Palo Alto Unified School District (PAUSD) Parcel Tax Proposal (2005)

7/29/2019 Palo Alto Unified School District (PAUSD) Parcel Tax Proposal (2005)

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PAUSD Parcel Tax Information

Since January 2003, the district has cut $6.5 million from its budget and used approximately $3.4 milliondollars from its reserves.

The major factors contributing to the budget cuts were: loss of funding from the State including $1.2 million in basic aid funding. enrollment growth (the district receives no money for additional students) increased costs such as health care costs, required employer contributions to the state retirement

system, workers comp., utilities, etc. relatively flat property tax growth due primarily to the decline in commercial property taxes (the

district receives approximately 70% of its revenue from property taxes and about 35% of that isfrom commercial property)

As a result, during the past two years the district reduced its administrative staff by 13%, teaching staff by2% and classified staff by 7%. Leaders examined all facets of operations to look for efficiencies, including

eliminating or reducing outside contracts, combining or eliminating positions and departments, reducingexpenditures for overtime or substitutes, and eliminating the district warehouse.

The budget for 2004/05 includes reductions to: elementary librarian time the spectra art budget elementary reading specialist time teaching positions at the secondary schools leading to reductions in course offerings school site funds for instructional materials and support funding for sports funding for Camp Anytown maintenance/landscape staff technology support and more.

The current parcel tax of $293 is set to expire in 2006. It provides $5.5 million annually for PAUSDprograms including class size reduction. In order to ensure the ongoing quality of the PAUSD educationprogram, the funds from the existing parcel tax plus additional funds are needed.

On February 8th, the Board of Education voted to place a parcel tax measure of $493 on the June 7, 2005ballot.If passed, the new parcel tax will replace the current parcel tax and will provide $9.3 million annuallyfor six years. Funding from the parcel tax will be used to retain teachers and avoid teacher layoffs, preservesmall class sizes in K-10, and restore some of the more critical cuts to secondary class offerings,

counselors, and elementary literacy, math and art.

The budget is updated throughout the year as new information is received, such as new property taxinformation from the County Assessor, enrollment numbers, and budget information from the State. Foradditional information, call Cathy Kroymann at 321-4133.


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BOARD OF EDUCATION Attachment: Action 7

PALO ALTO UNIFIED SCHOOL DISTRICT Date: 02.08.05

TO: Board of Education

FROM: Gerald F. Matranga, Associate Superintendent

SUBJECT: Parcel Tax Election Resolution #2004-05.13

BACKGROUNDAt the meetings of January 11, 2005, and January 25, 2005, the Board of Education consideredplacing another parcel tax request before the voters.

Proposed Resolution for a June Parcel Tax

Staff has worked with Larry Tramutola to prepare a formal resolution and ballot language(Attachment AA) for a new parcel tax. The resolution and ballot language take into considerationthe desire of the Board of Education to make the language more positive, set the parcel tax at $493per year per parcel for six years, incorporate an optional senior exemption, and have anindependent oversight committee and annual audits. The ballot language states:

To preserve small class sizes; maintain educational programs that enhancestudent achievement; and restore some essential educational programsincluding elementary literacy, math, and art support, and middle and high schoolclass offeringsshall the Palo Alto Unified School District replace its currentparcel tax with a $493 yearly assessment for six years with an optional exemptionfor senior citizens and an independent oversight committee?

SummaryAs background, the agenda items from the meetings of January 11, 2005, and January 25, 2005,are attached to this enclosure.

RecommendationIt is recommended that, after the Public Hearing at this meeting, the Board of Education approvethe amount and duration of a PAUSD parcel tax. It is also recommended that the Board approvethe following revised Resolution #2004-05.13 and the ballot language for a parcel tax measure thatcould be placed on the June 2005 ballot.


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ATTACHMENT AA

PALO ALTO UNIFIED SCHOOL DISTRICT

RESOLUTION NO. 2004-05.13

RESOLUTION OF THE BOARD OF EDUCATION OF THE PALO ALTO UNIFIEDSCHOOL DISTRICT PROPOSING A QUALIFIED SPECIAL TAX AND

ESTABLISHING SPECIFICATIONS OF THE ELECTION ORDER

WHEREAS, the Board of Education (the Board) believes that a qualified special tax isnecessary to maintain quality education for the students of Palo Alto Unified School District (theDistrict); and

WHEREAS, Section 4 of Article XIIIA of the California Constitution and Sections50075, 50076, 50077, 50079 and 53722 et seq. of the California Government Code authorize a

school district, upon approval of two-thirds of the electorate voting on the measure, to levy aqualified special tax for specified purposes following notice and a public hearing and

WHEREAS, the Board of Education has conducted a noticed public hearing, as requiredby law, on the question of whether or not to request the Districts voters to authorize funding tocontinue the programs identified below; and

NOW THEREFORE, THE BOARD OF EDUCATION OF THE PALO ALTO UNIFIEDSCHOOL DISTRICT DOES HEREBY RESOLVE, DETERMINE AND ORDER ASFOLLOWS:

Section 1. That the Board has determined in its best judgment that in order to maintainquality education in Palo Alto, an election is advisable and on that basis hereby orders the SantaClara County Registrar Voters to call an election and submit to the voters of the District thequestion of whether to adopt a qualified special tax to maintain high quality education in ourneighborhood schools, avoid deeper cuts to classroom instruction, maintain manageable classsizes, and preserve educational programs that attract the best teachers and school employees, andenhance student achievement in order to maximize learning by our communitys children.

Section 2. Said qualified special tax shall be in an amount not to exceed $493 per yearfor 6 years beginning as of July 1, 2005, assessed against each parcel of taxable land in theDistrict. Said qualified special tax replaces the qualified special tax approved by the voters ofthe District on June 5, 2001.

A parcel shall be defined as any unit of land in the District that now receives a separatetax bill from the Santa Clara County Assessors Office. All property that would otherwise beexempt from property taxes will also be exempt from the imposition of said qualified special tax.

Section 3. An optional exemption shall also be available for a person 65 years or olderwho owns and occupies as a principal residence a parcel (as defined above) and applies to theDistrict for such exemption in accordance with guidelines established by the District.

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ATTACHMENT AA

Section 4. That the date of the election shall be June 7, 2005.

Section 5. That the purpose of the election shall be for the voters in the District to voteon a ballot measure, a full copy of which is attached hereto and marked Exhibit A andincorporated by reference herein. As required by California Elections Code section 13247, theabbreviated form of the measure to appear on the ballot is attached hereto as Exhibit B.

Section 6. That the Board has the authority for ordering the election.

Section 7. That the authority for the specifications of this election order is contained inSection 5322 of the California Education Code.

Section 8. That this Resolution shall stand as the order to the Santa Clara CountyRegistrar of Voters to call an election within the boundaries of the District on June 7, 2005.

Section 9. That the Clerk of the Board is hereby directed immediately to send a certifiedcopy of this Resolution to the Santa Clara County Registrar of Voters, the Santa Clara County

Board of Supervisors, and the Santa Clara County Superintendent of Schools so that saidSuperintendent receives it no later than March 11, 2005.

Section 10. That the Santa Clara County Superintendent of Schools is hereby requestedto deliver this Resolution, which constitutes the order of election, and a formal notice of theelection to the Santa Clara County Registrar of Votersno later than March 11, 2005. That theSanta Clara County Superintendent of Schools is hereby requested to perform the duties underEducation Code Section 5302, to call the election, prepare recommendations, statements, orarguments for the election as required and to receive petitions, as necessary.

Section 11. That the Santa Clara County Superintendent of Schoolsis hereby requested

to prepare a Formal Notice of SchoolParcel Tax Election (the Notice) containing theinformation specified in Section 5361 of the Education Code, in substantially the form attachedhereto as Exhibit C andto publish and/or post the Notice as required by law.

