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on Jun 13, 2012
Prop 13. What a wonderful idea it must have been in the 70s. Instead here we are in one of the most expensive cities in the United States, wondering why our schools are asking for handouts.
Imagine PAUSD with a property tax revenue at 2X, 3X, or even 4X its current numbers. Before you think those numbers are absurd, consider that property values in Palo Alto have gone up 2X to 4X in the past 20 years and 10X-20X in the past 35 years.
I agree. Prop 13 is a huge contributor to this situation in our schools. I was shocked by this restriction on property taxes 10 years ago, when we moved here from Connecticut -- a state that supports its schools as they should be supported -- and I am even more disheartened in these past few years. How is it possible that such a wealthy community has schools with too many students in each classroom and vital programs paid for by parent donations, rather than by built-in public funding? It is shameful.
Prop.13 is not the issue here, at least not directly.
Palo Alto is a Basic Aid School District--which means that it funds most of its operations from property tax within the District. This funding has, over the years, come to about 70% of the expenditures. The other 30% has come from State/Federal/Other sources, which seem to be linked i many cases to optional programs, or mandated programs (such as "Don't Do Drugs")--mandated by the State Legislature.
Before anyone can make any sense out of the PAUSD's claim that the State funding is "down"--they need to provide a complete breakout of all of the funds from the State, and show the programs that these dollars were intended to fund. If it turns out that the program is not all that valuable, then defunding it (at the State level) makes sense, and the Schools should simply do the same.
Unfortunately, Schools have turned into employment engines, and once someone is hired, there is this expectation of life-long employment, followed by life-long pensions. That said, many of the people employed by the District are part timers, which makes a lot of sense. So--rather than bemoaning the State "cuts", the School District should be looking at which of these State-funded programs can be jettisoned, and say goodbye to those who have been previously employed to teach the content of these programs.
As usual, the PAUSD is simply not telling us the whole truth. Typical scare tactics of "big education".
California has built a world class prison system at the expense of education. I'm so sad about what's happening to my beloved state
Prop 13 is absolutely the root of the school funding problem here in Palo Alto just like the rest of California. Although Palo Alto is far more fortunate that other districts in its ability to fund itself via Parcel Taxes and donations above the base property tax revenue, it is still a far cry from the funding ability of schools in wealthy districts in other states.
Take for example the Parcel Tax that adds to school funds in PAUSD. Link here: Web Link
Why is this needed? Because the underlying property taxes aren't enough. Prop 13 has contorted school funding so much that additional taxes are needed to attempt to fill the hole left behind.
Imagine if Palo Alto property taxes scaled with assessed property values (like they do in just about every other state) how impressive PAUSD would be. Instead here we are living among billionaires, with average property prices above $1M and median prices even higher wondering if schools are adequately funded. Seriously?!
Yup, Prop 13 should be repealed immediately and will fix a number of problems:
1. insufficient school funding
2. nicer north PA neighborhoods becoming devoid-of-youth ghost towns because empty nesters don't want to leave their Prop 13 tax havens
3. PiE hitting us up incessantly. We pay up constantly, yet surely there are some other sources of revenue to go after? [That said, I will *gladly* keep contributing to PiE, but at some point it's no longer public school, is it?]
Allow educational vouchers to parents, then let them decide where to send their kids. No need to increase taxes.
I agree that modifying Prop 13 would be a good idea but let's recognize that PAUSD's budget has gone up very significantly since 1992 or 2002. And PAUSD is not immune from the pension and medical insurance problems that plague the City's finances. Resolution of those items should be done alongside any changes in funding arrangements. Just jacking up property taxes is not likely to find favor with the voters.
Jim - how would Ed vouchers help PAUSD? The neighboring private schools already receive far more applicants than they can accept. PAUSD is the best K-12 district in the area, we would be the ones being asked to accept new students - not the other way around.
Prop 13 could be made a lot fairer without taxing people out of their homes. Look at other high value housing areas to see how they manage assessments, etc. I think in Massachusetts, senior home owners can defer their taxes until their death or house sale for example.
