Saturday, November 13, 2010

Letter: To Pay for Government Spending, Mt. Lebanon Should Boost Real Estate Values

In the following letter to Blog-Lebo, reader and frequent commenter John Kendrick offers an interesting analysis of Mt. Lebanon real estate. He argues that Mt. Lebanon ought to raise the value of its homes if it is to pay for its government’s spending habits:

To the Editors of Blog-Lebo:

Below are a histogram and descriptive statistics of all residential assessed property values in Mt. Lebanon. The data was generated on January 4, 2010. I would like to leave the interpretation of the data to the readers, but I would like to point out that:
  1. The statistical distribution is not normally distributed (i.e., does not follow a normal curve);
  2. We are 95% certain that the true mean of the population is between $164,021 and $167,283;
  3. We are 95% certain that the true median of the population is between $144,500 and $147,000.

My personal opinion is that our community cannot absorb the tax burden to pay for the looming school district and municipal expenditures. Therefore, we will need to enact economic development policies that will increase property values. I would like to know what the community would like to suggest, and I will offer two ideas of my own. My suggestion is that we think of a ways to increase the value of Mt Lebanon real estate. These are my two ideas:

Idea 1: The School District and the Municipality enact policies and programs to move the properties that have an assessed value in the first quartile of the distribution to the fourth quartile of the distribution. One approach would be to initiate a program that would do the following:

When any person voluntarily sells a home with an assessed value less than $115,000 and the buyer agrees to tear-down the home and replace that home with a new home, then the school district will abate the property tax for 5 years. This program would be open to 50 homes per year for 5 years. In the end we would have replaced 250 homes in the first quartile with an assessed value under $115,000 with 250 homes having an assessed value over $199,600. In principle, the tax revenue from each home site would double.

Idea 2: The School District would abate the school district real estate tax for any residential homeowner over the age of 59-1/2 years. This should impact about one-third of the homes in Mt Lebanon. For many years our community has experienced “The Process” where people relocate to our community to educate their kids, and then the move upon graduation to avert the high school-district taxes. There are several aspects of this idea that appeal to me, but one is that I would expect the number of homes “coming to the market” every year to decline since the motivation to avert high taxes would disappear as the homeowners age. Basic supply and demand suggests that as the supply is curtailed then the price of the available property should increase.

Do either of these ideas appeal to the community? Would anyone else like to suggest any alternative approaches?

Sincerely,
John Kendrick

Labels: , , ,

Bookmark and Share

66 Comments:

Blogger Tom Moertel said...

Studying the assessment data that John presented, I was surprised by two things about Mt. Lebanon: (1) About 9 out of 10 homes are assessed at $250k or less. (2) Less than 1 out of 20 homes is assessed at $350k or more.

Do either of these statements seem like they describe a community that is affluent?

If Mt. Lebanon’s middle-class reality no longer squares with its rich-and-powerful reputation, maybe it’s time for us as a community to rethink our ideas about what kind of government we can afford.

November 13, 2010 7:46 PM  
Anonymous John Kendrick said...

Tom's right - the pages of MtL and reality are quite different, but our community still has great potential.

Part of the problem is that our school district real estate taxes have created distortions to our property values.

My point is that we need to start think about how we are going to build tangible value in our community to support the level of expenditures coming from our school district and to a lesser extent from our municipality; or we need to cut the spending.

Something has to give.

November 13, 2010 8:50 PM  
Anonymous Anonymous said...

A very interesting analysis. The assessment data are presumably the County's 2002-based & frozen values, which even in 2002 terms still undervalues quite a bit of the residential inventory. We should be mindful also that commercial office & retail properties have been excluded, and that category is even more undervalued in the County assessments...commercial & retail represent additional areas of increased taxable value potential in the forthcoming 2012 reassessments. There is also untapped and thus far unrealized development potential in both existing stock and possible new developments.

Development could conceivably include rehab-redevelopment of existing properties, infill development (i.e. the hotel; condo/retail or commercial at Bower Hill & Washington; the TRID Project at the LRT station; property on Castle Shannon Blvd. opposite Baptist Homes) or greenfield development sites (i.e. Mt. Lebanon & Castle Shannon Blvd.; McNeilly "Park"; available property on Castle Shannon Blvd. opposite David's P.T., etc.).

John's data are similar and confirming in many respects to U.S. Census data....the 2007 updated estimates from the 2000 Census for Lebo are available on the Muni website. Of related and particular interest is the employment and income data which also indicates Lebo is not the wealthy community some believe it to be. It surely was in the 1950-1990 time frame, but not in recent years. And, more accurate data in the 2010 Census will be available in 2011.

Mt. Lebanon has a number of tools in it's tool kit that it seems almost unaware of...and I don't mean TIF's and tax abatement's...that could be coordinated and brought to bear on economic development. How many of you are aware of and know the purpose and combined potential of Lebo's (a)Economic Development Office & Officer, (b) Economic Development Council (EDC), (c) Mt. Lebanon Partnership (a CDC or Community Development Corporation), (d) Mt. Lebanon IDA (Industrial Development Authority) ? These all exist and have existed for some time, are capapable of undertaking major property development projects, but have thus far not worked together....simply because there has been no sponsor and no plan to do so !

Perhaps some of this can be worthy of consideration, John.

Bill Lewis

November 13, 2010 10:15 PM  
Anonymous John Ewing said...

John Kendrick has some terrific observations in his letter:

1) The distribution of assessed values falls to the left of a normal bell curve – the poorer side of the curve.

2) Twenty-five percent of our properties are assessed under $115,200. Small assessed values don’t build big expensive schools

3) Seventy-five percent of our homes are assessed under $199,600 but school officials quote the average home-sale price in Mt. Lebanon as $200,000. That means the top 25% of homes above the assessed value of $199,600 are most paying the bill for good schools.