Section 12. Pursuant to Section 5303 of the Education Code, the Santa Clara CountyRegistrar of Voters is hereby requested to take all steps incident to the preparation for and theholding ofthe election in accordance with law and these specifications. The Board requests thatthe Registrar of Voters deliver a copy of all published notices to the Clerk of this Board pursuantto Section 12113 of the Elections Code.

Section 13. The Board of Supervisors of Santa Clara County is authorized to canvass thereturns of the election pursuant to Section 10411 of the Elections Code.

Section 14. In accordance with Education Code section 5342 and Elections Code section10402.5, it is hereby requested that the special election to be held hereunder be consolidated bythe Santa Clara County Registrar of Voters and the Santa Clara CountyBoard of Supervisors, forall purposes, with the Statewide election scheduled for the same day and with any and all otherelections also called to be held on June 7, 2005 insofar as said elections are to be held in thesame territory or in territory that is in part the same as the territory of the District.

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ATTACHMENT AA

Section 15. Subject to two-thirds approval of the voters, the qualified special tax shallbecome effective as of July 1, 2005 and be collected by the Santa Clara County Tax Collector atthe same time as and along with, and shall be subject to the same penalties as general ad valoremtaxes collected by said tax collector. The tax and penalty shall bear interest at the same rate asthe rate for unpaidad valorem property taxes until paid.

Section 16. The members of the Board, the Superintendent of the District, and officers ofthe District are hereby authorized and directed, individually and collectively, to do any and allthings and to execute, deliver, and perform any and all agreements and documents that theydeem necessary or advisable in order to effectuate the purposes of this Resolution, including,without limitation, to prepare and submit for inclusion in the voter information pamphlet anargument in favor of passage of the ballot measure. All actions heretofore taken by the officersand agents of the District that are in conformity with the purposes and intent of this Resolutionare hereby ratified, confirmed, and approved in all respects.

Section 17. The members of the Board, the Superintendent of the District, and officers ofthe District are hereby requested and directed, individually and collectively, to provideaccountability measures pursuant to Government Code Section 50075.1 that include, but are notlimited to, all of the following: (a) A statement indicating the specific purposes of the qualifiedspecial tax, (b) a requirement that the proceeds be applied only to the specific purposes identifiedpursuant to subsection (a), (c) the creation of an account into which the proceeds shall bedeposited, and (d) an annual report pursuant to Section 50075.3. of the Government Code, asprovided in Section 20 hereof.

Section 18. Pursuant to Section 50075.3 of the Government Code, the Board directs thatthe chief fiscal officer of the District file a report with the Board no later than January 1, 2006,and at least once a year thereafter. The annual report shall contain both of the following: (a) Theamount of funds collected and expended, and (b) the status of any project required or authorized

to be funded as identified in subsection (a) of Section 19 hereof.

Section 19. The Districts Superintendent, and her designee, are hereby authorized anddirected to make any changes to the text of the measure described in this Resolution, or to theabbreviated form of the measure, or to the text of this Resolution, as may be convenient ornecessary to comply with the intent of this Resolution, the requirements of elections officials,and requirements of law.

///

ADOPTED, SIGNED and APPROVED this _____ day of _________, 2005.

AYES:

NOES:

ABSTAIN:

ABSENT:

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ATTACHMENT AA

BOARD OF EDUCATION OF THE PALOALTO UNIFIED SCHOOL DISTRICT

By:

President

ATTEST:

By:Clerk of the Board of Education

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ATTACHMENT AA

STATE OF CALIFORNIA )) ss.

SANTA CLARA COUNTY )

I,______________, do hereby certify that the foregoing is a true and correct copy ofResolution No. __, which was duly adopted by the Board of Education of the Palo Alto UnifiedSchool District at meeting thereof held on the _____ day of ________, 2005, and that it was soadopted by the following vote:

AYES:

NOES:

ABSENT:

ABSTENTIONS:

By

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ATTACHMENT AA

EXHIBIT A

FULL TEXT OF SPECIAL TAX MEASUREFor

PALO ALTO UNIFIED SCHOOL DISTRICT

Palo Alto Unified School District Quality Public Education Preservation Act of 2005

INTRODUCTION

To maintain exceptional public education in our neighborhood schools, avoid deeper cuts toclassroom instruction, preserve smaller class sizes, keep educational programs that attract thebest teachers and school employees and enhance student achievement in order to maximize

learning by our communitys children, shall the Palo Alto Unified School District be authorizedto levy a qualified special tax in an amount not to exceed $493 per year for 6 years beginning asof July 1, 2005, assessed against each parcel of taxable land in the District, with an optionalexemption annually available, upon application, for senior citizens? Said qualified special taxwould replace the qualified special tax approved by the voters of the District on June 5, 2001.

PURPOSE

To provide local revenue that cannot be taken by the State and to maintain exceptional publiceducation in our neighborhood schools, the Palo Alto Unified School District proposes to levy aqualified special tax for a period of 6 years, beginning July 1, 2005, at the rate of $493per yearon each assessors parcel located within the School District, with an optional exemption annuallyavailable, upon application, for senior citizens, and to implement accountability measures inconnection with the special tax to provide oversight and accountability to ensure that funds areused to:

Restore some of the programs and replace some of the funds lost or reduced due tobudget cuts;

Sustain achievement in reading, writing, and mathematics for all students at all gradelevels by preserving smaller class sizes, while maintaining the ability to attract and retainquality teachers;

Maintain essential academic programs, including science, reading, math, music, and art;

Protect the taxpayers investment in education and ensure District accountability byproviding for oversight and independent financial audits of revenues and expenditures.

The Board of Education will fund all of the programs listed above, unless the Board of Educationdetermines in any given year that changes in student population, fiscal constraints, or otherchanges in state or federal funding make doing so infeasible or inadvisable. In any event, the

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ATTACHMENT AA

Board of Education will not fund any program or reduction other than those listed above fromthe proceeds of the special taxes.

OPTIONAL SENIOR CITIZEN EXEMPTION AVAILABLE

An optional exemption from the special tax will be made available annually to each individual inthe District who will attain 65 years of age prior to July 1 of the tax year, and who owns abeneficial interest in the parcel, and who uses that parcel as his or her principal place ofresidence, and who applies to the School District on or before July 1, 2005, or July 1 of anysucceeding tax year. Any application for such exemption must be renewed annually.

ACCOUNTABILITY MEASURES

In accordance with the requirements of California Government Code sections 50075.1 and50075.3, the following accountability measures, among others, shall apply to the special taxeslevied in accordance with this Measure: (a) the specific purposes of the special tax shall be thosepurposes identified above; (b) the proceeds of the special tax shall be applied only to thosespecific purposes identified above; (c) a separate, special account shall be created into which theproceeds of the special taxes must be deposited; and (d) an annual written report shall be made tothe Board of Education of the District showing (i) the amount of funds collected and expendedfrom the proceeds of the special taxes and (ii) the status of any projects or programs required orauthorized to be funded from the proceeds of the special taxes, as identified above.

In addition to the accountability measures required by State law, an independent CommunityOversight Committee shall be appointed by the Board of Education to advise the Board on theexpenditures funded by the measure in order to ensure that said funds are spent for the purposesapproved by the voters. The Community Oversight Committee will monitor the expenditures ofthese funds by the District and will report on an annual basis to the Board and community onhow these funds have been spent.

PROTECTION OF FUNDING

Current law forbids any decrease in State or Federal funding to the District because of theDistricts adoption of a parcel tax. However, if any such funds are reduced because of theadoption of this parcel tax, then the amount of the special taxes will be reduced annually asnecessary in order to restore such State or Federal funding.

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ATTACHMENT AA

EXHIBIT B

SPECIAL TAX MEASUREFor

PALO ALTO UNIFIED SCHOOL DISTRICT(Abbreviated Form) *

To preserve small class sizes; maintain educational programs thatenhance student achievement; and restore some essentialeducational programsincluding elementary literacy, math, and

art support, and middle and high school class offeringsshall thePalo Alto Unified School District replace its current parcel tax witha $493 yearly assessment for six years with an optional exemptionfor senior citizens and an independent oversight committee?