Vouchers would be provably useless here in PAUSD. The best local private schools charge between 2X and 4X in tuition than PAUSD spends per student per year. So unless a voucher is magically worth 2X or 4X what PAUSD spends per student per year, the end result of a voucher program isn't going to be dramatically better or different than the schools we have now.
PAUSD's enrollment has increased - but Jon is correct - it isn't immune to pension and medical costs that are a challenge. But again, when you compare PAUSD's per pupil spend as being 1/2 to 1/4 of the spend at the best local private schools, it is pretty clear that PAUSD is underfunded.
"when you compare PAUSD's per pupil spend as being 1/2 to 1/4 of the spend at the best local private schools, it is pretty clear that PAUSD is underfunded."
That some drive Porches does not mean Honda drivers are "under-funded" - they just don't want to pay that much for a car, esp. since it gets them to Point B nicely. With a $378M building bond, high cost per pupil compared to the vast majority of CA public schools, and very solid results, it seems to me that PAUSD is appropriated funded.
Local private schools are an excellent comparable to PAUSD. At the most basic, compare class sizes and teacher ratios. Both are trending in the wrong direction for PAUSD - and this is a direct consequence of funding. Or compare art, music, science and other specialist programs, all are trending in the wrong direction - directly a consequence of funding. PAUSD composed of incredibly fortunate and bright families dropped all funding for gifted and talented eduction - directly a consequence of funding.
We have a good school system because of committed families holding it together. It may be even be among the best in CA. But don't fool yourself - on an absolute level it is still underfunded.
Funding levels in PAUSD don't hold a candle to public school funding levels in comparable wealthy districts in other states.
This is not just a Palo Alto problem. Other districts are seeing more severe cuts.
Education for both K-12 and higher education is critical for our economy and for our kids. K-12 schools across the state are shortening the school year and increasing class size.
Public colleges are trimming enrollment and classes as well as raising tuition. Private colleges are expanding scholarships but there is only so much they can do.
Random resident makes good points in my opinion
School districts would have more funds without Prop 13 but the problem is funding. While changing Prop 13 could help, there are other ways to increase funding.
If posters want to discuss Prop 13 I did a blog back in February on a Prop 13 paper I finished for Joint Venture.
> Prop 13 is absolutely the root of the school funding problem
> here in Palo Alto just like the rest of California.
Every one is welcome to their own opinion, but where are the facts to back up this claim? So far, there are no data points offered to bolster this posters assertions.
> Take for example the Parcel Tax that adds to school funds in PAUSD.
> Why is this needed?
> Because the underlying property taxes aren't enough.
"Aren't enough" to do what? Incomplete sentences seem to abound on this blog, when it comes to discussing anything to do with the PAUSD.
Schools are simply spending more money that they receive in funding. Why? It's the same all over the country. About 85% of the expenditures of every school district in the US go to salaries and benefits. So, with Unions effectively buying school boards, it's not long before the salaries are out of the ball park. Teachers are now costing the taxpayers about $120-$150K (more-or-less) to hire. And the Unions are back every year wanting ever bigger salaries, for nothing in returnlike an extra hour, or two, of on-site contact with students.
So, as long as you maintain that the schools should be able to spend every penny they can get their hands on, then it's probably going to be true that the labor costs will shoot through the ceiling, and the results will either stay static, or decline, over time.
As for classified workers, their salaries have not gone up quite as quickly as certificated staff, but if one looks at the number of people hired into the non-certificated ranks, this number has gone up steadily over the years. Again, if the premise is that the schools should be able to hire as many people as they wantthen there will never be enough money to fund them. Not Now, Not Ever!!
> Prop 13 has contorted school funding so much that additional
> taxes are needed to attempt to fill the hole left behind.
Prop.13 is only indirectly involved here in Palo Altoa Basic Aid District. The downturn in the local economy, and shifts in the global economy has reduced the property values to the point that the taxes generated are less than the District would like, in order to spend .. spend .. spend.
> Imagine if Palo Alto property taxes scaled with assessed
> property values (like they do in just about every other state)
> how impressive PAUSD would be.
