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Time To Allow Tax Increment Financing To Help Oakland School District Keep Schools Open

The Oakland City Council raised the flag of alarm:

“On January 31st, 2022, the Oakland Unified School District (OUSD) revealed its plan to either close or merge 16 of the district’s 80 schools. The proposed closures have sent shockwaves throughout the community, galvanizing students, teachers, and families to oppose the proposed closures. School closures can have and have had a detrimental effect on communities of color across the city, and specifically on Black communities. OUSD has a history of disproportionately impacting majority Black schools for closure, closing 16 majority Black schools in two decades. Unfortunately, the list of schools slated for closures currently is no exception – with all eight schools proposed for closure being majority Black schools.

Keep Oakland Grass Valley School Open

The COVID-19 pandemic has had profound impacts on our school system, disrupting students’ lives and ability to learn, creating difficult and stressful environments for Oakland teachers, students, and families, and intensifying existing issues around equity within our schools. However, due to the enduring strain of partially-paid state loans, the district is proposing school closures as a means to balance their budget during this already turbulent time. Yet, research shows that cost savings from school closures are generally limited, particularly in the short term, and the task of putting closed buildings to productive use is extremely difficult.

In addition to eliminating OUSD’s debt, more must be done structurally to address how we fund public schools in California. Currently, the State’s Local Control Funding Formula (LCFF) allocates funding to school districts based on their average daily attendance—the average number of students in class each day throughout the school year. However, the ongoing effects of the pandemic—such as student and staff quarantines, challenges implementing remote learning, impacts of months of lost or insufficient instructional time, and stress and trauma from the pandemic and social isolation—continue to affect school attendance levels. According to a survey by the California Collaborative for Education Excellence, 90% of school districts experienced declines in attendance in 2020-21, and districts also reported spikes in increased chronic absenteeism.”

Then, Oakland Councilmembers Council President Pro Tempore Sheng Thao, Oakland Vice Mayor Rebecca Kaplan, and Council President Nikki Fortunato Bas called for California Governor Gavin Newsom to “amend the state budget to protect our hardest hit communities by preventing school closures and eliminating debt, amend state law and revise the Average Daily Attendance formula to remove penalizing schools when students are sick, and direct the City Administrator to send a copy of the Resolution to Governor Newsom, Senator Nancy Skinner, Assemblymembers Mia Bonta and Buffy Wicks, and Oakland’s lobbyist.”

What’s Wrong With That Approach

But that request takes time and to date, Governor Newsom has not even issued a tweet in support of the Oakland elected officials’ idea. There is a change in state law that Oakland can pursue and that would allow the City of Oakland to help the Oakland Unified School District. The change would involve AB464 for Enhanced Infrastructure Financing Districts, and the idea this blogger’s presenting, is to change it to allow the inclusion of property taxes to the Oakland school district from a proposed enhanced industrial development financing zone to be used as part of the Infrastructure Financing Plan, only if plans for the use of the resultant tax increment financing include a program or programs to help keep schools open, add new facilities, and maintain the current ones.

Provided Oakland City Staff acts in a timely fashion to implement the new process, it would end the need to consider closing schools for the foreseeable future. Considering that the main problems the Oakland Unified School District faces are driven by the COVID-19 Pandemic, and California Legislation AB464 was written to help small businesses recover from it via use of tax increment financing, why not include the school district as well? Developing the human capital of our children must be a top priority focus, and this legislative change will prove that it is.

Moreover, allowing tax increment financing to be used to help school districts like the Oakland Unified School District, effectively ties future development to school fiscal fortunes: growth in TIF revenue can now help schools, something not allowed before, and for reasons that, on the whole, were completely ridiculous. Time for a change.

Stay tuned.

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