July 11, 2010

County Grand Jury Recommends School District Consolidation. Expect Massive Migration to Palo Alto.

What puts a house in rather than out of the Real Bay Area (RBA)?  A damned good school district.  Now watch some meddlesome busybodies try and ruin everything!

Consolidate Santa Clara County school districts to save millions, grand jury recommends

 

By Sharon Noguchi

Posted: 07/04/2010 07:15:28 PM PDT
Updated: 07/04/2010 10:24:07 PM PDT

When budgets are tight, businesses often consolidate — so why not school districts?

After all, Santa Clara County school districts are a hodgepodge of large and tiny agencies, each with its own administration, and with century-old boundaries that randomly join disparate regions while dividing other communities. Some superintendents oversee 25,000 students, while others supervise only a few hundred.

So the Santa Clara County civil grand jury has recommended unifying and consolidating the county’s 31 school districts, which it projects could save $51 million annually.

District officials dispute the estimated savings, and question the benefits. In past decades, similar suggestion have been shunned as politically implausible. Why should this time be any different? For one, schools are facing unprecedented cuts to their budgets now.

The grand jury released two reports on June 24th: “Achieving School District Efficiency through Consolidation” and “Looking at Policies Our Schools Use to Find and Place Employees.”  These thrilling potboilers describe that “while the school districts in Santa Clara County are doing well in all areas, there are redundant administrative functions that can be made more cost effective through school district  consolidation.”  I tell you, I couldn’t put it down!

By merging elementary and high school districts that share attendance areas, the county’s 31 distinct school districts could be reduced to 16, unless the county actually has 34 districts (per 2008-09 Grand Jury report “Who Really Benefits from Education Dollars? (Hint: It’s Not the Students)“).  That’s the fun of an official report; you just never know what alternate facts could emerge!  Last year’s report had six findings and suggested actions, and it’s number 6 that must have led to this year’s threat to school administrators:

Finding 6

The operation of 34 K–12 school districts and four (4) community college districts
creates excessively high management and administrative costs. Five K-12 school
districts have excessively high Superintendent costs per student which is reflective of
the district’s having only one or two schools.

Recommendation 6

A consolidation of districts should be considered to reduce the numbers and costs of
Superintendents/Chancellors, Boards of Trustees, administrative staff and overhead.

One piece of good news for administrators and board members is the grand jury didn’t recommend all 31 school districts be rolled up into one countywide nightmare like Los Angeles Unified.  Instead, they selected feeder elementary districts that could be merged with high school districts, creating “Unified School Districts” that serve the same boundaries.  These are the four “lucky” high school districts and corresponding K-8 districts singled out:

  • Campbell Union HSD with Burbank SD, Cambrian SD, Campbell USD, Moreland USD and Union ESD
  • Fremont Union HSD with Cupertino USD and Sunnyvale SD
  • Los Gatos-Saratoga HSD with Lakeside JSD, Loma Prieta JSD, Los Gatos USD and Saratoga USD
  • Mountain View-Los Altos HSD with Los Altos SD and Mountain View-Whisman SD

imageThe civil grand jury’s reasoning is that unified school districts save money and can operate more efficiently than smaller districts with just a few schools.  The grand jury holds up these unified districts in Santa Clara County to support the concept: Gilroy, Morgan Hill, Milpitas, Palo Alto, San Jose, and Santa Clara.  And their gold standard of the benefits of school district unification is last year’s formation of Twin Rivers Unified.  In Sacramento.  Puh-leeeeeze!

Are they seriously suggesting that RBA cities such as Saratoga, Cupertino and Los Altos should emulate mediocrities such as Milpitas and Morgan Hill?  Seriously?  The only RBA city on the Unified list is Palo Alto, and they’re so Special none of the regular rules apply anyway.

Can you see parents who paid the RBA premium to live in Los Gatos wanting to share a school district with the hillbillies of Lakeside?  Or the families who paid the big bucks to live south of Fremont Avenue now finding themselves sharing a school district with North Sunnyvalers?  Wouldn’t every Los Altan sooner pull their kids out of public school than consort with those troublemakers from Latham Street?

image Obviously I’m not going to comment about the proposed Campbell Unified District, because they aren’t in the RBA so nobody much cares.  The Grand Jury also wants to merge four East San Jose school districts into two union districts, and even fewer burbed readers would ask. (Berryessa + Orchard, Alum Rock + Mt. Pleasant, if you insist.  You’re welcome.)  All 21 school districts suggested for consolidation have 90 days to respond to the civil grand jury, and expect the replies to be even more thrilling reading.