Tax - Yes Tax - No

* Limited to 75 words pursuant to California Elections Code section 13247.

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ATTACHMENT AA

EXHIBIT C

FORMAL NOTICE OF SCHOOL PARCEL TAX ELECTION

NOTICE IS HEREBY GIVEN to the qualified electors of the Palo Alto Unified SchoolDistrict of Santa Clara County, California, that in accordance with the provisions of theEducation Code of the State of California, an election will be held on June 7, 2005, at whichelection the following measure shall be submitted to the qualified electors of the District andvoted upon:

To preserve small class sizes; maintain educational programs thatenhance student achievement; and restore some essential

educational programsincluding elementary literacy, math, andart support, and middle and high school class offeringsshall thePalo Alto Unified School District replace its current parcel tax witha $493 yearly assessment for six years with an optional exemptionfor senior citizens and an independent oversight committee?

Tax - Yes Tax No

All of the purposes enumerated in the foregoing measure shall be united and voted uponas one single measure, with precincts, places of holding the elections and officers appointed toconduct the elections shall be the same as those provided in the local consolidated election, under

the notice of election adopted ________.

The County Superintendent of Schools of Santa Clara County, by this Notice of Election,has called the election pursuant to a Resolution of the Board of Education of the Palo AltoUnified School District, adopted ___________, 2005, in accordance with the provisions ofEducation Code Sections 5325 and5361.

IN WITNESS WHEREOF, I have hereunto set my hand this ____ day of ___________,2005.

County Superintendent of Schools,Santa Clara County, California

J:\wdocs\00981\007\res\00099044.DOC

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BOARD OF EDUCATION Attachment : Discussion 9



FROM: Mary Frances Callan, SuperintendentGerald F. Matranga, Associate Superintendent

SUBJECT: Parcel Tax

BackgroundOn January 11, the Board discussed whether or not to place another parcel tax request before thevoters. This two hour discussion was based on information contained in the staff report, asummary of a poll conducted by Gene Bregman & Associates, comments from the District'sconsultant, Larry Tramutola, and input from the community. A copy of the January 11 Staff Report(Attachment 1) and a copy of the poll results (Attachment 2) are attached to this report.

Based on the discussion, the Board expressed interest in placing another parcel tax measure onthe June 2005 ballot. This interest was based on several factors. In order to retain the $5.5 milliongenerated from the District's current parcel tax, voter approval must be obtained beforeNovember 2005, or the District will need to reduce this amount from its budget. In addition, theBoard discussed the current financial situation that has required over $6.5 million in reductions andthe use of over $3.4 million in reserves over the past 24 months. This financial situation has beencaused by: lowered State revenues to the District, increasing enrollment, increasing health andwelfare costs, and declining property tax growth. The Board also noted that 66.03 percent of voters(over 22,000 yes votes) supported the November 2004 Measure I Parcel Tax. This indicates broadcommunity support for the local schools and educational programs.

In preparation for this discussion, the Board requested staff to do the following.

1. Provide an update of the District's estimated Property Tax growth for the 2004-05 fiscalyear; how any estimated growth will assist the District in addressing its projected structuraldeficit; and proposed additional costs being transferred to the District from the State.

2. Provide two options for a new parcel tax. One option would be for $493. The first optionwould explain how the amount was derived and what it could provide to preserve andrestore the District's nationally recognized educational programs. The second option wouldbe for a lower amount of $465. Staff would illustrate what this lower amount would be ableto do.

3. Provide information from Gene Bregman on the effect on voter approval of lowered parceltax amounts.

4. Provide a resolution for a June parcel tax with the needed supporting documents.

5. Provide a list of the additional reductions that the District would need to make if a parcel taxmeasure was not successfully passed by November 2005.

The remainder of this report addresses these requests.


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Update on District 's Estimated Property Tax Growth for 2004-05As noted in the January 11 staff report, the District has had uncertain and reduced property taxgrowth over the past two years. As a basic aid district, the actual property tax growth is not knownuntil after the fiscal year in which it is spent. In the 2003-04 fiscal year, property tax growth thathad been projected at 3.77 percent in July 2003 ended up being .92 percent in June 2004. As a

result of this and the ensuing reductions that had to be made, the District projected 1.0 percentproperty tax growth for the 2004-05 fiscal year. At the Districts first quarterly meeting with theCounty in August, the estimate was projected to be 6.1 percent. This was due to the sale of theStanford Shopping Center and some revenue from the building of the Hyatt Classic Residences.(It should be noted that the Hyatt Classic Residences are leaseholds and not fee ownership units.This means that the District will not see large property tax increases as these units are occupied.)

At our second quarterly meeting with the County in November 2004, the estimated tax growth wasreduced to 5.84 percent due to continued downward reassessments of businesses and losses inthe unsecured roll. It was also noted at this meeting that a large reassessment request beingmade by a local corporation might be granted in May 2005. As a result, the District left its

projected property tax growth at 1.0 percent for the First Interim Report.

The next quarterly meeting of basic aid districts with the County will be held in mid-February.However, staff did call the County and requested an update. The County asked that the request bemade in writing so that staff would be able to better respond to the questions. A copy of thatrequest is attached (Attachment 3). While staff did not receive a reply from the County in time for itto be included in this report, an update will be provided during the meeting.

Staff is also discussing increasing the projected Property Tax Growth for the Second InterimReport from 1.0 percent to 2.0 percent for fiscal year 2004-05. This would be in keeping with theprojections used by the District prior to 2002-03. This increase would erase the District's currentstructural deficit, but would still leave the District with a possible deficit from the State. The extentof this deficit will not be known until the adoption of the State budget. If the Governor's proposal isaccepted, the deficit could be as high as an additional $1,000,000. Erasing the current structuraldeficit also does not leave any additional dollars in the General Fund to address growingenrollment, increasing employee costs, or restoration of any educational programs that werereduced.

At best, the above information indicates the District may be able to address its current structuraldeficit, but continues to face uncertain financial issues.

Options for a Parcel TaxIn 2001, the voters approved a $293 parcel tax that generates $5.5 million per year for the District.The funds from that parcel tax were to be used to attract and retain qualified employees byincreasing salaries in 2001, to reduce class size in targeted grades, and to maintain programs.The money was allotted for those purposes. The District also added further funding to reduceclass size in Grades 4 and 5 to 20 to 1. A summary of the report that discloses expenditures fromparcel tax proceeds in included in Attachment 1.

Since the passage of that parcel tax, the District has reduced its budget by $6.5 million and used$3.4 million in reserves. If the District wanted to restore the $6.5 million in reductions and renewthe $5.5 million parcel tax, a total of $12 million dollars per year would be needed. This amounts to$631 per parcel.


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Due to the current financial situation faced at the local, state, and national levels, the Boardrealized it would not be reflecting community needs if it requested full restoration of the $6.5 millionreductions along with the renewal of the $5.5 million. Therefore, the Board placed a $521 parceltax request on the November 2004 ballot. Measure I would have maintained the current parcel taxamount and added $228 per year for a total of $9.8 million per year. As noted previously, it was

narrowly defeated. Table 1 illustrates how the $9.8 million could have been used.

TABLE 1$521 Parcel Tax - $9.8 Million

Potential Distribution of Proceeds

Descripti on FTE Amoun t1 Maintain Current parcel tax (Measure D) expenditures. $5,500,0002 Additional costs of current class size reduction for Grades 4-8 and

10.$1,400,000

3 6.8 FTEs at the high schools to provide for greater class offeringsand academic support. 6.8 FTEs were reduced.

6.8 $595,143

4 1.0 FTE Deans at each high school to provide student support. 2.0

FTEs Assistant Principals were reduced.

2.0 $243,000

5 2 FTEs Teacher on Special Assignment (TOSA) to provideacademic and student support. 3.7 were reduced.

2.0 $175,042

6 4.3 FTEs at the middle schools to provide greater class offeringsand academic support. 4.3 FTEs were reduced.

