California Schools' Tough Choices

According to the Wall Street Journal cities across California have been approving parcel taxes to support local education. Schools in lower income areas have been suffering due to the poor economy and have been forced to make cuts left and right. Check out a snippet of the WSJ article discussing the issue below.

Residents of some affluent cities in this broke state are banding together to make up for cuts in public education, opening rifts between rich and poor school districts.

Key to the debate are parcel taxes, flat fees on property that are used by some cities to help fund public schools.

A handful of communities, such as the tony Bay Area enclave of Piedmont, Calif., have passed new parcel taxes to compensate for proposed state cutbacks, and others are considering them. Piedmont said the emergency measures would enable it to lay off only five of its 200 teachers, rather than nine.

"We're very, very fortunate that our community is supportive of our schools," said Ray Gadbois, vice president of Piedmont's school board.

In less-affluent communities where voters are loath to approve parcel taxes, the state's funding cuts are expected to hit harder.

One is Hayward, 15 miles south of Piedmont. At the city's Tyrrell Elementary School, Principal Rosanna Mucetti said she stands to lose nine of 30 teachers.

California requires any local tax increase for a specific purpose be approved by two-thirds of voters. Of the state's 1,042 school districts, only a small number have adopted parcel taxes. Since 1983, at least 245 such levies have been approved, including some that have been renewed, according to data from the lobbying group School Services of California.

The IRS Considers Pressing Schools to Further Reveal Their Business Activities

From NYTimes.com:

The Internal Revenue Service is considering expanding its scrutiny of colleges and universities to focus on billions of dollars associated with academic research, federal financing and intellectual property, a senior agency official said on Tuesday.

The expansion of an investigation would put pressure on the schools to further disclose their inner financial workings as the IRS undertakes a major effort to learn more about whether academic institutions are improperly using their nonprofit status to avoid paying certain taxes.

The expansion, while not yet certain, “is on the table,” Lois G. Lerner, the IRS’s director of exempt organizations, said in a brief interview.

As part of its current investigation, which began last October, the IRS sent unusually detailed questionnaires to 400 private and public universities and colleges about their executive compensation policies and their business activities.

While the institutions are not obligated to respond, not doing so can potentially lead to an audit.

The investigation is modeled upon similar scrutiny of hospitals that began in 2006 and has prompted audits, legislative hearings and stricter tax-filing requirements. The idea is to give the IRS a clear view of how the business of academia operates in the 21st century. “Universities are really part of a rapidly evolving sector, and as sectors evolve and the economy evolves, we’re going to periodically take a hard look,” Douglas H. Shulman, the IRS commissioner, said.