Special - Part 2 Meeting

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[11] Ray Rodriguez: We're reconvening from closed session where we met with our negotiating team and We got updates and we gave some direction. So before we go to 6.1, which is the letters that are as part of your agenda that we received from Alameda County Board of Education, Ms. Parks, did you want to address us on this or talk about this?

[73] Cindy Parks: I. So just. We have the attached letters which were nice. There's no course of action spelled out in any of our documentation and to quote from page 3 of both documents in accord with it was section 4, 2, 1, 2, 7, D 3 on or before October 8th, the board shall review and respond to the recommendations of the county superintendent at a regular meeting of the board. This is neither a regular meeting of the board nor this is, and since this is a staff report, how would you be approving any recommendations? So I'm at a loss how you will be able to comply with a request from the county office.

[118] Ray Rodriguez: Okay. So before we, um, you make your presentation, you can address that because I, um, I too, the letters seem very specific. So, um, Okay.

[138] Marie dela Cruz: Hello. Good evening.

[139] Ray Rodriguez: So, go ahead.

[141] Marie dela Cruz: Yes. So, we received a letter from the county about a week ago and we did see the date of October 8th. So, we contacted the county and told them that we would be submitting a response by October 17th or after October 17th which is the regular meeting. So tonight's presentation is information only. We're not taking any action.

[169] Ray Rodriguez: Right. But we are receiving the letters, okay?

[171] Marie dela Cruz: Yes, we received the letters and we're sharing them with you and I'd like to review the letters with you and then we can work on our response and plan.

[185] Ray Rodriguez: Okay. Board, did you ask any questions? Do we have any questions of Ms. Dela Cruz? As far as the letters are concerned.

[195] Marie dela Cruz: So I want to go ahead and just give you a brief overview of the letter. Thank you. So this is a letter that the county normally gives the districts after they review the budget. And in this letter, it's about the 19-20 adopted budget that we submitted in June, a few months ago. It addresses the fact that the board did approve a resolution which included $2.2 million in reductions in the 19-20 budget. However, because of the out years in 2021 and 21-22, the budget was conditionally approved. It wasn't disapproved. There's some conditions that we need to meet for them to review before they approve our budget. And that includes the LCAP because the LCAP is also included as part of our adopted budget submission. And the reason why they conditionally approved our budget is because our fiscal outlook is uncertain at this moment. We weren't able to meet our 3% economic uncertainty, reserve for economic uncertainty in the 2 out years. So the conditions that are specified in the letter we had 2 conditions. One had to do with the unaudited actuals. Report we did submit. The actual ending balance at that time was actually more positive than what we estimated. And then the second condition they want us to revise or 1920 adopted budget to include that we're going to be able to do that. The second one is on the schedule salary increase from 1819. Which we've already also completed. And then the 3rd one is the approval and adoption of a plan that they want would like for us to incorporate some more. Budget balancing solutions for the out years in 2021. And then in 21-22, there's 668,000 that's included in our multi-year projection for budget reductions or revenue enhancements. And so even though we put it in our multi-year, the county would like for us to give them a little bit more information as to what those reductions or enhancements might look like. indicated that in Fund 17, which is our reserves for other than capital outlay, the special reserves, that back in 08-09, there was a borrowing that still hasn't been paid back. And also in 16-17 and 17-18, there was money transferred from the special reserves into the general fund that they would like for us to address. and there's also the other item had to do with the enrollment in 88 projections the county would like for us to review those once again to make sure that we are in line with the. Last 5 years that the trend in the last 5 years. And so the county is aware. We receive this. not enough time for us to get it to you by October 8th, so they understand that we will be submitting a plan on October 17th, which is a regular meeting.

[432] Diego Torres: Okay.

[435] Ray Rodriguez: Okay. We've received the letters. Any questions of Ms. Dela Cruz? Okay, thank you.

[447] Elisa Martinez: Sorry, just very quickly. So on October 17th is when you would be bringing forward some of the additional plans or I suppose level of detail for the reductions of 1.8, at least what we're predicting or planning on. Let me back up. What is the level of detail that they're looking for, I suppose, that would be sufficient for them to approve?

[475] Marie dela Cruz: I think as long as we have a plan that shows our commitment to make those reductions, the county would at least have something to review rather than just saying, you know, we have 1.8 million that we need to reduce or here's 668,000. If we could specify or at least indicate what areas we're considering, it might be a menu of items that we could later determine and make some definite decisions. But in the meantime, we could at least provide some ideas on what areas we're looking at reducing and ways that we are looking at balancing our budget. So on the 17th, we're hoping to bring a response to the letter that addresses all of the items that they had included in the letter. And if need be, it's up to the board If you would like to have a study session to review some of the items that we could consider, we could also do that before the 17th.

[544] Ray Rodriguez: Okay. Thank you. Okay. So before we go to the study session, we have public comment on the study session, and I have. for community members have put in cards. Ms. Bloom, Ms. Parks, Ms. Silva, and Ms. Duke. In that order. Hi.

[586] Rachel Bloom: Hi. I've been thinking a lot about all the fancy things that were on that. presentation, they look very exciting. And I know that part of it is to increase enrollment. And then I've been thinking about all these things we've been doing to increase enrollment. And then I thought, well, what about the people that are here already? What about the kids that are here already? What about the teachers that have been here? And I've just been thinking about a lack of confidence that many of us have in improvements and things that have happened before. For example, I There was an HVAC renovation and roof renovation within the last few years. Roofs are leaking and air conditioning units don't work at various sites. And so that makes me very nervous that we're going to spend all this money on renovations when we kind of have a history of not getting stuff done right. My high school economics teacher Mr. Kitchens used to have a saying. It was do it once, do it right, and never do it again. And it just makes me think about that. And so some food for thought. Thank you.

[658] Ray Rodriguez: Thank you.