4.3 $376,340

7 2.0 FTEs counselors at the middle and high schools. 2.0 FTEs werereduced but the district has grown by 600 students in the past threeyears.

2.0 $175,042

8 4.0 FTEs at the elementary schools to support literacy and math.Funding for 4.0 FTEs were reduced by the State.

4.0 $350,084

9 0.5 FTE elementary psychologist. 0.5 FTE was reduced. 0.5 $50,00010 Spectra Art program at the elementary level. $20,000 was reduced. $20,00011 2.0 FTEs elementary librarians. 2.0 FTEs were reduced. 2.0 $175,04212 8.0 FTEs classified support for instructional programs and student

support. (4.0 FTEs at the high schools, 3.0 FTEs at the middleschools and 1.0 FTE at the elementary schools. This would restoreabout half of the classified support reduced at the sites.

8.0 $352,000

13 Restore $25 per student for instructional materials and academicsupport at the school sites.

$260,000

14 Restore $100,000 staff training at the sites. $135,000 was reduced. $100,000

TOTALS 31.6 $9,771,693

In developing an amount for a new parcel tax measure, one must keep in mind the educational

needs that exist as well as the financial concerns of the local citizens. Each of the followingoptions would bring differing amounts into the District to address the educational needs that exist.In developing these options, the actual cost to the District of class size reduction was reviewed.K-12 class size reduction costs the District $7.2 million. With the States contribution of $3.2 millionand the parcel tax contribution of $1.4 million, the Districts General Fund contributes $2.6 million(see Attachment 4).


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Option 1 $493 Parcel TaxA new parcel tax for $493 would generate $9.3 million in ongoing revenue for the District for a setnumber of years. Of this $9.3 million, $5.5 million would allow the District to continue the currentparcel tax expenditures. These current expenditures include $1.4 million for class size reduction inGrades 4-8 and 10. In addition, the cost of the class size reduction brought about by the current

parcel tax costs the District an additional $1.4 million from the General Fund (Attachment 5).

A new parcel tax needs to produce at least $6.9 million to maintain the integrity of the class sizereduction in Grades 4-8 and 10. This would leave $2.5 million for some restorations to instructionalprograms and academic support that have been reduced over the past two years. Based ondiscussions with principals, many of whom also met with staff and parents, $2.5 million would onlyallow for a minimum amount of restoration.

Table 2 illustrates how the $9.3 million could be spent to maintain class size reduction in Grades4-8 and 10 and to restore some reductions.

TABLE 2Option 1 - $493 Parcel Tax - $9.3 Million


Descript ion FTE Amoun t1 Maintain Current parcel tax (Measure D) expenditures. $5,500,000

2 Additional costs of current class size reduction for Grades 4-8 and 10. $1,400,000

3 6.8 FTEs at the high schools to provide for greater class offerings andacademic support. 6.8 FTEs were reduced.

6.8 $595,143

4 1.0 0.5 FTE Deans at each high school to provide student support. 2.0 FTEsAssistant Principals were reduced.

1.0 $121,500

5 2 FTEs Teacher on Special Assignment (TOSA) to provide academic andstudent support. 3.7 were reduced.

6 4.3 4.0 FTEs at the middle schools to provide greater class offerings andacademic support. 4.3 FTEs were reduced.

4.0 $350,084

7 2.0 FTEs counselors at the middle and high schools. 2.0 FTEs were reducedbut the district has grown by 600 students in the past three years.

2.0 $175,042

8 4.0 3.0 FTEs at the elementary schools to support literacy and math. Fundingfor 4.0 FTEs were reduced by the State.

3.0 $262,563

9 0.5 FTE elementary psychologist. 0.5 FTE was reduced. 0.5 $50,000

10 Spectra Art program at the elementary level. $20,000 was reduced. $20,000

11 2.0 FTEs elementary librarians. 2.0 FTEs were reduced. 2.0 $175,042

12 8.0 FTEs classified support for instructional programs and student support. (4.0FTEs at the high schools, 3.0 FTEs at the middle schools and 1.0 FTE at the

elementary schools. This would restore about half of the classified supportreduced at the sites.

8.0 $352,000

13 Restore $25 per student for instructional materials and academic support at theschool sites.

$260,000

14Restore $100,000 $50,000 staff training at the sites. $135,000 was reduced. $50,000

TOTALS 27.3 $9,311,374Note: Items 4-8 and 14 (shown in italics) are changes from Table 1.


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These restorations to instructional programs and academic support do not take into accountenrollment growth. However, they do allow the school sites the ability to provide some studentofferings that were reduced or eliminated. Attachment 6 describes the impact of budget reductionson high schools. The restorations also allow for more site communication with the parents and theability to address student concerns more quickly.

It was for these reasons that the $493 per parcel amount was proposed.

Option 2 $465 Parcel TaxShould the Board prefer to request a smaller amount for the new parcel tax measure, it wasrecommended by Gene Bregman that the Board consider a $465 parcel tax. This amountgenerates $8.8 million per year. As $6.9 million is needed to cover the current parcel tax and thecost of class size reduction as noted in Option 1 above, $500,000 would need to be reduced fromOption 1. This translates to fewer instructional offerings and less academic support. Table 3illustrates how these reductions could be made to maintain as much direct support as possible.

TABLE 3Option 2 - $465 Parcel Tax - $8.8 Million


Descript ion FTE Amoun t1 Maintain Current parcel tax (Measure D) expenditures. $5,500,000

2 Additional costs of current class size reduction for Grades 4-8 and 10. $1,400,000

3 6.8 6.0 FTEs at the high schools to provide for greater class offerings andacademic support. 6.8 FTEs were reduced.

6.0 $525,126

4 2 FTEs Teacher on Special Assignment (TOSA) to provide academic andstudent support 3.7 were reduced..

5 0.5 FTE Deans at each high school to provide student support. 2.0 FTEsAssistant Principals were reduced.

6 4.0 FTEs at the middle schools to provide greater class offerings and academicsupport. 4.3 FTEs were reduced.

4.0 $350,084

7 2.0 FTEs counselors at the middle and high schools. 2.0 FTEs were reducedbut the district has grown by 600 students in the past three years.

2.0 $175,042

8 3.0 FTEs at the elementary schools to support literacy and math. Funding for4.0 FTEs were reduced by the State.

3.0 $262,563

9 0.5 FTE elementary psychologist. 0.5 FTE was reduced. 0.5 $50,000

10 Spectra Art program at the elementary level. $20,000 was reduced. $20,000

11 2.0 FTEs elementary librarians. 2.0 FTEs were reduced. 2.0 $175,042

128.0 4.0 FTEs classified support for instructional programs and studentsupport. (4.0 2.0 FTEs at the high schools, 3.0 1.5 FTEs at the middle

schools and 1.0 0.5 FTE at the elementary schools. This would restore abouthalf 25% of the classified support reduced at the sites.

4.0 $176,000

13Restore $25 $15 per student for instructional materials and academic supportat the school sites.

$156,000

14Restore $50,000 25,000 staff training at the sites. $135,000 was reduced. $25,000

TOTALS 21.5 $8,814,857Note: Items 3-5, and 12-14 (shown in italics) are changes from Table 2.

The above options provide the Board information on how the proposed $493 was derived as wellas how a reduced parcel tax amount could be used to assist with restoring some of the District'sinstructional programs and academic support.


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The instructional needs of the students have suffered with the $6.5 million in reductions. There arefewer class offerings, larger class sizes at the secondary schools, fewer student support services,and fewer staff to work with parents on the questions and concerns they have. The options abovedo not restore, by any means, the reductions and support students and parents had two years ago.This is compounded by enrollment growth. The above options, however, do maintain current class

size reductions and restore some essential services. Further reducing the above options does notappear to generate significantly larger voter approval.

