The Hermosa Beach city school board will wait until at least July 13 to decide whether to seek a parcel tax, merge with a neighboring district, convert to charter school status, make drastic cuts in programs, or mix and match some of those options.
The board of the two-school district, with dwindling financial reserves, is looking for ways to head off shortfalls that come with increasing state budget cuts.
The school board last week heard from special subcommittees studying various options, and is chewing on the information.
Board members expressed some reservations about the charter school and merger options, which might signal the likelihood of a parcel tax, steeper budget cuts or both.
But first, some housecleaning:
(An April 28 story about the city school district’s finances listed the district’s costs to employ teachers. But it was not clear throughout the story that those costs include more than salaries and benefits.
The district’s costs to employ a teacher include salary, benefits and other items, such as the amount the district pays into a worker’s compensation fund. In addition, each teacher pays 8 percent of his or her gross salary into a pension fund.
The highest salary that a veteran Hermosa teacher, with a master’s degree, can reach is $81,000.)
Parcel tax possibility
Marianne Hunt Aguilar of the parcel tax subcommittee said if school board members ask voters for a parcel tax on their properties, it would be important to survey the public on the subject, and mount a strong election campaign.
“Polling is strongly suggested,” she said.
She pointed out that a parcel tax would require approval by two thirds of the voters.
She said members of the subcommittee met with supporters of an unsuccessful 2008 parcel tax measure to see “what worked and what didn’t work,” and studied a successful parcel tax measure on the Palos Verdes Peninsula.
A measure should call for the tax to expire in a definite period, perhaps five years, should not have increases for cost-of-living or inflation, and should clearly state that seniors and people with disabilities can exempt themselves from the tax, Hunt Aguilar said.
The subcommittee also urged a “continuous fundraising operation.”
“The 2008 campaign raised $20,000 by issuing a one-time solicitation to 20 people for $1,000 each, and no subsequent fundraising appeals were made,” a subcommittee report stated.
Supporters of the successful 2009 measure in Palos Verdes raised $100,000, the report stated.
Hunt Aguilar said a survey would cost $12,000 to $25,000, a ballot fee would run $20,000 to $50,000, a campaign consultant would cost $30,000 to $50,000, and other campaign expenses could run $25,000 to $40,000.
She said the subcommittee did not know what amount of tax should be sought, because it is not yet known how large state budget cuts might be.
“We don’t know the shortfall yet, because the budget has not been released, so we can’t ‘work backward’ into a figure,” she said.
The subcommittee suggested a “dollar rate per parcel” for residential properties, and rates based upon square footage for commercial and institutional parcels, Hunt Aguilar said.
Bottom line
Comparing the economics of a parcel tax versus a school district merger, she said the owner of a $700,000 home paying $300 per year in a parcel tax would be pumping all of that money into Hermosa schools, but the money would not stay in Hermosa if the same property owner was paying $315 to help cover the bond debts of Manhattan Beach schools, or paying $385 to help cover the bond debts of Redondo Beach schools.
The parcel tax committee noted that since 2007, school programs axed or reduced include an instructional aide at the K-2 Hermosa View School, an assistant principal, music for grades one through five, middle school academic counseling, aides for middle school technology and fourth and fifth grade science, a maintenance and operations coordinator, an operations worker, hours for a library/media technician at the 2-8 Hermosa Valley School, health aides at both schools, and two clerical workers.
Possible future cuts include third-through-fifth-grade science lab, first-through-fifth-grade physical education, a program to limit class sizes in kindergarten through third grade, the middle school electives art, technology, computers, Spanish, music, speech and drama, and a kindergarten-through-fifth-grade reading specialist, the subcommittee reported.
Charter course
Speaking for the charter school subcommittee, Barry Silver, an entrepreneur and father of two young children, said converting Hermosa’s two campuses into public charter schools would realize “a surprising gain in revenue.”
Silver said the school district would see an extra $272,000 to $585,000 a year. The state government doles out money to schools on a per-student basis, with schools in the more affluent districts getting less money. The state funds charter schools based on the per-student average, which would mean a funding increase for Hermosa.
In addition, the state gives each charter school a one-time start-up grant of $250,000, adding another $500,000 to the Hermosa district’s coffers if both schools convert, Silver said.
The Hermosa district’s annual operating budget is about $10 million.
Silver said charter schools, which focus on a mission such as technology, environment or arts to organize the curriculum, can get donations from private companies whose work dovetails with a school’s mission.
“A charter school is not a silver bullet for the financial crisis. We’re still better off with it. It doesn’t solve all our problems, but it’s a step in the right direction,” Silver said.
“On top of this, a charter school model can offer more financial transparency,” Silver said.
Two contractors that work with charter schools, offering financial and legal compliance services, post clear monthly financial statements online, he said.
Hermosa school district officials have increased efforts to clearly communicate financial matters to the public, at times translating into laypersons’ language the arcane reports they are required to file to Sacramento. Those efforts followed complaints by some critics of the district.
‘Not union busting’
Silver said a push for a charter school “is not a way to bust the union” of the teachers and other school employees.
“That’s a rumor going around. If we go forward with a charter school, we want to do this with union support,” he said.
“All of the schools that we talked to that were successful” in a charter school conversion made the move “with the help of the union,” Silver said.
On Monday, subcommittee member Jerry Gross said a charter school presentation at each Hermosa campus failed to draw a large number of teachers, but those who did attend were “consistently” surprised that the move was not one to “bust the union.”