An unstated fact is many of the higher priced homes are way under assessed so when the new assessed values come out shortly after the beginning of the high school construction the folks with assessments over $199,600 who are already paying for our schools will get an even bigger school tax bite if their assessment increases more than the average increase. The school board will tell you the millage must be adjusted to keep the assessment increase revenue neutral but those of you with the bigger percentage assessment increases will be in for a big surprise on your tax bill when the reassessment hits in about 14 months.

Those with the higher assessments will be wondering why you are paying the larger part of a $15,000 per student cost for folks who live in a house assessed under $115,200.

As Mr. Allison used to say, “Do the math.”

November 13, 2010 10:48 PM  
Anonymous John Kendrick said...

Bill Lewis and John Ewing both raise interesting points. I would like to add some additional statistics to the discussion:

The income distribution for zip code 15243: (Shows the number of households and the proportion of the total)

INCOME IN 1999



Households 5,270 100.0

Less than $10,000 163 3.1
$10,000 to $14,999 113 2.1
$15,000 to $24,999 490 9.3
$25,000 to $34,999 488 9.3
$35,000 to $49,999 816 15.5
$50,000 to $74,999 1,193 22.6
$75,000 to $99,999 745 14.1
$100,000 to $149,999 717 13.6
$150,000 to $199,999 215 4.1
$200,000 or more 330 6.3

Median household income (dollars) 60,717 (X)

Data Source: http://factfinder.census.gov/servlet/QTTable?_bm=y&-geo_id=86000US15243&-qr_name=DEC_2000_SF3_U_DP3&-ds_name=DEC_2000_SF3_U&-_lang=en&-_sse=on

The income distribution for zip code 15228: (presented in the same format)

INCOME IN 1999



Households 7,262 100.0

Less than $10,000 298 4.1
$10,000 to $14,999 307 4.2
$15,000 to $24,999 752 10.4
$25,000 to $34,999 677 9.3
$35,000 to $49,999 999 13.8
$50,000 to $74,999 1,446 19.9
$75,000 to $99,999 1,017 14.0
$100,000 to $149,999 949 13.1
$150,000 to $199,999 374 5.2
$200,000 or more 443 6.1

Median household income (dollars) 58,440 (X)

Source: http://factfinder.census.gov/servlet/QTTable?_bm=y&-geo_id=86000US15228&-qr_name=DEC_2000_SF3_U_DP3&-ds_name=DEC_2000_SF3_U&-_lang=en&-redoLog=false&-_sse=on

Also, I've done the same analysis for commercial real estate values. We are 95% certain that the median of the population representing the assessed value of commercial real estate in Mt Lebanon is between $195,000 and $240,000.

November 14, 2010 8:02 AM  
Anonymous John Kendrick said...

Bill,

I just want to add that I completely agree with your comments concerning economic development. I am aware of the infrastructure within our municipal government - and I can't begin to tell you how frustrated I have been over the years to see it unused!

There has been no plan, no leadership, and no management! - and our community is paying the price!

November 14, 2010 8:16 AM  
Anonymous John Ewing said...

Mr. Kendrick’s figures show that 24% of the State tax returned filed in zip code 15243 have personal incomes above $100,000 and 76% of the State tax returns filed in zip code 15243 have incomes below $100,000.

In the 15228 zip code 24.4% of the State tax returns filed show incomes over $100,000 and 75.6% of the State tax returns filed have incomes below $100,000.

The last time I saw Incomes by School District broken down from the State Department of Revenue was when I served on the Tax Commission in 2006 (no individual tax returns were revealed). The top 20% of Mt. Lebanon tax returns accounted for 65% of the Personal Income in Mt. Lebanon and 80% of the tax returns accounted for 35 % of the Personal Income in Mt Lebanon.

When I think about the concentrated distribution of income in Mt. Lebanon it helps me understand why there are almost 4,000 signatures on a petition opposing a $113,000,000 expenditure for a High School. There are just too many folks who can’t afford that price tag and the District is asleep on fund raising efforts to support the expenditure.

Upper St. Clair School District has already recognized the need for, and hired a professional fund raising firm to help them afford their infrastructure, yet one Lebo board member told me at the last Policy committee meeting that she did not think a fund raiser is a good expenditure of District funds. Perhaps that shortsighted thinking is why my high school is replacing and enlarging a nine-lane pool while Lebo tried to cut an eight-lane pool from their budget in June 2009 and also in 2010.

November 14, 2010 2:47 PM  
Anonymous John Kendrick said...

John Ewing is completely correct. What we are dealing with in our community is nothing less than class warfare. The problem is that our community has been transformed into a "bus stop" where a younger demographic temporarily relocates to give their kids a "Mt Lebanon Education" at the rest of the world's expense.

The problem is that the long term residents of the community like me and Mr. Ewing are left paying for it.

I'd feel better knowing that a $113MM - $135MM expenditure in a high school is able to increase property values, but the history of hefty education expenditures in our community have only resulted in a hefty increase in the demand in "FOR SALE" signs.

My personal opinion is that we need to think about rebuilding the community BEFORE we embark on yet another round of lavish and extravagant school district amenities. The problem in our community is that nobody seems to be concerned with how we can afford a new school project, street replacement, storm water management, long-term debt reduction, water parks, and a seemingly endless list of other projects because the requestors will most likely move after they have enjoyed these resources – let me be more specific, move and leave the bill for someone else!

An important message from this thread is very simple. If you’ve worked hard in your life and you’re a proud homeowner in our community be warned – there’s a group of people that want to squeeze every penny of equity from your property for their own benefit. Sadly, four RINO’s and a democrat gave their stamp of approval to this nonsense!

