Fourth Estate + One

I am happy to report that there is another blog now covering the Hermosa Beach school district financial problems:

Save Hermosa Schools

Russ, the blogger, has a more sober straight forward approach than mine. That is good. Hopefully between us the voters of Hermosa Beach will be able to find something they like.

I glanced at the numbers he has for the current Hermosa Beach City School District budget. I have been casually looking for these numbers for a week, but I could not find them on the official school district site for some reason. I have not dug into the data, but it looks to me like the school district will be short by $133,000 this year?  Are we seriously calling this a problem? The leaders of Hermosa Beach can't figure out how to patch a $133,000 hole? That is only 1/5th of the Dog Catcher Budget!

Problem Solved

There are 7000 parcels and about 10,000 housing units in Hermosa Beach (please note that I am not even addressing the obligation of the business community, yet). So correct me if my math is wrong, but if we had a TAX (there, I said the T-word) of $13.30 per home or apartment per year, there would be no problem?

This almost seems like a joke to me. Nobody could be seriously considering allowing the value of the average home to fall by $150,000 or more (see studies in previous blog posts) in order to save $13 per year, could they?


Hermosa Beach City Council
Peter Tucker Mayor peter@electpetertucker.com
Howard Fishman Mayor Pro Tempore kkfish@earthlink.net
Jeff Duclos Councilmember jeff@jeffduclos.com
Patrick "Kit" Bobko Councilmember kit.bobko@gmail.com
Michael DiVirgilio Councilmember mdivir@gmail.com

Councilmembers' phone number (310) 318-0216
Councilmembers' fax number (310) 372-6186


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Where There's Smoke, There's Money

Let me share a secret - THE ONLY THING I CARE ABOUT IN HERMOSA BEACH RIGHT NOW IS THE SCHOOL DISTRICT !!!

To be more specific, I do not care about smoking on patios.  I do care about the Hermosa School District being handed over to LAUSD (Los Angeles Unified School District), whose motto is Destroying The Future One Child At A Time.

Whereas Kit Bobko has spent his time sleuthing out hidden budget line items like $624,000 for a dog catcher, Councilmembers Jeff Duclos and Howard Fishman are spending their time trying to ban the burning of tiny tubes of leaves outside in the open air. Given that there are probably 5,000 barbecue grills, and 5,000 fireplaces in Hermosa Beach, the additional smoke that these cigarettes will add does not interest me.  Furthermore, Hermosa Beach has a ban on leaf-blowers that is never enforced.  If these pro-air quality councilmembers want to show their sincerity for saving us all, they should consider figuring out why I can count a dozen noisy illegal leaf blowers running on my block every single week.  And they can explain why I can't drive anywhere in Hermosa Beach without seeing leaf blowers running 7 days a week.

But I digress.  I have a solution to the Patio Smoking Issue.  It is called the market system.  Or you can call it Smoking Offsets.  Whatever you call it, it involves charging money for patio smoking.  Specifically, any bar or restaurant that wants to have smoking on their patio can pay $1.00 per day per unit of patio capacity.  For example, a patio that has a legal limit of 30 people would cost that bar or restaurant $30/day, which is $10,950 per year, charged annually. This is just an example of course.  Maybe $2 per person, or $3 per person would be the optimal number. The bars could just add it to the bottom of the bill and nobody would notice or care. Every penny of that money would go straight to the Hermosa Beach City School District.  Any any bar or restaurant that is not paying, and is caught with smokers on their patio, would have to pay triple for that year.

Of course dyed in the wool Puritans who want to tell everyone what they can and cannot do will never be happy with a solution like this, but they don't want any drinking or any bars to exist at all, so who cares about them.  They are not happy and they will never be happy.

Business owners should love this.  Money is the language of business.  The market system is the religion of small business owners.  As a matter of fact, if they have any sense at all, they will make this their mission.  If they can get Hermosa Beach parents and Hermosa Beach educators, and Hermosa Beach home owners on their side about the Patio Smoking Issue by using it to raise money for the schools, then they won't lose the right to have smoking on their patios.  Otherwise, they had better realize that they can kiss their smoking patios goodbye, just like bars and restaurants in Los Angeles, Beverly Hills, Culver City, and Calabasas.

Hermosa Beach City Council
Peter Tucker Mayor peter@electpetertucker.com
Howard Fishman Mayor Pro Tempore kkfish@earthlink.net
Jeff Duclos Councilmember jeff@jeffduclos.com
Patrick "Kit" Bobko Councilmember kit.bobko@gmail.com
Michael DiVirgilio Councilmember mdivir@gmail.com
Councilmembers' phone number (310) 318-0216
Councilmembers' fax number (310) 372-6186

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Kit Bobko Saves the Hermosa Beach School District?

We have good news, I think.  The Beach Reporter reports that Kit Bobko has discovered some interesting numbers in the city's budget:
http://www.tbrnews.com/articles/2011/02/24/hermosa_beach_news/news10.txt

It seems that Hermosa Beach spends $624,000 per year catching dogs, cats, and raccoons.  Yes, that is $1,710 per day, 365 days per year.