[671] Cindy Parks: Good evening. the district. At least 30 million dollars worth the bond projects have been completed at the elementary sites. I'd like to hear how the district justifies bulldozing projects that measure G has paid for over the last 6 years and the community will be responsible for paying for years to come. If the district bulldozes the elementary sites how are you for the ADIS master plan that you have yet to even publicly unveil. And talking about ADIS' master facility plan, the timeline shows the January to April 2020 timeframe to interview and hire the architectural pool. Hmm, since ADIS has been working with the district for over 12 months and developed the master facility plan, doesn't that give them an advantage over any other firm? Presentations for this evening state that there would be three elementary sites built. Would the district operate only three elementary sites? Side note, the enrollment numbers included in the September 5th document that you saw at that meeting did not include any of the preschool kids at music, which really lowered their numbers. In these scenarios, what provisions have been made if enrollment does increase? It has been said at the September 5th meeting that we would be able to receive matching funds from the state, just like we did with Measure G. Let me clear up that misunderstanding. The district received no matching funds for Measure G. Elaine Nielsen, the previous CBO, told me we did not qualify and that usually small districts such as ours do not qualify for matching funds because those funds end up going to much larger districts like Los Angeles or San Diego. If the district would be eligible for those state bond monies, the activity timeline page states that the board decision to move forward would be in January 2020. you would move forward without knowledge of whether the March 2020 bond passed? That makes sense to me. How is the district going to pay for the survey? What questions would be asked? What would be the parcel tax amount? Has anyone thought when you go from eight elementary sites down to three elementary sites, the traffic nightmares that will be increased in those three elementary site areas? Now let's not forget the fact that you just got a conditional budget. You want the community here. You don't even have a budget that was approved by the county, and you want us to maybe even trust you with more money, which you just heard what happened with Measure G and got roofs still leaking and HVAC issues. Finally, Ms. Gutierrez mentioned at the end of the last meeting, the formation of a district advisory committee on school closure. I'm requesting information about this committee be made public. And I would like to volunteer to be a member. Thank you.

[857] Ray Rodriguez: Ms. Silva. Hi.

[860] SPEAKER_14: How are you? I'd like to start off with some remarks that were made regarding Newark citizens. We have supported our schools. But we have a question and we're kind of wary how money was used in the past. to support the bond again. And we want to know, the community wants to know, is this the most effective way to use the money that you're going to receive from a bond? Open house needs to happen for our community, a display, a cost display, research explained with clear understanding of the research that shows the best path and the best ideas. Is this idea to rebuild just for an image of our community, just an image? Or is it for our children to get the best education? A building does not educate the children. Our children are educated by the teachers in the classroom. We need to invest in the classroom, not just the structure. And at the last town meetings that were held, citizens were heard. But the blame was placed on the teachers and financial problems were placed on the teachers and the citizens. So we need to visit, revisit this. Thank you.

[943] Ray Rodriguez: Thank you. Ms. Doot, welcome.

[954] SPEAKER_20: Good evening. I'd just like to say that as you move forward, and I've said this publicly before, I fully appreciate the fact that declining enrollment and the cost of living have greatly impacted this district and become a huge challenge for this administration in which to balance the budget and in which to provide the needs for all the students. Having said that, last week you approved another $11,000 for an interim CBO. who accused the residents of Newark of not doing their part in supporting our school district. I have lived here for 41 years. I don't know how many of our administration are Newark. I am Newark. These people are Newark. Mr. Schimel, with all due respect, is not Newark. He may be a great bean counter, but he is not Newark. Going forward, I think you need to be extremely careful. The resounding theme in our community that comes back over and over again is when you have a good-looking district office, it attracts new community members. It gives parents the confidence to want to put their children in schools. No, it doesn't. My husband's a realtor and tomorrow at 5 o'clock he's going to meet with a new investor coming to Newark who specifically wants to know about Newark schools in order to consider whether or not he should invest in Newark. What makes parents, and I can tell you this because I made this decision 41 years ago, What makes parents want to put their children in our schools are the test scores and the overall ratings that can be found online that include the test scores. So please don't be fooled. You dropped $500,000 on a dream sequence, a colossal waste of money that I was invited to. That if I had oodles of money, man, that looks good. But we don't. And now you've dropped another $11,000 on someone who does not appreciate that I walk the streets for measures A, B, and G. So you've got a big problem with apathy, and you've got a big problem with trust. And if you don't have trust, it doesn't matter what the relationship is. You don't have much going for you. Thanks.

[1141] Ray Rodriguez: Mr. Medina.

[1147] SPEAKER_05: Good evening, everyone, board members, staff. My biggest thing that I said, you mentioned it, and I'm going to do it again, is that most of you guys were here last year when there was a committee formed by the community. And we presented to the board, and we all agreed that a partial tax was the option to go. And you guys voted on it to investigate it on it, but nothing got moved on it. Now we're here again to try to add more things to it. And I tell you one thing is that listening to the community is not something you guys do well. So I'm hoping that you guys start developing some new skills and listening and also in communicating back to the community and communicating internally within your guys own groups. Because that's something that I see a lot of lack of. Again, I think the community is willing to support getting better scores. And I think investors in Newark and people that want to move here, I can look at that and having better numbers. will give us more opportunities to compete against other schools. And I believe that most of the schools that I saw in Hayward that were built by Mr. Berry here did not show the scores to me. So unless they show the scores to me, it's all about the scores, right? I mean, I had some members of you guys telling me, it's about the scores. You're going to shut down music because of scores. You're going to shut down all these schools because of scores or because enrollment. How do you expect us to enroll in a brand new mega school? If we're going to go to a mega size type of campus, how are we going to be able to enroll? We don't have enough kids either, and we don't have the scores. Now, it's going to skyrocket the debt. And then we're not going to have enough teachers. Because most of the teachers are going to leave. I'm telling you right now, they're going to leave. We can't compete. We got to be able to compete. Pay teachers. Pay teachers. Pay staff. Have programs available for kids to be able to compete today, in today's world, and in tomorrow's world. It's not be our time. It'll be their time. You guys got to stop thinking about today. You got to start thinking about what's happening in the future, how the new work is changing, too. This is not, you know, this is newer. Look how many faces, how many different people we have from different areas and different backgrounds. So we have to make sure we know that and programs are going to be needed because you're going to have more foreigners coming and they're coming. I guarantee it.