November 14, 2010 7:20 PM  
Anonymous Anonymous said...

Mr. Kendrick, I realize you loathe answering questions and you lack the personal experience of raising/educating kids in this district, but what support can you offer for your "educate and move" theory? This is the 2nd or 3rd time I've asked this question. Certainly, in your lifetime of collecting degrees you've been asked to support a position.

November 15, 2010 1:01 AM  
Anonymous John Kendrick said...

Mr. Franklin,

I tried to answer your post before, but it looks like my comments didn't make the queue. Please ignore this post if it is redundant. This is my response to your direct question.

As a 33 year resident of the community I have heard many residents say that they have either moved or decided to move because their kids have completed their education and they don't want to pay Mt Lebanon taxes. I don't have an exit survey to present you. If you have an exit survey that contradicts my emperical evidence, please post your survey results for us to examine.

Will you please answer these three direct questions from me:

1. Do you have an econometric study that predicts the impact of the proposed high school expenditure on real estate values in Mt Lebanon?

2. What increase in property values can we expect from the high school project expenditure?

3. What date should we expect the realize the increase in property values

November 15, 2010 10:48 AM  
Anonymous John Ewing said...

The spectator is back with nothing constructive to offer and no facts.

November 15, 2010 11:59 AM  
Anonymous Anonymous said...

If you've followed along, you should know that I'm not a fan of the high school project. Like most "spectators" I agree with the obvious premise that something needs to be done to repair/update the high school, but I believe that we should be able to do this for something well south of the approved proposal. As you might expect (and contrary to the ramblings of your mascot Mr Ewing), this position is not popular among my friends in the athletic community. If you’ve followed along you would also know that I tend to believe that the high school project may have a detrimental impact on our housing stock. Lebo could easily become unaffordable for many or at least unattractive when compared to similar products along Rt. 19 and in the North Hills. If and when the project is completed, I think the short term across-the-board impact on property values will probably be a push, but I’m inclined to believe that the values in some areas may go down. I think we can see that already given the uncertainty of the project, along with the uncertainty of the upcoming reassessment. Houses in the higher price ranges are not moving, perhaps because of the concerns mentioned in your letter. At the same time though, home values in the lower to mid range may move up once the dust settles. No one knows for sure, but I agree that it is problematic over the long term.

What I take issue with is your continued assertion that the cut and run “process” is rampant in Mt. Lebanon and somehow should drive other decision making. Like you, I’m going from personal experience and I see no evidence to establish that homeowners pack up and leave Lebo once their kids are out of school at a rate any different or faster than in other communities. I see nothing to support the position that those who do move are citing taxes as their primary justification, and not employment opportunities/family/warm weather/personal preference. Further, I don’t think it’s at all realistic to suggest that countless folks in their late 40s and 50s simply pick up and move once their kids receive their diploma. I don’t know many who have that luxury.

On the other hand, I think it is perhaps more accurate to contend that some young families these days are choosing to avoid Lebo all together because of the rising taxes, comparable education elsewhere and the uncertainty of the school project. I’d offer that in the last 2-3 years our school board has done more to push people away from Lebo than it has to attract them. But back to the point, I simply don’t see the rash of tax-related departures that you profess to be occurring, especially among those with kids who are out of the schools. I also think that your assertion to the contrary is a slap in the face to that generation of residents whose kids are educated and grown and who still understand and appreciate the importance of funding and supporting our education system.

Changing gears entirely, I was surprised to read Commissioner Raja’s opposition to the proposed monthly sewage fee that is included in the proposed 2011 budget. Aren’t these the sort of reasonable fees that we need to be prepared to address individually and in an effort to keep taxes and borrowing down, and services and quality up? $60-70 a year seems like a fair trade-off for updated sewer lines. If we continue to oppose fees like this we’ll inevitably be forced to look at the 800 lb elephant in the budget room and that is the money we spend on first class public safety.

November 15, 2010 1:14 PM  
Anonymous Anonymous said...

This was on Craig's List a couple of weeks ago. http://pittsburgh.craigslist.org/fuo/2042860150.html
I also heard that Howard Hanna ran out of lock boxes. I haven't been able to verify that statement yet. I do see that almost 300 houses are on the market and it is the middle of November. That is kind of scary to me.
Elaine Gillen

November 15, 2010 1:29 PM  
Anonymous Anonymous said...

Mr. Kendrick,

When you pulled the 15243 data, were you able to control for the approximately 33% of residents who live in Scott Township?

Thanks -

Mary Beth Sklar

November 15, 2010 3:00 PM  
Anonymous John Kendrick said...

Ms. Sklar,

If you have data that is more representative of the incomes within the 15243 zip code would you please share it with us and we can make a comparison?

In the meantime, it seems that you have intimate knowledge of the Mt Lebanon real estate market. Would you like to share your thoughts concerning the residential home value impact of the $113MM - $135MM that we are about to spend on a high school?

November 15, 2010 4:59 PM  
Anonymous Anonymous said...

Mr. Kendrick, this why you have single handedly made this once enjoyable Blog damn near unreadable. What about Ms. Sklar's comment prompted your antagonistic response? She just asked a question. Maybe she completely agrees with you but simply wants to know if you accounted for the fact that part of 15243 was not in Mt. Lebanon. I didn't read her comment to suggest anything else.

November 15, 2010 5:33 PM  
Anonymous Anonymous said...

Yikes.
I asked a question. I went to the data, as is my inclination, but didn't see a way to control for the zipcode overlay. I thought you might determined a way to do so. Guess I asked the wrong question.