For those of you who aren't familiar with the exact dimensions and demographics of Hermosa Beach, the city is 1.3 or 1.4 square miles, and it has a population of about 20,000 people.  I would like to know how many furry critters are caught per year.  Then we could figure out what we are spending per furry critter caught, and compare that to the amount that Hermosa Beach itself spends on each student in the Hermosa Beach City School District.  If anybody has any statistics on this I would really like to see them.

I do not feel very threatened by cats, and I don't see why they need to be caught.  If there is a raccoon problem that I have never noticed, having never seen a raccoon in Hermosa Beach (though I have seen very slow moving Possums), then maybe home owners and businesses should be fined for leaving their garbage cans uncovered, just like people are ticketed for blocking the street sweepers from cleaning my street 100 times per year.  That could also head off any potential rat problem for which we might have to hire a Pied Piper to solve in the future.  I have heard that hiring Pied Pipers can be tricky business.

And as for dogs, make the owners pay if their dogs need to be caught.  Problem solved!  We now have a spare $624,000 for the schools!

This does make me wonder what else we are spending money on.  I know we inexplicably pitched in to buy an armored personnel carrier for the South Bay communities when defending the Surfer Statue against the terrorist onslaught was all the rage.  What did that total waste of money cost?  Has it ever been used?  How much are we spending to maintain it?

Keep up the good work Kit Bobko!  Digging into the city's finances may save us from having to sell out our children to LAUSD, the worst school district on Earth.  Two-thirds of a million here and two-thirds of a million there, and pretty soon we'll be talking about real money.


Hermosa Beach City Council
Peter Tucker Mayor peter@electpetertucker.com
Howard Fishman Mayor Pro Tempore kkfish@earthlink.net
Jeff Duclos Councilmember jeff@jeffduclos.com
Patrick "Kit" Bobko Councilmember kit.bobko@gmail.com
Michael DiVirgilio Councilmember mdivir@gmail.com
Councilmembers' phone number (310) 318-0216
Councilmembers' fax number (310) 372-6186

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Would a LA Unified School District Takeover of the Hermosa Beach School Really Be So Bad?

In the last two post I have highlighted studies showing that the quality of the local schools is a huge factor in property values and home prices.  These studies showed the results in different ways.  For example one showed that a 1% change in pass rates resulted in a 1% change in property values, in the same direction of course.  Other studies showed that people would pay a large premium to live in a neighborhood with good schools over living in a similar neighborhood with bad schools.

Then we must ask the question, would turning over the Hermosa Beach City School District to the Los Angeles Unified School District ( LAUSD ) be so bad?  Let me give you some numbers.

The California Department of Education ranks schools using the Academic Performance Index, or API.  There are different indices withing the API, and we will look at the API Growth Index. In 2010, Hermosa Beach Schools earned an API of 936!  This is a great score, ranking the Hermosa Beach City School District in the very top of California schools.  LAUSD earned a score of 709.  LAUSD's API ranking was 24% lower than the Hermosa Beach City School District API ranking.  Does that mean that handing over the Hermosa Beach schools to LAUSD will cause Hermosa Beach home prices to fall 24%?  Maybe not.  Maybe we will get lucky and home prices in Hermosa Beach will only fall by 15%!  Or maybe we won't be so lucky and home prices in Hermosa Beach will fall by 30%.

If we really want to find out what will happen when the Hermosa Beach schools are gutted, all we have to do is nothing.  As it is, the schools district doesn't have enough money, and our representatives don't have the ideas, motivation, or desire to do anything about it.

Home Value Estimate

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So enter your address above, or go to Zillow's site ( http://www.zillow.com/ ).  Type in your address, find out what your home is worth today, and play around with some numbers.  Will your home fall in value by $100k?  $300k?  $500k?  Is that OK with you?  Then sit tight, because that is what is going to happen.

Hermosa Beach City Council
Peter Tucker Mayor peter@electpetertucker.com
Howard Fishman Mayor Pro Tempore kkfish@earthlink.net
Jeff Duclos Councilmember jeff@jeffduclos.com
Patrick "Kit" Bobko Councilmember kit.bobko@gmail.com
Michael DiVirgilio Councilmember mdivir@gmail.com
Councilmembers' phone number (310) 318-0216
Councilmembers' fax number (310) 372-6186

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If The Hermosa Beach City School District Dies, Home Values Will Tank

Every study I have been able to find comes to the conclusion that good schools increase property values.  Furthermore, for those of you like to analyze these things, they find the relation to be causation, not just correlation.  In other words, it is not a coincidence, or it is not caused by the socio-economic background found in good school districts, but it is the good schools themselves that actually increase property values.

