Questions from the Press, April 15, 2023.

Today, Sonoma Valley Unified's board held a meeting to discuss its Superintendent search. Because I generally get questions shortly after meetings from the Sonoma Index-Tribune and the Sonoma Valley Sun, I took the time during the session to write down what I thought happpened, and my meeting notes are below. Also, the photograph included is of my daughter Siena, a lacrosse player for Sonoma Valley High School, of whom I am very proud. 

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The public portion of the meeting concerned the findings in the Leadership Profile Assessment conducted by Hazard, Young, Attea & Associates (HYA) for the Superintendent position. The data was collected from virtual interviews, focus groups, and an online survey involving various stakeholder groups, conducted between March 10, 2023, and April 7, 2023. The purpose of this assessment was to assist the Board in determining the desired characteristics in the new superintendent, as well as to identify the district's strengths and upcoming challenges.

Participation in the data gathering process included a diverse range of stakeholders, with 621 respondents to the online survey, which was offered in both English and Spanish. Parents and support staff were well represented, with 325 individual responses. Sonoma Valley Unified School District's strengths include community partnerships, a value for diversity and inclusion, and talented, dedicated staff. Challenges and concerns facing the district include a pervasive sense of mistrust towards the district, a high rate of superintendent turnover, a need for improved governance practices, and addressing student mental health needs.

The focus group meetings allowed participants to build upon each other's comments and respond to questions regarding stakeholder values, current and future challenges, and desired characteristics in a new superintendent. The search team thanked all the participants and the SVUSD staff for their assistance, and particularly Kyra Sherman for organizing the stakeholder scheduling.

The data presented summarizes the participation of various stakeholder groups in personal interviews, focus groups, and an online survey conducted for the Sonoma Valley Unified School District Superintendent search. The key insights from this data were:

1. A total of 95 stakeholders participated in personal interviews or focus groups, while 621 stakeholders responded to the online survey.

2. The online survey had broad participation from different stakeholder groups, with the highest participation from parents (269), followed by support staff (56), students (22), and community partners (10).

3. Among the interviewed stakeholders, site level administrators had the highest participation (20), followed by teachers (103), and central office administrators (5).

This data indicates that there was considerable engagement from various stakeholder groups, particularly parents, support staff, and site level administrators, during the data gathering process for the Superintendent search.

The profile was essentially that SVUSD is seeking a Superintendent who: 

• Is Visionary and has a student-centered approach, emphasizing instructional focus, special education, and balancing district strategies with classroom innovation;

• Fosters trust, respect, and a positive climate among stakeholders, with an emphasis on relationship-building and engaging with the Latino community;

• Collaborates with the Board, supports teachers and staff, and seeks input from educational specialists in decision-making;

• Involves all stakeholders in strategic planning and implementation, maintaining a track record of positive working relationships and approachability across the community;

• Demonstrates experience in managing enrollment, reconfiguring schools, strong financial acumen, and commitment to biliteracy and biculturalism.

The trustees, before entering closed session, reviewed the analysis of the survey data from HYA. The data revealed a significant disparity between the opinions of administrators and community members, with no clustering observed on the State of the District. In contrast, more clustering was found in the weighted Leadership profile. Interestingly, "understanding and being sensitive to the needs of a diverse student population" ranked within the top concerns for both community members and students. Indeed, the two highest priorities of students were that the superintendent be visible throughout the district while actively engaging in community life, and understanding and catering to the needs of a diverse student population.

The trustees then entered closed session. The closed session adjourned at 12:20, with no action reported.

Attendance, Housing, and Basic Aid.

 Sonoma County's 40 public school districts continue to see attendance declines. The lack of housing and a steadily declining birth rate are among the factors contributing to the decline. Sonoma County is predicted to experience a 16.9% enrollment drop by 2031, the fourth worst in California, as reported by the Press Democrat. In the past five years, Sonoma Valley has already experienced an 18.9% decrease in attendance, and as a trustee, I am familiar with the very profound changes that can cause. 

The article elides past some distinctions that are worth noting. First, school funding in California is based on attendance (the so-called "ADA," or average daily attendance), not enrollment (ADA is usually about 90% of enrollment, although there is a lot of variation).  Paying attention to the attendance figure will be the more reliable indicator of the state of school finance going forward in Sonoma County. 

Second, and related to the first point, is that as of November 2022, 16 of the 40 school districts in Sonoma County were "basic aid" districts, whose revenues do not change with either attendance or enrollment. In 2021‑22, the state had 118 basic aid school districts (about 13 percent of all districts).  As attendance continues to drop, more and more Sonoma County districts will become basic aid. Basic aid will increasingly be the default rule in Sonoma County. These districts (like Sonoma Valley) will ironically end up with more money per student given declining attendance, which is why many of these districts may very well not be interested in district consolidation intended to cut costs, as such consolidation would in fact reduce per-student funding.  There are a number of these districts in San Mateo, Santa Clara, and Marin counties, those counties having had many of the same housing issues as Sonoma County for a longer period of time, and the trend in those counties has generally been against consolidation of districts.   