FYI - I have been against this project since it became very clear that the SD was not only compiling a wish list, but attempting to honor it too. In other words, I've been in disagreement since the inception. I've written to the SB numerous times over the years (usually snail mail). I have 3 kids, 2 of whom are recent graduates and one still in middle school. My sons have even done their civic duties and written to the school board with their views on the construction.

You like solutions, so you may like this one (but probably not). When my son was 16, he wrote to the SB suggesting they use student volunteers to caulk the windows properly, instead of using packing tape. He was inspired by the Japanese model of children, as part of the broader community, taking responsibility for their schools. He positioned it as a win/win - kids get volunteer hours and the SD gets true insulation. You can guess how that was received.

It's been a pleasure justifying myself,

Mary Beth Sklar

November 15, 2010 6:07 PM  
Blogger Tom Moertel said...

I’d like to highlight something Dave Franklin wrote about how the high-school project will affect property values. He writes, “If and when the project is completed, I think the short term across-the-board impact on property values will probably be a push, but I’m inclined to believe that the values in some areas may go down. I think we can see that already given the uncertainty of the project, along with the uncertainty of the upcoming reassessment. Houses in the higher price ranges are not moving, perhaps because of the concerns mentioned in your letter. At the same time though, home values in the lower to mid range may move up once the dust settles.”

My predictions of the high-school project’s effect on property values, compared to what those values would have been with a less-expensive project, are similar: (1) The demand for Mt. Lebanon property, as a whole, will decline slightly. (2) The demand for expensive homes in Mt. Lebanon will decline the most. (3) The demand for modest homes in Mt. Lebanon will actually increase slightly, as people who would have bought expensive homes start shopping more modestly. Because the supply of Mt. Lebanon homes is fixed, these shifts in demand will translate into corresponding shifts in market price.

So who wins and who loses among Mt. Lebanon property owners?

Winners: owners of modest properties.

Losers: owners of expensive properties.

Mt. Lebanon as a whole loses, too, but only a little bit. Like Dave, I think at this level it’s mostly going to be a “push.”

Any other predictions?

Cheers,
Tom

November 15, 2010 6:42 PM  
Blogger Tom Moertel said...

As an addition to my previous comment, the same predictions hold all the more for the coming tax increases needed to pay for our underfunded pensions.

November 15, 2010 6:45 PM  
Anonymous Anonymous said...

Mary Beth,
You raise a good point. 15243 also includes a large section of Scott.
It is refreshing to hear about young adults like your son, getting involved, and trying to come up with solutions. The School Board likes us all to think that the students are 100% for the current renovation plan. That is the impression you get when you watch the video that is floating around in Leboland. But with a 2009 graduate in the house, I know that is not the case at all. Thank you for sharing your story with us. Maybe this will encourage more parents to come forward.

Quick question - anyone in the 15228 or 15234 area get a survey in the mail today from the School District?
Elaine Gillen

November 15, 2010 6:54 PM  
Anonymous John Kendrick said...

Now I am stunned - I only asked if you have other data to compare to mine. I didn't know who Mary Beth was so I read her prior posts. She mentioned that her father used to flip homes and then discussed the sale of Lebo homes with Dave Franklin who apparently pays "sticker" for his homes.

Anyway, Tom raises an interesting point. If we don't know the effect of an expenditure like the high school project, does it make sense to move forward and spend $113MM to $135MM?

November 15, 2010 7:03 PM  
Blogger Tom Moertel said...

Elaine,

I received one of those surveys today. In 15216.

Cheers,
Tom

November 15, 2010 7:10 PM  
Anonymous Anonymous said...

15228 - I did not get a survey. Was it sent only to households who have a student in school? Can anyone who received it tell us what they are asking? Is it only statistical info. so that they can estimate enrollment (something they have never done well), or are there questions about how we feel about the district and its direction?
Joe Wertheim

November 15, 2010 7:13 PM  
Blogger Tom Moertel said...

According to the explanation at tonight’s school-board meeting, the survey will be mailed to every household in Mt. Lebanon.

November 15, 2010 10:08 PM  
Anonymous John Kendrick said...

What specific corrective actions will be taken by the Board and the administration to address any opportunities that are identified by the survey? Or is this just an instrument to make the Board feel good by validating their horrendous policies?

I received my survey today.

November 15, 2010 10:36 PM  
Anonymous Anonymous said...

I'm no Six Sigma consulting ninja like you Mr Kendrick, but I have to think that before identifying "specific corrective actions" they'll need to get the results of the survey first . . .

November 16, 2010 9:41 AM  
Blogger Tom Moertel said...

John (Kendrick),

How would anybody know what corrective actions should be taken until the results are in and the problems diagnosed?

That said, looking at the survey, I don't see that it's specific enough to provide much opportunity for action. There is, however, probably enough specificity to recognize problem areas that the administration, if interested, can investigate, perhaps through follow-up surveys, to identify problems and likely causes.

Cheers,
Tom

November 16, 2010 9:55 AM  
Anonymous John Ewing said...

Tom,
With a finance team and a consultant the school board couldn’t even get the PlanCon document right until the PDE did it for them.

If we had competent administrators and a conscientious school board we wouldn’t need surveys.

John Ewing

November 16, 2010 10:26 AM  
Blogger James Fraasch said...

Tom, it is important also to account for the "unseen" in your prediction.

If it is the higher end home values that get hurt the most, you must also account for the loss of higher incomes (and therefore EIT) associated with the more wealthy.

It has been my contention that the most likely people to leave to escape higher taxes are those that are most able (higher incomes). The question then becomes, and you have partly answered this, is who demographically speaking will take their place? That answer might show up in our EIT receipts sooner rather than later.