Effect of Lowered Tax Amounts on Voter ApprovalAt the request of the Board, Gene Bregman provided a January 12, 2005, memo regarding theeffect of lowered parcel tax amounts on voter approval. That memo is Attachment 7. In reviewingthis memo and discussing it with Gene Bregman, it appears that the Board would need to seek aparcel tax reduction below $450 per parcel to have a significant impact on increased voterapproval. There will always be a core of voter opposition in the community regardless of theamount of the tax.

Larry Tramutola will be present to discuss this issue further and address any questions the Boardmay have.

Proposed Resolution for a June Parcel TaxStaff has worked with Larry Tramutola to prepare ballot language for a new parcel tax. Following issample language.

To avoid deeper cuts to classroom instruction, maintain manageable class sizes,restore essential educational programs including teachers, counselors, schoolsupport staff, instructional materials, and academic support, shall the Palo AltoUnified School District replace its current parcel tax with a $____ yearlyassessment for __ years, including an exemption for senior citizens.

Attachment 8 includes a draft resolution and accompanying documents. Based on the Board'sdiscussion, the amount and the length can be inserted into the language. Larry Tramutola will bepresent to discuss the language. This language reflects the above options being proposed for theparcel tax. Following this discussion, corrections can be made and a resolution and accompanyinglegal language prepared for the next Board meeting on February 8. There will also be a publichearing at that meeting.

Addi tional Reductions i f a Parcel Tax i s not PassedThe 2001 parcel tax expires June 2006. If it is not renewed by November 2005, the District willneed to begin the process for reducing $5.5 million. These reductions in funding will result in thefurther loss of programs for students. The $6.5 million in reductions already made were kept as farfrom the classroom as possible. If forced to reduce another $5.5 million, programs that directlyaffect many of our students will need to be reduced or eliminated.


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The District would need to consider eliminating all class size reduction. In addition, another$1.5 million in reductions would be needed. Below is a chart listing some programs that could beconsidered. The cost of these programs is based on the cost of the staff providing them. Thesereductions would be effective for the 2006-07 school year.

Examples of Potential Reductions if a $5.5 million parcel tax is not renewed by November 2005

K-12 class size reduction net savings $2,500,000*Middle School 7 period day $1,120,000Reductions in academic support and pupil services $ 670,000High School 7 period day $ 630,000Closing of one elementary school due to termination of class size reduction $ 580,000*In reducing K-12 class size reduction, 82 teachers would be released. The District

would also lose the state contribution. Therefore, the net savings is approximately

$2.5 million.

These are only examples. Due to the severity of these reductions, a community process wouldneed to be used to determine the final reductions.

SummaryThe above report and attachments provide information to the Board in response to the requestsmade at the January 11 Board Meeting. Staff and Larry Tramutola will address questions theBoard may have in the course of its discussion. Following this discussion, at the direction of theBoard, staff will prepare the necessary documentation for February 8 to place a parcel tax on theJune ballot.

RecommendationIt is recommended that the Board discuss this report and provide direction to staff on the amount,length, and the resolution language for a parcel tax measure that could be placed on the June2005 ballot.


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BOARD OF EDUCATION Attachment: Discuss ion 5



FROM: Mary Frances Callan, Ph.D., Superintendent

SUBJECT: Parcel Tax

Background

In June 2001, the voters in Palo Alto overwhelmingly passed a $293 parcel tax for the Pal AltoUnified School District. This tax was to be used to reduce class size, maintain programs, and

provide a raise to staff in order to recruit and retain quality teachers. It netted the District$5.5 million in ongoing funds, allowed the District to add Grades 4 and 5 to the class size reductionprogram at 24 to 1, and to reduce class sizes in the middle and high schools in selected areasincluding math and language arts. (Due to property tax growth at the time, the District was able tofurther reduce Grades 4 and 5 class size to 20 to 1.) The tax was passed for five years and is nowup for renewal.

In the years following the passage of this tax, the District has seen a decline in revenue from theState, a decline in property tax growth, and growth in student enrollment. As a result, sinceJanuary 2003 and continuing through the 2004-05 school year, the District has reduced its budget$6.5 million, using $3.4 million in reserves. The lists of reductions that have been made areattached to this report.

Student Growth, Lowered State Revenues, and Increased Costs

In the past three years, the District has grown by 600 students. As a Basic Aid District, no revenueis received from the State for these additional students. In fact, the $120 per student the Districtpreviously received was eliminated in the State budget reductions. This has meant an on-goingloss of over $1.2 million in revenue per year. The District has also faced increasing health andwelfare costs for its employees. This is in spite of the reductions and additional out of pocketexpenses that staff have chosen in order to maintain coverage.

Declining Growth in Property Taxes

Decreasing Property Tax growth compounded the growth of students and the reduction of over$1.2 million in revenue from the State. In the 2003-04 school year, property tax growth that wasoriginally estimated to be 3.77 percent ended up in July 2004 to be 0.92 percent. As with all Basic

Aid Districts, the exact amount of revenue from property tax is not known until the end of the fiscalyear in which it is being spent. This requires the District to be conservative in its estimates ofrevenues coming from property tax growth.


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Uncertain Growth of Property Tax

Because of the decreasing nature of the property tax growth, the District projected 1 percentgrowth for the current school year, 2004-2005. The exact amount of that growth will not be knownuntil July 2005. However, due to the sale of the Stanford Shopping Center, the District was

informed in August that the estimated tax may rise by 5.1 percent. That estimate was reduced to4.84 percent in November and may go lower due to the loss of value in the unsecured roll and thenumber of businesses that are requesting decreases in their assessed valuations. Some of therevenue from Hyatt Classic Residences was also factored into this increase. As they areleaseholds rather than fee ownership, we do not expect ongoing increases when they changehands. The best that can be said is that it appears the growth in property tax may have stabilizedand may not go down as much as it has the previous two years.

This additional growth in property tax has allowed the district to address a $1.2 million deficit thatremained in the budget despite the $6.5 million in reductions and to cover the increased cost of thereduced health and welfare benefits. However, there is no additional funding available to address

the $6.5 million in reductions to programs and the growth in enrollment. Further, there may be asmall continuing structural deficit in the budget if property tax growth for 2005 and beyond does notincrease by more than 1 percent.

Request for Local Property Tax to Ensure Quality Education

Given lowered revenues and increasing student enrollment, the Board placed the renewal of thecurrent property tax on the November 2004 ballot along with the addition of another parcel tax.Measure I would have continued the $5.5 million from 2001 and added another $4.3 million tobegin to address a continuing deficit, maintained current program, and considered restoration ofsome essential programs. The Measure was narrowly defeated by less than 1 percent of the vote.It needed 66.67 percent to pass and received 66.03 percent. Even in defeat, it received 22,000yes votes, more than any the District has ever received in all of its successful campaigns.

The need for the renewal of the current parcel tax remains, as does the need for additionalrevenues to maintain current programs and to make some restorations in order to ensure theongoing quality of program. In fact, a local parcel tax is one of the only ways the community has toensure its priority for small class sizes is met. The State cannot capture locally voted parcel taxfunds, and these funds are independent of property tax growth.

In order to determine how another local property tax request should be made, a number of issuesneed to be addressed. These issues include the total amount to be addressed in a parcel taxrequest, the length of the parcel tax, the date for a parcel tax election, and the consequences to theDistrict should the 2001 parcel tax not be renewed. These issues are addressed below.

Parcel Tax Amounts

As noted above, the current parcel tax brings $5.5 million a year into the District. This amount, inconjunction with the amount received from the State to assist with K-3 class size reduction, allowsthe District to maintain smaller class sizes. Should this parcel tax not be renewed, the Districtwould have to make at least an additional $5.5 million in reductions above the $6.5 million it has


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already made. Further, the District may face an ongoing structural deficit of $600,000 for futureyears even with property tax growth estimated for the 2004-2005 school year. This deficit does notaddress increasing health and welfare costs, restoration of any programs made by the reduction ofthe $6.5 million, or increasing demands caused by enrollment growth. Even if an assumption ismade that property tax growth will increase by 2 percent, which was the percent used prior to the

2002-03 school year to project growth, only the on-going structural deficit is erased. The otherpressures on the budget remain.

