March 18, 2022 – Hartford, WI – Hartford Union High School has athletic facilities that need repair. The tennis courts have cracks, the running track is worn, and fields need drainage and re-sodding. But rather than repairs, HUHS District intends to expand athletic facilities and issue $12 million of 20-year bonds to pay for the expansion. This plan will have a long-term cost to taxpayers in the District.
To find out more, I requested documents from HUHS District and filed requests for documents under Wisconsin Open Records Request Laws. I obtained the District’s Bond financial planning documents, audits from the District’s independent auditor, and detailed breakdown of costs for the athletic facilities expansion.
I used the documents to make financial calculations and sent HUHS District the results. HUHS District didn’t dispute any of the following facts.
Bond debt is expensive. The District’s financial plan shows taxpayer’s actual cost of the Bonds will be $17.2 million dollars. The 2022 mill rate increase for taxpayers in the District will be 0.201 (not 0.18), so taxpayers in the District will have a property tax increase of about 8%.
The athletic facilities do not need to be expanded. The expansion plan shows HUHS District could repair existing facilities for about $4 million dollars, and the District could pay for repairs, without issuing Bonds, using General and Capital Projects Funds.
This is because the District’s financial ratio of General Fund to Expenses is about 41%. The auditor said that is “very healthy,” and the auditors expect a lower ratio of “10% to 25%.” If the District repairs existing facilities for $4 million, this financial ratio would be a very satisfactory 23%.
Through no fault of the District, their financial planning has been overtaken by events and should not be relied upon. The Bond issuance has a planning interest rate of 3.75%. Unfortunately, the Federal Reserve just increased interest rates by 0.25%. If the Bonds issue with a yield to maturity of 4%, the actual cost to taxpayers will be about $18 million.
HUHS District can fix the cracks, repair the track, put in drainage, and re-sod the fields without issuing Bonds.
Herman Zinnen
Hartford, WI
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