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Re: Question 2 - District Level

  • Archived: Tue, 11 Jun 14:54
  • Date: Tue, 11 Jun 2002 14:45:46 -0700 (PDT)
  • Author: "Runner, George" <george.runner@asm.ca.gov>
  • Subject: Re: Question 2 - District Level
  • Topic: Facilities & Finance

Allowing local communities to raise taxes to spend more on schools is a difficult issue. Decades ago, school finance was largely based on property tax revenues. The results were predictable; regions with greater property values and wealth were able to provide more per-pupil funding than were regions with lower wealth. Then the Serrano v. Priest ruling came along and essentially declared that the resulting inequalities were a violation of the Constitution's Equal Protection clause.

If we reverted back to property taxes as a means of revenue, I believe we would have many of the same funding disparities that spurred Serrano in the first place. How could you solve for that? Even if the state provided compensatory state revenue to those schools who do not benefit from additional property taxes, it seems to me that a perverse incentive structure would ensue—a free-rider problem. What district would voluntarily step up and levy taxes on themselves when they know that they can get money from the state if another similar school district opts to raise taxes? Smart districts would wait until another similar district somewhere else in the state opted to raise taxes. The patient district would thus capture the same benefit without the costs and hassles of promoting a higher tax rate in their region.

Even if some district did raise taxes, it would result in significant state costs if the state was obligated to equalize the effect statewide.

I also have a problem with reducing the threshold for implementing property taxes from the 2/3 requirement of the general electorate. Because property owners are disproportionately shouldering the responsibility for such tax increases, they deserve the historical protection of the 2/3's vote.

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