The Menlo Park City School District will receive a $1 million gift from the city to help it accommodate extra students after Stanford builds 215 housing units downtown.

The mixed-use development at 500 El Camino Real, approved by the City Council last year, is expected to bring an estimated 39 additional students to the school district when fully occupied, according to Superintendent Erik Burmeister.

John Donahoe, Stanford’s director of planning and entitlement, said those residences are expected to be fully occupied by early 2021. Demolition of buildings at the site is expected to begin next month.

The Menlo Park City Council unanimously voted Tuesday to authorize the $1 million contribution; Councilman Rich Cline was absent.

Combined with a $1.5 million gift from Stanford, the $1 million is projected to offset 60 percent of the impacts of those new students to the district. The district needs the money because Stanford’s 500 El Camino development is exempt from paying property taxes.

The $1 million gift will come out of the city’s $1.1 million refund from the state’s collection of local property tax revenues allocated to public schools to help meet minimum funding requirements.

Menlo Park school board President Terry Thygesen said she appreciates the city’s gift, but hopes it is a “first step” toward a larger discussion of how the city can help the district get full funding for accommodating extra students from new housing developments.

The city historically has negotiated agreements that cover 60 percent of those impacts with the city school district as well as the Los Lomitas and Ravenswood school districts.

“We feel like this is a good first step,” Thygesen said. “We have hope that developments going forward, they will figure out a way to see that all local school districts are fully mitigated, because if they’re not fully mitigated, the school districts are not providing the right level of service.”

The district doesn’t receive additional revenue from the state when new students enroll. Although it does receive some state funds, the bulk of its money for day-to-day operations comes through property and parcel taxes.