Upfront: School of thoughts

Study outlines possible effects of Marinwood housing development on Dixie School District

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by Peter Seidman

Rather than calm the debate over a proposed affordable housing project in Marinwood, a study the county commissioned to quantify the effects of a proposed development created new lines drawn in the sand.

A respected economist, Robert Eyler, presented the study recently to the Board of Supervisors. Eyler is head of the Marin Economic Forum, a professor and chair of economics at Sonoma State. The study aims to delineate the effects of a housing development in Marinwood that would include 72 units of below-market-rate housing and 10 units of market-rate units. The study includes potential effects on the Dixie School District.

The data included in the study about the effects of the project on local schools comes after opponents have raised objections to the project based, they say, on the deleterious financial consequence of allowing a developer to build the 72 units of below-market-rate housing.

The objections open a can of debate that involves the complicated and arcane procedure by which the state funds schools.

The Dixie School District is what’s called a basic aid district, which means that local property taxes make up the bulk of its general fund revenue. That’s because as part of the state’s school-funding mechanism for a basic aid school district, the district’s per-pupil-property tax revenue exceeds the state per-pupil revenue allocation limit. That means that the district is left to rely in large part on local property taxes.

An affordable housing project such as Marinwood Plaza, which the BRIDGE Housing Corporation has proposed, can throw a wrench into school funding projections. Affordable units, like the ones BRIDGE wants to build, can qualify for a property tax waver. The school district and property owners in the district would have to take up the responsibility to cover the education costs for children in the affordable units if they wanted to keep per-pupil funding stable.

Whether that’s an unfair burden or a fair social responsibility depends on which side of the debate a person stakes a position. There’s no question that the Dixie School District, which has three elementary schools for kindergarten through eighth grade, is, like most districts, revenue-challenged. Currently about 2,000 students attend classes.

BRIDGE Housing Corporation formed in 1983 when the San Francisco Foundation received a major anonymous grant aimed at creating solutions to the dearth of affordable housing in the Bay Area. Since then, Bridge has earned a firm reputation as a responsible creator of affordable housing that blends with the surrounding neighborhood. The agency’s track record regarding management of the developments it creates is likewise respected.

At one time, Bridge estimated that about only 44 students would be added to the immediate attendance rolls from the Marinwood Plaza development. Not all of the children who will live in the units would be of elementary school age at the same time, note proponents of the proposal, and that would lessen the financial effect on Dixie schools. The influx won’t be an avalanche. Based on the number of bedrooms, it’s not out of the question to estimate that between 44 students and, say, about 100 students would be added to Dixie School District classes.

If Bridge builds the development and receives waivers, the local community would face a shortfall in school funding that would affect the added pupils and also the current children in Dixie schools, say opponents of the proposal.

The objection dovetailed into the anti-government sentiment that erupted in the November election. In that election, San Rafael Councilman Damon Connolly ousted Susan Adams to take a seat on the Board of Supervisors, based in part on a campaign platform of slow-growth, especially when it came to Marinwood. He stated that the county should reset its thinking on the development proposal. Supervisor Judy Arnold, who won reelection in her Novato district by a narrow margin, recently said that 72 affordable units might be too many for the neighborhood, essentially supporting Connolly’s call for a reset.

The political fallout came after strong objections from Marinwood neighbors and often-raucous meetings during which emotions spilled out, swamping a rational debate that the Eyler study seeks to establish.

There’s an irony in the debate over Marinwood that stretches back to the start of discussions about a possible project. “Jerry” Hoytt built some of the first houses in Marinwood in the 1950s. Marinwood Plaza, at the corner of Miller Creek Road and Marinwood Avenue, served as a focal point for neighbors in the west side of Highway 101 between Terra Linda and Novato.

The plaza went into decline, and starting in 2004 local residents began working on a landmark cooperative effort with Hoytt and the county to determine the best route to rehabilitation for the little shopping area. To Jerry Hoytt’s credit, he reached out to the community to fashion a front-loaded planning process for the property. If the community would support a redevelopment plan early in the planning process, and the county would ease the way for construction (Marinwood is unincorporated), selling the property would be much easier for Hoytt. The process also would help ease the way for smooth planning because neighborhood stakeholders already would have thrown in their support.

That kind of front-loaded planning process had never happened to successful completion in Marin. The idea to develop a community consensus before entering the formal planning stage was aimed at forestalling the kind of community revolt that occurred in Novato, where neighbors said that they had never realized the full consequences of a proposal for a new Whole Foods. Neighbors in Mill Valley that had a similar shock when they realized that the town was embarking on a major renovation of Miller Avenue. Despite numerous public meetings in both towns, residents said that they had been unaware of planning strategies, details and consequences.