Hermosan Alison Suffet Diaz, founder of Environmental Charter High School in Lawndale, told the school board that unions can bring their existing employee contracts into the conversion process.
“When we talked to the charter schools that had converted successfully, all of them had converted through accepting the union contract as-is,” she said.
Silver told the board that teachers, parents and community members can exercise more control over a charter school.
“Don’t get me wrong, we have a great school district in Hermosa. But you always have to ask, can it be better,” he said.
“How do we teach them to write the next best seller? How do we teach them to start the next Google and Facebook? How do we teach them to build us a better banking system?” he said.
“But most importantly, how do we help them to dream, and make their dreams a reality? To address this we recommend the creation of a 21st century charter school, to prepare our students for an advancing world,” Silver said.
Not enough?
School board member Ray Waters said he wanted to know more about greater revenues for charter schools.
“They’re stated as facts here, and I wonder if they are facts,” he said.
Board member Carlene Beste said additional revenue from a charter conversion would not do enough to meet the district’s financial needs. She said the board is looking at “a $1.6 million difference in what the state should be funding us and what they say we’re actually going to get.”
“Even though you’re looking at something like $300,000 in increased revenue, my concern is that it doesn’t solve the problem that we’re looking at,” Beste said.
“At the end of the day I think you would still need a parcel tax, and if you tried to do both, I think you’d completely confuse people,” she said.
Beste also said she is “a fan of charter schools,” which enjoy greater flexibility in instruction because they are exempt from many portions of the state education code.
“I walk in the doors and see a lot of enthusiasm with the staff. I’m not saying our staff isn’t enthusiastic, but it’s a different environment, I think, and I really like some of the options that it presents,” she said.
Gross said on Monday that he believes a parcel tax is necessary to keep the school district going, but he believes a charter school conversion could also take place without confusing the public. He pointed out that a parcel tax would require a vote of the public and a charter conversion would not.
Manhattan merger?
Rose Rocchio of the unification subcommittee said merging the Hermosa district with either of the ones in Manhattan or Redondo would serve as a long-term solution to the funding woes.
“The larger districts have the wherewithal to weather the storm,” she said.
Manhattan and Redondo have kindergarten through 12th grade school districts, and Rocchio pointed out that they get more money per student than does a K-8 district; about $500,000 annually, she said.
Economies of scale would offer Hermosa students a broader curriculum, including programs for gifted and talented students, and music, which has suffered cuts in Hermosa.
Rocchio pointed out that larger districts have larger financial reserves.
“Manhattan has a rainy day fund. They have been able to do that because they are larger,” she said.
“The most important thing is, this is a long-term solution,” Rocchio said.
In addition, voters in Hermosa and a neighboring city could approve a merger by a simple majority instead of two thirds, which would be required for a parcel tax.
The subcommittee found that a survey of residents would cost $12,000 to $20,000, and placement on an election ballot would cost $20,000 to $50,000.
Rocchio said both neighboring school districts carry larger bond debts than Hermosa’s, and a merger would probably cost Hermosans about as much as a parcel tax would.
She said Hermosans would seek to retain their local campuses and staffs.
First choice
The Manhattan district’s campuses are at capacity, so a merger with that district would mean that, at least for the time “our schools wouldn’t go away,” she said.
Rocchio said about 90 percent of Hermosa students choose to go to Mira Costa High School in Manhattan Beach instead of Redondo Union High School. That choice would “be honored” with a Manhattan merger.
A guaranteed choice between the two high schools would no longer exist, but kids could petition to go to Redondo Union, she said.
Rocchio said the subcommittee taps Manhattan as the first choice for a merger partner.
State officials would probably approve a merger with either city’s school district, and officials of both districts have expressed an interest, Rocchio said.
Among the possible downsides of a merger, Rocchio listed the loss of guaranteed choice in high school attendance, the fact that a merger would not stop further state budget cuts, and a “perceived loss of Hermosa identity.”
“We think Hermosa would be well served to unify,” she said.
“Unification light,” a partial merger of services with another district, was not endorsed by the subcommittee.
Sharing administration services is limited under the state education code, and Hermosa’s technology systems are incompatible with those of its neighbors to the extent that no “immediate savings” would be found in a tech merger, Rocchio said.
‘No divorce’
Board member Jack Burns said money Hermosans spend on a parcel tax would stay in Hermosa, while money they spend to unify would help pay for “past improvements” in another city.
He said a parcel tax would have a “sunset” date, but with a merger, “you’re married, no divorce, that’s it.”
“I’m not saying one is better than the other – but one is better than the other. So, I guess, yes,” Burns said.
Beste said that under a merger, a larger district could decide to close View School.
Lisa Claypoole spoke protectively of Hermosa students’ ability to choose between neighboring high schools.
“Why should we give up the right to choose a high school,” she said.
Red ink
Former school board member Greg Breen, on a subcommittee tasked with envisioning a “minimum curriculum” for the schools, told the board that state law would allow a much leaner curriculum than is taught now.
But, he said, large cuts could lower students’ scores on standardized academic tests, hurt their chances to succeed in high school, and lower Hermosa residents’ property values.
“What the state will accept is far below what Hermosa Beach residents will accept,” Breen said.
He said a 20 percent reduction in funding would trim the curriculum, increase the number of students in each classroom, eliminate one-on-one “pull-out” instruction for students, require classroom teachers to teach science labs and physical education, and cut back maintenance.
The students’ collective Academic Performance Index scores, which are based on standardized academic tests, would probably go from the state’s top tier to its third tier, he said.