EIT Receipts (according to Steve Feller who I asked this question of a few weeks back) look like this:

2010 Budget: 9,293,610

2010 ytd: 7,169,131**

2009 9,539,489

2008 9,523,172

2007 9,045,173

For me, the question the municipality should try to answer is whether or not we can see 2009 EIT numbers again anytime soon without an increase in tax rates. I suspect that will be the first place any kind of differentiation between collective Mt. Lebanon income distribution will take place.

James

November 16, 2010 10:28 AM  
Anonymous John Kendrick said...

Tom and Mr. Franklin:

A thorough analysis will go beyond descriptive statistics and will include a statistical analysis that will identify key drivers of satisfaction and dis-satisfaction based on covariation in the responses, the directionality of categorical responses, etc.

There will be opportunities. My only question is whether or not there will be follow-through.

November 16, 2010 11:52 AM  
Anonymous Anonymous said...

James (Fraasch),

What are Jan Klein's EIT "etimates" in the 5-year "Estimated" budget that has not been made available to the public, but allegedly dated sometime in September ? What assumptions are they based on, and do they have any degree of validity worth noting ?

The Commission has received the final Strategic Financial Plan report and recommendations from the consultant hired earlier this year, have done some limited quoting from it, but have not made it public either. Perhaps it has some relevant EIT info.

To those who desire more EIT info and data, I suggest you review the Muni's Consolidated Annual Financial Review (CAFR) for 2009 on their website, under the Government link, then Documents.
Of particular interest and reference is a 2-page table towards the end in the Statistical section that tracks EIT income by numbers of filers in specific reported EIT income ranges....this can complement Census and other EIT data in the Muni & District CAFR'S.

Bill Lewis

November 16, 2010 12:43 PM  
Anonymous Anonymous said...

Mr. Kendrick, you had me up until, "A thorough analysis...”

It should also be pointed out that the survey can only really be answered effectively and completely by a small portion of the residents - those with kids in the schools or whose kids have recently graduated. Not sure what the reference point would be for those who don't have kids in the schools or haven't for some time since a number of the questions involve to actual goings on in the schools. Heck, I currently have all 3 bases covered with a child in elementary, middle and high school and I can't even respond to every question.

My concern is that some uninformed respondents will provide answers based on their perceptions or biases (perhaps hoping to extract vengeance or skew the results), rather than simply skipping the question as the survey suggests.

November 16, 2010 1:46 PM  
Anonymous John Ewing said...

Mr. Franklin once again has an amazing perspective. First he suggests maybe only parents are qualified to answer the Survey. That sounds like something the teachers union, the athletic supporters, or the PTA Council would like you to believe during elections or contract negotiations. But they are not paying the bills for education.

The information Bill Lewis led us to says the percentage of Earned Income Tax paid in the highest income ranges has fallen dramatically. Compare the decline in the percentage of Earned Income paid in the highest income range from 2001 to 2009:

% of Earned Income: 2001 2009
Over $1,000,000 12.9% 4.9%

Since the Earned Income Tax is a percentage of earnings these numbers suggest those in the highest income range, who are most able to pay the school bills, are suffering from lower incomes or are choosing not to live in Mt. Lebanon.

I chose those years because in 2001 the VB&E High School Study was done and the teachers contract for 2000 was settled in June 2001. This contract has been extended in 2004 and again in 2010 and the Extension lasts from 2001 until 2015.

Also, the period spans the beginning of the High School Study in 2001 until 2009 when the school board finally gave the architects the $113-Million price of the High School at their June meeting. Up until June 2009 the architects were designing a $160,000,000-Million project.

Remember Mrs. Cappucci saying, “I though we were designing a shorter building?” She was right about that because the DeJong Study said student behavior is better when students are grouped closer together.

Who knows what the extra design cost the residents?

November 16, 2010 9:06 PM  
Blogger James Fraasch said...

Bill,

Since I am unable to publicly release the actual file, I can only say what was talked about in the public Audit/Finance Committee meetings. For EIT we have estimated it to be static from (-70,000) 2010-2011 and then 3% EIT growth every year after that.

You probably know better than I, what has the Municipality projected for EIT in the coming years?

James

November 16, 2010 9:29 PM  
Anonymous Anonymous said...

Two headlines at thealmanac.net that should be of interest to all the submitters here.

"USC commissioners expected to hold line on taxes
Upper St. Clair Township commissioners are expected to adopt a preliminary 2011 budget Dec. 6 which includes no tax increase."

"BP OKs budget with no tax hike
Bethel Park council has approved a $30 million budget for 2011."

So, as Mt. Lebanon continues to raise tax rates while surrounding communities hold the line on theirs can Lebo continue to attract homeowners and businesses... anyone have an answer?

Bu, what I find more interesting in this post, by my count at the time of this comment, there were 9 individuals involved in the 32 comments. It appears all 9 are against the spending of $113 million on a high school renovation.

They'll attack each others ideas or question the validity of a survey before they're returned, but ignore the one issue upon which they all seem to agree.

The school board "promised" that the project would most likely come in around $94 million ($75 million at this point is a long gone dream). It appears to date the board still thinks they can achieve the $94MM goal.

Wouldn't the easiest, most efficient and immediate effort to control local taxes be to monitor the board's progress on reaching their "promised" $94MM cap?

It is kind of like being on a sinking boat. Before you start rearranging seating, buying new life jackets or drawing straws to see who gets off first... the smartest thing to do first is STOP THE LEAK!

Dean Spahr

November 16, 2010 9:32 PM  
Blogger Tom Moertel said...

I'm with Dave on this one. I suspect that most residents don't pay much attention to school business and yet will feel that they are at least as informed as their neighbors, and, thus confident in their beliefs, will fill out areas of the survey they actually know little about.

In the end, the survey will probably not measure the school district's actual properties as much as the community's beliefs about those properties, and those beliefs are as likely to be based on rumor and reputation as any first-hand experience.