A final point, which comes up here from time to time. "Affordable Housing" is a term of art in many respects, and while there is a shortage of housing that can be afforded in Sonoma County by most people, that is different from "Affordable Housing." Sonoma County just lacks housing, period. Narrowing the issue using the term of art is probably not the most helpful, because it obscures the fact that the response to the crisis needs to be comprehensive.

Green Checkmate.

Today Fred Allebach, a member of the Sonoma Valley Collaborative and a friend, shared his thoughts on affordable housing and the challenges faced in Sonoma Valley and beyond with me via email. He provides a historical context of the 2020 Sonoma Urban Growth Boundary (UGB) issue, and how it continues to impact affordable housing projects. Allebach identifies the "Green Checkmate," a dynamic that hinders progress in the development of affordable housing by preserving low-density zoning and maintaining property value advantages for existing homeowners.

Fred also discusses the tension between environmental justice and social justice, pointing out that environmentalists (and those aligned with) tend to use green arguments to justify preserving a low-density, high-property-value status quo. He explains how affordable housing development is caught in a series of impossible arguments, resulting in the de facto segregated status quo.

Allebach advocates for a more inclusive approach to housing development that balances sustainability and social equity. He suggests supporting lower-income housing projects in unincorporated urban service areas and strategic affordable housing projects in non-urban service areas, especially where there are substantial job opportunities nearby. He also recommends considering the establishment of a City of Sonoma Valley to better address the collective housing needs of the region's population.

I have long appreciated Fred's work and his keen attention to and expertise regarding housing. Over time, Fred, and a group of like-minded, pragmatic reformers, with their continued focus on this difficult problem, are building the necessary muscles in the community to allow change to occur in the face of what can only be described as obstructive hostility. Fred's work shows how, rather than inspiration or enlightenment, it is grit that is the essential element in pursuit of justice.

Housing, a Public Good.

Wikipedia contributors. (2021, September 15).

Public housing.

In Wikipedia, The Free Encyclopedia.

Retrieved April 5, 2023

from https://en.wikipedia.org/wiki/Public_housing

Yesterday, the Sonoma County Board of Supervisors held a first reading of a proposed "camping" law, which seeks to ban unhoused individuals from sleeping in specific public areas, such as the Joe Rodota Trail. Sonoma County has a huge challenge on its hands, with a 2022 countywide census finding 2,800 homeless people, of which only 800 were living in shelters. More shelters, transitional housing, and affordable housing are needed, along with social services such as mental health care and substance abuse treatment. 

But I think the core of the problem is different. I think we need to see housing as a public good, and not as a market. Vienna (60%), Singapore (80%), Sweden, Hong Kong (50%), Finland (20%), and the Netherlands (30%) have all managed to house very significant parts of their population by recognizing that housing is a public good and should be the object of concerted action. 

Sonoma County should prioritize the provision of more housing to effectively address homelessness. By repurposing sites, our County could become a "net zero" employer itself, setting a powerful example. As the county's largest employer, this initiative would have a significant impact on the housing crisis and substantially benefit working and middle-class families.

Encouraging government and employers to adopt a "net zero" position in how their operations impact the local housing ecosystem would be a good start. By taking responsibility for the housing needs of their employees and community, government and employers can play an active role in addressing homelessness and providing equitable access to housing for all. We need to focus on creating long-term solutions, not just temporary fixes.

Questions from the Press, March 27, 2023.

 As has come up here from time to time, I serve as a trustee of the Sonoma Valley Unified School District, in the northern part of the San Francisco Bay Area. My practice is to post answers I am asked by the press in that capacity, because the amount of information that can be conveyed by a newspaper is necessarily limited. On Monday March 27, I received the following questions from Dan Johnson, a reporter for the Sonoma Index-Tribune (Sonoma County has three "major" newspapers, the I-T, the Petaluma Argus-Courier and the Santa Rosa Press Democrat, all of which are owned and controlled by the same company). I have printed his questions and my written answers to them below. The questions concerned the realignment of our District, which is often reduced down in practical terms to which schools sites will continue to operate, and which will not, given declining attendance. 

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 1. During the portion about School district reconfiguration, did the board decide to end student enrollment at Dunbar and enroll its students at other districts beginning in the 2023-24 school year? Was a vote taken, and if so who supported and did not support this?

 No. The agenda was changed at the start of the meeting, and that item was struck on a 3-2 vote. Trustees Knox, Winders and I voted to strike the item.

 2. Were any other decisions made regarding reconfiguration of the district in 2023-24 or any subsequent years?

 No.

