It will cost the average Palo Alto property owner an additional $10 a year to repay the $378 million bond that is upgrading school facilities across the city.
The news came in a report to the Palo Alto Board of Education Tuesday night.
The economic downturn has slowed the growth of the district's property tax base, resulting in a bump in the tax rate from $44.50 per $100,000 of assessed valuation to $45.60 per $100,000 of assessed valuation to cover the bond repayment cost.
The average assessed value of a single-family home in the school district is $831,000. Such a homeowner pays about $378.50 per year toward the school bond.
The $378 million "Strong Schools" bond, approved in June 2008 by nearly 78 percent of school district voters, is supporting current major construction projects at Gunn and Palo Alto high schools, Ohlone Elementary School, and planned construction at Fairmeadow Elementary School, all three of Palo Alto's middle schools and Duveneck Elementary School. Other upgrades are planned for the remaining elementary campuses.
In other school finance news, the school board was told Tuesday that the district could face mid-year cuts of up to $3.1 million if state revenue projections fall short.
The state Department of Finance will analyze tax receipts in December to determine whether mid-year cuts will become necessary, the school district's Chief Business Officer, Cathy Mak, said.
The maximum projected cut of $3.1 million amounts to about 2 percent of Palo Alto's $162.4 million school operating budget.
Palo Alto is somewhat buffered from the ups and downs of state crises because it is among the 10 percent of California school districts known as "basic aid" districts. Those districts draw almost all their revenue from local property tax rather than per-pupil allocations from the state.
But when state revenues fall short, basic aid districts are asked to take what are known as "fair share" cuts from the smaller percentage of state funds they receive.