[1332] Ray Rodriguez: Anyone else? Okay. I, um, Before we go into the facility budget alignment, superintendent, how many more of these are you thinking that we're going to have at the study sessions? At most two more.

[1348] SPEAKER_27: OK.

[1348] Ray Rodriguez: Maybe one more, depending on how much time we have. OK. And I had a procedure done earlier today at Kaiser, and I'm in a lot of pain right now. So I'm going to ask member Martinez to take over. Some of you weren't here when we started the meeting at 6, but this is not an action item. This is a study session, okay? There's no action, and I do have a lot of questions, and I'm going to meet with Mr. Schimel and make sure I get those answered. And so I appreciate all of you being here, and this is very important. When I moved to Newark a long time ago, it was because of the small schools, and a nice, excellent community coming from Newark. And so I've raised all my kids here, and this is a change for us. And again, this is not an action item. The board is going to be looking at so many different things. And thank you, Mr. Schimel, for helping us. And then Ms. Dela Cruz, moving forward. in navigating through this very difficult times that we have. Thank you. With that, Superintendent, I'll turn it over to you.

[1426] SPEAKER_27: Okay, I'm going to ask the board to join me down here at the table so everybody can see the board, including the audience, and we'll start.

[1459] SPEAKER_26: We'll wait till we get there.

[1489] SPEAKER_36: Well, let's start with this. Is that better?

[1491] SPEAKER_35: Is that better?

[1492] SPEAKER_37: Yeah? Good evening. I'll move the podium a little bit so that.

[1550] SPEAKER_26: Good evening. I'll move the podium a little bit so we can watch everybody's face. Since we are on TV, I'd like to help with bringing the community. I think just jumping into something without any transition might not be helpful for the home audience. And I'll try to incorporate some of the comments that you heard earlier this evening. You heard from our CBO that the county is taking a look at Newark. They do that for all districts that are qualified. And Alameda County does have a history of a couple school districts where boards have said, we're gonna do this and it didn't happen. And the county is responsible for those school districts. As you heard Mrs. Dela Cruz indicate their concern, not so much about next year, but the following two years, because there is not a plan in place. The district is doing pretty much what all districts do when you have a budget crisis. You have one source of income. That comes from the state of California. And therefore, you have no control over the amount of money you get. The only thing a school board can do is live within that budget by making cuts. To give you an idea, right now we're about $2 million short. So what does that equate to? 20, 25 teachers. You've done a lot of cutting in the classified area, and there's not a lot of money left in that area. So what we began discussing two months ago was another option for the board to consider. You can certainly do the road that everybody else has done, cut, cut, cut. And you will not be able to apply employees because you can't even balance your budget. So it would be difficult to have an increase. This is not about increasing enrollment. Your enrollment is what it is. It's slightly declining. It's about the kids that are already here. And as a way of being very direct, it is not about the kids that went through this system. It's about the kids that are coming through this system for 2030. And yes, you heard some comments that people are coming. Yes, they are. And it's going to be a very competitive world. And Newark schools, frankly, are economically obsolescent. You heard that from the community. You spend X million on a school, and it still is not working right. And part of that is very true, because it's past its functional span. They're 60 years old. It's not a fix-it-up plan. That's the plan you were doing. Measure G, fixing up things as they broke. You have so many things that are broken, even with 63 million, you can't do that. So we're going to begin tonight with the second study session, and that will be taking a look at where we left off. Per the board direction, you had a master facilities plan that was done, and we spent some time looking at other options. Yes, you had a contract for $500,000 for Facilities Master Plan, and that was to do a plan. It was not to hire an architect. So ADIS has no status as far as if the district ever hired an architect. And we're probably a year away from looking at that. We need to use the information that has been provided to you by people that are expertise in their field. And just because you didn't grow up in Newark or go to schools in Newark doesn't mean that you can't bring something of value to the Board of Education to take a look at. $800 million in facilities. And we looked last time at what would that cost the community. It was $67,000 per household. And the question I raised to you, is that doable? And I think we answered that. The average size of schools in Alameda County is 650. I showed you a range. I showed that our schools are about 385. And while everybody wants neighborhood schools, can Newark afford them?

[1824] SPEAKER_35: Sorry, you said $800 million is not much per household?

[1830] SPEAKER_26: $67,000 per household, if you were to divide that. Now, that would be in one year. To further explain that, if you took that over 15 years, it would be about $4,500 a year. We'll be talking a little more about serving the community. I don't believe any of those numbers are doable.

[1852] Bowen Zhang: And we'll talk about that.

[1856] SPEAKER_26: That is correct. That is correct. you would add in approximately 10 to 15% if you chose to do a senior exemption. You don't have to do that, but many districts do do that. So the average size of Newark schools is 380. And if we had that kind of money and the taxpayers were willing to pay that, you could keep schools of 380. And then lastly, One of the proposals, a proposal, is consolidating two schools into one brand new school. Any new school that is built, Fremont Unified is opening up one very soon, is in the 800 student capacity range. I don't know of anyone that has built a new school in the Bay Area of less than 650. And that would provide, over a period of three years, enough money to reduce your deficit by $2 million without making one cut to a teacher, one cut to a student's program at all. So we did.

