Mountain View Whisman School District Superintendent Ayinde Rudolph will get a $1.2 million low-interest loan from the school district to purchase a house in the area, after the school board voted Thursday to grant the perk to its highest-paid employee.
The 4-1 decision was deeply criticized by parents and district residents, who slammed the decision as an inappropriate use of taxpayer funds that were meant to pay for student services. An online petition urging the board to reverse course gained 1,000 signatures as of Monday, with many commenters arguing that the money would be better spent on students and staff during the coronavirus pandemic.
Rudolph has been with the district for five years and earns a $281,000 salary, receiving a 14% pay raise from the school board last year. Instead of providing a raise this year, school board members said they felt a home loan provided by the district -- with a low interest rate -- would be the best way to retain the superintendent and give him a good reason to stay in the community.
"We strongly believe in Dr. Rudolph's leadership, and this really commits him to our community," said board president Tamara Wilson. "I've sat in board meetings and heard him being accused of using us as a springboard to bigger and better things and that we were a 'stop' along the way, and this shows his commitment to wanting to stay in the community."
The agreement states that Rudolph must purchase a home either in or directly adjacent to the Mountain View Whisman School District, and that the 30-year loan will have an interest rate based on the Applicable Federal Rate (AFR), which varies from month to month and will depend on when Rudolph buys a home. In July, that rate was 1.17%. The loan amount will come out of the district's reserve funds.
Even if it does serve as a retention tool, pouring money into a long-term home loan amounts to an "irresponsible and reckless use" of taxpayer funds, said district resident Mainini Cabute. She said that money would be better spent on school staff, including hiring new counselors and school nurses or training teachers to better provide remote education.
The district should not be in the business of granting home loans," she said. "The district funds are intended for the education and development of our district students."
The online petition, started by Cabute and parent Prem Andrzejek, also accuses the district for failing to disclose the home loan and allow for public input prior to the vote. Parents are "angry and appalled" by the lack of transparency, according to petition.
Trustees defended their decision at the Thursday board meeting, saying that home loans are a common way to attract high-level administrators to an area where housing is at a premium -- both in the corporate world and in the public sector. In 2015, the neighboring Palo Alto Unified School District provided a $1.5 million interest-free loan for former Superintendent Max McGee, who at the time received a $295,000 salary. McGee later resigned and turned over the title of the home to the district.
In 2018, Palo Alto Unified hired Superintendent Don Austin, who did not receive a home loan.
Mountain View Whisman school board member Devon Conley said no city or school district employee actually makes enough money to 'easily' purchase a home in the area. She emphasized that while superintendents have a high salary, they often serve most of their careers making modest salaries as teachers and principals.
"If we do not offer an employer-assisted housing benefit to future superintendents, we will only get people who are independently wealthy," Conley said. "They will not understand the needs of our students or the concerns of our teachers and staff."
Trustees also repeatedly said the public couldn't have been appraised about the loan ahead of time because of the Brown Act, which only permits the board to negotiate contract agreements with employees in closed session. Cabute said she wasn't sold on the argument, and that the Brown Act shouldn't be used as a broad defense for not giving the public access to the terms and allowing for more feedback.
What's unusual about the loan is the timing. While home loans may be commonly used to entice new talent to the high-cost area like Mountain View, Rudolph has served as superintendent for five years in the Mountain View Whisman School District. The job has a notoriously fast turnover rate, with superintendents in urban areas serving an average of just over three years in any one district.
Board member Ellen Wheeler, the only sitting trustee who voted to hire Rudolph in 2015, said in an email that home loans were not part of the hiring discussion that took place five years ago. But today, it marks a good opportunity to keep Rudolph in the school district at a time when many other superintendents are headed for the door.
"We are very pleased that Ayinde has stated many times to us that he wants to stay in our district for a long time," Wheeler said. "His experience in these extraordinarily complex times is highly valuable to the success of our school district. If he left, it would be very difficult find someone who could show the skill set Ayinde has developed over the years."
As for giving out loans during the coronavirus pandemic and the economic uncertainty it brings, Wilson said the district has the money available. Property tax growth for the 2020-21 school year remains unscathed by the immediate-term impacts of the coronavirus, and she said property values would have to sink pretty low to put a dent in the budget. She pointed out that the district's average home sale price is about $1.8 million, while the average assessed value floats closer to $910,000.
"With new residential and business construction still thriving in Mountain View, the property tax revenue outlook is good," Wilson said. "Even if a downturn occurs, home values would have to drop by at least half to decline below current average assessed value."
Wilson said the school district can also keep its "healthy" reserve levels while ratcheting up spending during the pandemic. For the upcoming school year, the district has $700,000 budgeted for a standing "virtual teaching team," which will support remote learning and limited access to school campuses, and has already purchased laptops and tablets for all students. An extra $300,000 has been set aside for unforeseen costs, which Wilson said will be kept in the budget indefinitely in order to offset future emergencies.
The only dissenting vote on the superintendent's contract was board member Jose Gutierrez, who said he supported the $1.2 home loan but nevertheless wanted to cast a symbolic "no" vote against the contract. He said he didn't want people to think trustees "don't care" or don't understand the frustration raised by parents Thursday evening.
"This is not a sham process, this is democracy," Gutierrez said.