Local schools to get millions from new North Bayshore housing | September 13, 2019 | Mountain View Voice | Mountain View Online |

Mountain View Voice

News - September 13, 2019

Local schools to get millions from new North Bayshore housing

by Kevin Forestieri

The city of Mountain View negotiated a landmark deal with two school districts to guarantee that tax revenue from future housing in North Bayshore will go to local schools rather than the city's coffers.

Under the deal, the Mountain View Whisman School District and the Mountain View-Los Altos High School District will both receive property tax money for new homes constructed north of Highway 101, which was recently rezoned to allow up to 9,850 housing units.

Without the deal, all of that property tax money would have gone straight to the city, due to a 1969 state law that turned North Bayshore into a quasi redevelopment agency that still exists today. The law, called the Shoreline Regional Park Community Act, has diverted hundreds of millions of dollars away from other local agencies over the last two decades.

Even with a revenue-sharing agreement that began in 2006, the city siphons more than half the money that would otherwise go to schools — roughly $43 million over the last five years across the Mountain View Whisman and Mountain View-Los Altos High school districts.

Mountain View Whisman Superintendent Ayinde Rudolph said the deal, which was reached in June and reviewed by the school board Sept. 5, is a "great step" towards ensuring schools have enough money to teach children who will live in the dense neighborhoods planned in North Bayshore.

"We are glad to see there is movement from staff on all three entities to find ways to mitigate the growth that we're expecting," Rudolph said.

Redevelopment agencies, or RDAs, used to be commonplace throughout California, formed as a way to pool resources for fixing areas deemed blighted. A function of RDAs is that they divert property tax money that would have gone to other local government agencies — including school districts, hospital districts and water agencies — in order to finance those upgrades.

California dissolved more than 400 RDAs in 2012, but Shoreline Regional Park — not technically an RDA and enshrined in state law — remained.

Although North Bayshore is now a tech park largely occupied by Google with an assessed value expected to exceed $4.6 billion this year, the area looked vastly different in 1969 when the law was passed. Features included a 461-acre landfill and a large automobile wrecking storage site, inefficient roadways and buildings that were deteriorating, dilapidated and conducive to "ill health and transmission of disease," according to the original act.

Making improvements to the area would have been difficult, in part, because it was partially unincorporated land, which was a key factor in creating special legislation for North Bayshore. The city of Mountain View is the steward of the Shoreline Regional Park funds and is responsible for numerous infrastructure projects that helped transform North Bayshore into one of the most desirable places to build on the Peninsula.

Assessed property values in the Shoreline area have steadily increased since the dot-com crash from $1.7 billion in 2004 to $4.6 billion today. Shoreline now generates an estimated $48 million in tax revenue for the 2019-20 year, according to the city budget.

The transformation of Shoreline has raised questions about whether it should continue to pull money away from other local agencies, particularly schools. In 2011 a group of parents led an effort called Share Shoreline, demanding that the city give school districts at least a portion of the money they would have received if the Shoreline Regional Park Community did not exist.

Assistant City Manager Audrey Seymour Ramberg told the Voice in an email that the amendment granting property tax revenue to school districts was developed in November last year and has now been formally adopted by the city and both school districts that make up the "Educational Enhancement Reserve" joint powers authority (JPA).

"The JPA is one of many examples of how the City and School Districts have worked together to effectively serve families and youth in Mountain View," she said.

Although the effort led to a sharing agreement, school districts are arguably still missing out. County tax documents show Mountain View Whisman would have received $9.2 million in the 2018-19 school year if it received its share of the property taxes in North Bayshore — amounting to about 23.7% of the revenue. Instead, it received a little over $4 million through the agreement with the city.

Mountain View-Los Altos, similarly, should be netting about 15.2% of the property taxes from Shoreline, or about $5.9 million in the last school year; it received less than half of that with $2.6 million.

Big changes for North Bayshore

While the JPA arrangement has helped claw back some of the property tax revenue diverted from local schools, the planned explosion in residential growth in North Bayshore is raising questions about how much of that money ought to flow to local schools that have to educate hundreds, if not thousands, of additional students in the coming decades.

In 2017, the Mountain View City Council passed what's called the North Bayshore Precise Plan, rezoning large swaths of North Bayshore — and by extension the Shoreline Regional Park Community — for a more urban mix of offices and up to 9,850 homes. Part of that precise plan explicitly states that the city must figure out how to ensure some of the property tax revenue reaped by the impending building boom makes it to schools.

The terms of the new agreement dictate that both the Mountain View Whisman and Mountain View-Los Altos High School District will receive property tax revenue from future residential development proportionate to what they would have received if the Shoreline Regional Park legislation didn't exist. For Mountain View Whisman, that means 23.7% of the property taxes would go to district on top of the already negotiated $4 million.

Existing residential development, like the Santiago Villa mobile home park, would not be subject to the new sharing formula, Rudolph told school board members at the Sept. 5 meeting. Future commercial development will still generate tax revenue that's diverted to the city.

Rudolph said he sees the agreement as a recognition by city officials that major housing growth puts a burden on schools, and that sharing in the property taxes is a good way to offset the costs of teaching students generated by housing expected to be built by Google and Sobrato. Separate agreements are being negotiated with both companies to offset the cost of building a school in the area.

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