1. What is the challenge we face?
Unless action is taken now, Delaware Tech will be forced to limit access to Delawareans in the future. Our current source of revenue for capital projects—the State Bond Bill—has been outpaced by the College's growing enrollment and the workforce and economic development needs of the State. The College is quickly approaching capacity.
2. Why are we facing this challenge?
There are three factors that will push the College's existing capacity to its limit in the next several years:
3. What is required to keep the doors of access open?
4. What has been done up until now to address this issue?
5. What are the findings of the Task Force?
The Task Force explored three options: (1) continue status quo - relying solely on the Bond Bill to fund capital projects; (2) dedicate an existing stream of State revenue; and (3) establish a Community College Infrastructure Fund which could be funded through the implementation of a statewide property tax.
If the College were to continue with the status quo (Option 1), we would not be able to adequately maintain our existing buildings or expand quickly enough to effectively meet workforce needs. Ultimately, the College would be forced to limit access for Delawareans. Dedicating an existing revenue source (Option 2) may solve Delaware Tech's challenge; however, this alternative creates a problem for the State in redirecting much needed revenue from other important State programs.
6. What is the most effective solution to this statewide challenge?
The College is asking the Governor and Legislature to establish a Community College Infrastructure Fund (Option 3) for the following reasons: (1) It is widely used by community colleges across the country; (2) It is easy and cost-efficient to implement; (3) It is a predictable source of revenue; (4) It is sufficient to both maintain and preserve our existing assets and expand to meet growing demand; (5) It establishes a fair and equitable tax rate that does not place an onerous burden on homeowners. The average household (with a market value of $174,400) will pay less than $16 the first year with the cost to the average homeowner being capped at $38 in the tenth year; and (6) This revenue stream does not affect the funding for other important State projects.
7. Why not raise tuition to generate the funds needed for capital projects?
The College’s commitment to Delaware includes providing the citizens of this state access to the quality education they need to succeed. A significant rise in tuition would mean placing a college education out of the reach of many middle and lower income students. Even at the College’s current tuition rate, approximately 1/3 of our students use financial aid to help them meet the costs. If Delaware Tech were to ask its students to supply funding needed for capital projects, they would see a 60% tuition increase. Placing the financial burden on our students would limit access to higher education and a successful future for many deserving students. And remember that access to higher education for Delawareans also means that highly skilled Delaware Tech graduates are entering the workforce, increasing the tax base and contributing to the economic vitality of the state.
8. Why can't the College partner with business and industry to secure the funds needed to address its capacity issue?
Delaware Tech has united in partnerships with small and large businesses throughout the state. The College works closely with local business leaders to provide the programs and well-educated employees that keep Delaware’s economy strong and competitive. Many of these companies have shown their appreciation for the College and its graduates by giving generously to fund important initiatives including technology improvements, scholarships and the purchase of needed equipment. In addition, some local businesses have provided the much-needed instructional space to support various College programs. However, it is unrealistic to expect these organizations to sustain the level of funding needed for capital projects at the College. Delaware Tech’s goal is to help Delaware’s businesses to continue to grow and contribute to the state’s economy, not to hinder their success with onerous new financial obligations.
9. Why doesn't the College consider limiting access to in-state students only?
Delaware Tech educates more Delawareans than any other institution of higher education in the state; 93% of our students reside in state. The relatively small percentage of students who come from outside the state pay 2.5 times more in tuition as Delawareans. Clearly, out-of-state student enrollment does not have a substantial impact on the College’s capacity issue but does provide significant revenue to the College. Therefore, limiting access to Delaware Tech to instate students would not benefit the College financially.
Furthermore, the total exclusion of all out-of-state students may be an unlawful violation of the Privileges and Immunities Clause of the U.S. Constitution, which ensures that rights granted by a state to its citizens are not withheld from citizens of a sister state. While the Clause does not give a nonresident the right to attend a public college at the same tuition as a resident, a complete prohibition of out-of-state students could be ruled unconstitutional.