 3. What did you feel were the main points made during the Perkins-Eastman presentation?

 The trustees, after extensive discussion, focused on Scenario 1A provided by the Perkins Eastman consultants, which would see the Dunbar campus made available to Woodland Star Charter, with middle schoolers at Altimira, and Prestwood remaining open. This would be the 3-1-1 alignment discussed previously, where the three District elementary schools would be Flowery, El Verano and Prestwood, the middle school would be at the Altimira campus, and the Broadway site for SVHS and Creekside. I have attached the "skittle" graphic illustrating this alignment below.

 The board gave direction to staff to answer two questions at the April 20th meeting, first, what are the costs to retrofit Altimira as estimated by the engineers versus the costs to expand Adele Harrison, and second, what are the pros and cons, and costs, of moving to a 7-8 middle school model, with 6th graders remaining at elementary sites. The board gave direction to staff bring a motion for the trustees to act on April 20th to realign the District in this fashion, with discretionary language included regarding choosing Altimira or Adele as the District's middle school, and with discretionary language included regarding shifting to a 7-8 middle school model. The Board also gave direction to staff to implement the timeline over two academic years, with the Dunbar campus being addressed in academic year 23-24, and the remaining realignment in academic year 24-25.

 4. During the school safety discussion, did the board discuss whether or not to bring the SRO program back? Was this topic agendized for the April board meeting?

 In the proposed scenario, what would happen to Sassarini, Adele Harrison and Sonoma Charter School? No, the board did not discuss whether to bring the SRO program back. No, the topic was not agendized by the board for April 20th. Staff informed the trustees that there is a trustee request that the SRO be agendized for April 20, and I believe the request is from Trustee Landry.

 5. What did you feel were the main points made during the school safety discussion?

 The materials for that agenda item were not provided in advance to the trustees. This violated our norm of "no surprises." Further, there was no description of the item in any way, including the minimal description required by the Brown Act. The materials were also not provided to the public in advance. These procedural failures necessarily limited discussion. There was no explanation offered by the Board President for why the item was added to the agenda without this routine and ordinary requirements being met. 

 In the room, Director of Educational Services Jillian Beall gave a presentation on statistics regarding incidents of student discipline, which are down by 58% this academic year versus last. However, suspensions are up by 11%, and there have been five (5) expulsions, versus just one (1) in the previous academic year. 

 Sonoma County Sheriff's Office (SCSO) Lieutenant Brandon Cutting (who also serves as Sonoma's Chief of Police) gave a report on handling emergencies at SVUSD campuses, including discussing the general aspects of the prepared responses of the SCSO to school sites located in the County portion of SVUSD, and then in the City. The specifics were not included for operational reasons. Because the meeting ran quite long the agenda item was concluded at approximately 2:45 without discussion of the SRO and without any listening circles being conducted regarding school safety. 

 6. Would you like to say anything else?

 On March 9, and again yesterday, members of the public showed up and treated the school board meeting as a "sporting event," cheering and booing positions with which they supported or disagreed. This is unacceptable behavior from members of the public. The Board President must instruct members of the public to either maintain decorum or excuse themselves from the room, especially when she agrees with their position. Individual school board members should never have to use points of order to ensure effective uninterrupted conduct of the meeting, which indeed did happen on Saturday.

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 Shortly thereafter, Dan Johnson asked the following additional question, which I answered as well.

 7. In the proposed scenario, what would happen to Sassarini, Adele Harrison and Sonoma Charter School?

 The trustees requested a motion be prepared that is specifically focused on what facilities will be used by SVUSD for its existing instructional program, with an emphasis on cutting waste. The board gave no direction for a motion to be drafted to repurpose any of the sites you referenced and I do not expect such a motion on April 20.

Questions from the Press.

At the Niners-Saints Game, Nov 27, 2022. 

 I serve as a trustee of the Sonoma Valley Unified School District, in the northern part of the San Francisco Bay Area. In that capacity, sometimes the press asks me questions about a given subject. I generally prefer when they do that in writing, because I can answer the questions and post them, so that constituents and stakeholders can see not just what was put in the newspaper, but the context of the conversations. 

 I think that making sure the press gets answers is important. I don't know of anyone who has figured out how to make a democracy work without newspapers. Press freedom is properly the fourth protection guaranteed in the First Amendment for a reason.

 On Tuesday December 6, I received the following questions from Dan Johnson, a reporter for the Sonoma Index-Tribune (Sonoma County has three "major" newspapers, the I-T, the Petaluma Argus-Courier and the Santa Rosa Press Democrat, all of which are owned and controlled by the same company). I have printed his questions and my written answers to them below. The questions concerned the settlement of a dispute between the school district and the local construction trades council (a group of construction unions, such as electricians, plumbers, and carpenters, amongst others).   

So, without further ado:

1. Why did you vote in favor of the settlement?

It seemed to me that the general sense of the board was that the agreement was in the interests of the District, and I agreed with that evaluation. 