And that's all fine, as long as the survey is interpreted as representing the feelings of the community and not the actual state of the school district. So I'm curious to see how the district presents the results.

In any case, the survey data are likely to be interesting. I'd sure like to see the data set.

November 16, 2010 9:38 PM  
Anonymous Anonymous said...

Mr Ewing, it's time for you to put up or shut up. I'll meet you any time, any where so that you can answer the following survey questions:

1. Are classrooms comfortable?
2. Does the library meet the needs of the children?
3. Do school computers meet the needs of the children?
4. Does the District provide adequate training in the use of computers?
5. Do teachers treat you with respect?
6. Do you volunteer in District schools?
7. Do you respect the teachers in the District?
8. Are there enough curent textbooks for children?
9. Do school computers help children learn?

Where should we meet John?

Let's face it, you're an insufferable malcontent who spews nonsense. You're no Bill Lewis.

November 16, 2010 9:43 PM  
Anonymous Anonymous said...

Dean, I couldn't agree more. Ewing and Kendrick are so intent on yelling louder than everyonme else, they neglect to realize that most people agree with them on that key issue. I've said it once, I'll say it again, we should ALL be striving to make good on the 9 promises that were made at the Act 34 hearing and that is that the project should come in somewhere well below the current estimated amount.

November 16, 2010 9:49 PM  
Anonymous Anonymous said...

And one more thing Dean, Bethel Park may be holding firm on taxes but their students are also sitting at home these days.

The grass is always greener . . . until you have to mow it.

November 16, 2010 9:54 PM  
Anonymous Anonymous said...

Dave Franklin, not so fast! I'm not going there.
I find Ewing, Kendrick, you and others to have good thought provoking comments. And then sometimes.... maybe not.

Those are debates for later dates.

The most important game on the table right now is keeping the high school project and tax rate at a level we can live with. One that will attract new residents and business!

Dean Spahr

November 16, 2010 10:00 PM  
Anonymous John Ewing said...

Dave F.
Does this mean we are back on for golf?

November 16, 2010 10:28 PM  
Anonymous Anonymous said...

David when the money finally runs out, the gardner quits and the weeds take over... who cares what color the grass is!

Once again, the issue is the biggest expenditure in the community! Agreed?

Dean Spahr

November 16, 2010 10:46 PM  
Blogger Tom Moertel said...

Dean,

I'd say the issue of interest is the one that we can reasonably expect to influence for the most good. Whatever it is, it's not the high-school project. Yes, that project represents the largest single expenditure, but as an issue it appears to be something we can do little about, regardless of the effort we invest. The bottom line is that most of our elected representatives are champions of the project, and no amount of evidence seems likely to change their minds.

So, when do we stop pretending that the leak can be plugged? When do we reach for the life preservers and start investing our effort where it is likely to do more good?

Cheers,
Tom

November 16, 2010 11:20 PM  
Anonymous Anonymous said...

OK Tom to the life boat!

You row that way and I'll row this way. Sounds like a plan.

Dean Spahr

November 17, 2010 12:30 AM  
Anonymous John Kendrick said...

Mr Franklin,

You seem to have a lot of insight into advanced statistical methods. I have these direct questions for you -

What does the term "effective sample size" mean?

Can you, or another representative of the School Board, explain the sampling technique of this survey in greater detail?

If the later question has no answer, or an incorrect design was used, what should we conclude about the SD survey?

November 17, 2010 9:01 PM  
Anonymous John Ewing said...

We can see from the income figures of the municipality that the incomes over $1MM are now paying a proportionately smaller amount of the total taxes collected. Therefore, the tax burden for the new high school project will impact the lower income groups more than with prior projects.

November 17, 2010 9:13 PM  
Anonymous John Kendrick said...

John Ewing is completley correct! If the proportion of the total tax collected for those having a higher income is decreasing, then the proportion of the total tax collected by taxing the lower income groups is increasing.

November 17, 2010 9:44 PM  
Anonymous Anonymous said...

The 2007 results are posted on the MTLSD website as well as on lebocitizens.com. Harris Interactive identified priorities for change in the 2007 survey. One of them was, “Determine parental concerns regarding amount and usage of tax dollars. 41% of the community members reported that current tax rates were not acceptable to them.” And that was before the 10.5% tax increase of May 24, 2010!
If you did not receive a survey, call Cissy Bowman at 412-344-2026.
Elaine Gillen

November 17, 2010 10:12 PM  
Blogger Tom Moertel said...

John (Kendrick),

Who cares about the survey design? It's just a simple survey to take the pulse of the community. And, for that purpose, it looks reasonable.

If the community has any serious problems with the school district, I trust that the survey, as is, will be sufficient to detect them. Then, if the school district sends out a follow-up survey, I might be inclined to ask if it can reasonably be expected to provide the information necessary to uncover the causes of the problems.

But for now, I'm perfectly willing to consider this survey "good enough."

Cheers,
Tom

November 17, 2010 11:30 PM  
Anonymous John Ewing said...

In 2007 this Survey received 1442 responses; there was no statistical measure of the reliability of a survey sample regarding that survey.

This year the survey was sent to every residence and that is far too large a sample than needed to determine a reliable answer to the questions asked.

The board should have asked their survey consultant how many survey returns were required to reliably answer their questions and then sent a smaller, less expensive mailing and not put more expense on the lower income earners of the community.

These questions should have been asked of the Administrators by the School Board as part of the Board’s process of holding the administrators accountable to do their jobs. This would have avoided the problem, raised by Tom, of having surveys returned with answers based on “rumor and reputation.”

Wasting tax resources is not acceptable.

November 17, 2010 11:38 PM  
Anonymous John Kendrick said...