This comment demonstrates a complete lack of understanding of Prop.13, or property taxes, on the whole. Let's look at a couple of basics that are related to Prop.13:
1) Basic property assessment
2) Top Tax Rate
3) Yearly Increase in Assessment
4) AB8Statewide Tax Allocation Mechanism.
Let's suppose for the moment that Prop.13 went away. It stands to reason that every one of the 2500+ government agencies would immediately claim: 1) the right to set assessed property values for purposes of taxation by that agency, 2) the right to set the yearly taxation rate. So, without the unification of Prop.13, we might see upwards of 15-20 different assessments for our home, and as many different tax rates for each of the governmental agencies claiming the right to tax us.
Let's look at Prop.13's assessment mechanismone initial assessment, and a yearly 2% increase. If we were to see Prop.13 "tweaked" so that the assessed value were to shit to the market value on a yearly basis, then we'll all be seeing property tax bills in the range of $10K to $40K here in Palo Alto. That's before the parcel taxes would be applied. Since it's clear that school spending should be uncapped for most people who seem to want Prop.13 to disappear, then it stands to reason that these people would always find ways to claim that the school district "needs more money" and using the famous "it's for the Children" line, push parcel tax after parcel tax through.
Now, the City of Palo Alto needs maybe $2B-$3B in the coming years for various purposes. No reason with Prop.13 gone, for them to go on a spending spree, and have the Council authorize the sale of hundreds of millions of dollars of bondsraising our property taxes more than just a little. Remember, with Prop.13 gone, there will be no more voter authorization for bond sales. Elected officials all over the State will be free to listen to labor Union and Construction interestsand go on the most ungodly spending spree known to man.
So .. for people who think that Prop.13 would make like better for the PAUSD, giving them enough money to raise teachers salaries into the $200K and then $300K range in the coming yearsyou really need to recognize that every other government agency will be unleashed too.
But if you are happy with your property taxes zooming up into the $40K to $50K range, and increasing 2%-5% (estimated) per yearthen keep on wishing for Prop.13 to go away. But if you do, be careful for what you wish, as the gods are known to be very cruel.
There is no magical thinking here about Prop 13 and the direct effect on schools. By not tracking market property values, Prop 13 distorts and reduces funding. Comparing PAUSD per pupil spending to local private schools is apt. Private schools are at 2X to 4X per pupil. Class sizes, arts, sciences, gifted education, all suffer due to budgets. You just can't blame all of this on unions.
The private market has a set a price on excellent education and it is 2X to 4X per pupil as compared to PAUSD. So it follows that if PAUSD were to offer an equivalent education to the local private schools, it should be spending at least as much.
Where should PAUSD get 2X or 4X per increase in budget?
You actually make the point quite perfectly: "If we were to see Prop.13 "tweaked" so that the assessed value were to shift to the market value on a yearly basis, then we'll all be seeing property tax bills in the range of $10K to $40K here in Palo Alto."
What is the problem with $10K-40K per parcel? Those are the numbers that people in other wealthy cities in other states pay. They have better schools as a result.
It is shameful that a city of billionaires and millionaires living in million+ dollar homes has a school system that needs handouts.
Anyway, this is a moot point. Prop. 13 is so firmly entrenched in the minds of Californians (even among the most liberal), that I can't imagine it ever being repealed.
@Random, sorry, I don't really follow your logic. Just like a Porsche isn't a comparable for Honda or even BMW, Casti isn't a good comp for Paly in terms of cost. Casti serves only a very small, high-paying set of customers; their costs are high due to lack of scale; and because of their high costs, they need to differentiate to demand a premium. That's all fine, it just means what they spend (or Nueva, etc.) doesn't give us much guidance to what PAUSD should be spending.
In terms of out of state schools, the best comparable study I know of was the one done by PIE a few years ago. Lots of interesting data. Of course, the whole point of that study was to show a funding gap to support PIE's fundraising efforts. That's not a knock - they did good work - but it is not a source of un-biased conclusions. I'm not aware of another good comparable study.