2. What is your reaction to the passing of it? Were you surprised? 

The PSA that was approved had been discussed for some months by the attorney representing the District and the attorney representing the building trades, and the final document reflected careful work by both lawyers. Given that the District and the building trades had told their attorneys to try to come to an agreement, I think that the success of the negotiation, and ultimate approval of the proposed PSA resulting therefrom, is not a surprise.

3. How will the settlement help the district?

 

I think that the agreement will provide jobs that prioritize a locally based skilled and trained workforce, and joint apprenticeship opportunities for Sonoma Valley students. These joint apprenticeship opportunities will afford students access to career pathway options that will provide family supporting wages, healthcare and retirement benefits, and the ability to live and work in their own community. 

4. Do you think that critics of the settlement made some valid points, and if so, what were they?

I thank the members of our community who took the time to share their thoughts with the board, both those who were in favor and those who were against. The democratic process depends upon constituents and stakeholders taking the time to express their beliefs. I don't have any other comment in response to this question. 

5. It seems to me that the two main changes in the ultimate agreement are shortening the agreement to five years and covering all work costing more than $212,500, rather than $50,000. Were there other significant changes in the agreement?

Regarding the specific changes from the agreement passed on 11-17-20, the issue was briefed by our attorney, Glenn Gould, for the board, and I would point you to that presentation. 

6. How could this process have been handled better by the board?

The settlement was handled in the fashion that one would expect. The board received legal advice that was of high quality, and acted accordingly. 

7. Several trustees said that they felt it was time to move on and focus on the needs of the students? Do you share this feeling?

I am always focused on the needs of our students. As far as my fellow trustees are concerned, I believe their words speak for themselves. 

8. How will the board be able to deal better with such matters in the future?

This was the final act of this board, and it will have no other matters to deal with in the future. 

9. Would you like to say anything else?

No.

10. I’m wondering how the changes I mentioned in question No. 5 came about. It seemed that The North Bay Building Construction and Trades Council opposed negotiating with SVUSD about the agreement, and yet two main concessions were made. Did the council end up negotiating with SVUSD attorneys?

After Sonoma Valley Unified lost twice in court hearings, Michael Allen, a former state assemblyman and representative of the building trades, reached out to the District to see if a compromise could be reached, which was what led to the settlement. 

11. Initially, the document was referred to as a project labor agreement, but at some point, it began being referred to as a project stabilization agreement. Why the change and what did it mean?

It has always been referred to as a project stabilization agreement. 

Hurricane Ian and Government Accountability.

Witnessing the damage from Hurricane Ian, the striking failures of local government to prepare their constituents feels all too familiar to residents of Sonoma County, few of whom forget the night of October 8, 2017. The failure of local government to inform residents in harm's way of the approaching danger sears memories years later. 

Image Courtesy National Weather Service. 

Use pursuant to 17 U.S.C. § 105.

To see this replicated by Lee County, Florida in the face of Hurricane Ian reminds that information from authorities in a crisis proves often unreliable. Worse, accountability after the fact is usually prevented by a smokescreen of finger-pointing and obfuscation.

This New York Times article, however, pushed across the line from mere spin to outright absurdity. Lee County, Florida, failed to warn citizens in time of the need to evacuate, despite a detailed plan prepared in advance that noted exactly how much warning was required. In defense of the County's behavior, "the county commissioner ... said that one challenge the county faced was that the local schools had been designed to be shelters and that the school board had made the decision to keep them open on Monday." 

To be clear, the county commissioner went so far as to blame the local school board for the civil authority failing to prepare citizens from the thoroughly understood threat that precisely this type of storm approaching created. The school board that was, of course, looking to the county for the very advice necessary on whether to stay open or closed. 

As a school board trustee myself, I could only shake my head. I note once again that school boards are a convenient target, whether fairly or not, for almost everything.

The Life Pressed Out.

 George Floyd was murdered May 25th, aged 46. Suffocated by a Minneapolis police officer over the course of 8 minutes and 46 seconds, his death has rightfully become a rallying moment for Black Lives Matter. Many (but not all) are astonished that three police officers stood watch as he was asphyxiated. Protests against police brutality and police killings of black people, and broader issues such as racial profiling, and racial inequality in the United States criminal justice system, continue with cause. 

"The Life Pressed Out"

Obituary, George Floyd

The Economist, June 4, 2020

available at https://tinyurl.com/yagm25jm

 In this kaleidoscope of horror, though, one fact in particular stunned and shocked me. For George Floyd knew Derek Chauvin, the police officer that killed him. They were coworkers.  Both were employed by the El Nuevo Rodeo club, a Latinx music venue in Minneapolis. George was known in the workplace for his calm manner, big smile, and physical presence. Chauvin, who had done the job for 17 years, was described by Ann Wroe of the Economist as "an off-duty white police officer with jittery eyes, who would reach for his pepper spray as soon as a fight broke out and fire it over everyone."  More than mere corruption, worse than the principal-agent problem, did Chauvin strike to settle a grudge, believing in protection from the Thin Blue Line? 

