With such high real estate values, why is parcel tax funding necessary for our schools?
Although the average home price in Menlo Park is worth well over $1 million and many residents pay tens of thousands of dollars in annual property taxes, property tax revenue covers about 60% of the cost of educating MPCSD students, with the balance coming from parcel taxes and other federal, state and local funding.
Not all property tax paid to San Mateo County goes to MPCSD schools. The county pays 43% of the property tax dollars it collects to school districts within the county. There are 25 school districts that receive funds. Of the total property tax paid out from the county, MPCSD receives 1.4% of that money.
A very small portion of our property taxes goes to fund MPCSD. In Menlo Park, the school district receives only 18.6 cents of every dollar paid in property taxes (2016-17). To illustrate, the homeowner of a $2.5 million home writes a $25,000+ check each year to the county, but only about $4,650 of that reaches MPCSD schools. It would take an assessed value of approximately $8,000,000 to generate enough property taxes to cover the expenses for just 1 MPCSD student.
Prop 13 significantly reduces potential property tax revenues. Due to Prop 13, the property tax base lags far behind recent home valuations. The average sale price of homes in Menlo Park is approximately $2.4 million. However, according to San Mateo County data, the average assessed parcel value within MPCSD’s boundaries is only about $1.7 million. The reason is that 60% of single-family homes within MPCSD’s boundaries have not been reassessed in over ten years, including 35% of all single-family homes that have not been reassessed in over 20 years, and the annual appreciation for these homes has been capped at 2% per year or less.
Parcel taxes are needed to fill the funding gap... As a result of both the relatively small portion of property tax proceeds allocated to the district and the artificially low tax base due to Prop 13, property taxes generated about $9,025 in funding per student last school year. MPCSD’s average spending per student exceeded $14,225, a difference of about $5,200. Other federal, state and local sources (excluding parcel taxes) generated about $3,330 in funding per student, but that still leaves a gap that can only be filled with parcel taxes.
...Even though we spend less per pupil than comparably performing districts. It is important to dispel the mistaken notion that MPCSD is using parcel taxes to deliver a “gold-plated” education or that the district is trying to match the per-pupil spend of neighboring districts. In actuality, MPCSD spends less -- and in some cases, far less -- per student than comparably performing districts. The table below illustrates how much each district receives and how much each spends on average across all students in the district.
Per Pupil Funding comparison for 2014-15 (revenue)
Per Pupil Spending comparison for 2014-15 (expense)
For additional context, Menlo Park -- with its concentration of high incomes and relative wealth -- spends only ~20% more than the US nationwide average ($11,841 in 2013), and it spends far less than the average across the entire state of New York ($19,818 in 2013). We believe that we are extremely efficient in our use of taxpayer dollars and that we deliver far more value per dollar spent than our peers in similar communities.