School eyes refusing builder fee exemption

While Superintendent John Baker said he recognizes the community benefit offered by the developer specializing in building housing set aside for those struggling to pay high market rates, he emphasized the district cannot afford to approve the respite.

“I made this recommendation reluctantly and after much thought because we are very concerned about the effect of housing cost on the families we serve, and St. Francis provides vital support to many of our families. At the same time, we are making millions of dollars in budget cuts, and the facilities fees are an important source of funds to ensure that we are able to keep our buildings safe and in good repair for our students,” he said in an email.

Impact fees are paid by developers to school districts to offset the increased costs campuses often incur through enrollment hikes often brought by new housing or jobs.

Baker said he could not support waiving the fees designed to preserve student safety by paying for capital improvement projects, in a district already strapped for cash.

Approving the proposal could also put the district in the precarious position of setting a dangerous precedent for other developers wishing to receive the same relief, according to a district report.

“If we approve one request for a waiver, we will undoubtedly receive subsequent requests and it will put the district in the difficult situation of either approving all that come in, or spending time evaluating each request that comes in,” said the report.

Trustees should deny the request, but it could be brought back should the district’s budget outlook improve, according to the report.

As it stands, the district’s financial outlook is pretty dire, according to a proposed budget for the coming fiscal year showing expenditures continuing to outpace revenue primarily due to a shrinking enrollment.

The district, which relies heavily on state allocations to fill its annual spending plan, expects to face a $5 million deficit next year as the $97 million in proposed spending exceeds the expected $92 million in revenue.

As a result, officials will likely be forced to dip into district reserves to balance the budget — depleting the rainy-day fund to $3.7 million at a level well below the minimum preferred to keep in case of an economic emergency.

Unlike many other local districts, the Redwood City school system is not funded locally because property tax revenue does not exceed the community-supported threshold.

So officials must look to the state for financial support — an estimated 38 percent of the 2015-16 fiscal year budget — which is allocated according to the amount of students enrolled at Redwood City schools.

But as the cost of living locally continues to increase and chases families from Redwood City, or more families select charter schools over comprehensive schools, the district’s enrollment plunges and with it goes more state money.

Enrollment has dropped by approximately 1,500 students since the 2010-11 school year, according to a district report showing little relief should be on the way, as the student population is projected to continue diminishing through 2020.

Barring a flood of new students bolstering the district’s current enrollment of 7,486 students, there is not much officials can do to improve funding levels other than hope legislators approve more money for state-funded schools or look to the Redwood City community for support, according to the report.

The district’s $67 parcel tax, which generates about $1.5 million annually, is slated to expire this month. Officials rely heavily on donations from specific school communities or support from foundations and local businesses to help offset the financial hardship.

Considering the variety of fiscal hurdles facing the district, officials should not approve granting the developer fee exemption to the builder, according to the report.

“We are grateful that dozens of our students will have a safe and comfortable place to live as a result of this project,” according to report. “However, despite our commitment to increasing the number of rental units for extremely low and low income residents, the administration concluded, in reluctance, that we cannot afford to support this resolution at this time.”

The Redwood City Elementary School District Board of Trustees meets 7 p.m. Wednesday, June 28, in the district office, 780 Bradford St.

austin@smdailyjournal.com

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