 The use of government authority and power for personal ends is the genesis of so much that is disquieting about the past two decades of American public life. But the events of May 25th must not recur.  An officer sworn to protect the public "dragged [George] aside, threw him to the ground helpless and then, for almost nine minutes, knelt on his neck, pressing, pressing as [George] cried out for his mother and his breath and his life. [George] possibly never knew that this was the same white guy with jittery eyes who had worked El Nuevo Rodeo, the one so ready with the pepper spray to keep the blacks in line." 

 But we know. And we can act. But it requires the efforts of all. As former President Obama noted, "the elected officials who matter most in reforming police departments and the criminal justice system work at the state and local levels[.] Review your use of force policies with members of your community and commit to report on planned reforms[.] Change America and make it live up to its highest ideals."

 One of the 13 guiding principles of the Black Lives Matter movement is a commitment to restorative justice, a vehicle for decarceration in the United States. In criminal cases, victims can testify about the crime's impact upon their lives, receive answers to questions about the incident, and participate in holding the offender accountable. Meanwhile, offenders can tell their story of why the crime occurred and how it has affected their lives. It's not a panacea, and real limitations exist in the context of domestic violence and racism. But it many cases, the conflict in the community calms.  

Sonoma Valley Equity & Inclusion Task Force, 2016

Report available at https://tinyurl.com/ybo9tyg6

 As Sonoma Valley Unified's Equity & Inclusion Task Force pointed out in 2018, "recent best practice for discipline in schools has included a movement toward incorporating restorative justice practices. Restorative justice has been shown to be an effective alternative to punitive responses to wrongdoing. Inspired by indigenous traditions, it brings together persons harmed with persons responsible for harm in a safe and respectful space, promoting dialogue, accountability, and a stronger sense of community." The Task Force noted some past attempts by SVUSD to implement restorative justice practices.  "However none of these attempts resulted in across-the-board implementation of the practice. While there has been some training for staff, without full implementation of the practice that includes appropriate allocation of staff, policy development, and training, change has not occurred."

 It's time for full implementation. Restorative justice practices, such as the one utilized by the Los Angeles School District, show significant decreases in suspensions. The LAUSD posted a 92 percent decrease in the number of days lost to suspensions as a result of its restorative justice program. As our Task Force noted, "[t]hese statistics are especially relevant to this [D]istrict that has a disproportionately high level of low [socio-economic status] students who are suspended and/or expelled.”

 We have the power in our Valley to make this change, and democratic self-governance starts with each one of us participating in bringing about a better shared future.  The way has been shown and the report of the Task Force is ready for implementation. Let’s make it happen. After all, it’s the least we can do to honor George Floyd's life. 

@TheEconomist on Alcohol and Health.

"A Sober Brawl," available at https://shrtm.nu/8Jwl
Sources: “Drug harms in the UK: a multicriteria
 decision analysis”, by D. Nutt et al., The Lancet;
 “How dependent is the alcohol industry on heavy
drinking in England?” by A. Bhattacharya et al.,
Addiction; Centre for Responsive Politics; NHS

A brief piece this week, on the Economist's "graphic detail" item.  "Vaping" has been in the news, with ancillary reporting relating to tobacco and smoking. The newspaper points out, however, that it is alcohol that causes far more harm, and further illustrates (troublingly) that industry profits are based on the dependency of problem drinkers.  Should all who drink at hazardous or harmful levels moderate, the price rises necessary to maintain profits would be significant.

True, firms engage in public messaging to the contrary. But it appears public health officials question their commitment.  The article points out that the National Institutes of Health recently stopped working with the industry as a consequence, as did the World Health Organization. Perhaps sensing the danger, lobbying spending by alcohol firms has been on the rise. It now exceeds that of the tobacco industry by 31%.

image available at http://tinyurl.com/qh8ww2f

It's not the way we think about these things in the northern part of the San Francisco Bay Area, where so many wineries (and increasingly distilleries and breweries) find their homes. We think of the beauty of the orderly rows of vines. "Living on a vineyard" evokes a mental flash of magic and starlight, hopefully in some way both natural and sustainable. Further, such vistas are reminiscent of James Scott's legible forests -- suggesting, to borrow from David Brooks, that our desire for ordered rationality has found symmetry in our cultivation of the natural environment where we reside.

Yet the industry those rows of vines serve has its problems. To paraphrase Brooks, the highest form of wisdom is balancing the networks that shape our reality by perceiving, evaluating, and acting upon evidence.  Doing so means recognizing that the beauty of Napa and Sonoma, as ever, can come with an uncomfortable cost. Per the bard, roses have thorns, and silver fountains, mud, while clouds and eclipses stain both moon and sun. Sobering thoughts indeed.

@econbartleby and @billswindell at @TheEconomist and @NorthBayNews, respectively.

