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Open Letter About Measure H to AUSD Superintendent and Board Members

Below is the full-text of a letter that appeared in the July 30th edition of the Alameda Sun has a one-half page paid advertisement:

Superintendent and School Board Members
Alameda Union School District

Alameda, CA

Re: Measure H

Dear Superintendent—–

I wanted to address some concerns about Measure H in addition to those discussed at the School Board meeting on June 23rd.

I want to start by saying that I share your concerns over the financial crisis that our schools are facing. The declining support for education in California is extremely disconcerting. I also want to say that I respect the intelligence, compassion and competence of you, your staff, the school board members and the authors and supporters of Measure H. Because of the crisis that the schools face, I can understand the temptation to implement a measure which provides for the shortfall in funds, even if it relies on an unbalanced allocation of the burden. But I am concerned that the noble nature of the cause has blinded staff and the board to the fact that the measure is, plain and simple, discriminatory.

I have read about classroom studies, where teachers divide students into two different groups. One group is given special privileges and the other is not. One group may be allocated a disproportionate share of work. The classroom experiment is intended to show students how it feels to be discriminated against, and to demonstrate what happens in an environment of discrimination. In the studies, there is a tremendous amount of tension between the two groups. Some students in the privileged group begin to exhibit disrespectful behavior or language toward the disadvantaged group. In short, the experiment tears the classroom apart and turns the student groups against each other in a relatively short period of time.

Unfortunately and unknowingly, the authors of Measure H have created that same, real live experiment in the City of Alameda. Measure H is starting to tear the community apart. Not surprisingly, when commercial property owners have raised their voices against the lopsided assessments, they have been threatened with boycotts or other means of retaliation. The classroom experiments would have predicted exactly this set of events.

Is Measure H discriminatory? ‘Discrimination’ is defined by the American Heritage Dictionary as an “act based on predjudice”. Furthermore, ‘prejudice’ is defined as “an adverse judgment formed…without knowledge or examination of the facts.” If there is a reasonable basis of assigning a greater burden to commercial property owners than to residential property owners, i.e., a reason based upon an examination of the facts, then the Measure would not be discriminatory. First of all, I have heard no logical reason or basis for the extreme discrepancy in residential and commercial rates. Since I have not heard one proposed, I have asked people what they think might be jusitifiable reasons for the extreme differences in assessments. There are only three substantative reasons that I can think of for assigning commercial property owners a much higher burden.

1. One reason would be if commercial property values were much higher on a proportionate basis than residential values—in other words, if Measure H was attempting to approximate an ‘ad valorem’ tax. This distinction would be similar to that made in allocating property taxes—that higher value properties pay more in taxes.

2. The second reason would be if commercial property owners, on a comparative basis, had a much higher capacity to pay the additional tax than residential owners. This distinction would be similar to graduated income taxes in which higher income individuals pay a higher percentage in income taxes because they can afford to pay more.

3. The third reason would be if commercial property owners received a much greater benefit of the services offered. This would be similar to the way utilities bill their customers—those who use more water, for example, pay a higher water bill.

Let’s look at the facts in the case of Measure H.

We are the owners of the marina at Marina Village. We currently pay $73,371.58 per year in Measure H taxes. The current value of the property is approximately $35 million.

Since residential property owners pay at the rate $120 per parcel, it takes 611 residences to generate the same amount of Measure H taxes as our property. If we assume the average residence in Alameda is worth $650,000, the value of those 611 residences is $397 million. So that means we, as a commercial property owner, pay 11 times as much as a residential property owner, in proportion to the value of the property. Therefore, the measure fails the first test.

Although this varies property to property, Marina Village has a little more than $200,000 per year in cash income after all expenses are paid, and has gross revenues, before expenses, of approximately $4 million per year. Assuming the average household income in Alameda is approximately $85,000 per year per household, than the total gross income for 611 residences is approximately $52 million. So under the second test, we pay 13 times as much in Measure H assessments as do commercial property owners, when measured in proportion to income. Therefore the measure fails the second test—there is no parity on a capacity to pay basis.

The last test is the benefits test. At our marina, we do have some berthers who live aboard, but, to our knowledge, there is not a single AUSD student living in the marina. On the other hand, if we assume that there are roughly 0.75 AUSD students per residence, the 611 residences would generate a demand of 450 AUSD students. Since our math teachers would remind us that we cannot divide by zero, there is no way of calculating how many times more we are paying than residences, on a benefits basis. Technically, I believe the answer is that we are paying infinitely more. In this case, the measure miserably fails the third test—there again is an extreme inequality in the payment by commercial properties in comparison to the benefits received.

I cannot think of, and I have not heard of, any other sound, reasonable, factual basis to justify the extreme discrepancy in assessments between commercial and residential properties. I would argue that, plain and simple, that makes the measure discriminatory.

If we are to be candid, I believe we all know why the commercial properties are paying so much more. And that is because the votes lie in the residences, not in the businesses. But that is simply to say that this is a version of ‘tyranny of the majority over the minority’, which is always a danger in a democracy. From the founding of our country, this has always been a concern of most thoughtful citizens. Is the measure any less discriminatory just because it is commercial property owners who pay a disproportionate share rather than, say, people who are left-handed?

If I am wrong, then I would like someone to explain the rational, factual basis for charging commercial property owners 10 times or more the assessment charged to residential property owners.

Whether the courts feel politically compelled to support this measure or not (it couldn’t be a very popular thing to overturn a measure like this and judges do come up for re-election), the measure is morally and ethically wrong. I learned from my teachers that noble ends do not justify unjust means. This measure has turned many commercial property owners against the school district. Last election, the measure barely passed, and no one really knew the implications. What do you think will happen when this comes up for election again? Rather than spending money and time supporting schools, many commercial property owners are spending money and time fighting the school district, and I suspect that will reach a new peak when the next school parcel tax comes up for a vote. Certainly, our organization and investors would have supported the “No on Measure H” campaign to the maximum amount allowable by law if we had known how lopsided and poorly drafted this measure was—but none of that was really discussed out in the open until after the election. Simply put, many commercial property owners supported, and voted, for the measure because they did not yet understand the implications. You will not have that support again, unless this issue is cleared up.

History shows time and time again that targets of discriminatory practices do not go away—do not give up. I can assure you that as long as this discriminatory measure is in effect, there are many commercial property owners who will never give up. We will be arguing this in the courts, in the press, at your hearings and meetings, in public forums, at the Chamber of Commerce, in community meetings, until it is rectified.

The commercial property owners are not asking for a free ride—just a fair shake. We want to begin supporting the schools again. We want to use our money, time and resources for the schools not against the schools.

I beseech you to right this wrong, and to settle this issue in a fair and reasonable manner—one based on the facts. Do not let your legacy in the AUSD be one of discrimination and of tearing the business community and residential community apart.

You are good, thoughtful, caring people—you wouldn’t be doing what you are doing if you weren’t. You now have an opportunity to serve as role model for the community, and for the students, by admitting the error and doing the right thing.

Thank you.

Steve Meckfessel

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