Now, some of these recommendations make sense.  There is only one school in Lakeside, Luther Burbank and Orchard School Districts.  One-school districts are clearly wasteful, and the Grand Jury has already noted criminal behavior in Burbank SD.  But some of the proposed unified districts will be much, much larger than others.  The proposed Mountain View-Los Altos Unified would have 21 schools, and the proposed Los Gatos-Saratoga Unified, 14.  But both proposed Campbell and Fremont Unifieds would have 41 schools each, which isn’t much smaller than San Jose Unified’s 43.  All the other current Unified Districts (which the Grand Jury report specifies as an ideal model) have between 14-24 schools.

41 schools?  Are they serious?  Does this fit the reasoning behind “Five K-12 school districts have excessively high Superintendent costs per student which is reflective of the district’s having only one or two schools”?  Cupertino USD, a K-8 district, already has 25 schools, which is more than all but one existing SC County unified district.  This is not a school district with excessively high costs, the complaint of the 2009 report.  This is a district that manages to produce perfect API test scores despite below-average funding.  But someone took the idea of merging feeder schools into high school districts and ran all the way to Twin Rivers Unified with it.

image At a certain point, large school districts lose the ability to respond to parental concerns, and nobody could call a 41 school unified district anything but large.  Effective and responsive school districts are exactly what parents expect when they spend the big bucks to buy in the RBA.  So recognize this plan for what it is: a recipe to remove Cupertino from the RBA forever. 

It’s clearly a plot by Palo Alto real estate agents.

Comments (99) -- Posted by: madhaus @ 5:01 am






July 10, 2010

feel trapped in my house with this market

Recently someone found this site by searching for: feel trapped in my house with this market

It’s true! Many Real Bay Area citizens feel trapped! What do you do when you’re sitting on this enormous gold mine of equity, in a land where all the smart people and great sushi restaurants are? How can you move anywhere else, which would be a step backwards? A move that might force you to resume paying your fair share of property tax, instead of 1/10 of your neighbors?

Like the great philosopher The Notorious B.I.G. said, “Mo Money Mo Problems”. Word.

Comments (5) -- Posted by: burbed @ 5:15 am

July 9, 2010

Assessor: Biggest property assessment drop since the Great Depression

Assessor: Biggest property assessment drop since the Great Depression

by Daniel DeBolt
Mountain View Voice Staff

Santa Clara County’s assessed property values fared better during much of the Great Depression than they did last year, tax assessor Larry Stone announced yesterday.

For the first time since the 1930s the county saw an actual drop in assessed property values. Stone is reporting a "distressing" 2.43 percent drop from January 2009 to January 2010 county-wide. The only other year more worrisome was 1933, when assessed property values declined in the county by 3.19 percent, Stone said.

"From my point of view, this is far worse than I expected," Stone said.

Just a month ago when the county’s cities were preparing their budgets, Stone told cities to expect only a two percent drop to be reported countywide. An additional one half percent might not seem like big news, but "when you are dealing with a $300 billion assessment, that’s not a small number."

Mountain View’s assessed values declined by 2.9 percent in total, worse than average. Palo Alto was the only city to see assessed values increase, at a meager .4 percent.

Of particular concern in Mountain View is a 25.2 percent decrease in the valuation of business personal property — which includes things like furniture, computers and other equipment — in the city’s redevelopment areas. That compares to a decrease of only 8 percent county-wide and an increase of 1.1 percent in Mountain View’s non-redevelopment areas.

"There must be some lost business, some businesses that moved out maybe," Stone said of Mountain View’s two redevelopment areas, which include Google’s Shoreline neighborhood and much of downtown.
Stone blamed the decline in property values on the county’s "soaring unemployment rate." Similarly, the number of businesses in the county decreases by 8.2 percent during 2009, from 46,000 to 42,000.

Thanks to Burbed reader Herve for this find!

Between this and the successful IPO of Tesla, it is absolutely clear that the bottom has been reached, and things can only go up up up up up from here on out.

Next year? “Biggest property assessment hikes since the earth was created.” You heard it here first!

Comments (21) -- Posted by: burbed @ 5:53 am

Defaulting? Are You Rich Too?

Yesterday’s NY Times covered mortgage defaults in Silicon Valley, and burbed reader Mark brought it to our attention.  Did you think strategic default was just for marginal properties or struggling homedebtors?  The Gray Lady visits Los Altos and finds a whole lot of default going on within the Prestige Tier.

Biggest Defaulters on Mortgages Are the Rich

By DAVID STREITFELD / Photos: Peter da Silva for NYT
Published: July 8, 2010

 

LOS ALTOS, Calif. — No need for tears, but the well-off are losing their master suites and saying goodbye to their wine cellars.