It should also be noted that each year the parcel tax has been in place, the cost for class sizereduction has grown as the district grows in enrollment and other employee and fixed costs rise.Staffing costs for class size reduction alone now total almost $1.3 million over the $5.5 millionparcel tax and that is without any employee raises for the past two years. (See attached annualparcel tax report.) Should the $5.5 million parcel tax not be renewed, the district would need toreduce $6.8 million in March 2006 in order to accommodate the loss of the parcel tax and toaddress the encroachment on the General Fund of $1.3 million for class size reduction. Thisreduction translates into the loss of 79.62 FTE employees. It would mean the loss of all class size

reduction programs K-12. This also assumes that property tax growth for the 2005-06 school yearand beyond will be at least 2 percent and that there will be no structural deficit.

In order to maintain current class size reduction programs K-12 and restore some essentialprograms for which this District is noted and for which it attracts residents, additional dollars overand above the current $5.5 million are needed. This amount could be as high as the Measure Irequest, an additional $228 per parcel that would have yielded $9.8 million in revenue per year forthe District. However, given the defeat of the measure, even by a narrow margin, it would beprudent to reduce this amount. If a reduction were made to an additional $200 per year per parcel,the District would receive an additional $3.8 million per year over the $5.5 million for a total of$9.3 million. This amount is based on the retention of the senior exemption. It would bring thetotal parcel tax from $521 per year as proposed in Measure I, down to $493.

This new parcel tax, generating $9.3 million per year in revenue would allow the District to maintainmanageable class sizes, restore counseling ratios and some staffing and support services neededat the school sites, as well as restore some funding for instructional materials and academicsupport at each school.

Currently data is being gathered from the community through a poll to better understand how tostructure a new parcel tax request. Information from this poll will be available at the meeting. LarryTramutola who is working with the District will be present at the meeting to address questions.

Length o f Parcel Tax

Measure I requested the renewal of the current parcel tax along with an addition that would becollected for 8 years. Again, while there was little criticism of the length of the request, it would beprudent to shorten it. A 5-year parcel tax means that the renewal process needs to begin 12 to 18months in advance to meet the dates for notices that must be given to staff should the renewal notbe successful and to meet the deadlines for special elections. A 6- or 7-year parcel tax wouldallow the District to wait at least four and a half years between elections. It would also allow thecommunity time to see the value of the programs being funded.


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Timing of Election

It is important to note that the regular election times left to the District before it has to make$6.8 million in reductions are June and November 2005. The cost of a regular election is $7 to $9

per voter or $377,762 to $485,694 depending on the number of items on the ballot. A June 2005election would ensure that the funds needed for the 2005-2006 school year would be available inJuly 2005. In order to meet the deadline for the June ballot, the Board must have passed aresolution and filed all necessary paperwork by early March. That would mean staff would need tobring a resolution to hold a parcel tax election to the Board for its discussion at its January 25meeting. This resolution could then be voted on at the February 8 Board Meeting.

Recommendation

It is recommended that the Board review and discuss the issues presented in this narrative andprovide direction to the staff regarding the renewal of the current parcel tax and addition of a new

parcel tax amount. That direction should include the amount and duration of the parcel tax alongwith the date of the election.


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Administ rator Certifi cated Clas sified Total

# Description FTEs* FTEs* FTEs* Amount**

1Reduce the centralized Educational Services budget by

$100,000.$100,000

2 Reduce the Academy/Summer School budget by $54,000. $54,000

3 Reduce the Information Technology budget by $70,000. $70,000

4

.

position. This is a retirement and the position will not be 0.17 $25,250

5 Delete a 1.0 FTE warehouse position.1 1.00 $60,485

6Delete the 1.0 FTE Project Specialist position in Business

Services.2 1.00 $106,868

7 Reduce 1.0 FTE in Digital Publications. 1.00 $66,284

8 Reduce 1.0 FTE in Educational Services. 1.00 $53,461

9Reduce the centralized library/media staff from 1.0 FTE to 0.1

FTE.3 0.90 $73,335

10Delete a 0.5 FTE district teacher on a special assignment

position.0.50 $40,742

11 Reduce 1.0 FTE landscape position.4 1.00 $51,219

12Reduce the high school funding by the equivalent of $15 per

student.***$50,739

13Reduce the elementary school funding by the equivalent of $20

per student.***$93,200

14 Reduce 1.0 FTE high school Assistant Principal at each school. 2.00 $219,824

15Reduce elementary school library-media positions by a total of

2.0 FTEs.2.00 $143,482

16 Reduce certificated staffing by five periods at each high school. 2.00 $143,482

17Delete the general fund support for the reading teachers at El

Carmelo and Fairmeadow.0.90 $64,567

18Reduce the below the line middle school periods by a total of 0.5

FTE.0.50 $35,871

19 Delete the 1.0 FTE unfilled Secretary II middle school position.5 1.00 $47,732

TOTAL 2.17 5.90 6.90 $1,500,541

* FTEs are show for items in which 2004-05 FTE reduction is known.

** Total amount includes salary and employee benefits.

*** The general purpose per student allocations are currently $100 elementary, $80 middle, $95 high school.1This was done last year. A position is available for this person.

Proposed Budget Adjustments for the 2004-05 Budget (TABLE A)

1/6/2005


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Adm ini str ator Cert ifi cated Cl as si fi ed To tal

# Description FTEs* FTEs* FTEs* Amount**

1 Credit 50% of the K-5 rental revenue to the General Fund. $15,000

2Appropriate the annual Adult Education lottery income to the

General Fund.$65,000

3 Charge Adult Education for custodial. $10,319

4*** Use $70,000 from middle school carryover to balance the budget. $70,000

5***Transfer $200,000 to Routine Maintenance from B4E Planned

Maintenance rather than the General Fund.$200,000

6Staff will provide enrollment projections in-house and therefore

save on contracted expenses.$16,000

7 Reduce the communications consultant contract by $15,000. $15,000

8 Charge for actual cost of TB testing. $11,000

9 Delete the K-12 site allocation for travel and conferences. $57,000

10Require classified employees to take their vacation each year in

order to avoid payouts.$20,000

11 Delete the General Fund allocation for Camp Anytown. $24,000

12Reduce the allocation for high school athletics by $10,000 at

each site.$20,000

13 Reduce the support for Spectra Art by $20,000, leaving $45,000. $20,000

14 Delete 1.0 FTE administrator at the district office. 1.00 $128,084

15**** Delete 0.25 FTE Account Technician position at the district office. 0.25 $10,898

16Reduce the number of middle school support teaching periods by

a total of eight periods.1.60 $114,785

17Reduce the number of high school support teaching periods by

five periods at each high school.2.00 $143,482

18 Delete a 0.5 FTE psychologist position or equivalent. 0.50 $49,148

19 Delete 0.8 FTE clerical position at each high school. 1.60 $67,383

20 Delete a total of 1.6 FTE clerical positions at the middle schools. 1.60 $67,383

21Reduce the amount of clerical support at each elementary school

by one hour.1.50 $67,383

TOTAL 1.50 3.60 4.95 $1,191,865

Alt ernat ive: Remov e 19-21 and subs tit ute 22.

19 Delete 0.8 FTE clerical position at each high school. N/A N/A

20 Delete a total of 1.6 FTE clerical positions at the middle schools. N/A N/A

21Reduce the amount of clerical support at each elementary school

by one hour.N/A N/A

22***

The savings for a two-day furlough for administrators, CSEA unit

members, and confidential/supervisory employees is $199,092.

This can be subsitituted for items 19, 20, and 21.

$199,092

TOTAL 3.00 7.20 9.90 $1,188,808

*FTEs are shown for items in which 2004-05 FTE reduction is known.

