It’s not business, it’s personalBringing budget cuts home to make them real
It’s a measure of how worried and angry people are that nearly a hundred parents, students, educators, and policy makers gave up their Saturday to learn just how badly schools will be hit under Gov. Brown’s all-cuts budget, due out today, and to discuss some of the not-so popular solutions. Hoi Yung Poon, executive director and founder of Parents for Great Education, who organized the event, worried needlessly that “no one would show up.” The 21st Century Education Summit at De Anza College in Cupertino drew Silicon Valley Congressman Mike Honda and San Francisco Assessor Phil Ting. A group of Chinese American moms drove down from San Francisco with an interpreter, a parent organizer came up from Los Angeles, and a community college trustee flew in from Orange County.
Facing down Prop 13
Most speakers challenged the belief that extending the tax increases is the only way to solve the pending crisis in public schools. Ting in particular has been on a mission to stop the worshipping of one of California’s sacred cows: Proposition 13. He even has a website, called Close the Loophole, that’s devoted to eliminating the loophole that lets commercial property owners make improvements without paying increased taxes, because the property rarely changes hands. Ting said there’s been a complete flip in property tax contributions as a result of Prop 13. In the 30 years since the initiative passed, property tax contributions have flipped in San Francisco from 59 percent paid by commercial property owners and 41 percent by homeowners, to 43 percent and 57 percent respectively. He estimates that taxing commercial property at fair market value could raise $7.5 billion a year.
When asked how he would respond to businesses that argue they should be included in Prop 13 because they create jobs and improve the economy, Ting had a ready answer. He said Prop 13 was sold to Californians as a local measure to protect residents, but “consumers get no subsidy” from the tax break to commercial property owners. He gave an example fro nearby Menlo Park. “Draeger’s (an upscale supermarket) pays $66,674 in property taxes, while Trader Joe’s pays about $7,000 because the people who own Trader Joe’s land have handed it down to their heirs who live in Massachusetts.” Not only is the tax break going out of state, but local residents get no benefit, said Ting. Plus, a gallon of milk at the Trader Joe’s in San Jose doesn’t cost any more than a gallon of milk at the Trader Joe’s in Menlo Park, even though that one is paying so much less in taxes.
“What we do in California is tax the hell out of new businesses and we don’t tax the windfalls that accrue on everyone else, said Ting. “The benefits of the new business taxes goes to a windfall for the older businesses.” Consumers, he added, get no subsidy.
Although Ting’s position isn’t yet universally embraced, it is gaining more vocal adherents. Mary Perry, the deputy director of EdSource, a nonprofit, nonpartisan education research organization, says the current funding structure isn’t sustainable, not with the changing mission for our public schools. “To expect schools to innovate and change their paradigm and be more effective while they’re trying to figure out how to keep the lights on is a little disingenuous, a lot disingenuous,” said Perry. ”The restriction on state revenue on California’s ability to raise revenues for its local services that were created by Proposition 13 are due for reexamination. If people understood the negative consequences for them personally and the economy as a whole it would not any longer be something sacred.”
Lenny Goldberg, with the California Tax Reform Association, said that just by going after the “low hanging fruit” the state could bring in several billion dollars:
- $2.3 billion raising income taxes on the wealthiest 1% of Californians by 1%. “The Bush tax cuts gave the top 1% in California $9billion in tax relief,” said Goldberg.
- $1.3 billion from implementing a production tax on oil. California is the only oil-producing state in the world without this tax, says Goldberg.
- $1.3 billion from eliminating the corporation tax election, a new law that allows California companies to decide each year what formula they’ll use to pay taxes on their operations in the state.
- Collecting taxes for online commerce, such as Amazon.
- $1.7 billion by eliminating redevelopment districts and reallocating property taxes diverted to those districts to schools, cities and counties.
- $900 million now and $500 million ongoing by eliminating enterprise zones.
Education funding is rooted in values
Not everyone put the blame on Sacramento or Washington, D.C. “We are as responsible for the reason the system is broken as anyone,” said Cindy Chavez, executive director of the San Jose-based Working Partnerships USA, a social change organization funded by labor. She said the uncompromising tone of political debate has turned a significant number of people against any taxes for any reason. “I think it’s become so fashionable in this state and in this country to blame others that we’re going to kill this country and this state.”
What really irks Chavez is how the conversation about education funding is devoid of values. When the purpose of school is discussed, she said it’s always about training students for jobs; the idea that education has value in and of itself isn’t discussed. “In no environment has it worked to say ideology doesn’t matter,” said Chavez. “We design political systems and economic systems with the idea that people are dispassionate.”
Parents advocates hope to bring out some of the passion, especially in parents, with a new mapping tool that shows how much their children’s district stands to lose under the worst-case scenario budget. Click on the district and it shows the decrease per student and the total cuts to the district.
“I had an idea for some sort of tool that would show school funding information that was digestible,” explained Dr. Cynthia Liu, founder of a parent news site called K-12 News Network, who has been working with Parents for Great Education. Liu is also hoping that seeing those numbers will inspire people to lobby their legislators. “We really need something that helps community understand the urgency and the severity of the cuts. It’s hard to be motivated without the facts and figures.”