The housing bust that began among the working class in remote subdivisions and quickly progressed to the suburban middle class is striking the upper class in privileged enclaves like this one in Silicon Valley.

Whether it is their residence, a second home or a house bought as an investment, the rich have stopped paying the mortgage at a rate that greatly exceeds the rest of the population.

More than one in seven homeowners with loans in excess of a million dollars are seriously delinquent, according to data compiled for The New York Times by the real estate analytics firm CoreLogic.

Nothing like a story about what self-centered jerks rich people are, so here’s one about rich people from Silicon Valley moving on and reinventing themselves, without the mortgage.  That’s like doing a story about washed-up country musicians in Nashville or unemployed coal miners in Wilkes-Barre: it only confirms people’s expectations.

Like the real estate pictures?  They’re foreclosed houses in Los Altos, where the median home price is a million and a half.  That doesn’t impress many in the Real Bay Area (RBA), but it sound expensive to people reading the Times in Teaneck and Teterboro.  Plus they have this fascinating graphic showing that people with bigger mortgages are defaulting at a higher rate than average:

burbed says a number of readers have sent this article in after Mark did.  Is it because the NY Times noticed the RBA for an article about wealthy people, even if it didn’t make the rich folks featured look particularly sympathetic?  Finding a house that had its equity systematically drained, Irvine-style, was an eye-opener.  Weren’t RBA buyers supposed to know better?  Or was this strategic from start to finish?

Another regular reader felt the article didn’t do a good job at all:

I actually read this article before [you sent it] and thought it was amateurish and misleading. Surprisingly poor for NY Times publishing.

1. It’s mostly hearsay-based or anecdotal (I asked this guy, I knocked at that door, that other guy says, etc.) and when there are numbers, they don’t support the tone of the article. 5 foreclosures in the entire Los Altos?  Quote about Las Vegas in the middle of first page? And then this: “The once-thriving Los Altos downtown is pocked with more than a dozen empty storefronts in a six-block stretch.” Do you ever recall Los Altos downtown thriving?

2. Once you look closely, you realize that the article throws US-wide research and numbers while focusing on Los Altos, making things look much worse than they are. Two examples:

  • “More than one in seven homeowners with loans in excess of a million dollars are seriously delinquent, according to data compiled for The New York Times by the real estate analytics firm CoreLogic.”
  • “The delinquency rate on investment homes where the original mortgage was more than $1 million is now 23 percent.”

These numbers represent US-wide data, not Los Altos data.

This is entertainment journalism at its worst. It’s not factual reporting.

The phrase you want, oh regular reader, is “meaningless anecdotal data.”  Or “useless aggregate data.”  Or both.  But not neither.  In Los Altos, you can afford to use at least one while there are still stores open downtown.

Comments (4) -- Posted by: madhaus @ 5:33 am

July 8, 2010

Dealing with Spam

As some of you may have noticed, there has been an unusual uptick in spam getting onto this site.

I’ve now added a plugin called WordPress Hashcash to try to mitigate this issue.

If you have trouble posting comments… uh… just leave a comment to let me know. Or send a smoke signal.

Comments (5) -- Posted by: burbed @ 10:18 am

Non-Euclidean Property

10035 ORANGE Ave, Cupertino CA
$945,000

Since landmark works on non-Euclidean geometry by, among others, Lobachevsky and Minkowski, Real Estate has come a long way.

These days, slanted buildings are all the rage (you didn’t know? Now you do!)

Certainly, locals could seek inspiration in the leaning Tower of Pisa…
but that would not be too earthquake-friendly, and anyway that tower is not even leaning on purpose.

Seek no more! Right here in Cupertino, the town that invented the perfect/1000 API score, technology has also come a long way.

Behold! The Light Bright and Airy Not Quite Slanted But Definitely Non-Euclidean Detached House.

image

And Ranch architecture will never be the same again!

Comments (8) -- Posted by: DreamT @ 5:02 am

July 7, 2010

Let’s revisit 602 CHIMALUS Dr

$1,689,000

602 CHIMALUS Dr Palo Alto, CA 94306

image

Beds: 4
Baths: 3
Sq. Ft.: 2,090
$/Sq. Ft.: $808
Lot Size: 5,311 Sq. Ft.
Property Type: Detached Single Family
Style: Contemporary
Stories: 2
View: Neighborhood
Year Built: 2009
Community: Barron Park
County: Santa Clara
MLS#: 81011503
Source: MLSListings
Status: Active This listing is for sale and the sellers are accepting offers.
On Redfin: 115 days
Custom contemporary home on a Palo Alto cul-de-sac. Custom bamboo cabinetry in the kitchen and baths w/ soapstone and slate counter tops. Soaring ceilings. Heated bath floors. White oak floors throughout. Green features include LED lights, tankless hot water, ceiling fans, attic fans, 2 zones HVAC, and more! Palo Alto schools including Gunn High. ALso available for rent at $6250/month.