**Total amount includes salary and employee benefits.

***These funds are one-time, so the budget deficit will be increased in 2005-06

****This position is currently vacant, so no person will be losing a job.

Proposed Additional Budget Adjustments for the 2004-05 Budget (TABLE B)


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Budget Ad justments for the 2003-04 BudgetApproved by the Board o f Education May 13, 2003

Administ rator Cert if icated Classi fied Total# Description FTEs* FTEs* FTEs* Amoun t

1The GATE revenue from the State is estimated to be reduced by$10,938. Budgeted expenditures will be reduced by the same amount.

$10,938

2The SIP revenue from the State is estimated to be reduced by $77,018.Budgeted expenditures will be reduced by the same amount.

$77,018

3The PAR/BTSA revenue from the State is estimated to be reduced by$41,516. Budgeted expenditures will be reduced by the same amount.

$41,516

4The EIA revenue from the State is estimated to be reduced by $14,601.Budgeted expenditures will be reduced by the same amount.

$14,601

5The Miller-Unruh revenue from the State is estimated to be reduced by$12,957. Budgeted expenditures will be reduced by the same amount.

$12,957

6The State Instructional Materials revenue from the State is estimated tobe reduced by $74,487. Budgeted expenditures will be reduced by thesame amount.

$74,487

7The School Libraries Materials revenue from the State is estimated to bereduced by $6,534. Budgeted expenditures will be reduced by the sameamount.

$6,534

8The Instructional Technology (AB 1339) revenue from the State isestimated to be reduced by $8,129. Budgeted expenditures will bereduced by the same amount.

$8,129

9The School Safety revenue from the State is estimated to be reduced by$17,545. Budgeted expenditures will be reduced by the same amount.

$17,545

10The Tobacco Use Prevention revenue from the State is estimated to bereduced by $1,966. Budgeted expenditures will be reduced by the sameamount.

$1,966

11The Tenth Grade Counseling revenue from the State is estimated to bereduced by $2,554. Budgeted expenditures will be reduced by the sameamount.

$2,554

12 Reduce the travel and conference budget for all departments by 50%. $67,500

13

Increase the requirements for sites/schools to obtain substitutes and use

overtime and capture and save approximately 1/6 of this budget. $80,000

14 Reduce the use of cell phones in the district. $4,000

15Charge Building for Excellence for the direct costs incurred by theRoutine Maintenance staff.

$75,000

16Take advantage of energy management opportunities to reduce utilitiesexpenditures by 7%.

$158,000

17 Reduce the Accounting Department budget by $50,000. $50,000

18 Reduce Superintendent's annual contingency budget by $10,000. $10,000

19 Reduce Board of Education budget by $7,500. $7,500

20 Reduce the Information Technology budget by a total of $75,000. $75,000

21 Reduce the Student Support Services budget by $35,000. $35,000

22 Delete an overtime allocation in the Print and Mail Shop. $30,000

23Reduce the elementary per student school allocation from $128/studentto $100/student.

$125,692

24Reduce the middle school per student school allocation from$84/student to $80/student.

$9,060

25Reduce the high school per student school allocation from $101/studentto $95/student.

$19,674

26Reduce the pool of dollars to fund the elementary school special needsallocation at the elementary schools from $300,000 to $250,000.

$50,000


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27Reduce the number of district landscape positions by 2.0 FTE. Thesehave been held vacant.

2.00 $96,828

28Delete the $25,000 of the $250,000 Staff Development budget spent onmeeting support.

$25,000

29 Delete the budget for sabbatical leaves for 2003-04. $70,768

30 Delete the 53 lead teacher stipends of $1,196/teacher. $63,388

31Replace a one coordinator position in Education Services with a TOSA.Also, replace a vacant director position in Education Services with acoordinator and leave the coordinator position vacant.

2.00 -1.00 $171,722

32 Delete the 1.0 FTE allocation for Middle School deans. 1.00 $71,100

33Delete the 0.5 FTE Assistant Business Manager position, currentlymanaging renovation, mitigations and moves at Terman Middle School,effective October 31, 2003.

0.33 $50,500

34Delete the Landscape Supervisor position and have the Manager ofMaintenance and Operations supervise the landscape staff.

1.00 $103,000

35Reduce the number of classified staff in Human Resources by 1.0 FTE.This position is currently unfilled.

1.00 $56,033

36Reduce the budgeted expenditures for the Assessment Program by$59,000.

0.40 0.20 $59,000

37Delete the contract to provide webmaster services and perform theactivities in-house.

$15,000

38Replace the Digital Publishing (WP) supervisor with a non-supervisoryposition.

$12,000

39Reduce the secondary literacy resource teacher position from 1.0 FTEto 0.5 FTE.

0.50 $36,000

40Reduce the General Fund support for the technology TOSA positionfrom 1.0 FTE to 0.6 FTE. Fund the remaining 0.4 FTE with one-time AB1339 funds.

0.40 $29,000

41Fund a 0.6 FTE Mathematics TOSA position with Noyce funding ratherthan the General Fund.

0.60 $43,000

42

Delete the 0.7 FTE elementary literacy TOSA position funded by theGeneral Fund. This activity will be supported by an existing 0.2 FTEGeneral Fund position augmented by a 0.2 FTE federally fundedposition.

0.70 $50,000

43

Delete the 0.53 FTE General Fund science TOSA position. (The other0.47 FTE of this position is currently funded by the expiring BASEEgrant.) There will be a 0.5 science TOSA position multi-funded bycategorical programs.

0.53 $37,683

44Reduce the allocation for contracted counseling and behavioral supportservices at the secondary schools from $220,000 to $110,000. Some ofthese services will be performed by district staff.

$110,000

45Delete the over-formula custodial FTE at Gunn High School for a fullyear. (Staff has already been transferred to a vacant position.) Paly wasnot over formula.

1.00 $36,311

46Move support staff, including clerical and custodial staff, along withenrollment to the third middle school. Therefore, reduce the allocationfor growth in support staff by $266,437.

$266,437

47 Reduce General Fund support to high school athletics by 50%, or$10,000 at each site.

$20,000

48Reduce support to middle school athletics by 50%, or $7,500 at eachsite.

$22,500

49Reduce the calendar and compensation for all administrators by twodays.

$72,000

50

It is possible that the state will delete the funding for staff developmentbuy-back days. If this funding is deleted, there will be a correspondingreduction in teacher calendar and compensation. Here, the assumptionis that two days will be deleted. If all three days are deleted, the savingswill be proportionately greater. The loss of income for 2 days of$323,000 and the savings in compensation of $572,000 yield a netsavings of $249,000. This reduction was not made.

$249,000


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51Reduce the total number of Middle School Instructional Supervisorpositions from current year 4.0 FTE to 3.2 FTE.

0.80 $57,000

52

Reduce the High School "below the line" allocations by 1.40 FTEs ateach of the two schools. The reductions are 0.8 FTE technologysupport, 0.2 FTE senior project, 0.2 FTE WASC and 0.2 FTE AVIDcoordination. (The coordination duties will be funded through a stipend.)

2.80 $196,680

53

Reduce the Middle School "below the line" allocations by a total of 1.4FTEs from current year. The reduction is 0.6 FTE technology support,

0.3 FTE all-city music, and 0.5 FTE AVID coordination. (Thecoordination duties will be funded by a stipend.)

1.40 $95,940

54 Staff middle school counseling positions at 400:1 rather than 360:1. 0.61 $44,94355 Staff high school counseling positions at 400:1 rather than 360:1. 0.89 $64,67456 Reduce the allocation for classified staff at each high school by 1.5 FTE. 3.00 $129,294

57Phase out the warehouse. For 2003-04, delete a 0.88 FTE position andfor 2004-05, delete another 1.0 FTE. Use one-time money to fund the1.0 FTE position in 2003-04.

0.88 $108,600

58

The state has reduced the transfer to Routine Maintenance from 3% ofthe General Fund to 3% of the smaller Unrestricted General Fund. Thiscalculation has cut the General Fund obligation by $700,000. At thispoint, it is intended that the General Fund will contribute an additional$290,000. It is hoped that the final state budget will not require thedistrict to use these dollars to support the General Fund. At this time, no

non-vacant maintenance positions will be reduced.

