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State Funding Flexibility

San Mateo Superintendent Manages Gradual Cuts in District Where Private Sector Economy is Booming

By Jeff Hudson - June 23, 2011

(Part Two in a series)

In late May, the RAND Corporation released a preliminary report, “Deregulating School Aid in California - How Local Educators Allocate Flexible Tier 3 Categorical Funds: Findings from 10 School Districts in the First Implementation Year, 2009-2010.”

After examining the situation in ten school districts, the report concluded that California school districts – wielding new fiscal flexibility granted by state lawmakers – had cut deeply into several popular programs to balance local budgets, due to financial hardship brought on by the state budget crisis.

As a follow-up, EdBrief sought opinions and feedback to the RAND report from some high level administrators in California school districts. This week’s conversation is with Scott Laurence, who is Superintendent of the San Mateo Union High School District.

The San Mateo Union High School District serves central San Mateo County, just south of San Francisco, in the vicinity of San Francisco International Airport (one of the nation’s busiest). There are about 250,000 people living in the school district, and about 8,400 high school students, with an enrollment that is 23 percent Asian, 26 percent Hispanic/Latino, and 35 percent White, plus single digit percentages of other subgroups. Real estate values – both residential and commercial -- are high within the district, which is funded on a Basic Aid (rather than Revenue Limit) basis.

The school district includes Hillsborough (a small and very affluent community of about 10,000 residents, with median home prices over $3 million), but also low-income neighborhoods in San Mateo – some 19 percent of the district’s students participate in free- or reduced-price meal programs, and 12 percent of the district’s students are English Learners. Somewhere between 80 percent and 90 percent of the district’s high school graduates go on to college. Several big-name companies – Genentech, Oracle and YouTube to name only three – have their headquarters within the district’s boundaries, or nearby. And many of those tech- and biotech-related companies are growing and hiring new employees – unlike the school district itself, which (like all California districts) is dealing with reductions in funding from Sacramento.

“We are what you could consider a very interesting high-performing district, but with a lot of needs,” said Laurence. The rising local economy contrasts with the shrinking resources in the school district. “We work with many folks that are adding all sorts of things (at their company) and talking about profits. But we’re offering less services for our students. We’re reducing services while the companies around us are turning massive profits.”

This set of “interesting dynamics,” as Laurence politely puts it, has led to discussions with parents, a number of whom have sufficient income to consider putting their children in private schools, if the parents become too worried about the reductions in public school programs.

So Laurence has made the cuts strategically. “We did not do a five-day reduction in our school year,” Laurence said. That probably would not have gone down well with parents in the tech industry, especially those born in India or China (where the school year is longer than in this country).

But Laurence feels that on the whole, “the flexibility has been good.”  The district has reduced personnel in some areas, cut back a bit on GATE programs, and given staff fewer release periods and more stipends to work on projects.

“We’re trying as much as we can not to eliminate programs,” Laurence said. “We have used the flexibility to do things a little more scientifically, and gradually reduce things. We feel that property values and the state budget will come back eventually.”

The district has capped benefits for staff, Laurence said. “In the past, we had an automatic formula that we worked with for ten years, based on a percentage of property tax revenues. We were not able to continue with that formula, so we’re going back to a normal bargaining process” with groups representing employees.

Laurence said that in the relatively recent past, the San Mateo Union High School District had supported “one of the largest adult education programs” for a district of its size, serving as many as 14,000 adults. But budget cuts from the state have forced reductions – “we are down to about 10,000 students now” in adult ed programs.

The district is also proceeding with about $400 million in construction, at a time when many construction firms are hungry for work. “We’ve hit the market right, we’ve had a lot of capacity to build in a distressed construction market,” Laurence said. “But now, some of the contractors are going out of business, and we’ve seen fewer bids on some projects, since fewer contractors have been able to sustain themselves in this market.”

The district also moved ahead recently with solar energy arrays at several sites, which are expected to save the district’s general fund some $1.5 million annually. “That will be money we’re not paying to Pacific Gas and Electric,” the regional utility provider, Laurence said.
To read Part One in this series, a discussion with Associate Superintendent Brett McFadden of the Pajaro Valley Unified School District, click here.

To read the May 26 story in EdBrief about the RAND Corporation study, “Deregulating School Aid in California - How Local Educators Allocate Flexible Tier 3 Categorical Funds: Findings from 10 School Districts in the First Implementation Year, 2009-2010,” click the link below:
http://www.educationmediagroup.com/reports110526_135.php

To read the complete report, click on the link below:
http://www.rand.org/pubs/reprints/RP1426.html

Editor's Note:  Jeff Hudson is the editor of EdBrief and an award-winning education reporter and writer in print, radio and television media.