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Malibu’s latest proposal to split from the Santa Monica-Malibu Unified School District was the focus of a recent meeting involving financial experts on both sides.
The May 13 get together, Christine Wood, assistant city attorney, told the Malibu City Council on Monday, “wasn’t really an attempt to negotiate.”
“But seeing that it felt like we were talking past each other with some of our negotiations and some of our public comments, this was an opportunity, with no attorneys or staff present, for the financial consultants to get together and talk.”
Officials stressed that Santa Monica's position was not up for discussion. Rather, this was a chance to let district officials know Malibu’s intent.
Spreadsheets were used to show how funds would be allocated between the future two districts, Cathy Dominico of Capital Finance Group, one of Malibu’s consultants, told the council.
The basis for the proposal, she said, is splitting property taxes based on geography and ensuring the state was made whole in the event it had to give a little more to the new Santa Monica District.
“The third layer,” said Dominico, “is that we would make Santa Monica USD whole in the event one of their other local funding sources drops below current funding levels.”
While a split is still way down the road — if it happens at all — one thing became clear in the meeting, said Dominico.
“We did agree that the way that the school district was actually interpreting our proposal was not what the city had intended.”
Santa Monica’s expert, for example, interpreted property taxes would be split based on the percentage of assessed value within each territory.
That was contrary to what the city proposed, splitting it by geography, with the tax rate areas serving each future district being the ones that contributed property taxes to that district.
Because of this, district officials made some public comments about the Malibu proposal “that raised a lot of concerns on their part with some pretty large numbers.”
In their appeal to the public against separation, SMMUSD officials have said Malibu’s petition for unification “will create irreparable damage to children in Santa Monica and Malibu” and force both communities off a “fiscal cliff.”
But a misinterpretation on the property tax split, added Dominico, resulted in “a significant discrepancy in the funding.”
“We agreed that we were not projecting things in the same way,” she said. “But there was a significant disagreement as to, number one, whether property taxes could even be allocated the way the city was proposing. The school district’s consultant does not feel that it can be.”
The county committee hearing the matter has hired a consultant to provide a feasibility study on a Malibu school district completely independent of the proposals from the city or the district.
That assessment could help guide the committee’s next move.
Council member Karen Farrer said a third-party arbitrator is what Malibu has pushed for — over district objections.
“It’s not (the consultant’s) job to help us come to an agreement,” said Wood, adding there’s a statutory process for erecting a school district.
“It’s their job just to make sure we’re following the rules and meeting the feasibility standards.”