[1934] SPEAKER_27: So could you go back to the first slide? Sure. I want to just kind of, to some degree, translate what we learned from the prior presentation. One of the things that we learned is that our buildings are pretty much getting to the capacity of the school line. And to fix them would be very expensive. That's one thing we know. The other thing we know is that our enrollment has been declining and probably will continue to decline for the next few years. And that's something we all worry about. I also would say the other thing that we've learned is that we know that many other school districts have larger schools. And our schools generally are smaller. But that's also something the board needs to weigh. Is it worth having smaller schools? I think a lot of people like small schools. And I think that's something we have to weigh. But we know that our buildings are aging, and that's kind of a dilemma. So the other piece I wanted to share is that we also know that if we were to look at new construction, the money we would use for that would be out of a bond. That can't be used for salaries. So we're going to talk a little bit tonight kind of a public comment around parcel tax versus salary and how those two funds can be used. So even though we're talking about, in one avenue, things we can do to fix our schools, that's a separate pot of money from the money we were talking about that would be like a parcel that might let us pay our employees more. And that's something I'd be worried about. But I want to just kind of say it a different way because I think, the other thing I want to say before we go forward is, We've made no decisions. These aren't our recommendations, but part of it is we do have a dilemma with how we right-size the district so we have a structural model going forward so we can afford to pay employees a competitive wage so that we don't keep losing employees. That's something that I do agree we need to find a way to get to. So these aren't all the answers, but these are some potential models for the board to consider, and ultimately the board will make some decisions as we go forward.

[2064] Elisa Martinez: very sorry I have a question though because I think in that one line item it's a pretty heavy line which is by consolidating two to one it would create a two million shift in budget I mean so if you also followed it by and we wouldn't have to make any cuts but the way I read it is I'm now freeing up additional funds yes right yes there's an overhead operating savings

[2092] SPEAKER_26: And further down the road, what you did with the property as far as not selling it, but using it as an exchange to bring in revenue, that could be used for operating.

[2109] Elisa Martinez: Okay. So that, I'm sorry, I'm just going to close that question. Sorry. So the assumption would be if we could generate revenue, that's what would bring me those $2 million.

[2119] Bowen Zhang: That is correct.

[2121] Abbey Keirns: Okay, thank you.

[2122] Bowen Zhang: So I do find a technical difficulty about exchanging land and generating revenue from the land. So my question is, I remember the figure is $400,000 for additional revenue, or is that $1 million? So if you don't count any additional revenue coming from leasing the land or having commercial, it's changing of exchange for a commercial property, what would be that $2 million? So is that going to be around $1 million?

[2147] SPEAKER_26: There's two sides to that $2 million. The decrease in operating expenses of the school, that's one half of the equation. The other half of the equation is the revenue that could be generated on an exchange from that property would be the other half. So in round numbers, 400 decrease in operating expenses, 400 increase in revenue, that's 800,000. And there was a misstatement about three schools. We have never talked less than four and possibly five schools. So that would be three schools at $800,000 each. That's $2.4 million. Does that help clarify, Mr. Young?

[2201] Bowen Zhang: Yeah, half of the 2.4 million is coming from additional revenue. If we successfully exchange for commercial property. That is correct. Any of that commercial property is liable enough to generate that.