The specific items you call out - class sizes (within a relevant range), elementary art/music, GATE education - frankly, I don't view them as key performance indicators (though others might). I focus more on standardized test performance and end-of-high-school outcomes. On those scales I believe we are doing pretty well, though I am sure there are areas where more money could be helpful.
Bottom line, if we increased the school district by 10%, say, I expect we would see very marginal improvement in our educational results, if any. Do you think it would be different?
> The private market has a set a price on excellent education
> and it is 2X to 4X per pupil as compared to PAUSD.
If you say so. In reality, the private sector education market only "sells into" the very/ultra-wealthy segment of the market. If these folks were to try to accommodate more kids, they would likely be able to lower their cost/student ratios some, at the same time they might find that the capital costs for accommodating the new students would make the costs so high that no one would be able to afford this educational delivery.
There is something to be said for economy-of-scale. Your suggesting that paying less for something of equal, or greater value, is wrongyou should be paying "top dollar", regardless of what the deliverable is make no senseother than perhaps to the "filthy rich".
> What is the problem with $10K-40K per parcel? Those are the
> numbers that people in other wealthy cities in other states pay.
(That's $40K/50K to start-and probably doubling every 10-15 years in the future.) Well, just look around and see who's living in Palo Alto. A significant number of people are older than 65, on fixed incomes, and would likely have to sell, and/or move from their homes of 30+years. Why? Because teachers want salaries that far exceed their value, and the District has convinced itself that it wants to build "palaces", instead of adequate schools. Pretty soon, the town would only have people living here who could afford property taxes in the $40K-$100K range. It would be interesting to see how many kids would be born into families what have those kinds of incomes?
> They have better schools as a result.
Really? Who says? It's really hard to compare schools at the national level. Expenditures/student are a terrible metric. Certainly if one looks at NYC and Washington, DC.
> Prop.13 is here to stay ..
Well, at least until a more rational taxation system can be devised, let's hope so!
Wait a few years. When you've owned a house for a few years and house prices have escalated, your opinion on prop 13 will change as you too will then become taxed out of your house.
Prop 13 is there for a reason.
Unfortunately, MOST of the benefit goes to COMMERCIAL property owners, not to residence owners. Please, differentiate between the two.
If Prop. 13 needs to be revised the revisions should be directed only at commercial property owners and not at older folks who barely scrape by here.
Bob and other:
Prob 13 is almost solely the reason for the budget problems. From the Santa Clara County Tax Collector website: "[There] been a widening disparity between the market value and assessed value of property in Santa Clara County. Long time property owners benefit from lower assessments while new, and frequently younger property owners, are adversely impacted by assessments that can be as much as ten times greater than the owner(s) of a similar property held for many years.
"Between 1985 and 2001 the average assessed value in Santa Clara County of single family homes has ranged from 42% to 56% of the actual average market value."
This, coupled with a tax rate fixed at 1% of assessed value with a limit of 2% increase per year, means that the tax revenues collected by municipalities is grossly lower than other states, and is directly responsible for the lack of funding for schools.
Anyone who thinks the budget problem is primarily due to waste and overemployment in the schools choosing not to look at the facts, and the facts are that local tax revenues are bizarrely low, with per pupil spending correspondingly low. Unfortunately, Prob 13 is a ditch California has dug for itself that is politically impossible to crawl out of.
To Random Resident:
If your taxes escalated as the value of your home went up, either you bought before Prob 13 (and your taxes are unfairly low) or you lived somewhere other than California.
Everyone pays for taxes on increased property values. Everyone. This includes renters and owners. The home I now own have yearly taxes of ~$2000/year and after buying it recently the taxes have gone up 8 or 9 fold. Someone should pay $2000 in taxes and another $18,000 for the same property. I suppose you think you should be able to employ people and buy food and goods at the same prices as when you bought your home, too? Someone should pay a fraction of their share of city services compared to a new resident? If you can't afford to live in a community any longer, don't live there. Prop 13 is an absurd distortion of the market. Most cities raise their taxes based on the growth of their budgets and not the value of the homes; that is, tax rates go down when property values escalate quickly, but the taxes are distributed equitably.
With all due respect to the above comments, the quality of an education has very little correlation with the amount of money being spent.