As I lamented the result from St James' Park this morning, I looked for an insightful article from The Economist. A nice part of focusing on one piece is the chance to learn about the writer. Knowing these journalists grow up and live in a certain context humanizes them. For example, I ran across a piece by Motoko Rich of the New York Times a few years ago, and was surprised to find she grew up in the small town literally next door in Sonoma County.

Philip Coggan

available at https://shrtm.nu/EYpO

So, today, it's the Bartleby columnist, Philip Coggan. He's a graduate of Sidney Sussex College, one of the constituent colleges at Cambridge University. His work at the Financial Times, authorship of several books, and awards won belies his skill, but details on his person are scarce. He has a feed at Medium, though, where his words on the loss of a pet say much. It recounts how he, his daughter, and his wife said goodbye, recalling Philip's loss of his own father as a child:

"We take small pleasures from our pets. The purr of a cat as it is stroked; the excitement of a dog as it chases a ball; the occasional bursts of madness as a cat attacks a piece of string or a dog chases its own tail. They create a rhythm to the day; the morning feed, the afternoon walk, the night-time arrival of cat on bed, eager for shared bodily warmth. And there is satisfaction from a relationship that is so uncomplicated; in return for food and affection, the dog or cat will stay around. There are no arguments; no sudden estrangements. These small joys help us through the long days and nights. My cat will no longer be the first to greet me when I open the front door. How can I not be sad that he’s gone?"

Julian Richer

available at https://shrtm.nu/o5fQ

Perhaps fitting for a financial journalist with such a sense of the personal, the piece this week is his writing on the appropriately-surnamed Julian Richer.  Richer made his fortune in peddling high-end audio equipment in the UK, from stores cheekily named "Richer Sounds." Richer's parents had both worked for Marks & Spencer (for an American, think maybe Macy's), and he entered the business at fourteen.  Coggan draws attention to Richer for the unusual fact that Richer has planned to give away much of his wealth to his employees.

When asked why, Coggan writes that Richer claims inspiration from the nearly 40-year-old book "In Search of Excellence." Richer maintains (and Coggan appears to agree) that the case studies therein illustrate that top performing companies treat both customers and employees well. "Organizations that create a culture based on fairness, honesty, and respect reap the rewards ... [t]hey attract motivated staff who are there for the long haul."

Coggan does not concede that Richer's arguments are ones for general application. He notes that Richer Sounds' turnover is a mere $157 million. That about matches the four supermarkets in the little City of Sonoma. However, he points out that the UK's high street retailers and supermarkets (M&S, Asda) have sought Richer out for his insight, suggesting lessons for the business community as a whole.

The point Coggan doesn't quite tease out (and I give him the benefit of the doubt here, for the column is a brief one), is that Richer, while not running a family business, is definitely in the family business.  His folks were retailers.  His approach to employees mirrors many family businesses in my part of semi-rural California. Bill Swindell of the Santa Rosa Press Democrat made this point five years ago, with his article "All in the Family." Swindell's quote from Marcus Benedetti (Clover-Sonoma) sums it up, as the CEO of the longtime dairy said "I look at myself as a temporary steward of something I can pass on to my children."

Over the past months and years, increasingly, navel-gazing about the raison d'être of companies has been a recurrent theme in the business press. The Economist has been no different. Contemporary capitalism often feels simultaneously disconnected from place while focused on individual cults of personality, provoking something of a crisis. It has not always been thus. When so many large business organizations in the United States came into existence in the Gilded Age, the personalities involved were known to one another, and the ownership thereof was often family-based, if dysfunctional.  Discomfort with family-type structures may therefore be present for good reasons -- embarrassing, emotional strife was and is common, messy details are inevitable, and nothing saps a meritocracy like nepotism.

Business is replete with family fortunes won-and-lost, the proverbial "shirtsleeves to shirtsleeves in three generations." It is understandable then, that with family life often resembling nothing so much as a blooper reel, that businesses would have a long-deep discomfort with management principles that may very well be family-derived. What irony there is, then, in the unstated suggestion of Mr. Coggan's piece — that at the core of successful businesses, those impersonal machines of prosperity, is the resiliency, reciprocity, and, yes, care for one another upon which family depends?

The Return of #Cash.

Image available at http://tinyurl.com/yaxw3y5g

Just a brief note today, regarding reporters who are pointing to an economic and financial shift.  Extraordinarily low interest rates have had a significant impact on asset prices in Sonoma Valley (as I blogged about here, here, and here).  In 2015, Robert Shiller pointed out that in the San Francisco Bay Area, that most people expected annual home price increases over the next decade of 5%. However, more than a quarter of respondents thought prices would increase each year by 10% or more. Many of the second group leveraged (and profited impressively) as real property prices have continued to rise over the intervening 36 months.

S&P 500 dividend yield v. 3-month T-bill yield

courtesy the Board of Governors of the Federal

Reserve System (US), retrieved from the Federal 

Reserve Bank of St. Louis [FRED] May 15. 2018. 

