 48, has a junior in high school, a seventh-grader at Core Knowledge and a daughter in college. Wozniak, who has lived in the district for 25 years, supports the referendum.

“Your high school and schools in general are the center of your community,” she said. “It is an unusual situation and I’m not sure everybody even understands that the TIF is what’s making this truly possible. Whether it passes or not will be up to families. I’m excited about it from a parent perspective. But I think, long-term, the community will benefit from it.”


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