As an example, in the high school classrooms in general there is very little technology compared with the middle schools. Smart boards which are in every elementary classroom, most middle school classrooms and few high school classrooms, are used by some teachers and not others regardless of whether they have them available or not. The teaching methods of the teachers vary regardless of the availability of smart boards and there is no data to say whether students studying any one particular subject do better if the teacher uses a smartboard or not.
In the case of language education, our high school classrooms must be considered in the dark ages with comparative classrooms across the world if not the country. Language labs have been the norm for language education long before computers. In fact, since we have taken so much time and effort in introducing language immersion, it is amazing that those students who do not have the bonus of learning a language through immersion, do not have even interactive language labs in their classrooms either. Quite a huge difference in the money being spent on one type of language learning compared with the other.
Whereas I do think the funding of PAUSD is important, I am not convinced that the lack of funding is holding the quality of our education back. If we had more funding it would only be replacing the fundraising done by PIE and boosters, most likely. The real question may be to quantify how money spent (or lack thereof) equals improvements across the board.
The more money a community like Palo Alto raises through parcel taxes and the like, the less education money will be available from state-funded appropriations.
@Resident: "With all due respect to the above comments, the quality of an education has very little correlation with the amount of money being spent."
This is provably false statement. For a well-functioning system like PAUSD, extra dollars could easily be deployed to improve end-results.
1) I would immediately use any substantial extra funds to reduce class sizes and increase differential education programs - bringing more teacher attention to each student's individual needs. Kids at all spectrum of performance would be helped. 2) I would greatly expand specialist programs: art, music, science, language, etc. 3) I would create GATE tracks starting in 3rd grade. 4) I would open a 3rd high school.
School systems in states that have higher funding per student do exactly these kinds of things.
@Random - the changes you mention - class size, enrichment, GATE, schools - are means, not ends, right? We can spend money on a lot of things, but the vast majority won't move the needle on standardized tests results, drop-out rates, and how many go to the college of their choice. I have no problem with them personally, but, like the Porsche vs. the Honda, they don't get you from Point A to Point B more effectively.
Talk about Prop 13 is nonsense without talking about the spending.
What about the VTP program? roughly 5% of the student population. Tell property owners why they should pay more taxes to educate kids from another city - come on.
And comparisons to privates schools are pretty useless. Private schools choose who they admit, while public schools don't. How many private schools have special education programs? for different learning disabilities, etc.
And what about the gorilla of spending - guaranteed pensions; CalPERS (teachers have a similar fund) figures for the last quarter indicate investment losses - who makes that up - the taxpayers. and even though the professionals at CalPERS wants to lower the assumptions on investment returns, the politicians don't want to do it, because to lower the assumptions on investment returns means allocating even more of the budgets to pension contributions.
I will accept all the points you made about class size,etc. as making a difference. Although for class size specifically we would need to open a new school as well as hire new teachers to make this type of difference.
I would like to see more money spent in the classroom, particularly in the high schools, on aids to education (rather than classroom aides). If language could be brought down to the elementary level it would make sense too. But so much money at present seems to be spent on changing from InClass to Infinite Campus, new admin positions at Churchill, and beautifying and landscaping, that I am very wary about saying that throwing money at PAUSD would improve education. I would like to be wrong, but as I said, I am very wary.
Sorry. Schools in Palo Alto are DROWNING in money.
We are WEAK in priorities, planning, management and leadership.
Educators know there is NO significant connection between MONEY SPENT PER PUPIL and PERFORMANCE OUTCOME, above a small minimum we are well above. but union-ist teachers can't discuss this publicly, I understand.
1/3 to 1/2 of teachers would stop paying dues if allowed. Make dues volutatry for five years, and test this.
Children do well (and this is my goal) due to loving parents who spent time with them ,eat dinner, set reasonable expectations, have consequences, are educated themselves, and married, though of course a child can do well without one or more of these correlates.
Principals matter the most, then superintendents, then high quality, dedicated, functional, prepared teachers, of which our city has many.
Teacher quality, an elusive but knowable thing, matters a great deal.
Funding does not matter.
