Shoreline Unified School District is questioning a new annual charge levied by the Tomales Village Community Services District, a change that caused an increase of about $10,000 in the school district’s sewer bill this year.
The service district’s administrator, Karl Drexel, says the charge reflects a new state policy that requires agencies like his to bill for depreciation expenditures.
“They have to pay us,” Mr. Drexel said. “They’re a partner in this system. We have a legal contract that the school district agreed to uphold.”
When Shoreline formed an agreement with the sewer district to build Tomales Elementary School in 1976, the contract stipulated that the school would be responsible for several portions of the total annual bill, including 34 percent of operational costs.
But Shoreline’s representatives said they were not expecting the depreciation charge this year. And the district’s incoming chief business officer Bruce Abbott—whose first day on the job was Monday—said the invoice did not clearly specify how much additional depreciation costs are contributing to the increased bill.
“The numbers are not here,” Mr. Abbott said. “That’s the frustrating thing. We do not know the actual amount because it’s not written down here.”
At their Dec. 18 board meeting, Shoreline’s trustees voted to approve an updated interim budget on the condition that the school would not pay the sewer bill. They noted that the charge puts undue pressure on the district in the midst of its budget crisis.
“From the board’s perspective, there’s a lack of clarity on how that amount was calculated,” said Jill Manning-Sartori, the board’s vice president. “I’m not aware if the board has had any communications with the sewer district. I certainly haven’t had any.”
For the sewer district, the feeling of communication breakdown is mutual. “I only heard second-hand that their board had pulled [the issue from the agenda] and were not paying the bill. This matter has not been presented before our board yet,” Mr. Drexel said.
Bill Bonini, the president of that board, said the school district hadn’t contacted him.
The board did have a discussion about clarifying the new depreciation costs with the school. “And we left it at that if they’re interested in it, then they can come to us,” he said.
Auditors for both the school and sewer districts have also discussed the matter and agree: depreciation is an operating expense that the school will have to start paying.
In the wake of the state’s municipal bankruptcies, in which cities like Vallejo and Stockton were hit hard by unpaid depreciation expenses and post-employment benefits, the state Controller’s Office began requiring agencies to charge for depreciation according to regulations set forth by the Governmental Accounting Standards Board.
Last January, Mr. Drexel was informed that he needed to start charging Shoreline for depreciation costs. He emailed a letter from the state Controller’s Office explaining the new requirement to Susan Skipp, Shoreline’s outgoing chief business official, on Nov. 12.
Although the charge represents less than one percent of Shoreline’s total budget expenditures for this school year, the pressure is on as county-mandated deadlines for staffing cuts loom.
“We didn’t say that we weren’t going to pay it or not,” Mr. Stubbs said. “We’re not sure how to respond to this, other than we’re not going to pay for something that we don’t understand what or why we’re paying.”
Shoreline’s trustees will discuss the depreciation bill at the regular board meeting, starting at 8:30 a.m. on Jan. 15 at Tomales High School.