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Michigan’s School Construction Boom

The real costs of new public schools

February 22, 2004 | By Mac McClelland
and Keith Schneider
Great Lakes Bulletin News Service

MLUI/Gary Howe

With its sweeping rooflines and red brick, the new Holt High School is a shining example of the latest in school design. The $67 million facility opened in the formerly rural community outside of Lansing last fall; voters approved the millage increase to pay for it by just seven votes. Thanks to a sewer extension installed to serve the school, houses are sprouting nearby in what used to be farm fields.

Michigan is building ever-bigger schools ever farther out of town at a faster rate than most other states. annual expenditures in the U.S. for school construction doubled since 1992. In Michigan they tripled.
A few miles away, the Lansing School District is spending $67.5 million from a recent, successful bond initiative to compete with Holt and other local districts. More than half of the money will be spent on building a new middle school; the rest of it will be used to repair just five of Lansing’s 40 schools. Meanwhile, down the road in Okemos, the lavish $40 million school built there a decade ago could be half empty in 12 years, due to declining enrollment.

And in Charlevoix, many citizens are still bitter because school officials there ignored their input and managed to pass, by just 100 votes, a bond issue to build a new high school outside of town without giving much notice of the proposed location. Four lawsuits tried, and failed, to stop the process.

These are examples of decision making that drive one of the most important and expensive construction booms in the state and are reshaping Michigan’s urban, suburban, and rural landscapes for generations to come.

Encouraging An Unfortunate Trend

MLUI/Gary Howe
  Youngsters at Grand Rapids’ newly renovated Coit Avenue Elementary School.
Published by the Michigan Land Use Institute, Hard Lessons: Causes and Consequences of Michigan’s School Construction Boom, is the first detailed review of how school construction decisions — whether to renovate existing buildings or build new, greenfield facilities — are made in Michigan and their effect on development patterns. Hard Lessons, which grew out of a joint project of the Michigan Chamber of Commerce and the Michigan Land Use Institute, aims to help school officials, community leaders, homeowners, and parents evaluate the full cost of new school construction or renovation. It recommends changes in state policy that, if implemented, will capture the economic and cultural benefits of renovating older schools or building new ones in town.

This collaboration was prompted by our observation that building schools in undeveloped areas might be encouraging Michigan’s trend toward increasingly dispersed development patterns. Although its population is growing slowly, Michigan is one of the fastest sprawling states in the nation, according to a study prepared by Public Sector Consultants. The study also found that Michigan is consuming land for new development at a rate eight times faster than the increase in population.

Business and government leaders recognize that spread-out growth patterns are increasing taxes and fees that pay for expanding infrastructure, hurting the cities left behind, and diminishing the quality of life as open space and farmland are paved over. Hard Lessons concludes that, in keeping with these development patterns, Michigan is building ever-bigger schools ever farther out of town at a faster rate than most other states. A 2002 construction report by School Planning and Management, a national trade magazine, found that annual expenditures in the U.S. for school construction doubled since 1992. In Michigan they tripled.

HARD LESSONS asks whether building bigger, newer schools is always best for students and communities. We conclude that new school construction is raising tax, economic, and community stability issues with long-term consequences. Among our findings:
1. New school construction is dramatically raising property taxes for Michigan homeowners and businesses and has tripled related debt from $4 billion to $12 billion since 1994.
 2. In 1995, the year after the passage of Proposal A, which tied school operating funds to student populations and halved property taxes, the state saw a 150 percent increase in the dollar amount of bond issues for school construction — from $499 million in 1994 to $1.25 billion.
 3. Since 1996, our research indicates that districts built at least 500 new schools in Michigan and closed 278 older ones while the school age population grew by just 4.5 percent. Even though southeast Michigan will lose 1.5 percent of its school age population within 30 years, according to the Southeast Michigan Council of Governments, that region recently spent $6.2 billion on expanding or building new schools in the last eight years.
 4. School districts use spacious new schools to attract families with students. Last year Leslie school officials spent $11,000 on advertising, attracted 112 “outside” students — nearly 10 percent of its enrollment — and collected an extra $750,000 in state school revenues. It spent $12.6 million in 1997 to build a new, rural high school.
5. Tying each student to at least $6,700 in school operating funds has made building spectacular new schools profitable endeavors for districts that can afford them, but creates severe challenges for both small rural and large urban districts with older buildings and small or badly eroded property tax bases.
6. Building new facilities to combat overcrowding can accelerate development that prices young families out of the market, which can lead to declining enrollment. Okemos had 401 seniors in its 2003 graduating class, but just 224 children in kindergarten.
7. The broader the public’s involvement in school construction decisions, the more effectively a school board develops long-term, less costly solutions.
8. Architects and financial advisors heavily influence school construction decisions. Firms commonly attract school boards by providing “free” feasibility studies in exchange for contract guarantees. This tilts decision making towards new construction and encourages the abandonment of hundreds of quality neighborhood schools.
9. In every case we studied, building a new school cost more than renovating an older one.
10. Often, new Michigan high schools use so much land largely in order to be adjacent to athletic fields that are infrequently used.
11. Our preliminary research suggests that keeping an existing school open increases home values in surrounding neighborhoods and helps stabilize the area and its business activity, while closing them slows the rise of home values.
12. The State Superintendent of Public Instruction has exclusive jurisdiction over school buildings and sites, but provides little oversight or direction.
13. Since state law exempts schools from local planning and zoning, location decisions are often made without considering local government master plans and frequently place new schools in farmland areas that should be preserved. Standards for school development could improve cooperation between school boards and local governments.
14. School construction on undeveloped sites generates many new expenses for infrastructure and government services, which eventually raise taxes for business and property owners.


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