The city magnanimously agreed to part with a portion of the revenue from the development district, which was formed in 1969 to create and maintain Shoreline Park and the surrounding business district. The special legislation that created the district funnels away property taxes that otherwise would go to schools. Over the years, income to the district has grown and is expected to produce $26.9 million this year.
In their agreement to share revenue with the school districts, the city agreed to fork over $8.2 million in three payments over three years to Mountain View Whisman and $5.4 million to the Mountain View-Los Altos High School District.
After years of receiving nothing from Shoreline tax revenues, school officials were ecstatic, even though there was no commitment for revenue-sharing after the three-year period. And although not all the district's income is committed, what will be available got considerably smaller when the City Council agreed last week to "borrow" an additional $26.5 million for district projects.
The new bonds will take 29 years to pay off at the rate of $2 million a year from the Shoreline Community fund. The money will be used to build new soccer and baseball fields for $9 million, a new fire station near the Shoreline Amphitheatre for $10 million and a pedestrian/bike bridge over Highway 101 for the Permanente Creek Trail that will cost $4 million.
In the current estimate of investment earnings and property tax income, the Shoreline district is expected to produce about $26.9 million this year, but decline to $25.4 million in 2011-12 with virtually the same performance in 2012-13. And if current revenue estimates and expenditure plans hold, the city might not have quite enough to meet an obligation similar to the $4.8 million yearly average being paid to schools today through 2014, although there could be a surplus in the Shoreline fund that could accommodate school payments in 2015 and 2016.
In the past, the City Council has been more than willing to pledge Shoreline district income to bankroll various projects to improve the Bayshore neighborhood, where many high-tech companies are located, including Google and Microsoft. But the city has now reduced its budget for such expenditures by $2 million next year and in 2012-13, with estimates rising to $3 million available for projects the following two years.
If school supporters, who helped convince the city to provide the $13.6 million schools will receive over the next three years, want to continue getting a share of the Shoreline Community district revenue three years from now, they may have to ask the city to hold off on new investments at Shoreline. Otherwise, this revenue could be invested in other bond issues or projects that will take away the ability of the city to share this revenue, which is so important to the school districts.