Fight on its hands: School district asks voters to approve two parcel taxes

For decades, voters in Menlo Park and Atherton have reliably approved every school finance measure put before them. This year, however, as the Menlo Park City School District asks for two parcel taxes to be approved, the district appears to have a fight on its hands.

According to state data, since 1990, the Menlo Park City School District has asked voters to approve three bond measures and six parcel taxes. All of the measures surpassed 70 percent “yes” votes, with three of them gaining the approval of more than 80 percent of the voters.

In the neighboring Las Lomitas School District, all measures put before the voters since 1990 have also been approved.

This year, however, a campaign is being waged against two parcel tax measures proposed by the Menlo Park City School District.

Ballot measures

The two measures appear on a special San Mateo County May 3 election ballot. Each must win the approval of at least 66.7 percent of the voters to pass. Both would annually be adjusted upward by the increase in the Bay Area consumer price index, and both offer a permanent exemption for those 65 or older.

According to the language of both measures, the parcel tax money can be spent only for teachers, to maintain low student-to-teacher ratios, to preserve “comprehensive educational programs” and, if money remains, for purchasing classroom equipment, supplies and materials. None of the money can be spent on administration costs.

Measure A

Measure A would replace a parcel tax due to expire at the end of June 2017 with an identical tax but without an expiration date. The district currently has three other parcel taxes with no expiration dates.

The expiring parcel tax is currently $201.38 a year, providing about $1.58 million a year to the district. It was originally passed in 2010 and can increase annually by the amount of the Bay Area consumer price index.

The purpose of Measure A is described in the ballot measure language as maintaining “existing small class sizes, high quality teachers and comprehensive academic programs.” If approved, the tax will go into effect in July 2016 and the expiring parcel tax will end a year early.

The expiring tax had a similar purpose but added language about dealing with “deep state budget cuts and growing local enrollment.”

Measure C

Measure C is directly tied to increases in student enrollment. It proposes an annual $2.20-per-parcel tax for each student who enrolls beyond the district’s current 2,938 students. If the student count in the district rises by 71 students, the increase predicted for next school year, the tax would be $156.20. The measure has a cap of 213 additional students, or $468.60, plus the annual increase in inflation.

Because Measure C is totally dependent on enrollment, the parcel tax total could vary year to year. If the 71-student prediction is correct, and both measures are approved, the 2017-18 tax bill per parcel for all five parcel taxes would be $1,007.80, plus the increase in inflation from 2016.

Property owners in the school district now pay four parcel taxes, including the tax which is about to expire. They appear as one on tax bills, and total $851.60 for the 2015-16 tax year.

The maximum parcel tax with both measures and with 213 additional students, is $1,320.20 per parcel per year, plus the amount of any inflation.

District officials say they crafted Measure C this way to combat a problem they had with the expiring parcel tax measure. Because it was a flat rate, yet enrollment was projected to go up annually, in order to fund later years’ projected enrollment, the parcel tax had to bring in more money than was needed in early years. That surplus was then saved to be spent in later years, when the parcel tax did not bring in enough to pay for additional students.

The estimate of the increase in the number of students that the 2010 parcel tax was designed to compensate for turned out to be low. The district got a new projection in 2015 from Enrollment Projection Consultants (a firm that did both studies). That projection shows that enrollment, instead of leveling off and eventually decreasing, is expected to continue increasing through 2025, when it will reach about 3,200 students.

Measure C will rise and fall with the number of students, but is capped at 213 additional students, the number expected to enroll by the 2019-20 school year. District officials say at that point if enrollment increases continue as predicted and revenues are not keeping up, they could have to ask for a new parcel tax.

The issues

The school district says it cannot continue its existing programs without additional funding. Figures provided by the district show that between the 2005-06 school year and the 2014-15 school year, the district’s revenue per student, adjusted for inflation, has decreased by $465 per student. The district uses the Bay Area consumer price index to measure inflation. That index rose 23.4 percent from 2005 to 2014.

At the same time, district figures show its Academic Performance Index (API) rose by 41 points between 2005 and 2013 (the last year these tests were used). District representatives say they educate their students at a lower cost than any other nearby district that is funded in the same way, and the students have similar test scores.

The 2015-16 figures make it appear the district is doing much better in terms of revenue per student, but according to Ahmad Sheikholeslami, the district’s chief business and operations officer, the district last year received considerable one-time state revenues, which increased the per-student spending to $14,532 per student. Without the one-time funds, Mr. Sheikholeslami said, the per-student spending for 2015-16 would be $13,886.

Other districts

State figures show that in 2014-15 (the latest year for which state figures are available), other nearby community funded (formerly known as basic aid) districts had considerably higher revenue per student, ranging from a high of $21,533 in the Woodside School District to a low of $16,584 in the Palo Alto Unified School District, compared with $13,745 in the Menlo Park City School District.

All of these districts have lower parcel taxes than the Menlo Park district, but all have higher per-student property taxes, and all the others except Palo Alto have higher per-student donations. The Palo Alto and Las Lomitas districts also get additional income from renting surplus property.

“We feel like we’re delivering a great value to the community,” school board member Terry Thygesen said.

Opponents argue that the district should instead be compared with other similarly sized Bay Area districts, such as San Carlos Elementary School District, Burlingame Elementary School District or San Bruno Park Elementary School District, which have much lower per-pupil costs ranging from $10,149 in San Carlos to $9,043 in San Bruno Park. But the district points out that all the districts used by the opponents for comparison are primarily state-funded “revenue limit” districts, not community funded districts such as Menlo Park, making for an “apples to oranges” comparison.