[2213] SPEAKER_26: It's a soft guarantee. That would need to be explored. But it would decrease half of it if you just take out the revenue. It would decrease your expenses without cutting a teacher. The number of students you have in the district is gonna be the same. And the number of teachers you hire is based on a contract formula. So whether you have 15 teachers at the site or 30 teachers at the site, the same number of teachers are gonna be in the district because you have 5,700 students. Okay, we took a look at some new schools that Actually, both of these schools that I'm going to show are 8 and 10 years old. You will see that building a new school, I would agree with the comments made, doesn't bring a better test scores. No way does it do that. That's your teaching staff sticking to standards and teaching to the standards. But there are some things in new schools that research has shown more light in a school and most of your schools were built in the 60s, all of your schools were built in the 60s, have very little light in them. You will see to the school to the left, Burbank Elementary has lots of light and you get a lot more light when you have two stories, okay. Also, the school itself does have a curb feel. It's something nice to go into that's new and everything in those schools works. OK, I appreciate it. I've learned over years to tune that out. OK, so the next school we looked at was Schaefer Park. And you will notice that it has an attractive entry. And I'd like to point out to the right-hand top picture, this school was designed by teachers. Every one of the schools in that district now have what's a teaching wall. And you will see the whiteboard. But the two whiteboards to the left and right slide and they have storage for teachers. You will see that all of the electronics for displaying and hooking up electronic devices are all at teacher workstation. And you'll see the podium there for that. You'll also see that security in the schools is a lot better because this particular school is more of a courtyard effect. So once you're inside, the school is bounded by walls of the buildings and the open space in the middle where you can actually see everybody. So looking at funding possibilities, because none of this is possible unless your community chooses this is the look you want for your school district. And you do have a choice. You can keep band-aiding up the schools that you have and see if they'll make it 80 years. Or you might look at something different. So what are your funding possibilities? The governor signed AB 48, so there will be a March 3rd, 2020 election, six months from now. And that's a statewide bond, because the state of California has no money to fund schools. All of the money has been accounted for and expended to date. In fact, there's a waiting list. There was a comment made about we didn't get money last time. I don't know the facts. I wondered if you applied. There's a specific formula and process to do that. You may not have been eligible then. I don't know. I do believe you're eligible today, and we'll be talking a little bit about that in a moment, about what that process is to get and approximately how much. The second election we know that will happen will be a year from now, in November of 2020. And the board could place what's called a GEO bond, government obligation bond, on the ballot. And I'll talk a little bit about parcel tax, because they're two different taxes. Both are, in a sense, taxes. So there'll be a state bond. We know that for sure. We do not know whether the Board of Education will ask the community about which direction they want to go with their schools. So what would a finance model look like? School Works is currently calculating for the district what our eligibility may be. The state bond that you will hear about has a lot of billion dollars. but only about half of it is going to go to K-12 schools. The rest goes to the three levels of colleges, community, state, and university. Now, of that remaining dollar amount, there is $9 million. So, half of it will go to K-12. 500,000 is going to charter schools and 500,000 is going to CET. So, that 9 million now becomes 8 million. Of the $8 million, $5.2 million is for modernization and $2.7 billion for new construction. So there's only $8 billion for K-12 schools to take a look at. And we will get a further study about what would Newark be entitled to But we need board direction for that. That will come in the future. But to let you know, it's a significant amount of dollars. You will have to wait in line. It won't come without somebody guiding you through that process through the State Department. It usually takes one to three years. And it would be unlikely you saw any real cash till 2023. But you're in a very fortunate position as a district because you have two other funds that could step up and then be replaced once you're known that you're eligible. You apply and then it's a matter of when the state sells the bond to get the money and you work your way down to the list. A new GEO bond. Now what would that cost? You can only do a GEO bond at 55% vote for $60 per 100,000 of assessed valuation. Assessed valuation is not the value of your home. It's usually about half in round numbers. So as an estimate, the assessed valuation of a Newark home is probably someplace in the $400,000 range. At $60 per 100,000, it would be four times $60 or $240 per household. significantly different than the $4,500 we talked about before. Yes, per year and for 30 years. Those are generally 20 to 30 year bonds. Sometimes you refinance to save the community some money, whether it's a variable rate or a fixed rate. We also have a current balance of approximately 10 million in Measure G. One of the advantages of having Measure G is you, when you go to the state, you have a very difficult process to go through. And you actually have some money that you could start the process in January of 2020 if that's what the board chose to do. Most districts have to wait until they pass the bond. When they do that, that wouldn't be till November. So you wouldn't begin your process till 2021 versus 2020. And that cost of construction would probably cost you 10 or 15%. A lot of districts are finding that out. So you'd have $185 million available to take a look at building new schools, not fixing up. And it would probably take the community a couple bonds. You have to have some vision and you have to think out about 10 years for where you want to be. So what could be accomplished with $185 million for students for the program? Having a building that, okay. Having a program that would benefit students both the architectural and facility as well as academically. If you were to build in 2020 three brand new elementary schools of 650 students, it would cost approximately $150 million. That's above average school. It's not a Cadillac. But it's significantly better than anything you have in Newark. It would be $150 million, three schools at 150 million with a capacity of 650 to 700 students which fits the model of consolidating two schools into one, although a brand new school. We would take $18 million and there are two options. A lot of school districts are looking at the middle school concept. Very few school districts have junior highs anymore. Some do it because their enrollment's too much. Some do it because their enrollment's too little. That's Newark's case. We have approximately 420 to 450 sixth grade students in eight schools. So you have about a class and a quarter, class and a half per school. Very difficult to have continuity. with that system. So we would be looking at one option, building a core program where sixth grade students had a core teacher, same teacher that they have now, that they have all day for the morning portion. And then have options if they were at your junior high school with having choices for classes in the afternoon. We would build 16 classrooms at 900 square feet each. There would be two innovation spaces where kids could create, build, and think. And those would be 1,200 square feet, about a classroom and a half. There would be a large nurses, counselors, office space. There would be a science tech lab. and approximately six bathrooms. So it would be 22 rooms, square footage. That's one option. Also spoken to a couple architects who have indicated you have a lot of space at Newark Junior High. And with some study, it might be better to remodel a wing at the existing Junior High change all the rooms around inside with the proper electrical, proper heating and ventilation system, and use what's there, there may be a cost savings. So we'd have to take a look at whether that could be done. So there are two options to do it, not just one to build new, to take existing and remodel the existing space after we did a study of what exists now. And you will be hearing in our next study session from our educational side of the house about why that might benefit students, the sixth, seventh, and eighth grade program for that middle school age group, because the curriculum does change. We would look at allotting $7 million to Newark Memorial High School for improvements. Some of the things that we know need to be repaired. Newark Memorial High is your newest school, even though it's 30 plus years old. The bones and the structure of the school are in pretty good shape. Because it's 30 years old, not 60. And there would be some things that need to take place with flooring, plumbing, lighting. I've talked to a lot of students, and your student board member has talked a lot about the star building, which is science, technology, art. And so making that more usable as an innovation space for students at the high school would happen in this first bond. And then four years later, you would ask the community with what they saw, Were they ready to complete the one or two more elementary schools that we're going to have to get by with? And then by then, probably upgrade the junior high school significantly, because it was Newark High School, and it was built 60 years ago. And when you build a budget, you need to think through, depending on how fast the community can move, is going to cost. I think I mentioned to the board that in 2012, neighboring districts built elementary schools for $25 million. We're talking about that school at $50 million. And I really don't know what it's going to cost in 2030. But it won't be $50 million. So I've put in a 5% contingency for costs. or things we don't know, like the land, the soil underneath the land. So that's how we would spend $185 million. And I'd like to hold questions on that because Char is going to help us write those down so that you can just let us know what they are because we might have to do some research and look at whatever you want. So that's the first, that's the program. different than the fix it up, make it program that we've had in the past, which you still can do, it's a board decision, or do you want a new face for Newark and a program that will be economically more secure and cost you less operating budget for at least the first 10 years. Questions the board might have, if Char, you would be kind enough to write those questions down. Both the home audience and the audience here can see those. And we will use that as part of our next study session. So if I can pause for a moment.

[3187] Bowen Zhang: I do want to ask, where do we come up with the 800 million? Where did we come up with? So how did we reach the 800 million? I know it is, but that 800 million number, how accurate would that be?

[3202] SPEAKER_26: It's about as accurate as numbers are today. They actually said the number would be, in today's dollars, 600 million. And you can't complete the remaking of existing buildings in anything less than 10 years in the district. You have too many schools. And so what you would do is start on that road, and you'd be at the cost of whatever inflation is going to be coming up. And I don't know that. So generally, over 10 years, at 2.5% a year, that's 25%. And that's what they put in as an estimate. Their $800 million number is their number, not my number. have any quarrel with it in terms of, I think it's pretty accurate, based on the last 10 years. I don't think it will double as it did in the last 10 years, going from $25 million to $50 million. From $20 to $30, you're probably looking at $37 million for an elementary school somewhere in that vicinity. But it's unknown, to real answer your question. Maybe something will happen. The construction cost goes down. There's a less, more effective way to do it, some other kind of material that we don't know today. But it is a good question. So are you clear on the 600 to 800?

