School district could use general fund money for construction

In an ongoing effort to balance a volatile construction budget, administrators at the Mountain View Whisman School District are looking to millions of dollars in general fund money as a way to pay off cost overruns at several schools, including Stevenson and Theuerkauf.

At the June 2 board meeting, Robert Clark, the district's chief business officer, laid out the situation: five schematic designs for school construction with cost estimates that are all over budget. The schools are Huff, Bubb, Landels, Stevenson and Theuerkauf. Combined, Huff, Bubb and Landels are about $3 million over the budgeted amount.

Theuerkauf and Stevenson could cost anywhere from $4 million to $9 million over the original $26 million price tag, depending on whether the school board votes to rebuild Stevenson at the current location of the district office located next door.

The costly projects do not bode well for the district's construction budget. The $198 million in Measure G general obligation bonds, supplemented by other funding sources, including deferred maintenance and developer fees, currently has a $3 million ending balance and would not be enough to cover the overruns. Rather than look toward cost-cutting measures, Clark suggested that the board could use the increases in lease money over the next three years to fund the difference.

The district current leases land at the former Whisman Elementary campus to the German International School of Silicon Valley, at Slater and Theuerkauf Elementary to Google, and a portion of its Cooper Park land to Action Day Primary Plus. Rent is expected to increase dramatically for Google and the German school next year, and increases in rent from all three sources is expected to total $5 million over the next four years. Clark said that money, which is slated for the district's general fund, could be diverted toward building new facilities.

Board president Ellen Wheeler said she was "satisfied" with the proposed finance methods, and that the board knew full well that the projects were going to come in over the preliminary budget. She said she preferred the option that swaps the location of Stevenson and the district office, which she said allows Stevenson to stretch its legs on a larger footprint while also giving district staff an improved, renovated home at the former school site.

"One of the things I like the most is being able to utilize the space of the district office to go towards Stevenson and finally giving our district office staff buildings to work in that are safer, more healthy and more pleasant to work in," Wheeler said. "That goes a long way with me."

The board eventually postponed the decision until the next board meeting, but some trustees made it clear they were uneasy with using general fund dollars to plug the gaps in funding. Board member Greg Coladonato said the board needs to consider cuts to the scope of projects — like ditching plans to expand the multipurpose room at Theuerkauf — so that money slated to fund student programs remains untouched in the coming years.

"All that money can be spent on students directly, and I strong prefer it to be spent on adding programs," Coladonato said. "(Rather) than just blindly building to a district standard so no one's feelings get hurt."

Board Member Steve Nelson said he objected to using increases in lease revenue from the German school, which the board voted last year to earmark for opening a new school at Slater Elementary. He said the board committed to reserve that money for the northeast residents of Mountain View who have been fighting for a new school in the neighborhood for years.

"If we say we are talking all that money away until after 2019 ... I think we're making a big mistake," Nelson said. "It's not free money from heaven, it comes with very drastic consequences to one of our communities."

District parent Steve Bell urged board members to stand by their vote last year, and said it would reflect poorly on the board if it reneged on the decision to commit money towards a new school. He said parents fighting for a school at Slater supported the extension of the lease with the German school to 2045 — essentially locking up the Whisman campus — under the assumption that the district would put money away and make sure a school would be opened at Slater.

"If you're thinking about re-allocating that money, that would send a bad signal to all the people who were there that night and were in favor of a 30-year lease on the condition that those funds would be set aside for that neighborhood," Bell said.

This isn't the first time the board has made the uneasy decision to use money for construction overruns that could have been spent on new academic programs and technology. The school district has spent years stockpiling money from the Shoreline Regional Park Community special tax district — property tax revenue north of Highway 101 in Mountain View — and in two years drained the entire $7.5 million account to pay for new facilities.

According to an agreement between the district and the city of Mountain View, the Shoreline money was earmarked for technology upgrades and "enhancing" educational programs at the school to better prepare students to join the local technology workforce. Under a broad interpretation of the Joint Powers Authority agreement, the district has used the money to build new facilities at Crittenden and Graham Middle School.

Nelson later told the Voice he believes the district needs to spend money based on the constraints of the original $198 million bond, and that the community would be clamoring for a new bond measure if they felt more needed to be spent on school facilities.

"Diverting more money from programs to buildings is shorting the kids from programs and extra teaching that they need now," Nelson said.