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How The Tax Bill Could Impact San Diego Schools

Backpacks hang outside of a San Diego classroom.

Photo by Ana Tintocalis

Above: Backpacks hang outside of a San Diego classroom.

How The Tax Bill Could Impact San Diego Schools


Megan Burks, education reporter, KPBS News


Deductions for classroom supplies and student loan interest are here to stay under the federal tax bill that passed Wednesday. But educators are worried funding is not.

There were a couple of major scares for educators as the tax bill took shape. The first, that teachers would no longer be able to deduct the personal income they spend on classroom supplies. The second, that student loan borrowers would no longer be able to deduct loan interest payments. Both of those provisions did not make it into the final bill, which is now awaiting President Donald Trump's signature.

But educators remain worried about the implications for across-the-board education funding. They say if the bill does not spur economic growth and the government has to start making cuts, already-meager special education funding and Title I grants aimed at closing the achievement gap could take a hit.

Impact on future funding measures

And then there’s the new cap on federal write-offs on your state and local tax burden. Those who itemize their deductions would take a hit on anything in excess of $10,000. While that doesn’t have a direct impact on school funding, San Diego Unified School District Trustee Richard Barrera said he worries it could discourage future funding measures and flatten revenues.

“It certainly makes it more difficult to go to taxpayers, as we did statewide with Prop. 30 and Prop. 55 and as we’ve done here in San Diego with our bond measures, and ask taxpayers to make a sacrifice and invest,” Barrera said. “Because now you’re going to get punished because those deductions are capped — are not available in the way they were before.”

According to the Government Finance Officers Association, 34 percent of San Diego County taxpayers claimed the deduction in 2015, at an average of $18,437. The new cap means they would have an average of $8,437 less to spend and, according to Barrera’s logic, much less incentive to approve tax increases for schools.

Barrera said he’s similarly worried about the lower mortgage interest deduction for new homes. The bill puts it at $750,000 — a significant figure for California, where housing prices are high.

One silver lining for those who share Barrera's logic: rhetoric surrounding the tax bill could make voters more amenable to a proposed 2018 ballot measure to adjust how commercial property taxes are levied under Proposition 13.

“Californians will be hit hardest by the federal tax plan, which gives huge tax breaks to millionaires, billionaires and big corporations while the rest of us pay for it,” said campaign spokesman Mac Zilber. “We can no longer afford to keep giving an $11 billion commercial property tax break to the very same groups who will benefit the most from this tax heist.”

RELATED: Barrera, San Diego Nonprofits Eye Commercial Property Taxes To Boost Schools

Under the measure, the state would assess the value of commercial properties more frequently so what companies pay in property taxes keeps pace with the market.

Teacher pockets a little fuller

One boon for teachers — they stand to pocket several hundred extra dollars based on the bill’s individual tax cuts, at least until 2027 when the tax cuts end. But many teachers are still focused on the bigger picture.

“It’s very scary,” said Matthew Becerra, a first-year teacher at Thrive Public School, a charter in Rolando. “Public schooling is tricky in that there’s always a fear of funding being cut. And so with this new tax bill, it rings an alarm because there might be even more in the long term.”

Becerra is currently earning — and paying for — a credential. He said he worries the tax bill will signal to those considering getting teaching credentials that there is no investment and no future in public schools. California, along with many other states, currently faces a teacher shortage.

Private school classrooms a little fuller

Broadly, public school teachers like Becerra also are not too keen on the bill’s expansion of 529 savings accounts to benefit private K-12 education. But a lobbyist for the California Catholic Conference points out the accounts can be used for much more than private school tuition.

“Books, online educational materials, tuition, tutoring outside the home, dual enrollment at a college, being able to access educational therapies and diagnostic services for your children,” Ray Burnell said. “So it does help public school families, as well as Catholic school families.”

While the expansion does signal some kind of life raft for San Diego Catholic schools that have been hemorrhaging students because of tuition costs, it is not a major move in the Trump administration’s agenda to expand school choice. While 75 percent of 529 accounts belong to families earning less that $150,000, they're difficult for low-income families — the kind parochial schools have traditionally tried to serve — to access.

RELATED: Parents: Think Vouchers Would Be A Ticket To San Diego’s Top Schools? Think Again

That’s why Burnell and others would have rather seen scholarship tax credits that allow individuals and groups to donate tax-free to a fund for private school tuition.

Fewer bond options

There’s one final piece of the tax overhaul that could impact schools. Dale Scott, a school finance consultant who has worked with the Poway Unified School District, said it could make it more difficult for districts to refinance school infrastructure bonds at lower interest rates, meaning taxpayers would pay more over the life of a bond. He also said the bill scraps subsidy bonds that many districts are using for energy projects.

Unlike earlier versions of the bill, new market tax credits and private activity bonds that many charter schools use to build new campuses remain.

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