The governor's idea — to take dedicated funding away from special districts and return it to local governments and schools — is far from becoming law and is certain to be strongly opposed by cities and special districts from around the state. Mountain View could lose its downtown and Shoreline redevelopment agencies (RDAs), which have financed improvements worth millions of dollars on Castro Street and in the Shoreline area.
Brown's message said in part, "RDAs were not intended to become a permanent source of business subsidies" and that their original intent was to "relieve blight" in a "limited amount of time."
In Mountain View, the life of the downtown "Revitalization Authority" began in 1969. It was set to expire in April but the City Council said Tuesday that it now wants to extend it another two years as the city figures out other ways to pay for future needs like new parking, business recruitment and maintenance. Some also hope to spend $1.5 million to $2 million of the current $5.5 million balance to subsidize a downtown grocery store.
For the uninitiated, an RDA collects and keeps all the property taxes that are due in the district, but must spend all the proceeds to make improvements inside district boundaries. When a special district is created, no other districts, including schools, receive any funds from the district.
In Mountain View, for example, the downtown district collected and spent its taxes to improve the streetscape, help pay the city's economic development team and build parking structures. Without it, nearly $1 million would have gone to local schools and not been available for downtown improvements.
The city's other single-purpose cash generator is the Shoreline Community District, which, unlike a typical RDA, is endowed with the power to collect taxes in perpetuity, unless the Legislature acts to end its run. This district generates millions of dollars a year that have been used to build the Shoreline area into a major economic engine for the city.
Last year, Mountain View Whisman Superintendent Craig Goldman created a stir when he pressed the city for a larger share of its Shoreline property taxes, which exceeds $25 million a year. So far, the city is continuing to share a small percentage of the Shoreline proceeds with the school district, but it is far less than the $5 million elementary and middle schools would otherwise receive. It seems unlikely that council members will volunteer to part with anywhere near that amount.
One only needs to look to Palo Alto to see that a city can function quite well without these special tax districts. And the improvements that could be afforded to schools could raise the city's property values as well. While we are thankful for the city improvements paid for by the Shoreline and downtown districts, it is time to explore other options, including Brown's proposal to allow economic development bonds to be approved by only 55 percent of voters, rather than a two-thirds majority now required.
As it becomes clear how little the city needs these special tax districts there will be increasing pressure to dedicate the money to schools. And while a few projects remain to be done for Shoreline, such as the continued expansion of the city's trail system, it seems only fair that local schools receive a fair share of the tax revenue that is generated by Google and other high-tech firms.
And with downtown now looking as nice as anyone could wish, it's hard to prioritize further improvements there over local schools which face millions in budget cuts.