[3295] Bowen Zhang: The whole discussion about building new schools and replacing the new building is based on the premise of this $800 million. If this precondition turns out to be false or way off, I think our discussion is not really worth it. Because what made me start thinking about the whole replacement of the elementary school is this number, because this number is too scary for me to not think about replacing and building new stuff.

[3324] SPEAKER_26: Well, if you were to look at $50 million today, first of all, you can only build about a school a year in round numbers. So let's say that we were to replace all eight elementary schools at $50 million apiece. That's $400 million. And easily, you could spend $100 million at Newark Junior High School and probably another $50 million at Newark Memorial. This architectural firm does this for a lot of, different districts, and I have no connection with them, but I think their numbers are pretty accurate.

[3364] Elisa Martinez: Right. We're still, it's still a scary number.

[3370] SPEAKER_26: If I may interject, and then we'll come back. Mr. Zhang, that only gets your cost of construction. Your operating cost of your schools and your administration hasn't gone down one little bit. to be able to do that.

[3386] Elisa Martinez: And that was going to be, I don't think it's just about the repair, but I think it's about the numbers that we just saw and heard about, which is our day-to-day, how are we going to cut expenses without continuing to go to salary, salary, salary, right? And we go back to the numbers, and maybe we're not even at the California average of 600, But we're at three in some schools, less than 400, 360, 350. A couple schools under 300. So I mean, we have to look at that. I mean, that's the responsible thing to do. So I don't think it's just purely on the maintenance thing. We have to look at, do we have enough to cover the operating expenses, frankly?

[3430] SPEAKER_26: There's another comment that probably for the home audience is significant. 85% of the school budget is in people, employees. And so that only leaves the board 15%. Utility bills take up about five. Other contracted services like attorneys and those kind of things take up another five. So your choices are really down to about 5% of the budget. On $70 million, that's $3.5 million. So I know school board members get pinged on, why can't you do this or that? You don't really have a whole lot of control over your budget. Unfortunately, the money comes from the state, and then they tell you do what you want, but you have to do collective bargaining.

[3478] Bowen Zhang: I got to ask, say, theoretically, we replace all the eight, whatever old building with new building, what will be the initial maintenance cost for the first initial five to ten years for those new buildings?

[3490] SPEAKER_26: Would be very thin, very, very thin. But what you have to do, And I can't think of very many districts that do it. They get a brand new school, and they cut their maintenance budget. And they forget that a hot water heater still only lasts 10 years. You went to a school that was 10 years old, and I was quite amazed at how well it had been kept. But they have what they call a sinking fund. And they put, every year, hot water heater in your homes about $1,000. They last 10 years. You have to put $100 a year away to cover a hot water heater. Not very many people do that. They wait till it blows up. You need hot water. So you find $1,000. You put it on your credit card or some other kind of thing. Schools need to do that. That's how Newark got itself into difficulty. As much as the community does support their schools, it wasn't at a level that kept up. Because look at them. Everybody agrees that air conditioning, heating, roofs, all the things you heard tonight, those are true statements.

[3560] Bowen Zhang: I guess the second question I want to ask is the initial maintenance cost for the new building. Because you were talking about eliminating the 800 million accumulated deficits. But we all have a better idea about what will be the future deficit, maintenance deficit, if you get a new building.

[3577] SPEAKER_26: That's a good question. Generally, the rule of thumb is you should, as a district, be putting 5% away of the value of your building every year in its sinking fund for things like carpet. Carpet lasts eight to 10 years. Heating, air conditioning after 10. So the first years are going to be really good, and then If you stretch it from 10 to 15 without putting any money into your buildings, then you're going to have to do some kind of maintenance thing. And if you stretch it further, you'll be exactly back where we are today with 60-year-old buildings that have not been kept up. Other questions from the board that we need to come back and do some research on?

[3635] Bowen Zhang: Can you tell us what the general operations are? After we pass it, say 160 million, how many years will that take an average household to pay off that?

[3645] SPEAKER_26: Between 20 and 30. Average bond's running about 3.5 to 4% right now.

[3664] Bowen Zhang: And I guess the... prevailing interest rate at the time of the passage of the bond actually can affect how much you need to pay back, right?

[3672] SPEAKER_26: That is correct. Generally speaking, school districts do fixed rates, not variable. You can. But that's a hole when we get towards the bond. We're not anywhere near there yet. You're going to see some other things that have to come first. But that would be your financial advisor. And where those numbers came from was not me. Kelly, Norcross, and Nubriga is your financial firm that your district hired a couple years ago, I believe. And that's where those numbers came from. So you would have, if you start to look at a bond, then you would have them come represent, update numbers, validate what they've said. Talk about the marketplace has been pretty flat the last two, three years. You haven't seen any big spike in rates.

[3727] SPEAKER_33: Ready for the next one.

[3728] SPEAKER_26: OK, let's go. Now what I would like to show you is we've talked about the two concepts. Continue doing what you're doing. Take a new approach. What kinds of activities and timeline would we look at? And this is going to be some significant information for the board in planning your future board meetings for actions you would need to take. So let's talk about a parcel tax for a moment, because everybody likes a parcel tax. Parcel tax has to pass by 67%. So we get the superintendent and Mrs. Gutierrez to vote yes for it. And the four of us, one no vote takes away two yes votes. So those two people vote yes, Mr. Zhang votes no. It goes nowhere. It's not 55%. So it's much more difficult to pass. And what would that raise? $100 per parcel, and again, you'd have to take out the senior citizens if you choose to exempt those folks, would raise $1.2 million. So let's put that kind of in perspective. $100 a parcel raises $1.2 million. $240 a house raises $159 million. So if you had $1 million from a parcel tax, could you use it to work at your deficit? Yes, you could. And that would take about half of your deficit away. So it's just the facts. We will, when you get studying this, increase that amount to $200. which would give you 2.4 million, something of that nature. So you're going to get, if you accept the recommendation, much more data and much more depth about that. But, you know, I think it's important for the home community to realize there's a huge difference between a general education obligation bond must pass by 55% and a parcel tax that must pass by 66.67%.