Here is an article from Columbia Business Times siting several studies on the subject:

http://www.columbiabusinesstimes.com/8099/2010/05/28/superintendents-view-school-quality-home-value-and-industry/

"Several studies indicate that homeowners would experience a reduction of 2 to 10 percent of the value of their home should standardized test scores drop by 10 percent in public schools. Specifically, the Rand Corporation cites studies that have found that a 1 percent higher average reading or math score in Chicago and Massachusetts was associated with a 1 percent higher property value.

Other studies link the value of homes to the rating of the local school. Values for homes close to elementary and middle schools rated as good or excellent were 20 to 32 percent higher than similar homes located close to schools rated as average or poor. "

If that is not clear enough, that says that when LAUSD takes over the Hermosa Schools, property values will fall by a large amount.  Hermosa Beach schools are currently excellent, the best in the state of California.  And LAUSD is as bad as a school district can be.  LAUSD is not average, it is poor or worse if there is a worse rating.  Will Hermosa Beach home prices fall by 10% or 20% or 30% ?  We will definitely find out if the Hermosa Beach School District is allowed to shut down.

Do you want to roll the dice just for fun to see if your property values fall by $100,000 or $250,000 or $400,000?

According to Zillow, the Median List Price of Single Family Homes in Hermosa Beach is a hair below $1.3 Million:

Hermosa Beach Median List Price

Hermosa Beach Home Values - Interactive chart

So, if home prices fall by only 10% after the handover to Los Angeles Unified School District, then the median list price for single family homes in Hermosa Beach should fall by a mere $130,000.  But, if property values fall by 32% as the study says is possible, then the median list price will fall by $416,000 !  And that is for the median list price.  Remember that half of the homes listed on the market are priced higher than the median by definition!

The house for sale at 2260 Circle Drive is listed for $3,549,000.  This is not the most expensive home for sale  in Hermosa Beach by a long shot.  If this house at 2260 Circle Drive falls in price by 32% after the Hermosa Beach City School District is allowed to die for lack of money, the value of this one house will fall by $1,135,680.

In other words, the value of this one single house would fall by so much that if the school district had that amount it wouldn't be in financial trouble and wouldn't have to consider surrendering to LAUSD.

Hermosa Beach City Council
Peter Tucker Mayor peter@electpetertucker.com
Howard Fishman Mayor Pro Tempore kkfish@earthlink.net
Jeff Duclos Councilmember jeff@jeffduclos.com
Patrick "Kit" Bobko Councilmember kit.bobko@gmail.com
Michael DiVirgilio Councilmember mdivir@gmail.com
Councilmembers' phone number (310) 318-0216
Councilmembers' fax number (310) 372-6186


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Hermosa Beach Schools Going Bankrupt

Home buyers who are considering buying a home in Hermosa Beach should seriously reconsider.  I have kids, and I therefore know lots of people with kids.  Many of the people I know have moved to Hermosa Beach for the great schools.  What many people probably don't know is that the Hermosa Beach School District is going to merge with Los Angeles Unified School District (LAUSD) if some serious funding doesn't appear soon.

According to this article on CNN's site ( http://money.cnn.com/2005/03/22/real_estate/homeguide_schools/ ), homes in cities with good schools may be worth 12% to 25% more than comparable homes with worse schools.  LAUSD is as bad as it gets on Earth and a handover would result in lower standardized test scores.  It is safe to say that if the Hermosa Beach School District is handed over to LAUSD, property values in Hermosa Beach should rapidly fall 10% or 20% or more.  That is an immediate and permanent $100,000 to $250,000 decrease in price on a $1 million home.


Here are a couple quotes from the article:

Education is so important, say agents, that buyers without children should sit up and pay more attention to school."By going in areas where the schools are not as strong, you're essentially cutting out a potential group of buyers," , said RealEstate.com general manager Jeff Lyons.In his hometown, Charlotte, N.C., houses in school zones with higher test scores sold for an average of 12 percent more than similar houses in areas with lower test scores, based on research by UCLA and Dartmouth for sales between 1994 and 2001. That discrepancy is likely to be even greater today.In the suburbs of Columbus, Ohio, buyers might pay as much as 25 percent more for a house in a desirable school zone, according to Jill Rudler, a real estate agent with HER Real Living. "I've always looked for property in areas where the schools are improving," she said. "I'm willing to pay a little more in taxes to ensure that my investment is solid.".....
"I was just working with a family looking for property in the $5 million range," said Meris Blumstein, a real estate agent with the Corcoran Group. "They insisted on being in a particular school district. That was their first criterion."

I will be dwelling on this topic until this issue is settled. 


Hermosa Beach City Council
Peter Tucker Mayor peter@electpetertucker.com
Howard Fishman Mayor Pro Tempore kkfish@earthlink.net
Jeff Duclos Councilmember jeff@jeffduclos.com
Patrick "Kit" Bobko Councilmember kit.bobko@gmail.com
Michael DiVirgilio Councilmember mdivir@gmail.com
Councilmembers' phone number (310) 318-0216
Councilmembers' fax number (310) 372-6186


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