Why are we not allowed to fire the worst teachers? Ones who come to school drunk, bother children in bad ways that make the papers, work at other jobs on their desk, such as tax preparation, or real estate, or come unprepared, or those who seek to teach children WHAT to think, rather than HOW to think.
Many of you know personally of such examples, but do not report them here or to the school for rational fear controversy will hurt your child. I understand.
Many many students come to school on prescription drugs from their parents' cabinet; a smaller number drink; many cut class.
The "lower third" in performance are not well served, past elementary school, and do not do well.
The top students would do well in any environment and are in fact no credit to the Palo Alto schools.
Test scores are used to say "it is a great school" but then why are not scores equally value to say "good teaching" or "bad teaching" per class teacher?
No, burning money is not the right way to heat the schools.
Clarify the goals for our children, and focus on what has been proven to matter.
Agree with you, Sara. If we made more investments in education and the well-being of children, we might not have to spend so much on prisons...
Solon wrote: "Funding does not matter."
What is about class sizes and teacher to student ratios that is hard to understand? Instead of the 20+ students per teacher that we have - how about 15 or 10 students per teacher?
How do you think we achieve these improved numbers? More funding.
@Appropriate: I think smaller class sizes and differentiated education are key to improving results for all children - from the most challenged to the most gifted.
At the core is this idea: we are an extremely wealthy community - our schools should reflect that. Instead, due to the distortions caused by the funding mechanisms, our schools have to look for continuous handouts. That is sad.
Interesting perspective (from C.Thornberg "No Nonsense Economics).
Those involved with commercial property, particularly large investment properties that have many owners, have learned over the years how to shift ownership around in ways that avoid the tax reassessment attached to complete changes in ownership.
As a result, commercial property has enjoyed much greater protection under the 2% rule than has residential property, where turnover is more common. It used to be that commercial properties paid a much larger share of the state's property tax, but over time, the commercial share of California's tax receipts have become smaller and smaller. Moreover, large properties have been protected more than small propertiesagain, a regressive tax that favors large investors over small business owners and businesses over residents.
... Consider this: 7 out of 10 self-made wealthy people in California made their fortunes in real estate. These are powerful and connected families and they, more than anyone in the state, benefit from Prop 13. Their long-term holdings are taxed at some of the lowest rates. And they wield tremendous political clout. They want Prop 13 to continue to be a political third rail.
But if we can debunk the myths, and help people see through the frayed and broken logic peddled by proponents of Prop 13, perhaps we can begin the long process of finally overhauling California's badly broken revenue system. Yes, we need expenditure reform. And pension reform. All of these represent significant status quo-breaking challenges. Dumping Prop 13 is a necessary step in the process of fixing these larger problems.
"I think smaller class sizes and differentiated education are key to improving results for all children - from the most challenged to the most gifted."
I believe the data on class size impact on outcomes is inconclusive at best. Teacher quality is more important - and in fact that is what PAUSD primarily focuses its money on.
Differentiated education I know less about. Again, I'm sure we could do more, and it might create a more 'enjoyable' education (I'm struggling with the right work - what quality makes a Porsche a better car than a Honda?). But I'm not sure we'd improve the key end results, as mentioned above.
As 'neighbor' of Greenmeadow neighborhood mentioned
Prop 13 has been a boon for commercial property owners, much more so than for residents. So we need to make a difference between commercial and residential properties when we speak of reforming Prop.13. Make commercial property owners pay their fair share and keep protections in place for home owners who live in the houses they own.
And to those who say that we should live PA if we can't afford the taxes, even though we've lived here for 20 years or more, I can't wait for you to be in my shoes and have your own taste of the medicine your suggest. Make no doubt about it. You'll be in my shoes some day.
I meant to say:
"And for those who say we should LEAVE PA...."*
Great comments. It would be wonderful to see someone as intelligent and sensible as you in charge here!
Michael >> "Most cities raise their taxes based on the growth of their budgets and not the value of the homes; that is, tax rates go down when property values escalate quickly, but the taxes are distributed equitably."
Uh, as I recall, Prop 13 passed precisely because that statement proved to be untrue.
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