By Sara Ballenger
It has been a rough year financially for the Los Altos School District.
Earlier in the year the district faced a $4.5 million deficit, but it restored $2.6 million through fund-raising efforts by the Los Altos Educational Foundation and Save Our Staff. However, the district is still cutting $1.9 million from its budget for the 2002-03 school year.
How did one of the top districts in the state of California find itself in so much debt?
A large part of the district’s problem is the lack of state funding.
In 1972, the state imposed revenue limits on school districts, or a cap or general fund revenue per student. The Los Altos School District is a revenue limit district, according to Randy Kenyon, assistant superintendent of business services.
The revenue limit was based on the amount of funding that voters within each school district had authorized through previous tax elections.
A key factor hurting the district now is the method the state employs to determine how much money to allocate to each district.
The 1976 California Supreme Court decision, Serrano v. Priest, ruled that schools should spend money at the same level to ensure equal educational opportunity for students statewide.
“The state set our revenue limit based on the taxing level in the district prior to 1972 and funds an annual inflationary increase,” Kenyon said.
Kenyon thinks the district’s taxing level was below the state average so it received larger annual inflation increases than those districts that were above the state average.
According to the state, to achieve equality of funding among schools, the state provided the annual inflationary increase at higher levels for low spending districts and lower inflationary increases for higher spending districts.
“The revenue limit is a per student amount of approximately $4,500 for 2002-03, that is multiplied by the number of students. For us the total amount is (between) $17 million and $18 million,” Kenyon said.
Another factor that affects the district’s state funding is the 1978 passage of Proposition 13. Prop. 13 amended the state constitution to limit the level of local general purpose property tax to 1 percent of the full cash value of the property. Schools could no longer raise funds by raising local tax rates and became more dependent on state funding.
About 73 percent of the Los Altos district’s funding comes from the state, which faces a projected deficit of $22 billion, according to Kenyon.
When the state economy suffers, schools receive lower cost-of-living adjustments or inflation increases, he added.
According to the district, it spends $7,300 per student, which is close to the national average and higher than the California state average, Kenyon said.
Revenues from the parcel tax and the Los Altos Educational Foundation give the district the opportunity to spend more money per student, he added.
While property taxes can bring additional revenue to the city of Los Altos, the same isn’t true for the school districts.
“For every dollar that local property taxes increase, because of the increase in the value of homes in town, the state reduces the amount of aid it gives the district by exactly the same amount,” said Dick Hasenpflug, chairman of the district’s Citizen Advisory Committee for Finance. “Thus, the recent increases in local property values have neither helped nor hurt the district.”
The district offset its funding inequity in the past with a parcel tax, which has been in place since 1989, currently set at $264 per parcel annually.
The district will ask voters for a $333 increase to $597 this November.