S&P 500 dividend yield courtesy mutlpl.com,

 May 15, 2018. Excel data and graph available here.

Today, though, there is evidence that change is afoot, as the yield on "cash" (short term Treasuries) now exceeds the dividends on a broad range of stocks (the S&P 500).  The Financial Times' graph, courtesy of John Authers, is on the right.  I extended the graph back a bit (to 1933) just to get a longer perspective, via FRED and multpl. For about a thirty year period, dividends were generally always higher, until some point in June of 1963, when the rule flipped. Cash was king, more or less constantly, for the following ~2,335 weeks, until February of 2008. There are periods where these two measures briefly "invert" from the norm in both eras (e.g. 1959 for dividends, 2002 for cash), but it's unusual.

What does it mean? Stanford economist Bob Hall (who continues as chairman of the academic panel that dates American business cycles) notes that, economic syncopation being what it is, “[t]he next recession will come out of the blue ... just like all of its predecessors.” However, the Economist has pointed out previously that this economic cycle is already running exceptionally long at ~105 months, and it is now more than a year past the average of the last three (the longest ever, March of 91-March 01, was 120 months).  Meanwhile, valuations continue to be particularly rich (the Shiller PE is at 32.33, in excess of the '29 crash and only matched by the dot-com bubble). My sense is that the financial columnists pointing to this data are wondering how "out of the blue" a contraction could be at this point. Which is an interesting point to consider, when one reflects on the power of narratives in financial markets.

Casa Del Maestro, Pt. 1. #teacherhousing #sonoma

"Casa Del Maestro"
3380 Lochinvar Ave, Santa Clara, California
image available at http://tinyurl.com/htm8n2z

On Monday, the Press Democrat’s editorial board described a “brewing fiscal crisis” for Santa Rosa's schools, who must, as of their first interim report for 2016-17, implement a ~2.2% budget cut going forward.  SRCS is confronting flat enrollment coupled with declining rates of return on pension funds, that will increase budget pressure over the next four years. At least one board member’s suggesting a parcel tax in response.  

The editorial describes a problem familiar to Sonoma Valley Unified. SVUSD will implement a ~5% budget cut in a similar fashion to SRCS. While Santa Rosa must deal with a 1.6% reserve reduction due to an accounting error, and Sonoma Valley's audits have consistently been clean, it is the medium-term funding squeeze, with costs rising substantially faster than revenues, and an increasing inability to make up the difference via one-time funds, that’s driving concerns. SRCS' potential pursuit of a parcel tax is one solution that certainly appears to be on the table, but it could cause voter confusion, if not outright fatigue, given Santa Rosa's successful $229 million bond in 2014. As Jenni Klose, president of the SRCS board noted in a letter to the editor today, "[SRCS], as with all California districts, is simply wrestling with how best to meet its increased pension obligation while continuing to fairly compensate staff[.]" 

Sonoma Valley, grappling with the same situation, should investigate creating structural, long-term advantages to ensure our teachers and staff aren’t crushed between stagnant funding and our ever-rising cost of living. Housing remains the single largest expense for many teachers and staff, whether laterals or new graduates. Meanwhile, those further up the step-column need salaries that can pay for mid-life expenses, such as children starting college. Addressing one issue means more’s available to deal with the other. Much as our schools confronted rising power prices by getting on the supply side of the equation with solar panels, so too should our district pursue construction of high quality, reasonably priced teacher and staff housing, an advantage in recruiting and retention independent of state funding.

2.83 acre Sonoma Valley Health Care District Property

432 W MacArthur, Sonoma, California
image available at http://tinyurl.com/joonh66

Serendipitously, Sonoma Valley’s health care district must make a decision regarding 2.83 acres on West MacArthur in the next 18 months. The land is four houses from Sassarini Elementary, and down the street from the SVHS/Adele/Prestwood campus.  Due to some (very) recent changes in the law, SVUSD has an opportunity to pursue a teacher housing project there, before the main front of the financial storm hits our budget.

The model for such housing is Santa Clara Unified’s Casa Del Maestro. Commenced in 2002 on a previously closed middle school, the project utilized certificates of participation to fund construction of 70 units, subsequently rented out to teachers and staff via a functionally integrated public charity. Construction was done at market rates. No subsidy was involved. One bedroom apartments rent for ~$900, and a large two bedroom for ~$1,450 (typically $2,390 for one in Santa Clara, $2,930 for two).

The cost advantage has four parts. First, the District owns the land, and thus land costs are not included in the cost of ownership or operations. Second, the capital structure allows for tax-exempt finance. Third, the land and construction are both property tax-exempt. Finally, there is no profit -- rents are set at a level sufficient to pay back costs of construction, financing, maintenance and operations, and to fund a long-term reserve.

