Read the first appraisal on Aug. 29, 2024
Read the second appraisal on Sept. 5, 2024
Palo Alto City Council tonight voted unanimously to release the two appraisals the city obtained while it was negotiating to buy seven acres of the Cubberley Community Center for $65.5 million.
For several months, the city had refused to release the appraisals even though the city is seeking approval of a half-cent permanent sales tax increase on the Nov. 3 ballot to pay for the purchase.
If the tax, Measure J, passes, the city said it would use the proceeds to pay the Palo Alto School District $65.5 million for the property.
The Post has been seeking the appraisal since July. A California Public Record Act request was denied by City Manager Ed Shikada, saying the council and school board needed to approve its release.
The Post argued that state law says that once a government agency had reached an agreement to purchase property, the appraisal must be released. However, the city ignored that argument.
On Oct. 5, the city once again refused to release the appraisal and instead issued a press release saying the appraiser, who wasn’t identified, said the property was worth between $43.6 to $60.2 million. The city emphasized that the appraisal was done in 2024, and with inflation the top price would will increase to $65.5 million when the deal would close.
Not mentioned here is the added info, including that not one but two private schools were interested in the property which PAUSD valued at $90 million over 10 years.
That PAUSD didn’t take the money and run is a testament to the strength of our wider community and doing what’s right for that community.
There is more information given by council members and I look forward to the press covering those aspects of tonight’s proceedings at the meeting.
This show would have been more convincing if we had some written evidence of a $90 million offer on the property. The only person who said the PAUSD got this $90 million offer was Don Austin, whose credibility isn’t strong. At this point, the $90 million offer is hearsay. Council members were gullible to believe PAUSD had a $90 million offer without proof.
“There is more information given by council members …” Oh, and that additional information is? Lydia Kou is a bad person for supporting the Cubberley plan but turned against it when it became a forever tax?
So council gets a high appraisal of 67.7 million and a low one of 48.9 million, and they agree to pay the high price? Ridiculous. Start over.
This confirms that the team negotiating the deal in 2024 settled on a fair price. Listening to the meeting, it is clear there were at least two other offers for much more $$ that the district could have pursued instead. In today’s dollars, $65M is still low, considering what real estate around here goes for. Thank you to the PAUSD Board, who favored our community over making a better deal with a private entity. I’m glad to see these documents, happy to be voting YES on J.
Bonds versus general sales tax. A bond needs 67% to pass, a sales tax only 51%. A bond puts severe restrictions on how collected money must be spent. A general sales tax does not. The Cubberly Measure J is a general sales tax. Maybe it gets spent on Cubberly, maybe not.
The board of education had a fiduciary responsibility to the school district to flesh out the “offers” it received to lease out Cubberley. After fleshing out the offers, the board could still determine it would be in the best interest to refuse the lease offers. With projected deficits that the school district has projected, the money from the lease would be very helpful
Too little, too late. The bigger issues are the crisis in confidence and why the Measure J crowd is more intent on stifling discussion and blaming critics than going back to the drawing board and delivering a better measure for our consideration.
Why, for example, was the text of the Measure J ordinance removed from the city web site before voting even started? (A savvy friend and city watcher KNEW that would happen and saved the 13-page document.)
Given the shameful stonewalling, the incredible nastiness, the money behind this measure, the lame arguments that they worked so so hard that voters should just accept a forever tax giving the city a blank check, one has to wonder who’d benefit from Measure J’s approval since it sure isn’t us, the voters and taxpayers.
Perhaps our “leaders” should examine their tone deafness to voter outrage at their unwillingness to reduce out-of-control spending and never-ending utility rate hikes funneling OVERCHARGES into the General Fund and ask themselves why the deserve ANOTHER blank check.
(PS: A lot has happened since 2024 when they money WOULD have been slated FOR Cubberley instead of becoming a blank check. So NO to J and No to illogical deceptive spin.)
The real cost of this land deal with our own school district will likely be much higher that $65,500,000.
Assuming that this new regressive sales tax will bring in $15.6 million dollars annually (and that is a stretch) then it would take about five years to come up with the pile of cash our City Council wants to gift our tax-supported school district.
So, they wait five years to be paid or, as hardly been mentioned, the City floats a bond based on all of the tax revenues for five years. However, given the promises for millions made to the committees for a new athletic complex and TheatreWorks for a 750-seat theater and offices, the bond(s) would need to to be for 20 or 30 years. At this time, the price demanded by bond buyers is very high, making this a very expensive way to raise the cash for the Palo Alto School District Office. The final price for the piece of land which we should just lease (it works well for Stanford) may well end up at twice the 65.5 million dollar figure that is touted as such a great deal.
Here is a Google AI Calculation of the probable real cost of just the land deal:
“The total lifetime repayment cost of a $65.5 million 30-year municipal bond issued by a California city today will range between $159.8 million and $171.6 million. Based on current market rates, California municipal bonds maturing in approximately 30 years are yielding between 4.80% and 5.40% depending on the issuing city’s specific credit rating (AAA to A).
At a realistic average yield of 5.00% for an investment-grade California city, the total interest obligations alone will nearly double the cost of the project:
• Principal Borrowed: $65,500,000
• Total Interest Paid (30 Years): $98,250,000
• Total Taxpayer Cost: $163,750,000”
Perhaps our school district will wait for decades for those millions they were promised. Or, perhaps Palo Alto has 65.5 million in a reserve fund they can fork over to our school district. I doubt both of these alternatives will be chosen and consider a long-term bond the most likely option.
Our voters have no idea of how much this project will really cost and it looks like the total may be hundreds of millions of our tax dollars.
Vote no on J.
Th San Jose mercury news has taken a no on J opinion.
For many of the reasons already mentioned.
All interested parties should read it.
Some people think that PAUSD is an entity like Google or Nvidia whose primary purpose is to make a lot of money. PAUSD’s function is to do a great job educating young people while at the same time being responsible to the people who are funding them. The district is doing a great job pitting people against each other trying to get top dollar for a piece of property that taxpayers paid off years ago. If we didn’t have children to educate we wouldn’t need schools, teachers or administrators.
Measures J (PA), P (MP) and D (LA) = Just Pay, Duh!
Thanks so much to the Daily Post and Dave Price for insisting on releasing the real property appraisal(s). It is so overly generous of the Council members who are spending other people’s money to offer the higher amount to purchase the property. BTW, so how much is the construction/renovation/modernization cost?
And frankly, how condescending to say releasing the appraisal for taxpayers’ review is going down a rathole. Voters have a right to know 1) how the purchase price came about, 2) did the council members “negotiate” with the voters’ best interest in mind or out of fear and for the best interest of PAUSD’s budget, 3) why a tax that is in perpetuity?
Measure J is still a blank endless check for the city to receive revenues for a slew of city programs and services and is not dedicated toward Cubberley land purchase and renovations.