Tom,

With all respect, you are suggesting that it is not important if the measurements are precise, accurate, or even if the questions have been properly presented to a sample that is representative of the population!

If you are going to follow that line of thinking then where does it end? Maybe the district should simply survey the members of the Board and make an inference about the population as a whole? Would that approach make sense? Of course not!

If we are going to spend our hard earned money on a survey then it should be done properly. "Good enough for government" is a terrible example for our Board to set for the children in this community.

If this instrument is going to validate programs and policies, or even measure the overall level of satisfaction, doesn't it make sense to have an instrument that is going to provide an accurate assessment?
Management without data is cheerleading; and invalidated measurements are meaningless!

Besides, I am waiting for Mr. Franklin to explain the concept of an effective sample size to all of us!

November 18, 2010 12:31 AM  
Blogger Tom Moertel said...

John (Kendrick),

What I'm actually suggesting, perhaps too subtly, is that it's pointless to dive into the deep implications of survey-design esoterica as if they had something meaningful to tell us about the school district, when what we are really discussing is a simple take-the-pulse survey that the school district didn't even design. If anything interesting turns up in the results, then I'll worry about whether we are doing what it takes to identify causes. Until then, I will take the survey for what it is – a simple survey.

Cheers,
Tom

November 18, 2010 1:07 AM  
Anonymous John Kendrick said...

Tom,

I understood exactly what you said, and again, I respectfully disagree.

If the measurement system is flawed, how will you know whether or not there were any significant findings?

Was a preliminary survey performed to estimate the population parameters so that the proper sample size could be determined? Has anyone examine the reliability of the survey itself? How will the district deal with respondents that speak with each other BEFORE the survey is returned? Did anyone consider if one question can influence the response to another question? Does anyone know if the sequence of the questions can influence the responses? Did anyone check? Interested readers should take a look at this site and then think about what the SB has done with their survey:
http://www.socialresearchmethods.net/kb/reltypes.php

If they haven't thought through any of these questions then what does that tell us about the validity of the results? Doesn't that tell us that the conclusions are suspect?

What you are suggesting is that it’s okay to send out a half-assed survey, and if the results meet what you agree with, then there is no need to examine the issues further! Where do we draw the line? Is this the quality of the work that went into the design of the high school project?

Tom, they are spending our hard-earned money; and being paid rather well to spend it. All of us should be outraged!

November 18, 2010 8:16 AM  
Anonymous John Ewing said...

Tom,

Your simple survey is not the correct way to sample the community. When I was on the board we wanted to survey the community attitude toward the teachers contract negotiations. Our survey consultant told us that a random sample of 200 folks would be representative of the community attitude. The board was not comfortable (for political reasons) with such a small survey so we asked for a random sample of 400 folks.

Compare a random sample of 400 to the cost of sending a survey to over 11,500 residences and you can easily see the sample is too large and expensive.

Following your reasoning to the extreme would lead us to the conclusion we should build a 500,000 Sq. Ft. high school for half the students we had in a 525,000 Sq Ft. high school and that would be “good enough.” I think we have already decided the Board/Master Design Team carelessly spent our money for a building that was politically designed to suite the want list of deadbeat athletic supporters.

How do we know this survey is “good enough” when sample size is unproven and the Board did not do their homework with the Administrators to assure the answers are what is needed to continue a great educational system?

How does the Administration know the correct answers to the survey if they just shirk their responsibility to evaluate the performance of the schools and let community residents respond to a survey when they admit they don’t know the answers to questions in the beginning?

Our great school district was not built on a lazy survey approach to education but it is being administered that way by our school leadership. Unfortunately, the Board is not doing their job but abrogating it into mailing over 11,500 surveys and labeling it constituent satisfaction.

When you think about it some folks are satisfied with much lesser schools but most folks moved here for education and we expect much better of our school leadership.

November 18, 2010 8:42 AM  
Anonymous Anonymous said...

Tom, JK, and JE,
Many interesting things turned up in the results of 2007 survey. But did MTLSD listen? No. Besides the tax issue I raised in my earlier post, these are other priorities for change as recommended by Harris.
Why are community members not willing to recommend the District schools to others?
30% of the community felt that the School Board was not performing their roles well.
26% of the community felt that the teachers made too much money. What does their new contract say?
16% of the community felt that the District did not provide education to children of all ability levels. Remember what was discussed on here previously about children with special needs?
26% of community members said the school needed to improve with including their views when making decisions. Do 4,000 signatures come to mind to anyone?
And this was just the first page of priorities for change!!! MTLSD is just going through the motions of listening. In reality, they don’t listen to anyone. Save the four grand and put it towards spell check. Obviously, this school district needs it.
Elaine Gillen

November 18, 2010 9:10 AM  
Blogger Tom Moertel said...

John & John:

If you’re looking for evidence that the school district’s leaders are incompetent, this survey offers only feeble evidence because it’s easy to believe that lots of well-run school districts send out similar, if not the same, survey to all of their residents, too.

Further:

John (Kendrick): What your analysis fails to consider, and what seems obvious to people who aren’t so enamored of survey theory, is that there are lots of reasons why reasonable people would send a survey besides to extract the most information theoretically possible. Example one: because approximate, or even crude, results will probably be sufficient. Example two: because designing a custom survey may require more time or money than seems merited in light of the marginal potential for improvement compared to the off-the-shelf Harris product. Example three: because changing the survey compared to the normal Harris product makes it less comparable, in the eyes of the public, to the surveys administered in other school districts.

John (Ewing): What your analysis also fails to consider is that there are lots of reasons why reasonable people would send a survey to everyone in a community besides to waste money. Example one: because that’s what the community expects, having learned from their repeated experience with the U.S. Census that if you want to do a survey right, you have to give it to everybody. Example two: because if some people don’t get a survey, some of them will think they have been deliberately or unfairly excluded and raise hell.