Revenue increases vs. student enrollment increases

The opponents of the tax argue that the district does not need the money. In their ballot argument against Measure A, they say district revenues rose $18.2 million while the number of students increased by 772 students between 2005 and 2014.

But district officials argue the revenue number is incorrect ($4 million too high) and leaves out an important factor: inflation. The figures are wrong, they say, because for many years the district used accounting practices, which officials say were approved by the county and state, that showed the Menlo Park district’s parcel tax revenues not as general fund revenues, but as transfers from one school fund to another.

In 2014-15, the district changed to a more transparent form of accounting, also state- and county-approved, that showed the parcel tax as general fund revenue. That means that figuring an increase in revenues between any year before 2014-15 would show a several-million-dollar increase in revenue that doesn’t really exist.

No expiration date

Opponents also do not like the permanent nature of the tax. “I am offended that this parcel tax is forever,” said Atherton resident Peter Carpenter, a board member of the Menlo Park Fire Protection District. He said that by not putting an expiration date on the parcel tax, the district is “presuming what the community wants.”

“You need to go back to the voters,” Mr. Carpenter said.

But the district argues that since they are funding long-term needs, good business practices say the funding should be long-term. “When we know something is going to be an ongoing need, we’re not going to be disingenuous with the community,” Ms. Thygesen said.

She said that if voters are unhappy with the amount of the parcel tax in the future (the amount, up to the set maximum, must be set each year by the school board) then they can vote board members out of office.

But opponents argue that on most local school boards, members who don’t plan to run for re-election tend to resign before their terms expire, allowing the board to appoint a replacement who then runs as an incumbent with an advantage over any challenger.

Special election

Opponents also question why the district scheduled a special election instead of putting the measure on either the June primary or the November general election ballot.

County election officials say that while it is nearly impossible to predict the final cost of an election because so many variables are involved, the upcoming election will probably cost the district at least $83,000, which is what its 2010 parcel tax election cost. Because election costs are pro-rated among participating jurisdictions, holding the election in June could have reduced the cost as much as 50 percent, and holding it as part of the general election in November could have saved an additional 50 percent, election officials said.

School board president Jeff Child said the May 3 date was chosen for the election both to make it easier to know how much money the school had while hiring new teachers and to make it easier on the volunteers leading the campaign, who are parents and often very busy with school activities in the last weeks of school.

He said that the district has also had very high voter turnout in special elections. In the May 2010 election, 47.6% of registered voters actually voted, he said, compared to the June 2012 Presidential Primary Election, where only 36.5% of registered voters in the county voted.

District officials thought the May election might lead to “better representation by all voters,” Mr. Child said.

Quality of education

Both opponents and proponents say that in the end, the argument comes down to whether the community wants to fund the type of education that Menlo Park City School District offers its students.

The district’s teachers have the highest average salary in San Mateo County, at $100,890 in 2014-15, according to state figures. The lowest is Bayshore Elementary district, with a $59,409 average salary.

“The community has a choice before them right now,” Ms. Thygesen said. “Do they want to continue funding the schools the way they are now?”

Mr. Carpenter agrees. “You’ve built a richer and richer program for students, and at some point the community has to say, can we afford it?” he said.

Another election?

If the measure doesn’t pass, Superintendent Maurice Ghysels said, “everything’s on the table.” The district could consider a hiring freeze, elimination of programs, reducing employee salary and benefits, and layoffs.

Opponents argue that the district could craft a new measure that speaks to some of their objections and schedule another election as soon as November. Mr. Carpenter said he could support a measure that consolidated all existing parcel taxes and had an expiration date.

But district officials say it would be almost impossible to schedule another election in time to qualify for the November ballot.

Mr. Child said the district spent almost a year preparing for the current election. Before holding another election, “I think we’ve got to figure out why didn’t it pass,” he said. The district would want to hold public meetings to find out what would be supported, he said.

Because a measure would need to be put on the ballot 90 days in advance, the district would not have much time to talk to the community before that deadline, especially with many people gone over the summer.

How to vote in special election

How to vote in special election

San Mateo County started mailing ballots and voter information April 4 to registered voters in the Menlo Park district and will continue mailing the ballots through April 18, the Elections Office says.

For the votes to be counted, the ballots must be mailed and postmarked on or before May 3 and must be received by the Elections Office no later than Friday, May 6.

Voters have the option to deliver the ballots to the Registration & Elections Division’s 24-hour ballot drop box at 40 Tower Road in San Mateo by 8 p.m. on Election Day (May 3) or to Menlo Park City Hall, 701 Laurel St., by 5:30 p.m. on Election Day.

Voters may also vote in person at the 40 Tower Road office any weekday through May 2 from 8 a.m. to 5 p.m., or on Election Day, Tuesday, May 3, from 7 a.m. to 8 p.m.

Voters who have not received a ballot by April 18 should contact the Registration & Elections Division at (650) 312-5222 or by email: registrar@smcare.org.

At ShapeTheFuture.org, registered voters may track their ballots by clicking on the “Track My Ballot” link under the “Voters” section of the home page.

Video statements

A video with statements by opponents and proponents of the two parcel taxes was put together by the MidPen Media Center.