Possible Additional School Costs to the Parents of $47,000 per Year plus Inflation- Forever

posted in: North 40, School, Schools | 0

What happens if living units are built in the north end where the Campbell, Cambrian and San Jose school districts lie?



By law, the schools will receive $3600 dollars per average sized living unit of 1572 sq. ft. (1572 x $2.29) which is a state mandated, fixed fee to the school district.  In addition to this fee, the developer, Grosvenor has made an agreement with the LGUSD to give them either 2 contiguous acres, or $23,500 per living unit that is neither affordable nor low income.  If the current plan was approved for 271 of these units, the LGUSD would receive either the acreage or $ 6,368,500 over and above the state mandated $975,600 specified by SB 50.

However, the North 40 consists of 4 other elementary school districts (Campbell, Cambrian, Los Gatos Union School District , and San Jose) with the LGUSD comprising only the ~southern half of the 44 acres.  Any housing going into the north section of the North 40 would fall into the other school districts jurisdiction.

In general, the property tax money for schools goes to the jurisdiction.  A complication may arise if the housing were reduced in the southern half, that would reduce the amount received by the schools proportionately.  Having the houses spread around the North 40 may be more pleasing to many people, myself included,  but it is important to understand the implication for the dollars donated to the schools and the property tax dollars.

The agreement calls for an additional mitigation fee of $23,500 for every market rate unit in the Los Gatos Union School District. Students who live in the northern end of town in the North 40 are students in the Cambrian School District  – not part of the agreement between the developer and LGUSD. Students who PETITION to transfer from Cambrian into LGUSD have the right to appeal to the Santa Clara County Office of Education (SCCOE).

If SCCOE approves the transfer from the Cambrian into LGUSD, LGUSD would not receive any revenues to educate children living in the Cambrian School District. The financial burden to educate students from other districts falls on LGUSD for 9 years (K-8). For example, the cost to educate a student in LGUSD is approximately $9,630.  As best I can determine, the cost to educate a high school student is $13,000.

Given that the North 40 has its own community identity, and bounded by four major roads, all within Los Gatos,  it would be very common for the families living in the northern half to petition the Santa Clara County Board of Education to have their children go to the Los Gatos schools since they actually live in Los Gatos, and they are living in a defined neighborhood.  I confirmed this with both LGUSD Superintendent Abatti and with former school principal and administrator, Jim Russell.

The North 40 is all within the Los Gatos boundaries, and is physically bound with Hwy 85, Hwy 17, Lark Ave. and Los Gatos Blvd.  To a degree, it is a community within itself, and parents in the northern half have the right to petition to join the LGUSD.  Petitioning does not guarantee that they will be accepted to the LGUSD, however, parents have a right to petition to the Santa Clara County Board of Education, and it is likely they will succeed in sending their kids to LG schools for as long as they attend LG schools.

It may be far worse than just losing the $23,500 donation plus losing the $3600 mandated dollars.  The schools would also lose the property tax benefits.  If the average unit sold for $1,200,000, that would be an annual loss of $12,000 in property taxes to the town, of which approximately 40.62% goes to the schools.  This does not count any 2% annual increase.  The cost of each child attending Los Gatos would be incurred by the LGUSD.


Very roughly, over the elementary school life on one child (K-8) the cost to our school district would be $11,563,000 IF 120 of the living units were placed in the northern half.  Over the school life of a high school student, 10-12, the cost to the LGSUHSD would be $6,535,000 for those same 120 units.

Without figuring in inflation, the parents of LGUSD and LGSUHSD will have to raise another $ 47,000 per year, plus inflation, into perpetuity, just to stay where the school budgets are today.

This is a Catch 22 that you should know in advance and an unforeseen consequence of spreading the housing to the northern half of the development.

One last thing, I’m not sure that it was the developer that wanted all of the housing in one location.  As I recall, the LGUSD also wanted the living units all in the south – perhaps because they knew they would be facing the above costs.

To see the spread sheet, click on:   Costs to LGUSD w houses in the north section of north 40 w corrected prop tax split


Note:  The data sheet has to be a .pdf format due to our blog limitations; however, I will be glad to send you  the actual Excel file if you want to check my formulas.  Please advise if you see any errors that need correcting

Due to state law, SB 50, local governments cannot consider the implications of development on the school system.  But we can and you should.


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