[3879] Bowen Zhang: When we count whether the parcel tax, do we just look at the people who vote yes and see if there are more than twice as many as the people who know? Or there's a 67% number there?

[3894] SPEAKER_26: Can I put that question on hold for just a minute? Because I have the answer to that coming up. Is that okay? Okay. Thank you. So the next thing that we would do, and I I'm looking at bringing that to you for your consideration at your October 17th meeting, is we need to have an independent firm that does survey. You hear from people at a school board meeting, very valid opinions, and it gives you a snippet of how people feel. But it's a dozen people. They would do a survey of 400 people in your community. And it's a research data firm. The firm, we have three proposals before the board that I will bring you, three different firms. They're all very good at what they do. The recommendation will be the firm that did it for you for your 2012 bond and did the city's polling for their utility tax. Why? One, their cost was the lowest, but two, I think they know the newer community. That is a time when knowing the Newark community actually makes some sense. Because they've done it before, they know what questions to ask, and the Board of Education can also pose questions. It's called what they call almost like a study group. They do it sometimes by telephone, and then they do it sometimes by inviting people in to hear. And you will hear from the firm to present how that goes. We are looking for a contract with the Godby firm. That's what we're talking about. October 17th, so that you can hear from all of your community what they think the conditions of your schools are. And you will get data on, should we do a parcel tax? Should we do a geo bond? Should we do both? And it gets at your question, Mr. Zhang, about what percentage were favorable. They do a whole series of questions. They'll describe that to you in a lot more detail than I can. But it really will give you a research-based data group from a wide selection of people from newer. It's a telephone survey that they do. They've done it with the city. I checked with our new city manager. He was comfortable with the data that was presented. You would get those survey results in December of 2019. Takes a couple months. So you would know before the new year, what's the survey say? Have the people have been talking to you? I think they know what they're talking about. But if your community says, no, we're not going to pass it, then you go back to cutting teachers and those other kinds of things, because it's likely it won't pass. But you don't know that data right now. And we'd like to bring that before you. Generally speaking, you would like to have the poll come back with a 55% positive. And then you begin a series of educational information. to help educate the community to what they might be getting for either a parcel tax or a bond. But if the board chooses, nope, we're not going down this road, that is definitely your choice, all five of you. And say, nope, to the superintendent and the business CBO, we're going to cut programs. We're going to live with the money that we get. We're going to try to operate our schools just as they are now with the information that you have that they're not very efficient. So the next thing that would have to be constituted is something called the Form the Measure B Bond Committee. And I made up Measure B. The county decides on what letter it's going to be. But it's kind of worked with Build Newark Schools, BNS. It was kind of catchy to me when I was putting the slide together. The first thing you would need to do is select a chairperson for the committee because you haven't done that in a while. And it takes quite a bit of effort. So in February of 2020, we'd have to look for a very energetic, very well-schooled, and person that has a lot of time to lead this effort. There are three main tasks that need to happen. is you're going to need to collect funds. Once this gets placed on the ballot, you cannot spend $1 of Newark money because it's a political issue at that point in time. Everybody has to be a volunteer. So a person coming to work could not make a phone call on Measure B committee if they're employed by the Newark School District. That's against the Fair Political Practices Commission. So what you would do is to try to raise money, and you start early, is all the people that have a vested interest in the district are mostly your vendors who do business with you. And the local support groups, whether it be Kwanas, Rotary, businesses, everybody knows that a business wants to attract people, good schools attract people first. It's the first thing on parents' mind, particularly if they're new to this country. Media lead. This is going to have to create public relations. So we're going to have to work with service groups, city government officials, the public, neighborhood associations. So this chairperson is going to have a right arm of a finance chair. Then they're going to have a middle arm of a media lead, and the other side is volunteers that are going to walk precincts, as you heard parents tonight talking about, stuff mailers, flyers, create a speaker's bureau, phone banks. And as I said, none of these activities, particularly as you, once you put it on the ballot, and the date for the ballot is August of 2020, this board needs to notify the County Office of Education to place it on the ballot. Another reason why November works better, the cost of an election in November is a lot less than March, because there'll be many other things on the ballot. And the register of voters adds up all the people and divides by the number of participants in the election.

[4329] Elisa Martinez: Can we wrap up in the next ten minutes?

[4331] SPEAKER_26: We're gonna make it. We will be there by 8.30.

[4339] SPEAKER_35: All these, the process that was on the bottom, are they all done by the surveyors? Is that separate?

[4344] SPEAKER_26: Okay. Sorry. The first one is done by the people that are going to do the survey. The second one is done by the Board of Education. The third one is involving our community and the board working with the superintendent to identify those three go-getters. This is about not nitpicking. and not looking at what we did in the past, but what we're going to do in the future. And I think there's some really intelligent people in Newark that can do this. Many of them I've heard at this podium. You would also then begin to have an architect interview pool, and you would begin hiring. Now, why is that important now? Because you have to get your plans in and approved so you can begin construction. And I would begin doing that now rather than wait till the bond because you lose a year of time, your cost for the architect goes up and your cost of construction goes up. You also have to have somebody help you submit eligibility application to what's called the State Allocation Board, that's what SAB means, to get that 20 million or whatever that number works out to be. That's a separate railroad track. You need to submit an application to the Office of Public School Construction.

[4433] SPEAKER_27: So let me pause for a second. I want to just go back, talk a little about the parcel. Is this kind of the same timeline trajectory?

