San Francisco November 2016

San Francisco
November 2016

Ballot analysis and recommendations

Overview chevron_right Prop B
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Prop B

City College Parcel Tax

City College Parcel Tax

Raises the current parcel tax dedicated for City College from $79 per parcel to $99 per parcel and extends it for 15 years.

Vote YES

What the Measure Would Do

Proposition B would authorize a parcel tax in San Francisco of $99 per property annually for 15 years to provide funding for the City College of San Francisco. This measure would effectively extend and raise by $20 the current tax of $79 per parcel, passed by the voters as Prop. A in 2012 and set to expire in 2020. Prop. B would generate $3 million to $4 million of annual revenue in addition to the $14 million generated by the current parcel tax each year.

The parcel tax proceeds would be used to support the college’s general operating expenses. Proposed expenditures include maintaining math and science programs and student services like school libraries and counselors. Part of the funding would increase faculty salaries, which are below 2007 levels.

An existing citizens’ oversight committee, created by Prop. A in 2012, would monitor expenditures.

The Backstory

Founded in 1935, City College of San Francisco is the largest public community college system in California. For many years, City College has served as one of the primary partners delivering workforce-development programs in San Francisco, including coursework for nurses and technical professionals and programs for those pursuing careers in culinary arts and hospitality. City College also offers one of the largest English as a second language (ESL) programs in the city.

City College has faced serious challenges in recent years. Like community colleges throughout California, it was hit hard by the Great Recession. From 2007 to 2012, the college lost a total of $57 million (17 percent) of its state funding allocation. In 2012, a team of state auditors criticized City College for fiscal mismanagement; the college faced a projected budget deficit of $25 million and possible bankruptcy.

City College has also confronted a possible loss of accreditation. In 2012, the Accrediting Commission for Community and Junior Colleges (ACCJC) of the Western Association of Schools and Colleges issued a “show cause” rating, which gave the college a year to address deficiencies or face a loss of accreditation and almost certain school closure.1 Though City College has remained accredited, the school’s uncertain status did serious damage to student enrollment. Since 2012, City College has lost 35 percent of its student body,2 compounding its financial stresses.

In 2012, San Francisco voters approved Prop. A, which levied a $79-per-parcel tax for City College for eight years, generating about $15 million annually. Also in 2012, California voters approved Prop. 30, a bundle of sales and income tax increases that accounts for $25 million of City College’s $200 million budget this year. In 2014, Governor Brown approved a bill to stabilize state funding to City College for three years, and this June Governor Brown approved another bill (AB 1602) that will remove a cap on the amount of state funding City College earns for growing its enrollment. However, this stabilization funding will dry up next year, and revenue from Prop. 30 will disappear unless extended by California voters this November. The city parcel tax will expire in 2020, and AB 1602 will expire after fiscal year 2022–23.

Revenue from these city and state tax measures has helped to stabilize City College since 2012, while a new administration has made significant progress on financial reforms and accreditation within the college. The school has been steadily reducing its class offerings in order to balance its budget, with a planned 26 percent reduction in classes over six years. An assessment by the Fiscal Crisis and Management Assistance Team earlier this year showed that City College has implemented effective fiscal reforms, and the school’s accreditation level has been elevated to “restoration status,” meaning that the college now has two years to demonstrate that it fully meets all ACCJC standards.3 This fall the ACCJC will send a visiting team to re-evaluate City College’s progress for continued accreditation.

City College has also developed a plan to boost enrollment by 10 percent annually over five years through outreach campaigns and new partnerships with high schools. In July, the Board of Supervisors passed a resolution of intent to make City College tuition-free for San Francisco residents and city employees, with funding contingent on voter approval of another measure on the ballot this November: Proposition W, a new real estate transfer tax.

This measure was placed on the ballot by the San Francisco Community College Board of Trustees by unanimous vote and must be on the ballot because it is a funding measure. City College is an independent taxing jurisdiction, separate from the City and County of San Francisco. State law (Prop. 13) requires that parcel taxes receive two-thirds of voter support to pass.

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Pros

  • City College serves a critical role in providing affordable education and job training for San Franciscans. It helps promote economic mobility through skill training like ESL and technical courses, and its affordably priced college credit allows students to earn associate degrees as well as transfer to and graduate from four-year colleges. City College programs in particular benefit lower-income households and students who are the first in their family to go to college. The additional resources from this parcel tax would help stabilize the college and restore key classes and services.

  • Supporting City College contributes to the health of the local and regional economy. The community college structure allows the institution to design courses and curricula in partnership with industry, so students are more likely to learn relevant skills and secure jobs upon graduation.

  • The funds generated by Prop. B could not be taken away by the state and would better equip City College to weather the coming loss of several state funding sources.

Cons

  • The size of this revenue measure is not sufficient to address the scale of City College’s needs. With the expiration of state sources far outstripping the amount of additional revenue generated by this local parcel tax extension, it is unclear that the voters or those served by City College would see any added value from this tax measure.

  • With the current parcel tax not set to expire until 2020, City College might have waited longer and put forward a more beneficial measure based on a more developed financial plan. This measure could represent a missed opportunity.

SPUR’S Recommendation

City College is a tremendous asset to San Francisco. The college provides affordable degrees, life skills and career and technical education opportunities to 60,000 students per year. It is a key part of the city’s workforce-training network and is a major resource for economic mobility for low- and middleincome families in the Bay Area.

This measure, if passed, wouldn’t solve City College’s financial challenges. But it would help maintain core classes and support students while the college continues to work toward stabilizing itself in a new operating environment. There are reasons for optimism: The college has passed a critical hurdle in reforming its finances, is set to solidify its accreditation status in the coming year and has new leadership that’s developing a viable vision for the future. Putting this measure to the voters now could allow City College to focus on its enrollment goals while giving faculty and staff a long overdue raise.

Though City College is in a stronger position now, it must continue to prove to students and the public that it is on the path to long-term stability. Prop. B presents an important opportunity to pledge local dollars to City College at a critical time and support the vital role the college plays by offering affordable pathways to economic mobility for all San Franciscans.

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