School Fee Update | April 2014

About School Fees

At this time, many school districts throughout Riverside County are considering the state of their per square foot school fees.  Those that are currently at the higher rate Level II must reexamine their fee annually with what is known as a School Facilities Needs Analysis.  At least half of the school districts in Riverside County currently charge the statutory Level I fee which was recently raised mandatorily by the State of California from $3.20 to $3.36 per square foot.  These are codified in school districts when what is known as a School Fee Justification Study is passed by a Board of Trustees and is merely a mandatory statement of validation for the benefit of transparency and the Board.

SFNA’s are challenging to justify and often the cost of the study can outweigh the benefits which is one of the reasons why many districts choose to remain at a Level I fee.  Additionally and more importantly, the pace of development, market concerns, land acquisition costs and student generation all play a role in the rate of a higher Level II school fee.  The BIA staff reviews these items and conditions contained in SFNA studies to validate assumptions or challenge them based on data conflicts, assumption errors and market realities.

The Riverside BIA has supported the conclusions of many SFNA’s as well as the decision for the vast majority of school districts to stay at their current Level II fee rate or the lower statutory Level I fee rate.  Our review of these studies is ongoing and below is a selection of a recent victory and an ongoing challenge.

Riverside Unified School District

The Riverside Unified School District (RUSD) recently met to consider an increase of $0.23 to their $3.77 Level II School Fee bringing it up to $4.00 per square foot. With the average size of locally built Single Family Detached (SFD’s) homes being 3,300 square feet, this would mean a fee increase of roughly $760 per unit.

The BIA staff discussed its opposition with RUSD’s retained consultant as well as individual members of the Board of Trustees. At the scheduled public hearing the RUSD Trustees listened and summarily questioned their staff and consultant regarding the merits of the proposed fee. It should be stated that following recent November 2012 elections there was a significant shift of representation to the Board when longtime incumbent Chuck Beaty was defeated by a young professional realtor named Brent Lee. The RUSD Trustee’s chose to make a bold statement about its support of the business community and clearly understood the mutually beneficial partnership it shares with the building industry. Four out of five Trustees voted to defeat the proposed increase and maintain the current Level II fee rate. The BIA appreciates the decision made by the leadership of RUSD and looks forward to continuing its valuable partnership with the District. 

Val Verde Unified School District

Alternatively the BIA has been involved in challenging negotiations with the Val Verde Unified School District (VVUSD) Staff. The BIA has consistently engaged the district and met with staff regarding its opposition to what would be a fee increase making it the largest Level II fee in Riverside County.

VVUSD had originally proposed a school fee increase from a Level I fee to a $5.76 Level II fee potentially costing the industry $5000 or more in additional fees per unit depending on the size of a unit being built. The BIA successfully defeated the increase at the last Board meeting in March. The staff has since proposed a new fee increase of $5.57 following recent dialogue between the BIA and school district staff. The BIA still strongly disagrees with the assumptions in the current version of the study. The BIA has found codified methodology errors and has retained a consultant well versed in SFNA studies to challenge the district’s conclusions.

We urge the industry building in the VVUSD region to pay close attention to this matter as we will continue to keep the BIA membership updated. The public hearing for the proposed fee increase is scheduled for the evening of May 6th.