[4441] SPEAKER_26: Or are you going to hit that at the end? Good question. The parcel tax, since it's only $1 million, the board could decide what they want to spend that on. Salary raises, that'd be a percent or two. That's up to the board to decide what they want to do with that. You could spend it on fixing up things. You could spend it on a music program that gets quite popular, a science program. You fund X number of teachers for a particular program. So a million dollars is only about 10 teachers. So it's not a great deal of money. It's not going to take you very long to spend a million dollars. Now maybe you go to a higher amount of 200, now you have 2.4 million or something. But that isn't going to be a long discussion.

[4492] SPEAKER_27: And parcels typically go for 5, 7, 10 year intervals?

[4495] SPEAKER_26: Yes. 3, 5, 7, and then they have to renew. That is correct. So if the board chose to put a ballot, chose to look at new schools, you would need to begin in early 21, because you're not going to implement this in August of 20 or August of 21. It's likely to be in August of 23. You're going to need to create a boundary study. You'll bring in a professional. You haven't done a boundary study in this district in years. That's why you have some schools at 285 and others at 450, because your boundaries have changed. Your population is not the same in all your neighborhoods anymore. And so you should do that every five years, not that you're going to change boundaries every five years, but you should look at it. So if you had fewer schools, you'd look at boundaries, the least disruption to parents, the walking distance, what big streets you would have to cross. And hopefully by March of 21, your architect would have plans and you would have plans approved by the division of the state architect. That's what DSA stands for. That's a year process because those are engineers and the people come back with lots of questions. You would need to begin a process for selection of contractors in June of 2021. You would begin construction in January of 22. And students would move into their new schools no later than August of 2024. And I finished at 827. I have a question.

[4625] SPEAKER_35: If for whatever reason, All this is, even AIDS, so your idea and even AIDS work, which they're estimating 600 million and possible 800 million. All this is still, for any of this to happen, it's still contingent on the community saying, I'm good for partial tax, I'm good for a GO fund. Let's say election happens and none of them get voted on. So then, what is their default plan?

[4657] SPEAKER_26: Thank you for leading, because you said something that I just realized I didn't clarify. The $800 million is if you rebuilt your schools. And I think we've looked at, that's not a number that the Newark community would be willing to support. Now, maybe the survey would say something different. We're talking about $185 million, which is about a quarter of the money to do this plan.

[4691] SPEAKER_35: Currently, I feel like we have two options. We have Ada's, which is a $600 to $800 million plan. We have yours, which is a $185 million plan. And then what's our default if any of those two get approved?

[4706] SPEAKER_26: Keep doing what you're doing. Listen to parents come up here and tell you the air conditioning doesn't work. And should we have air conditioning or not have air conditioning?

[4714] SPEAKER_35: I think, and I understand that, but I think to that end, I still want to have a default plan, because even if these don't work, and let's say our community, for whatever reason, just does not want to vote for this, our students need to continue studying, and they need to continue to have a facility, and they need to continue to have AC. So I would like to have a default plan.

[4736] SPEAKER_27: I can respond to that. I think part of that would be we have to come back and revisit school consolidation. So school consolidation would probably be something to look at. School boundaries, we'd have to come back and look at that after exhausting those other things to see if they're feasible. They may not be feasible. The polling may come back and say, we don't support either. We've got to stick with, do another plan. And I would say that because of, if there's not support in the community, we'd have to do things within the sphere of control with more action, which is probably going to be school consolidations, school closures.

[4773] Elisa Martinez: I know we only have two minutes. You know, coming back to Mr. Zhang's question and, you know, that's kind of coming back in my mind, 600,000, 600 million, sorry, I wish it was 600,000 on the ADIS report. I can't, if I were to go have a conversation with any community member, I can't in earnest, I don't know enough to say absolutely we need every million of those 600 million. So if we were to, I think this is a request I guess that's where I'm going is I think there's a couple of us in the subcommittee that should look at those recommendations so that, you know, we can amongst ourselves as a board, you know, get to that degree of certainty that we need every one of those $600 million. Because if that, then that's a different conversation that I can look at anybody in the face and say, this is absolutely something we need. But if we come back and say, you know, it's a smaller portion and we'll have to, you know, limp along for another 10 years, that's also a conversation we could have. So I think that's something that we need before we can really be certain this is the direction. We don't need to do something. It may be consolidation if we don't believe this is the path we need to go. But there is a hard answer we're going to have to arrive to. We just don't know which ones. So I think we've just got to do our homework.

[4862] SPEAKER_35: And for the sake of time, if I can get some questions to Sharjah just right, and then we can, they can get answered later. And this is in regards to the survey firms. Basically, you said, I think you said you already have, currently already have three bids. So who are they? How are they picked? And is there still any time for additional bids to come through?

[4883] SPEAKER_26: No to the last question. Unless you're.

[4886] Elisa Martinez: No discussion, let's just get the questions. I'm sorry, because we're about to break some rules here, so.

[4892] SPEAKER_26: That'll be coming back to you October 17th as your next board meeting.

[4896] SPEAKER_35: And then one more, Lucia? No, I'm sorry. Oh, actually, I need one second. Just remember, Rodriguez, what your money is for. Okay, I believe they were answered, so thank you.

[4917] SPEAKER_27: The solution might be some blend of all these or none of these. But I know we have two more study sessions we're trying to put together to kind of keep bringing those pieces of the puzzle together. As I said earlier, I think that if I, you know, both things are important, but it comes down to the viability with the community. And I think that I definitely am interested in stabilizing the pay of our employees. And I think that is a reason we do lose employees over time. That's the bigger thing we're wrestling with. But I do want everyone to know that the purpose is just giving you lots of different models to look at. And maybe from that, a solution might emerge. But there's not a hard, fast, this is absolutely what we want to do. But I think all we're saying coming forward on the 17th is it's worth at least asking the polling to see if we know if there's viability. It's really not, as far as I'm concerned.

[4975] SPEAKER_35: I move that we adjourn. I'm sorry? I move that we adjourn. Yep.

[4979] Elisa Martinez: Can I get a second? I second. Can I get a vote? I don't think we need a vote.

[4986] Elisa Martinez: OK. Four ayes, meeting adjourned.

No minutes available.