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A Response to Brian Carver by EUSD Board Member John Affeldt
Brian, thank you for your thoughtful consideration of the CAB issue. I have admired your dedication to improving the Emeryville community over the years, and I appreciate the opportunity to respond here to a number of the points you raise.
A Reasonable Growth Estimate
First, you criticize the School District’s assumption that the overall assessed value (AV) of property in Emeryville will increase by an average of 4% annually over the next 32 years. This assumption is hardly an “absolute fiction” propelled by “blind faith.” It is reasonable, indeed, conservative. For starters, your analysis seems to leave out the impact of underlying inflation on the cost of housing. If inflation runs at 2%-3% and housing is able to keep up with inflation, then a 4% annual increase is just keeping its head above the level of underlying inflation.
Next, your argument incorrectly assumes that all of the growth in the assessed value of property derives from rising market values. In fact, a significant piece of AV growth comes from the fact that every time a home or commercial property is sold it is re-assessed at current market rates. In addition, every time a new building is built or renovated, the value is added to the tax rolls at a substantial increase. Thus, even though our home values may be close to where they were a decade ago, during the last ten years Emeryville still experienced an annual average 5.4% increase in assessed value.
In fact, over the last 30 years, going back to 1982, assessed property values in Emeryville have grown on average every year at a 7.49% rate. As such, the modest 4% estimate is a much better gauge of likely growth than simply looking at a snapshot of housing values alone and limiting that snapshot to the last decade during which we experienced the single biggest housing bust and economic downturn since the Great Depression.
Of course, no one has a crystal ball, but current economic projections of which I’m aware point to a return to normalcy, not another economic cataclysm. Yet even if there is another big downturn or three during the next thirty years, the data from the last thirty—in which there were seven downward dips including four years with negative growth and a Great Recession—amply supports the conclusion that we can experience such dire events and still end up at or above an average annual 4% AV growth rate.
A Sound, Long-Lasting Facility
Secondly, contrary to your suggestions, the new facility will endure longer than the 32 year, 6 month debt owed on the Series D bonds. In fact, it is designed to withstand a major earth quake and still be safe for use as an emergency shelter for the community. By comparison, the high school was built to much less rigorous standards in 1964 and lasted 48 years; similarly, Anna Yates dates back to the 1950’s or earlier.
Investing in Education and Our Community
You compare bond financing to financing a car, the value of which depreciates over time, and take issue with the overall cost of the Measure J bonds. I respectfully disagree with your comparison and your conclusion. When you finance your car, it is a private act that has no ripple effect on your neighbors—on the quality of their or their children’s lives, on the quality of their community or on the value of their homes. Bonds, including the recently issued Series D CAB, do more than purchase a product which gets used up over time. They are investments in making possible the education of our youth, in improving the quality of our schools going forward, in strengthening the bonds of our community and, yes, even in increasing the future value of our homes.
Ensuring Basic Educational Opportunities
Bond funds serve to build the buildings that house our 700-800 students and staff and make possible the free public education that will last a lifetime. Yes, you could give graduates $50,000 each instead of investing in their educational facilities, as you whimsically suggest—but then there wouldn’t be anything to graduate from. Much better, I think, to invest those dollars in ensuring those students have a high quality educational experience. Indeed, the average high school graduate, without college experience, earns $290,000 more over a lifetime than a high school dropout, and contributes $100,000 more to federal, state, and local taxes. The figures only increase if the students are ready for a 2 or 4-year college as most of Emery’s recent graduates are.
Improving the Quality of Our Schools
Beyond just maintaining the educational experience for our students, however, the Measure J bonds will make it possible to significantly improve the quality of our schools. I understand you have a different point of view about the ECCL project and would prefer to maintain separate locations for Anna Yates and the high school. You have raised reasonable concerns but, for my part, I believe that the risks of program quality dilution for Anna Yates are not high, that the safety concerns can be (and are being) addressed, and that the potential rewards from a full service K-12 community school substantially outweigh the risks.
It is wrong to characterize Anna Yates as “shutting down.” The school and its quality staff, programs and practices will move. And the new site will be a seismically safer, state of the art, technologically updated facility that will enable staff to continue and improve program delivery. The high school, which needs serious quality improvements, stands to benefit even more from the integration of services and the upgrades that co-location and the City’s investments will engender. ECCL will enable us to establish a new school-based health center to deal with our students’ physical and mental health needs (when many California districts have abandoned even school nurses); to keep our librarian and expand the library (when many districts have shuttered their libraries); to upgrade our science and technology resources and spaces for art and music.
On top of these improvements, the ECCL project will create new community spaces for the Emeryville community to gather after hours and on weekends: a community center, playing fields, a public commons, a senior resource center, a public library with a café and an upgraded gym.
Investing Wisely & Within Our Means
Yes, we could simply build a cheaper replacement high school that will largely retain the status quo (though doing so for less than 300 students is hardly an efficient use of taxpayer dollars as it divides our resources and requires higher administrative and operating expenses). Instead, we are choosing to invest in a project that will enable staff to better serve our students now and will substantially increase the ability of our schools (and not just Anna Yates) to attract families and teachers going forward. At the same time, the Center will create new community spaces for all Emeryville’s citizens.
As we build this Center that could well become a national model which other cities and districts will look to, we’re doing so within our means. Even with Series D, which I see as a prudent and measured CAB and you see as irresponsible, the four Measure J bonds together will cost taxpayers much less than the bond program anticipated at the time of the Measure J campaign. When Measure J was approved by 73% of voters in 2010, it was anticipated that the bonds would issue at then prevailing interest rates of roughly 6% (like the Series A bond), have a maturity of as much as 40 years, and total up to $95 million in principal. Instead, the ECCL project is being built for less than $65..6 million in Measure J bonds, with a combined interest cost of 4.58%, and over a shorter period of time (the longest maturity is 32½ years). (See also the CAB FAQ on the EUSD website.)
I wouldn’t ask taxpayers to invest in anything I wouldn’t consider worthy myself. That means my family will pay approximately $240 per year in Measure J-generated taxes on our approximately $400,000 home. That’s a bargain in my mind for what our children and we as a community stand to gain—and it would be to me even at your doomsday scenario of $360 per year.
And if our schools do significantly improve as these bond investments portend, then the increased demand for Emeryville schools will have one other effect—our housing values will rise too. There are no guarantees in life but, to me, for a few hundred dollars a year this is a community vision worth investing in.
John Affeldt has a son in Kindergarten at Anna Yates and was appointed to the School Board in July 2012. For over twenty years he has worked on educational equity issues at Public Advocates in San Francisco where he has twice been recognized as an Attorney of the Year in California for his education work.