Former Cal. State Sen. Mark Leno
image available at http://tinyurl.com/zbw9tum

Despite such success, few K-12 housing projects have gone forward since, due to an aura of legal uncertainty. Is restricting residency to teachers and staff consistent with California’s Unruh Civil Rights Act? Can land held in educational trust be used for teacher and staff housing? Can Certificates of Participation be used to fund construction? Can schools cooperate with other agencies on projects? Are there legislative findings that the housing crisis is hitting teachers and staff?

We got our answer January 1. Mark Leno’s SB 1413, known as the “Teacher Housing Act of 2016,” codified at Health & Safety Code § 53570 et seq., provides the express authority to proceed. The law’s factual findings and statutory language gives the same type of guidance for K-12 districts long available at the junior college, CSU, and UC levels. Doubts regarding limiting the rentals to teachers and staff, about the use of lands held in educational trust, and the availability of innovative financing and intergovernmental cooperation were all addressed.

2.83 acre Sonoma Valley Health Care District Property
432 W MacArthur, Sonoma, California
image available at http://tinyurl.com/gtmavhq

And this brings us back to the 2.83 acre parcel. Ideally located, the site is nearly identical in size to the Casa Del Maestro. It’s within walking distance of supermarkets and the Sonoma Square. The neighborhood already has several master planned facilities (Village Green, Sonoma Hills, Pueblo Serena, Moon Valley). Further, the school district has broad powers available to support the project, given the financial flexibility of the authority granted by Health & Safety Code § 53573.

What of the hospital, the current owner? Hospital sites must be “multi-decade,” allowing new buildings to be constructed as others pass from use, like a wave traversing the property over decades. For now, the MacArthur parcel is surplus to requirements. But the two districts could allow for a future exchange of land with fair compensation. The Andrieux site could become housing and MacArthur a hospital, when contemporary structures reach their end of life.

There are any number of problems that could interfere with teacher housing at this site (or another), but the rough contours are clear.  Making sure teachers and staff can afford to live in our community was the first item I discussed when walking Sonoma door to door this past fall. There are few more effective proofs of the power of small-town cooperation, especially in the face of discord we now witness washing over our small valley.  Let’s get our government agencies talking about working together, and let's set an example, by having our health care and school districts discuss how they might make this land continue to serve the public interest for decades to come.

@SVHSDragons @SVUSD1 #SonomaValley College Readiness Going Up.

It's a day of sorrow, and for the acknowledgment of tragedy for Sonoma Valley's school district. But it's important to remember that great work is being done overall in our public schools.

Per Person Income vs. College Readiness, California Counties.

Sources and methods available here.

PDF version available here.

In particular, this year has been a strong one for SVUSD, because both governmental and commercial measures indicate our schools are having increasing levels of success.  For instance, US News & World Report found that Sonoma Valley's College Readiness Index, at 36.7, is now exceeded by only three Napa-Sonoma area schools: Maria Carrillo, Casa Grande, and Roseland University Prep.

This result is confirmed by State measures of performance, as the graph on the right shows. In general, Sonoma County rates poorly given what's expected for a county of its wealth. It is one of the clearest and worst under performers.

But Sonoma Valley is different.  SVUSD does 40% better on preparing students for college than the rest of Sonoma County. Sonoma Valley now outperforms Napa as well. SVUSD deserves a lot of credit for turning in such a strong result.

One of the best things about working for the past couple of years with the District's trustees, our very strong Superintendent, and so many dedicated principals and teachers, is that it gives some context concerning the regular and sustained progress being made.

@eloisanews, nice article on #Sonoma grad rates ...

Eloísa Ruano González
image available at @eloisanews

So, I don't personally know Eloísa Ruano González. I do read her articles via the Press Democrat from time to time, though.  Her writing caught my eye earlier this year regarding Cloverdale High; recently it was a piece about graduation rates in Sonoma County overall. I'm typically favorably disposed towards education writers, particularly those that focus on the interplay between education and economics, and so I'm very supportive of Eloísa for focusing on statistics for the different parts of Sonoma County.

Of course, a well researched article on an important subject often makes people want more of the same, and I thus wonder whether an article on the County's A-G graduation rate might now be a good idea, too. For those who find education jargon impenetrable, that's the difference between whether a graduate has or has not met the college entry requirements for the University of California ("UC") or for the California State University ("CSU"). The technical requirements of A-G completion are complicated, but can (very roughly) be boiled down to passing the second semester of Algebra II with a C- or better.

Most parents and voters think that a graduate's a graduate, and that anyone receiving their diploma is ready for college, but that's not necessarily the case.  And that's where Sonoma County seems to have trouble, because while the statewide rate for A-G is 43.4%, in Sonoma County it's only 33.7% (for my friends and neighbors reading this post, Sonoma Valley High's rate is 47.2%).  I feel like I'd really like to see our educators explain the overall rate of preparation for college being achieved by Sonoma County's high school graduates to a reporter like Eloísa ...