Phil Serna isn’t sticking up for Natomas schools in a development showdown | Opinion
A proposed 25,000-resident housing development within the Natomas Unified School District may leave district property owners paying for most of the costs of the new schools that will be needed in the future to serve all those new people. You would think that the Sacramento County Board of Supervisors would insist that the developers agree now to pay more before they consider the project.
But sticking up for the Natomas students, parents and teachers does not appear to be the priority of the area supervisor, Phil Serna. Despite a lack of iron-clad financial commitments to protect the school district, Serna’s staff says he has scheduled a vote August 20 on this project, known as the Upper Westside Specific Plan. It is east of Garden Highway and bordered by Interstate 80 to the south, and it bisects El Centro Road.
“If this comes in, the other surrounding schools will start bursting at its seams,” said the local Sacramento councilmember, Lisa Kaplan. And she of all people should know. By day she is an attorney working on school financing challenges throughout California and a former Natomas Unified board member.
Financing new schools is a growing problem throughout California. The traditional formula of the state and local sources roughly splitting the costs has completely collapsed as state funds cover less and less while construction costs have skyrocketed.
Locally, the result can be a political tug-of-war between the project’s developers and the school districts. What’s now amplifying problems in Natomas is that there is no approved agreement for the developers to contribute any more than the bare minimum in required fees, which is estimated to be a modest fraction of the overall cost.
“The developers have an interest in keeping them (fees) down,” said David Gordon, superintendent of the Sacramento County Office of Education “The cost of new construction of schools has just gone through the roof.”
Natomas Unified Superintendent Robyn Castillo did not respond to The Bee, but her staff did provide its public records detailing the financial challenges the district would face if the Upper Westside project were approved, In short, the district believes that the developers of Upper Westside and the county are dramatically underestimating the potential costs of building four new schools needed for this development. In addition, the district says it doesn’t have the borrowing capacity to pay for the new schools if it is left to shoulder all those costs.
Upper Westside would be horrible for other reasons, particularly how most of these homes will be within a mile of the Sacramento River, in defiance of a pledge by the city of Sacramento to never grow there. Bordered on three sides by the city of Sacramento, Upper Westside is a project that county supervisors should never have considered. They should be honoring a 2002 agreement to let the city be the lead on all growth matters in Natomas.
Natomas Unified to Serna: The county’s numbers are wrong
The school district, comparing the county’s school cost estimates with its own, concludes that these schools could cost the district a lot more than the county’s numbers suggest. Upper Westside developers by one estimate would pay $69 million in fees, while the county estimated the total costs for school construction at $573 million. So by the county’s math, Natomas Unified calculates there would be $429 million in future school costs that wouldn’t be covered by developers or the state. To put that amount of money in perspective, a 2018 Natomas school bond approved by voters will collect only $172 million.
Castillo countered that actual gap in funding could be as high as $750 million, exceeding the district’s ability to borrow.
Natomas Unified cannot unilaterally increase the fee for Upper Westside developers because state legislation sets the limit. But developers can voluntarily enter into additional “school mitigation” agreements to pay more. By Kaplan’s rough estimate, Natomas Unified needs hundreds of millions more money from this project for all the schools to have any chance of being built.
Castillo’s presentation squarely asked Serna to support these additional school mitigation fees and that they be large enough to “fully mitigate all impacts on the demand for school facilities.” Yet as of now, Natomas Unified said there is no firm agreement with the school district for the project to commit more toward the needed schools.
Asked why these agreements don’t yet exist, county spokesman Kenneth Casparis said: “At this time, we don’t have information to share as coordination efforts are still ongoing.” Serna has declined to answer numerous questions about this project posed by the Bee, including the matter of school finance.
The district’s last leverage moment. Where’s Serna?
The way this game is played, a savvy developer wants a project that eventually includes the needed schools while paying as little as possible to get them. Meanwhile, the school district wants as much money from a project to minimize the bill for property owners via bonds.
This is the kind of important financial matter for Upper Westside and the school district to settle long before Serna as board chairman deems this project ready to go to fellow supervisors for consideration. “We have to make sure the district is protected,” said Kaplan.
The bottom Upper Westside project is half-baked. The silver lining is that enough is known about this project for supervisors, if it gets to them on August 20, to reject it.
More to come. It gets even worse.