“After extensive conversations, negotiations and mediations, both the City of Malibu and the Santa Monica-Malibu Unified School District agree that it is now in the best interest of all students that a mutually agreed to process for the formation of an independent Malibu Unified School District and Santa Monica Unified School District be pursued jointly by the two parties.”
So says the seven-page term sheet laying out the divorce settlement between Malibu and the Santa Monica-Malibu Unified School District (SMMUSD). Santa Monica and Malibu are heading into the weekend closer to a school district divorce than ever before, with both sides agreeing to a term sheet outlining a “conceptual framework” for the long-anticipated separation to begin.
Malibu City Council voted, 3-0, in closed session on Friday morning to approve terms for a school district split, with Councilmember Steve Uhring absent from the meeting and Mayor Pro Tem Bruce Silverstein abstaining from the vote. The vote came days after a similar approval by the Santa Monica-Malibu Unified School District (SMMUSD) School Board, though no formal vote was taken.
“The term sheet contains a conceptual framework that sets forth the process and timeline for creating an independent Malibu Unified School District,” according to Malibu Interim City Attorney Trevor Rusin, who spoke during the Friday meeting. “The Council also authorizes legal and financial consultants to continue to negotiate three separate agreements contemplated by the term sheet that would accomplish a full separation: a tax revenue sharing agreement, an operational agreement and a joint powers agreement. The City and District will continue these negotiations with the mediator to finalize these agreements. If the contemplated processes are accomplished within the proposed timeframes, an independent Malibu school district could be formed by July 1, 2024.”
The general terms of the split state that the proposed Santa Monica Unified School District would retain all school sites in the City of Santa Monica as well as all local revenues; the same would be true for Malibu under a new Malibu Unified School District, with the addition of revenue from the unincorporated portions of LA County often referred to as “unincorporated Malibu.”
The major sticking point in negotiations up to this point has been the potential loss of funding for Santa Monica students after Malibu — with its deeper pockets — departs. Proposed terms account for an allocation to maintain funding for Santa Monica schools.
“Each successor educational entity shall upon the first day of operations be allocated a sufficient share of funding to provide for a similar level of service at each school site as delivered by the Santa Monica-Malibu Unified School District in the fiscal year prior to formation,” according to the term sheet. Various machinations would ensure Santa Monica students would retain current funding levels (accounting for inflation) at least through 2042, at which point “tapering of tax revenue sharing shall commence” if necessary, that would go no longer than 10 years until tax revenue sharing officially ends by 2052.
The agreements also acknowledge that property tax revenues could change due to things like natural disasters, and that the cost of operating a Malibu Unified School District could be higher than currently foreseen.
The timeline attached to the term sheet includes a roughly 70-day stress testing of the proposed tax revenue sharing agreement terms that is now underway. By mid-December, the two sides hoped to have requested the special legislation required to split the two districts (one of the requirements for the process to continue). Parent and stakeholder input would be collected from January through mid-March 2023, and final agreements — tax revenue sharing, operations and joint powers authority — were to be completed by mid-April.
In early May of next year, the two sides hoped to have earned SMMUSD Board of Education approval for the split, followed by Malibu City Council approval shortly thereafter. The petition would finally be submitted by May 15, if the timeline holds up, giving the County Superintendent of Schools until June 14 to approve of the joint petition.
LA County Office of Education (LACOE) would then hold hearings on the arrangement in July 2023, before a November 2023 decision.
If all that goes according to plan, the split would appear on the March 2024 ballot for voter consideration in the statewide primary election, with the earliest possible start date for each independent school district set at July 1, 2024.
The move is the latest in a years-long process the City of Malibu and SMMUSD Board of Education have undertaken to facilitate Malibu departing the District. Malibu is geographically separated from the Santa Monica-based School District and its students make up about 15% of the total school population, but Malibu’s strong tax base has been responsible for supplying an outsized percentage of school funding to the shared District over the years, complicating the negotiation.
“This process we’ve identified reflects countless hours of negotiations and hard work on both sides,” SMMUSD Board Member Jon Kean said in a statement provided by the SMMUSD. “Unification has been discussed, debated and pursued many times over the last few decades. The commitment by both sides to move forward under this framework represents the first time that we have been able to mutually agree upon an equitable financial model. While there is work left to do, we have reached an historic moment in this process.”
The next LACOE Committee on School District Organization meeting, which had been scheduled for Wednesday, Nov. 2, has been canceled. The next scheduled meeting of the County Committee is for Wednesday, Dec. 7, 2022, at 9:30 a.m.