School Finance Conference Creative Local Funding Options Parcel Taxes and Local Educational Foundations Ian Padilla

What Is A Parcel Tax? Allows school districts to assess a tax on local residents and requires a two-thirds vote for approval. Typically used to fund costs associated with specified educational programs and activities that state and federal funding do not fully cover.

What Can Parcel Tax Funds Be Used For? The law does not limit what Parcel Tax funds can be used for – this is determined by the local school board.

What Can Parcel Tax Funds Be Used For? Examples of what some school district Parcel Tax funds have been used for include academic enrichment programs, recruiting and retaining high staff (i.e. teacher salaries), educational materials, computer and technology equipment, and facility improvements.

How Long Does It Take To Call An Election? A Parcel Tax election should be called at least 90 days before the election to address legal requirements. More time should be allowed for planning, surveying public opinion and building coalitions.

How Is The Rate Of A Parcel Tax Set? The law does not establish a maximum tax rate – this is determined by local school boards. The only exemption allowed is for taxpayers over the age of 65.

Is There A Restriction On The Length Of A Term For A Parcel Tax? The law does not specify the length of a term for a school district Parcel Tax. Typically parcel taxes have been approved for four years, but terms lasting 5, 7 or more years are increasingly common. With a longer term inflation can be expected to erode the spending value of the tax over time, some districts include an inflation escalator in the tax formula.

How Many School Districts Have Attempted To Pass Parcel Taxes? 210 school districts have attempted to pass a parcel tax through 2006, but some districts have passed multiple levies. Since 1983, 51% have passed, 40% have failed but had a majority, and 9% failed. A disproportionate number of Parcel Tax elections have occurred in the San Francisco Bay Area. Tend to occur in more affluent communities.

What is a Local Education Foundation (LEF)? LEFs are non-profit charitable organizations designed to establish a partnership between local schools and local communities. LEFs are “outside” of the school system and have their own board of directors and staff. Community partners typically include school board members, business leaders, superintendents, parents and concerned citizens.

What Can LEF Funds Be Used For? Just about anything. LEFs typically fund scholarships, curricular enrichment programs, teacher training, teacher resources, staff positions, and parent involvement programs. More effective as public relations tools than as revenue-generating mechanisms.

How Many LEFs Are There And How Much Do They Raise? There are about 4,800 LEFs in the United States The majority of them are in California. In 2005, California LEFs raised $100 million.