1.00 -$290,000

59Increase Targeted Instructional Improvement Grant income to includethe deferred revenue for 2002-03 and additional income for 2003-04.

$298,000

TOTAL 3.73 8.22 10.08 $3,536,071Additional FTE reductions. See note below.** 6.62 GRAND TOTAL 16.70

PERCENTAGE REDUCTION 7% 1% 5%

*FTEs are shown for items in which 2003-04 FTE reduction was known.

**Some of the reductions in the total amount column, where no staff are listed, did result in either certificated teacher reassignment or additional classifiedreductions. As a result, another 6.62 FTE classified positions were laid off, for a total of 16.7 FTE. Certificated teachers who were affected were offered alternativeassignments which they may or may not have accepted. As a result, no certificated layoff reduction was made by the Board.


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Mid-Year Budget Adjus tments Made in the 2002-03 Budget

Approved by the Board of Education March 4, 2003

Admist rator Certificated Classified Total# Description FTEs* FTEs* FTEs* Amount

1

The mid-year reduction plan includes a 25% loss

in state instructional materials revenue. Theexpenditure budget in this categorical program isreduced by a corresponding amount.

$154,000

2

The mid-year reduction plan includes a 50% lossin school library materials revenue. Theexpenditure buget in this categorical program isreduced by a corresponding amount.

$27,000

3Savings from not filling a vacant part-time digitalpublications supervisor position for the balance ofthe year.

$15,000

4Savings from filling a vacant custodial position,effective in April, with a transfer and not a newhire.

$11,000

5Savings from not filling a vacant landscaperbudget for the balance of the year.

$19,000

6Savings from not filling a vacant Special Educationsecretary budget for the balance of the year.

$19,000

7Savings from not spending a portion of theSuperintendent's budget.

$5,000

8

Savings from transferring a portion of categoricalfund balances to the general fund to offset mid-year budget cuts (requires ABX1-8 being signedinto law).

$118,000

9 Savings from the staff development budget. $10,000

10Savings from not spending the major part of therecruiting budget.

$20,000

11Overall savings from salary reconciliation andunfilled positions through the end of the secondinterim period.

$210,000

TOTAL 0.00 0.00 0.00 $608,000


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EXHIBIT A

COSTS OF 2001-02 SALARY AND BENEFIT INCREASE

2001-02 ONGOING SALARY INCREASE 8.50% $5,926,000

AMOUNT FROM GENERAL FUND $1,807,365

AMOUNT FROM PARCEL TAX REVENUE $4,118,635

COSTS OF DISTRICT-FUNDED CSR TEACHERS2003-04

Teachers Salaries 30.87 71,255 $2,199,642STRS 8.25% 181,470Medicare 1.45% 31,895Health Benefits 30.87 7,494 231,340Unemployment Insurance 0.30% 6,599Workers Compensation 0.50% 10,998

TOTAL COSTS FOR 30.87 TEACHERS $2,661,944




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ATTACHMENT 5

COSTS OF DISTRICT-FUNDED CLASS SIZE REDUCTION TEACHERS

FOR GRADES 4-8 AND 10 FROM THE 2001 PACEL TAX

2004-05 COSTS

FTE AMOUNTTeachers Salaries 32.01 $70,856 $2,268,101

STRS 8.25% $187,118Medicare 1.45% $32,887Health Benefits 32.01 $8,021 $256,752Unemployment Insurance 0.65% $14,743Workers Compensation 1.85% $41,960

TOTAL COSTS OFR 30.87 TEACHERS $2,801,561




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Impact of Budget Reductions on High Schools

Due to current economic conditions, falling commercial property tax revenue in Palo Alto, declining State

revenues, an increase in the cost of health care benefits, and growing enrollment, our District has beenforced to cut $6.5 million over the past two years, and use over $3.4 million in one time money. Oursecondary schools have had a loss of $3.7 million ($2.1 million in the high schools and $1.6 million in themiddle schools).

Our high schools have experienced a reduction in administrators, teaching and support staff, and areduction in per pupil allocations from the State and District. The high schools have attempted to offsetbudget reductions. However, these budget cuts are impacting our high school programs.

Our High Schools Have Lost Teaching Periods

Each high school has been reduced 10 teaching periods. These flexible periods allowed the high schoolsto offer a rich elective program. While schools continue to be staffed according to contractual agreements,many electives with lower enrollments are not being offered this year. For example:

At Palo Alto High School, AP Physics, American Sign Language I, German 1, AP Art History,American Lit, World Lit 12, American Classics Honors, Shakespeare/Chaucer, Introduction toGender Study, Ethnic Studies, and Sports Medicine will not be offered this year.

At Gunn High School, Multicultural Literature, African American History, American Studies,Introduction to Business Communication, Computer Applications, and History of Women in

America will not be offered. The loss of staffing allocations over the past two years has also eliminated additional classroom

support at each high school for Digital High School, Site Technology, AVID Coordination, and

Senior Projects. The student to teacher counseling formula changed from 360:1 to 400:1, along with a reduction

of a school psychologist from a full-time to half-time position.

Our High Schools Have Lost Administrators

Our high school administrative staff has been cut to a minimum. Previously, each high school had aprincipal and three assistant principals. Each high school now has a principal and two assistant principals,a 25% reduction in administrative staff, at the same time we have experienced student enrollment growth.

As a result: Administrative responsibilities have been reassigned to the principal and assistant principals.

Each high school has created a Deans position (using classroom staffing allocation) to supportstudent discipline and attendance.


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Our High Schools Have Lost Classified Staff Positions

The reductions in classified staff positions over the past two years have impacted teachers, students, andadministrators. For example:

Reproduction technicians have been reduced and teachers now do much of their own copying of

materials, a poor use of teachers time. The athletic assistant position has been eliminated and coaches or the athletic director are now

responsible for field and equipment set ups, transportation arrangements, and field trippaperwork for classes missed on game days.

Attendance secretarial help has been reduced resulting in a loss of time to monitor attendanceand send attendance notifications to parents.

Allocations for Computer Lab Specialists have been reduced at both high schools.

Our High Schools Have Lost Per Pupil Allocations from the State and District

State allocations for various programs such as GATE (Gifted and Talented Education), SIP

(School Improvement Programs), Instructional Materials, School Library Funds, and InstructionalTechnology have been reduced.

The District has been forced to reduce the high school allocation per pupil from $101 to $80. Fora student body of 1,700, this is a loss of $10,300.

Additionally, $40,000 in support for each high schools athletic program has been cut over thepast two years, and $12,000 for Camp Anytown has been eliminated. Funds for teachers toattend conferences, which supported professional development for teachers, were also totallyeliminated, resulting in a loss of approximately $9,000 at each high school.

Our High Schools Have Attempted to Offset Budget Reductions

To offset these reductions, the high school principals reviewed areas where they might seekadditional funding sources, as well as areas where we might increase fees.

The high schools are now fundraising for a variety of needs. While some fundraising can bedone through service organizations (e.g. Kiwanis Club for Camp Anytown), most is done at theparent/community level.

The loss of revenue has also resulted in increased costs to parents. For example, fees haveincreased for sports participation, parking permits, student body cards, lab fees, and copies oftranscripts.

Our High Schools Are Among the Best in the Nation

Exceptional teachers, challenging programs, dedicated parents, and support from our community allcontribute to our high student achievement.

Ninety-five percent of our graduates go to college Each year over 40 percent of Paly and Gunn students enroll in Honors and Advanced Placement

classes Over 70 percent of our graduates complete the rigorous A-G University of California

Admissions Requirements for high school course work Over 90 percent take the SAT College Board Exam with a combined Verbal and Math score

averaging 1250


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Documents

Palo Alto Unified School District (PAUSD) Parcel Tax Proposal (2005)