10. Why should I pay a tax if no one in my family goes to Delaware Tech?
In 2006, over 38,000 Delawareans took at least one course at Delaware Tech. Chances are good that you, a family member, or someone you know has benefited from attending Delaware Tech. Even if neither you or a family member has graduated from one of the over 100 degree, diploma or certificate programs offered at the College, perhaps your child attended one of the wide selection of summer camps, or maybe you’ve upgraded your skills for a promotion on the job through a Workforce Training course -- or made the most of your free time with leisure classes or activities.
Even if no one in your family has taken advantage of any of the College’s many educational offerings, it is still in your best interest to support Delaware Tech. Why? Because as a Delaware citizen, your life has been touched by Delaware Tech graduates in ways you may never have realized. When you need a nurse, a paramedic, a police officer or other emergency personnel, odds are that you’ll be calling on a Delaware Tech graduate. Many of the people you rely on for the day-to-day services you need got their start at Delaware Tech. In addition, your quality of life in Delaware is improved by the contributions our graduates make to the tax base and by the businesses that are thriving because of the outstanding Delaware Tech alumni they hire. Consider that in 2005, 90% of our graduates were hired by 517 different businesses and organizations around the state! Based on a number of economic impact studies of community colleges, an educated workforce not only translates into higher earnings and a more robust economy, but other socioeconomic benefits as well such as reduced crime, improved health and reduced welfare/unemployment.
11. Aren’t property taxes in Delaware already extremely high compared to other states?
No. According to the National Tax Federation, Delaware ranks 47th when calculating the property taxes as a percentage of home value, 45th as a percentage of income and 39th as the average tax paid on homes. As compared to surrounding states, Delaware residents pay considerably less tax on their homes; New Jersey ranks the highest for average tax paid while Maryland and Pennsylvania rank 13th and 14th respectively.
12. How will existing property tax exemptions be handled?
If a Community College Infrastructure Fund were implemented, the exemptions currently in place in each county would be honored.
13. Why solve the College’s capacity issue before solving the problems faced by the local school districts?
If the College does not take action to solve its capacity issue, there will be far-reaching implications for Delawareans and Delaware businesses. The College has a responsibility to address this issue, and there is a viable solution. It's a solution that has precedence; community colleges in more than 20 states have used a similar funding mechanism. It’s a solution that addresses the short and long-term capital needs of the college. And, it’s a solution that does not put an undue financial burden on tax payers and provides them with a high return on investment. For pennies a day, every Delawarean is guaranteed the opportunity for an affordable, high quality college education while Delaware businesses will continue to have access to a highly qualified workforce. This is a local revenue source that supports local people for local, good-paying jobs.
14. Why not put the College’s CCIF proposal to a referendum?
Serious legal issues are presented by a statewide referendum. The Delaware Superior Court has ruled that the General Assembly alone is vested with legislative authority - a power that it can not divert, even to the people, unless constitutionally authorized to do so. At this time, only the public school system has this authority. For Delaware Tech to have the right to go to referendum, a constitutional amendment would be necessary.
15. How is the Governor and State Legislature’s SEED Scholarship program affecting the College’s increased enrollment?
The College is now serving more than 40,000 credit and non-credit individuals annually -- a number expected to increase 27% by the year 2020. The driving force behind this dramatic increase in enrollment is the economy in which we live, an economy that requires an education beyond the high school level for good paying jobs. It’s true that the Governor and Legislature’s SEED (Student Excellence Equals Degree) Scholarship program is motivating more high school students to come to Delaware Tech, but SEED students represent only 5% of our credit enrollment. Delawareans of every age are coming to Delaware Tech because they know the College can help them achieve their career and financial goals. Consider that the Delaware Department of Labor (DOL) projects over 10,000 job vacancies by 2012 in career areas where Delaware Tech already offers academic programs. And DOL data shows that Delawareans with an associate’s degree earn on average $50,020 per year compared to a high school graduate with some on-the-job training who earns $26,470.