Now this house was mentioned before – let’s take a look at the way back machine…

July 24 2009

Pralay Says:
July 27th, 2009 at 10:52 pm

One more Palo Alto property that has neither buyer nor renter – 602 CHIMALUS Dr. The flipper bought the lot for $1.1M in 2007. In market from December (price reduced from $1.9M to $1.6M).

Now the flipper put it up as rental in craiglist – for $6995 per month.

Recently, burbed reader Gallileo saw that it continues to be listed, and had this additional commentary:

A house no one is worth of in Barron Park

Flipped not once but twice from 2006 to 2007, then undergoing an extensive remodel, this house first listed in 2008 in its new incarnation. All the resales and repricings–”Up! No down! no up!”–show the true desirability of this house–its so hot that no one feels worthy of it for more than a year. Even the former renters moved out. And how can you ever find the right price on a house that sells and rerents so often?

Now it sits there, stately and sideways on its half-sized lot, backed up against Palo Alto’s only light-manufacturing industrial plant, just waiting for a renter or buyer who feels worthy of it. The recent price increase shows just how desirable it is.

Alright all you creative minds out there… what’s it going to take to get this house sold? I’m thinking… increase the price even more! Let’s make it even more valuable by making it even more precious!

Anyone know what the fair market rent value of this house would be? Any good comparables?

Comments (60) -- Posted by: burbed @ 5:05 am

July 6, 2010

Gracious Home with Classic Architecture

19730 Glen Una Dr, Saratoga CA
$7,800,000

GlenUna

(He) Honey, I think I found the perfect estate for us
(She) Do tell, pumpkin pie!
(He) Well first, it is fabulous, and it has gorgeous, breathtaking vistas
(She) Hmmm, sounds rather moisturizing!
(He) But wait, we can invite our car lover friends to enjoy the garage with us! The setting is private and gated.
(She) Say, this is a wet dream!
(He) A dream you can build! And once in the garage, we have license to divide and reproduce. Well worth the $1,656/sqf, if you ask me! But you don’t know the best part…
(She) Do tell, I am breathless
(He) Wait until you see the gracious existing home with classic architecture!
(She) … Pumpkin pie, is that a manger?

Comments (6) -- Posted by: DreamT @ 5:02 am

July 5, 2010

Homebuyer Tax Credit Closing Deadline Extended Until September 30th; RBA Yawns

Obama signs 3-month extension of homebuyer credit

By Corbett B. Daly

WASHINGTON | Fri Jul 2, 2010 3:11pm EDT

(Reuters) – President Barack Obama on Friday signed a law giving consumers already in the process of buying a home three extra months to close the deal and still get a popular tax credit from the government.

Homebuyers with contracts signed by April 30 who failed to go to closing by the original June 30 deadline will now have until September 30 to complete their purchases.

The measure is meant to support the battered U.S. housing market which still faces tough headwinds despite low mortgage interest rates.

The extension would not help anyone purchasing a home now, only those who already went into contract by April 30th but could not close in time for the original June 30th deadline.  There’s some talk that this is an invitation to fraud.  “The IRS reminds taxpayers that special filing and documentation requirements apply to anyone claiming the homebuyer credit,” said a spokesperson from the Internal Revenue Service.

This measure should not affect anyone buying in the Real Bay Area, despite real estate industry watchers claiming May’s terrible housing numbers are due to the tax credit’s April contact deadline.  RBA buyers would not change their purchase plans due to a mere $8000 federal tax credit ($6500 for existing homeowners) and would not make their decision based on such a small percentage of the contract price.  The increase in RBA sales this May over last confirms it, and let’s not discuss the California tax credit.  Experts agree: everything is fine.

Comments (16) -- Posted by: madhaus @ 5:01 am

July 4, 2010

Independence Day 2010

It’s July 4th!

The day where we celebrate Independence. And nothing means independence more than having a mortgage for your house.

Enjoy watering your lawn!

(Speaking of Independence Day, I’ve heard rumors that in the UK, realtors only charge 1%. Can someone confirm or deny that, and explain why it is so much cheaper to sell a house in a place where a breakfast costs $30USD)?

Comments (49) -- Posted by: burbed @ 5:11 am