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February 14, 2008

The Mini Storage Kids

MINI STORAGE KIDS.jpg
Image: Chico Unified School District wants to charge mini-storage development fees to account for the impact they will have on the school district's enrollment.

Chico Unified School District comes to some interesting conclusions in its version of a Nexus study (see study here). The study lays out a case for increasing fees on new home buyers (development impact fees) to pay for the impact of growth on schools. The assumption is that new homes = new students. The school district wants to increase its building fee to $2.97 square foot of residential development (they currently charge $2.63 square foot), They also want to add $0.47 square foot for commercial/industrial development, and $0.16 square foot for mini-storage development. Neither of which currently exist.

Here is a portion of what the school district published as its 10-18-07 budget message.

"For a number of reasons including declining enrollment, increases in employee costs and incorrect income projections, Chico Unified School District has a $400,000 deficit this school year. Not correcting the problem now will mean we will be $2.5 million in the red next year. If we can't find solutions, the State of California will appoint people to come into our district, cut programs and staff, and bring our budget into balance. The bottom line is that we are spending more than we are making each year."


Chico has experienced 4.2% growth on average since 2000. New development was responsible for about half of that. During that time enrollment seems to have dropped.

Here is a discussion of the results of that growth from an August 2005 Chris Gullick ER article ...

It would have been easier if the decline in enrollment in elementary schools had all taken place in one school, Rees continued, but the district was down an enrollment equal to of 11/2 -2 schools spread throughout the district. Keeping that many schools operating was a waste of money

" We've gotten rid of an entire school's operating costs," Meeker explained.

Estimated savings from closing Jay Partridge, $407,394, will still be realized even though the campus became Fair View High School.

The costs of Jay Partridge support staff and operating costs of the building Fair View vacated total about the same as the previous estimated savings.

Closing Nord was estimated to cut $164,707 from the budget, but that savings will be offset by a loss of state funding because the district will lose about 50 students to a new charter school created by the Nord community and approved by the board of trustees.

Let's also not forget the high school bond that was never applied to its purpose because of reduction in enrollment. Student enrollment doesn't seem to be following population growth. Yet the district's study is specifically saying that it will.

The City of Chico built 4952 new units from 2000-2007. That is an average of 619 units per year. This results in a 20.2 year build out of the 12,500 proposed to effect the CUSD system. Current density of construction is 5.5 units per acre, making 2272 acres of developable land necessary to meet the build out requirements the school district identifies. Ummmm, I don't think that's out there.
Summary: Development impact fees are applied to offset impact growth will have on a community. They don't exist simply to raise money. Raising fees and costs on new development makes the homes less affordable to young families. If those young families were buying homes and flooding our schools the impact fee would seem justified. It seems to me like an argument could be made that high home prices have resulted in lower enrollment at Chico's schools. Comparing enrollment concerns to historic population growth seems to reinforce that assumption.

I'm currently a homeowner and have a child at public school. These impact fees will push up my home value and benefit my family. And it won't cost me a dime.

But it seems to me that in the study Chico Unified is identifying population growth as a factor in increased enrollment, and in other public comments claiming reduced enrollment (that occured during population growth) is a significant portion of their budget problem. Which is it? Impact fees that run up home prices need to be justified and not gamed to help pay expanding employee costs.

Adding the new fee to commercial/industrial construction is probably not going to increase the number of businesses willing to move here. And we've all heard that economic development will solve our budget woes.

The one thing they might have spot on is that young families may be looking at mini-storage as the most affordable housing opportunity in Chico's future. They might consider placing some bus stops nearby.
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CI Challenge: Can you guess what it is? Winner: Mark Sorensen, the Love Machine. See comments below for the answer.

Posted by Lon at February 14, 2008 08:01 AM

Comments

CIC: I'll go with St Christopher.

Posted by: Mark Sorensen at February 14, 2008 09:01 AM

Mark,

This challenge is not really related to the post, but instead to something else that most people are aware of today.

Here's the wikipedia blurb on Saint Christopher from a Roman Catholic perspective...

Christopher was a Roman of imposing stature and physical strength, originally named Reprobus. According to legend, Reprobus—referred to as a giant by those who knew him—converted to Christianity and vowed to serve Jesus Christ. Other sources say his name was Offero, and that he was born in Canaan.[2] He sought out a Christian hermit to inquire as to how he could better serve Jesus. He directed him to a path with a dangerous crossing point at a swift river, and suggested that the man's great size and strength made him a good candidate to assist people in crossing the river. So, Reprobus began his new work, ferrying people across the river on his back.

One day, a small child approached the river and asked to be carried across. Reprobus began to comply, only to discover that the small boy was far heavier than any other passenger he had taken. When they finally reached the other side safely, Reprobus asked the boy about his identity and his weight; the child revealed that he was in fact Jesus Christ, and that his unusual weight was due to the fact that he bore the sins of the world. The boy (Jesus) then baptized Reprobus in the river, and he acquired his new name, Christopher, which is Greek for "Christ-carrier" (from Christos, "Christ", and pherein, meaning "to bear").[2]

The child then told Christopher to plant his staff in the ground. The staff miraculously bloomed into a fruit-bearing tree. This miracle converted many.