Guys: Look, the school district does make mistakes, including some big ones, and when it does, I haven’t been shy about saying so. But this survey isn’t one of them. If you want to maintain your credibility, you’ll stop nitpicking the little stuff to reserve your persuasive capital for those times when you truly need it – for the big stuff.

Your friend,
Tom

November 18, 2010 9:51 AM  
Anonymous John Kendrick said...

No Tom,

This initative was intended to dress a rat in a mink coat and sell it to the community using this "instrument" to validate the results.

Our community has a right to be upset. We're paying a lot of people up there a lot of money to do their jobs. If we are paying for the best, then we have a right to expect the best performance from them.

November 18, 2010 10:01 AM  
Anonymous Anonymous said...

Tom:
I absolutely agree with you... "reserve your persuasive capital for those times when you truly need it – for the big stuff."

But, I'm curious as to what you think is the BIG STUFF? Earlier, you replied to one of my comments: "I'd say the issue of interest is the one that we can reasonably expect to influence for the most good. Whatever it is, it's not the high-school project. Yes, that project represents the largest single expenditure, but as an issue it appears to be something we can do little about, regardless of the effort we invest."

So the biggest of the BIG STUFF... "the largest single expenditure"-- "appears to be something we can do little about."

I'm lost, so where are you suggesting we use our persuasive capital?

Dean Spahr

November 18, 2010 10:04 AM  
Blogger Tom Moertel said...

John (Kendrick),

If you believe the survey is intended to dress a rat in a mink coat and sell it to the community, you've reached that conclusion from your prior beliefs and not upon any evidence you have presented here.

What's the probability that we would see a survey like this in public school districts that are widely considered to be well run? If that probability is high (and it is), you're going to need some evidence beyond the survey itself to support your claims.

And, so far, you haven't presented it.

(Friendly observation: If you keep making lofty claims and supporting them only with scanty evidence, you'll harm your credibility more than the school district's.)

Cheers,
Tom

November 18, 2010 10:17 AM  
Blogger Tom Moertel said...

Dean,

We ought to use our persuasive capital where it will do the most good. That means on the biggest problems over which we can expect our capital to have some influence.

Potential Good = Size of Problem × Our Influence Over Problem

Regarding the direction of the high-school project, we have effectively zero influence. Do the math.

Time to move on.

Cheers,
Tom

November 18, 2010 10:30 AM  
Anonymous John Kendrick said...

Tom,

As a friend, I have to say that you're sounding like a mouthpiece for the Board.

The hole has not been dug. It's not too late to act - and frankly, even if they do build it, tax policy can always be changed.

Dick Nixon, a great American president, once said, "If there is a lesson to be learned from my life it is that you should never give-up, never stop trying."

Tom, never surrender! ... ;)

November 18, 2010 10:45 AM  
Anonymous Anonymous said...

Ah, come on Tom, some nebulous equation, Potential Good = Size of Problem × Our Influence Over Problem.

What are we going to do, write forever over what each of us defines "potential good," "size of problem," and "our influence over problem are?"

The district spent over $100,000 on the DeJong sessions polling the community! The results of which showed residents preferred a $60-$80 million HS solution.

As Mr. Lewis points out, two board members were elected on the promise of keeping the project under $95 million. Did any board member vote against going over $95 million???

For me, I thought Franklin made a good suggestion here on 11/16... "I'll say it again, we should ALL be striving to make good on the 9 promises that were made at the Act 34 hearing and that is that the project should come in somewhere well below the current estimated amount."

That is the BIG DEAL! We should as Mr. Franklin suggest make sure the 9 promises, and the claim that the project will come in below the current estimate are delivered!

What can we do to make sure they are delivered? Good question!

What do we do if they aren't? My first suggestion would be to campaign against every current board member running for re-election that didn't deliver!
It's not that they're are necessarily bad people, but rather they just couldn't deliver on their promises.

Dean Spahr

November 18, 2010 11:12 AM  
Blogger Tom Moertel said...

Dean,

We're not in disagreement. What I said seems to be what you already think. You've already started thinking about things that you can hope to change, like elections and whether promises are kept.

All I'm saying is that it's pointless to focus on things that there is little reason to believe we can change.

Cheers,
Tom

November 18, 2010 11:20 AM  
Blogger Tom Moertel said...

John K,

Here's the thing: I have to go with the evidence. And you're not presenting enough to support your claims.

If saying so makes me sound like a “mouthpiece for the Board” in your book, I can live with that. Just like I can live with the claims of the guy who recently wrote in to question whether I was a “Glen Beck-ish political hack” because of the “blog's single minded focus on the school district's shortcomings.”

I guess to one guy I'm a school-district mouthpiece and to another I'm a school-district detractor.

If the price of calling ’em as I see ’em is to have people on the extremes of every subject calling me names and questioning my integrity, I can live with that. Because the price of not calling ’em as I see ’em is higher.

Cheers,
Tom

November 18, 2010 11:42 AM  
Anonymous John Ewing said...

Tom,

I agree as you say, “the price of not calling ’em as I see ’em is higher.” I believe that too, or I would not have posted what I did.

I believe there is sufficient evidence on this thread to question the validity of the survey and I encourage you to read the thread again to reexamine the questions and statements that present that evidence.

Stay Well, Tom,
John Ewing

November 18, 2010 2:07 PM  
Anonymous David Brown said...

You lost me by describing people exercising their freedom to move where they like and buy and sell real property as "class warfare."

I hope you will be lucky enough never to experience real class warfare, mainly because that means I probably won't then either.

November 19, 2010 6:35 PM  

Post a Comment

<< Home