Point Reyes Light - December 16, 2004
Lagunitas School joins ranks of 'wealthy' districts
By Jim Kravets
Lagunitas School District this school year will have more money to spend than it did last year. In accordance with state law, the county Department of Education and the Assessor’s Office has reclassified Lagunitas as an "excess-tax" district.
The district was previously designated a "revenue-limit" district, which meant the district’s property-tax revenues were insufficient to fund the school district and that state assistance was necessary.
However, a combination of new homes and the higher prices for which Valley homes are being sold has resulted in the district’s taxpayers providing the school with "excess-taxes."
The excess tax revenues, which this year amounts to $34,000, go to the school district as a whole, and the district’s relatively low-paid teachers had been hoping to get a share of it.
But real estate prices and school costs change from year to year, and the extra money the teachers want may not be available next year. Some teachers have complained the district’s new Waldorf-inspired program will interfere with the district’s new excess-tax status and keep their paychecks from rising to the level of other teachers’ in the county.
The issue is complicated and brimming with contention. "It’s a complex situation and the more you dig into it the more muddled it becomes," admitted District Trustee Kelly O’Connor at Tuesday night’s meeting of the Lagunitas School Board.
The Light below attempts an unabashedly full dissection of the issue. The account may frustrate and confuse readers. Indeed, it frustrated and confused Light staff.
"Excess Tax" vs. "Revenue Limit"
California school districts receive money from both state funds and local property tax revenue. A school’s "revenue limit" is the amount of money a school receives per student from all sources. The number, set by the Legislature, is different for each district and is based on historical spending patterns, among other factors.
The revenue limit for Lagunitas is $4,573. This number is multiplied by the district’s average daily attendance, 299 students, to determine the total revenue limit. If local property tax revenues are insufficient to cover the whole revenue limit the state makes up the difference.
If the local property taxes are greater than the revenue limit, as in the case of wealthier districts, then the district gets to keep the extra money – a benefit for both students and teachers.
Only about 65 of California’s 981 school districts are "excess tax," according to a spokeswoman from School Services of California, a consulting and advocacy firm that represents school districts. But Marin County is exceptional. There are ten excess tax districts in Marin alone, including Mill Valley, Tamalpais, Sausalito, Larkspur, Bolinas-Stinson, and Shoreline Districts. Novato, Kentfield and Ross Valley School are "revenue limit" districts.
In order to increase funding, a "revenue limit" district, such as Lagunitas was last year, really has only one option: try to increase enrollment. More students mean more money from the state.
In an "excess-tax" district, the schools have no incentive to add students. These districts get to spread their entire property tax revenue over however many teachers and students they have. What’s more, as property tax revenues increase from year to year, as they have throughout the county, the districts get that money, too.
Supplemental tax made the difference
San Geronimo Valley property tax revenues increased by seven percent last year. Also, the district received a one-time supplemental property tax pay out of $130,000. The County Assessor’s Office working with the county office of education in November determined that the combined tax revenues were sufficient to make Lagunitas an excess-tax district for the 2004-2005 school year. The total tax revenues surpassed the district’s revenue limit and resulted in an excess of some $34,000, which the district gets to keep.
What made all the difference, according to Alice Kattner, director of external business services for the office of education, was the $130,000 supplemental tax payout. In subsequent years, however, the district will receive no such supplemental tax payouts. And again, Kattner said, this makes all the difference.
Fifteen-year Lagunitas School veteran teacher Larry Nigro sees excess-tax status as long overdue manna for the district. "Lagunitas is one of the poorest districts. We are the lowest-paid teachers in the county, well over $15,000 a year below the county average for ten-year veterans. Our benefits are also at the bottom in the county."
Nigro laments the recent loss of three Lagunitas district teachers to wealthier districts – excess tax districts. "With our current funding, we’re giving our veteran teachers good reason to go someplace else. Excess tax will offer us increases of seven percent or more each year. With excess tax, suddenly we’re not a poor district." The district’s property tax revenues have increased on average seven percent over the last six years, and the trend is expected to continue, according to the district’s finance committee.
Teachers lowest paid in County
Before the district became "excess-tax," adding students was the only way to improve their financial situation. District trustees saw the new Waldorf program as a good way to bolster district attendance. Now, Nigro said, things are different. The threat to their excess-tax status, according to Nigro, comes from adding new students at a rate that nudges district costs ahead of the property tax revenues, again returning Lagunitas to a "revenue spending" district.
