By KATHERINE PETERSEN
An unexpected shortfall in the Fremont Union High School District's property tax revenues could confound the already difficult task of completeing contract negotiations with the teachers' union, district officials say.
Property taxes comprise about 90 percent of the district's "unrestricted" revenue, by far the largest chunk of income the district receives. Unrestricted revenue is used to cover expenses such as salaries, supplies and utilities.
The property tax revenue the district anticipates receiving for the year ending June 30, 1997, falls about $800,000 short of projections.The district had counted on $33.3 million in property taxes, said Mike Raffetto, associate superintendent of business services for FUHSD.
Yet union president George Gredassoff has little sympathy for the district's financial problems. Teachers worked hard 10 years ago to pass Proposition 98, which diverted more state money into public education, he said. The measure directed $1.23 million to FUHSD last year.
Raffetto received the county's estimates Jan. 29, four months later than expected. The district made its offer of a 7.05 percent raise to the teachers' union based on projected growth in property tax revenue, not a decrease, Raffetto added.
The cut in property taxes comes on the heels of a $614,000 loss the district already faces. About $400,000 of that loss is due to a Santa Clara County Controller error; the remainder is due to refunds for property tax appeals.
"Not only is money being taken back, but the base we've used for multiyear planning is being driven down. This is a serious blow to all of our planning," Raffetto said.
The district has never taken such a hit from the county before, Raffetto said, adding that the take-back came four months after the school board passed its budget.
The district was discouraged by the lack of communication from the county, which it felt reflected a disregard for the importance of these dollars, Raffetto said.
The county admitted it was late and gave the district two years to repay the money, Raffetto said.
The district had planned to pay for its 7.05 percent offered salary increase with its reserves, which it expected to last for four years. "That would give us time to watch property tax revenues grow," Raffetto said.
According to Raffetto, every 1 percent increase in teachers' salaries costs the district $200,000 per year. Using the county's estimates, the district questions whether or not it can afford its offer on the table, let alonesatisfy the teachers request to be the highest-paid teaching staff in the state, he said.
"This is a serious problem that is going to require growth in taxes over the next few years," Raffetto said.
Gredassoff contends the district is too conservative and could use the money that teachers got for them to pay them more.
"We brought funding to this district through a teacher-backed proposition that guaranteed funding for average daily attendance at school sites and as an entire district," he said.
If the district can prove its projection is accurate, Gredassoff might become more sympathetic.
"In the past 10 years, [Raffetto] has not been right once. I would take a wait-and-see attitude. Our crystal ball is as good as his," he said.
Raffetto's cautious projections are partially based on his conservatism, Gredassoff said.
"He's a conservative, cautious business manager, and that's good. But we're always the ones holding the short end of the stick," he said.
In its proposed for a contract for the 1996-1997 year, the union had requested a 10.5 percent salary increase.
This article appeared in the Sunnyvale Sun, February 5, 1997.
©1997 Metro Publishing, Inc. All rights reserved.