The irony is that Adams played a key role in creating the front-loaded community consensus strategy in Marinwood, where she lives near Marinwood Plaza. A local task force formed, the Marinwood Village Collaborative. Early on it included numerous individuals from the neighborhood, organizations and county government representatives. The collaborative, Hoytt and the county worked and reworked redevelopment proposals. In 2006, county supervisors endorsed a proposal for a grocery store, ancillary retail, a community plaza and a redesign of Marinwood Avenue. The conceptual plan also included a housing component. The county identified the area as suitable for new housing and contemplated a target of making up to half of the units built qualify as affordable. The idea is that Marinwood is particularly appropriate for affordable units because it’s near the freeway and public transportation, and a revamped plaza would put the housing units near shopping.

The concept called for building up to 100 housing units. The Bridge proposal represents a considerable reduction. Even so, calls to reduce the number of units on the site continued. Eventually, Bridge settled on the 82-unit figure. The corporation was the only entity that brought a practical development plan to the county.

The argument that the affordable units—and the property tax waivers they could bring—would harm the Dixie School District added to the emotional paroxysm that slow-growth/no-growth advocates were espousing, especially those who looked with a particularly unfavorable eye at what they call high-density development.

The Marin Economic Forum study, among other criteria, is an attempt to look at the numbers to determine their effect—without emotion—on local schools.

The Marinwood neighborhood is an above-average socio-economic area. The median income is $130,000 a year—well above the county average. To maintain school funding at current per-pupil levels after the Bridge project, homeowners might have to contribute more property tax to their local schools. Opponents call that an unfair burden. Proponents of adding affordable housing say it might be a burden, but it’s the socially responsible thing to do to move toward a more diverse community. And that’s what lights the emotional match.

If the Dixie School District remains a basic aid district and must rely in large part on local taxes to fund its schools, how much would local homeowners have to contribute on an annual basis to maintain stable funding with the added pupils? As so many things concerning school finances, much is uncertain, a fact the Marin Economic Forum study acknowledges. But if, for estimate’s sake, the district receives no additional funds from the state, the cost for those additional students could be borne by the 2,351 households in Marinwood (again for estimate’s sake) to maintain stable per-pupil funding. (Marinwood has 84.2 percent owner-occupied housing. For estimation, it’s safe to assume that property owners would increase rents to cover increased property taxes.)

According to the Marin Economic Forum study, “If the new housing units increase school enrollments without commensurate increases in revenues, given current projections of land improvements and property taxes that would come from such enrollments, there is an implicit loss of $251 per student per year.” That would hold true for 45 added students. That means the $251 per-pupil per year would have to be apportioned out among 2,351 households (for estimate’s sake), if the goal is to keep per-pupil funding stable. The 45 pupils would add $11,295 a year to school costs. Divided by the (estimated) number of households, each household would be responsible for funding approximately an extra $5 a year to recoup the implicit loss estimated in the Marin Economic Forum study.

If 100 students enter Dixie schools, the study states, “The reduction would be $559 per pupil.” That could mean an annual added tax per household of $24, if neighbors wanted to maintain stable per-pupil funding.

Projections can be tricky things, but the calculations lay out the ballpark in which Dixie Schools would play if the Bridge project added students—and if property owners in the district agreed that funding their local schools to educate the kids in the development is a worthy endeavor.

The Dixie School District might not be totally reliant on local taxes to fund the added pupils. It depends on state school funding mechanisms, an always hard-to-estimate variable. But as the Marin Economic Forum study states, “If property taxes grow more quickly than expected, Dixie schools may be basic aid schools and not receive state funding.” On the other hand, the study continues, “If the increase in new students is large enough, Dixie may continue to be state-funded due to enrollment growth outpacing local revenue growth.”

After meeting a rather harsh unveiling, the Marin Economic Forum study is due for a peer review to corroborate its numbers and estimates and assumptions.

The Bridge proposal currently is on hold as the corporation negotiates what could be a larger property purchase than the original 3.5 acres included in the residential proposal.

That altered element, in addition to the fallout from the November election, which followed vociferous objections and political action from opponents, are signs that attitudes are hardening in Marin. The Marin Economic Forum study is a chance to digest the numbers and give Marin residents the opportunity to determine whether they want to welcome or reject a development like the Bridge proposal.

“No study or data exists to make a precise estimate of the number of students Dixie Schools will receive from the new units,” the study concludes, “or the type of households that will be formed. This study provides ways to frame the future discourse in a way that focuses on the major variables involved rather than classic arguments seen in Marin County that are neighborhood-specific. The academic literature suggests that framing the question around economic and social variables of interest and not the opinions of neighbors helps make better decisions and plan for shaping public resources.”

It also opens the possibility for rational compromise.

Contact the writer at peter@pseidman.com.

 

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