The Lagunitas school district is required by law to accept all eligible students from within the district. But the San Geronimo Valley population alone, with its restricted development, is unlikely to provide a terminal boost to district attendance.
The district also enrolls students from outside the district but is under no legal obligation to do so. The Open, Middle School, and Montessori programs on average enroll less than twenty percent of their students from out of the district.
By contrast, seventy percent of the Waldorf program’s 17 students, Nigro points out, are from out of the district. Nigro believes that by flooding the school with out of district students, the Waldorf program could potentially ruin the district’s excess-tax status and spoil their good fortune. Nigro recommends the school board end the Waldorf program, or at the very least, restrict out-of-district students to 25 percent of any program.
The Waldorf program is currently in a recruitment drive with the ultimate hope of adding another class and another teacher every year for the next five years.
Waldorf to be cut?
"Some staff members are so invested in the Waldorf program that they don’t consider the financial responsibility to the Valley," Nigro said. "It will be a shame if the program has to go, but you’re looking at teachers who live in the Valley and are some of the lowest paid teachers in the county. The goal is to remain an excess-tax district."
The "excess-tax status means wealth" equation is contested by other educators. "Some teachers raced to the conclusion that they will get a fortune from being an excess-tax district," District Superintendent Mary Buttler told The Light. "That conclusion is maybe not true. We’re not like Tamalpais and Mill Valley and Larkspur."
Buttler said the difference has to do with the land available for development in the San Geronimo Valley. "Where the teachers have miscalculated is that the number of parcels in the Valley is limited, but the number of parcels in other excess-tax districts isn’t. Plus," she said, "those other districts have parcels with property values over $1 million. The Valley has a no-growth philosophy and therefore can’t count on the same tax revenue. It simply may be that more income is generated for the district by increasing enrollment."
Buttler explained that it is not uncommon for some districts to teeter back and forth between excess-tax and revenue-limit status for a few years. "We know that for the current year we had a $34,000 surplus. What we don’t know is the future."
Board trustee Thelma Weiss also expects the district’s status will teeter back and forth in the next few years and sees no merit in restricting enrollment. "We’ll likely go in and out of excess tax, and ending the Waldorf program isn’t the answer. More kids should mean more money to the district, that’s all there is to it."
Excess-tax status won’t deliver
In fact, the Business Office’s Kattner pointed out that without the supplemental tax payout, the district will almost surely return to revenue limit status for at least the next two years. But, she added, contrary to what many teachers believe, this may actually be a better scenario than chasing and achieving excess-tax status next year.
Without the supplemental tax payout, next year’s projected tax revenue, even with the anticipated seven percent yearly increase, is only $1.33 million – that’s $70,000 less than this year’s tax revenue. Attaining excess-tax status would therefore mean less money for the district next year. (To attain excess-tax status next year the district would need to enroll about 15 fewer students than the current year – a feat that could be accomplished by shutting down the Waldorf program.)
By contrast, according to Kattner, the expected total revenue limit next year is $1.44 million. That’s the amount Lagunitas can expect to receive if it’s a revenue-limit district. Moreover, this figure includes an attendance increase of ten students.
A dogged pursuit of excess-tax status is wrongheaded for other reasons, some trustees said. Addressing a packed house at Tuesday’s meeting of the district board, Trustee Richard Sloan said, "The truth of the matter is that it’s the exact opposite of how this district should operate."
Lagunitas means choices for parents
Limiting enrollment to achieve excess-tax status, Sloan contended, is antithetical to the spirit of the district. "It’s contrary to everything we wanted to do for the 30 years I’ve been involved with the board. If we want to keep providing the education and education choices that parents want for their children, the future of this district is in attracting more students."
Faced with an equal number of raised hands and worried faces, Trustee Kelly O’Connor tried to quell the audience as he directed the county’s business office to analyze projected district revenues and expenditures for scenarios with and without the Waldorf-inspired program for a period covering the next six years. O’Connor said he hopes the Finance Committee will have the results by February, 2005.
Until then, the Waldorf-inspired program is in limbo, and so are its teachers, students and their families – some of whom relocated to the San Geronimo Valley for the program. "There’s a huge sense of anxiety among the parents and the teachers of the 17 students about whether we’ll be here next year or not," John Corshen, a Waldorf parent lamented to the trustees.
Board President Stephanie O’Brien apologized for the anxiety, but said the program’s future needs to be chosen deliberately. "I’m sorry for your stress," she said, "but whether or not we change direction next year is a decision that will be very, very well thought out."