Enraged at these conversions, a local king (or by some accounts, the emperor Decius) had Christopher imprisoned, where, after cruel tortures, he was beheaded as a martyr.

History/religous study is always interesting.

Lon

Posted by: Lon at February 14, 2008 09:08 AM

Perhaps that would be St. Valentine?

Mark and I try hard to ignore the whole thing - except for the kids. We make it special for them.

Posted by: Tina at February 14, 2008 09:18 AM


New construction should pay to create needed public facilities…. However….

I am having a wee bit of difficulty understanding how a mini storage causes school enrolment to grow. I thought that kids lived in homes, not mini storage facilities.

Similarly, their usage of San Diego County statistics of commercial/office space utilization does not quite apply to Chico.

All, while we’re in one heck of downturn in the construction industry… Now is a dandy time to put a little economic salt in the wound.

As you point out, isn’t it fascinating how fee nexus includes many of the very same things that we were told that the facilities Bond would cover? Plus, you should look at what it costs to build 1 square foot of school facilities… Yikes… you’d croak. Which is probably why they do not specifically mention those numbers in the study – they are literally “unbelievable”.

I think that the root issue is that state law allows them to collect a maximum of $2.97/sq ft of residential and $0.47/sq ft of commercial in this area… therefore they will.

It is merely a matter of paying someone to write a justification for the fee. In this case it was these folks:
http://www.gfsi.com/

Posted by: Mark Sorensen at February 14, 2008 10:02 AM

Tina,

I woke this morning to a giant helium balloon that said "Be My Valentine" and was attached to a bag of chocolates. I was so excited... then noticed it was for my son.

There was a smaller balloon attached to a soap bubble blowing set, and I thought "well, not as good, but beggers can't be choosers". Turns out that was for my son to play with my daughter.

I was expecting a heart shaped pendant from Kay jewelers, but I guess I'll have to cry myself to sleep tonight.

The CIC is pretty obscure. I think he would be related to the Church of England, but is better known as an author or poet, and played a part in how Valentine's Day is currently celebrated. But he's not a Saint.

Lon

Posted by: Lon at February 14, 2008 10:40 AM

Mark,

It's funny how government institutions find ways to attach fees and taxes to virtually anything. No matter what industry is taxed the cost will always filter down to the consumer. In this case you're right that the report is just a means to an end. They need to justify an increased fee, and the creation of new fees, because they spend too much money.

I'm just curious how the falling enrollment that is often cited dovetails with the descriptions of increased enrollment used to take more money from private property owners/buyers.

Is Chico's enrollment still declining (apparently it was 4 months ago)? What is the root cause of declining enrollment?

Lon

Posted by: Lon at February 14, 2008 10:49 AM

Marissa's gone to Florida to enjoy Disneyworld and a biz convention without me... so i'm stuck here on Valentines day without my valentine.

I always hated this day anyway. But that was back in high school and post-high school....

now it's just another day that I have to spend money on to keep my other half from beating me senseless with my louisville slugger that I keep under the bed.

Posted by: TrevHastings at February 14, 2008 11:02 AM

Posted by: Mark Sorensen at February 14, 2008 11:03 AM

What is the root cause of declining enrollment?

Economics.

How can young families afford to live here? Where would they work where they could afford our housing costs?

Remember how Chico received dubious national attention for having remarkably UN-affordable housing? There are forces at work here that create the situation.
There is relationship between not only the cost of a home, but is relative to the jobs and incomes available to home buyers... Quality of life begins with a good job and a good place to live.
Chico and Butte County are near the bottom rung in the State’s economy in terms of average income per household and housing affordability.
We’ve talked before about our severe lack of good paying private sector jobs. Government jobs is the 2nd largest area of job growth in Butte County.
Statewide… it’s a problem. Temporary economic downturn aside, state population is expected to grow by around 600,000 per year. We try to keep people from coming here (restrain growth, which ALWAYS makes it more expensive) and then at the same time wonder why housing is un-affordable… young families are among the first to be pushed away.

http://www.independent.org/publications/article.asp?id=1746

http://www.capmag.com/article.asp?ID=4775


Posted by: Mark Sorensen at February 14, 2008 11:34 AM

Mark,

Yes it is Chaucer. From wikipedia...

The day became associated with romantic love in the circle of Geoffrey Chaucer in High Middle Ages, when the tradition of courtly love flourished.

Chaucer is also credited with the first literary reference to Valentine's Day as a day of love...

The first recorded association of Valentine's Day with romantic love is in Parlement of Foules (1382) by Geoffrey Chaucer:[5]

For this was on seynt Volantynys day
Whan euery bryd comyth there to chese [choose] his make [mate].


This poem was written to honor the first anniversary of the engagement of King Richard II of England to Anne of Bohemia[6]. A treaty providing for a marriage was signed on May 2, 1381.[7] (When they were married eight months later, he was 13 or 14. She was 14.)

Ahhh, young love... really young.

Lon


Posted by: Lon at February 14, 2008 02:55 PM

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