California Challenge: Avoid ‘Dysfunction’ in Resolving Budget

By Linda Jacobson — January 21, 2009 3 min read
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Education—and virtually all other government priorities—took a back seat to the state’s fiscal crisis as Gov. Arnold Schwarzenegger used his Jan. 15 State of the State speech to push lawmakers to end a deficit stalemate that threatens to paralyze state operations.

Already, the current-year budget deficit of more than $14 billion has led the governor to propose such cost-saving measures as shortening the school year by five days, increasing class sizes, and suspending a grant program designed to help low-performing schools.

With the deficit expected to swell to more than $40 billion in the next 18 months, the governor warned lawmakers that new initiatives in education—or anything else—are stalled until the state resolves its fiscal problems.

“It doesn’t make any sense to talk about education, infrastructure, water, health care reform, and all these things when we have this huge budget deficit,” the governor said, according to excerpts of the speech released by his office. “I will talk about my vision for all of these things, and more, as soon as we get the budget done.”

Meanwhile, as the state legislature prepares to tackle the budget for the 2010 fiscal year, lawmakers are still negotiating over how to address the gap in the current, $103.4 billion fiscal 2009 budget.

The governor has proposed cuts that would include delaying until later this summer almost $3 billion in state aid payments that schools would normally receive in January and February.

Lawmakers have now gone more than two months without a budget solution the governor will sign. Republicans have refused to vote for any tax increases. (“State Budget Chills Send Shivers Through K-12 Circles,” Nov. 12, 2008.)

“People are asking if California is governable,” Gov. Schwarzenegger said. “They don’t understand how we could have let political dysfunction paralyze our state for so long.”

‘The Last Thing’

In the current budget, the governor is calling for twice-a-month, unpaid furloughs for state employees, including education department workers, to save roughly $1.3 billion, but unions have filed a lawsuit hoping to block that move.

But even if legislators pass everything the governor has proposed—a combination of taxes, cuts, and new construction projects to stimulate the economy—the state still won’t be able to meet its obligations and could be forced to start paying bills with IOUs in February, according to state controller John Chiang.

The governor’s proposed budget of $95.5 billion for fiscal 2010 includes roughly $6 billion in cuts for education programs.

For Proposition 98, the main source of funding for classrooms, the governor is proposing $55.9 billion, which meets the minimum spending level required by the funding formula. In more prosperous years, the state has provided more than the minimum level.

The governor, however, is proposing to give school districts greater flexibility in the use of categorical funds to handle the cuts in a way that least disrupts instruction.

The state’s largest teachers’s union, meanwhile, is hoping to use a possible special election, likely in June, to generate funding for for schools. In December, the California Teachers Association, an affiliate of the National Education Association, filed paperwork seeking to put an initiative on the ballot that would add a penny to the state’s 7.25-cent sales tax. If it were to go forward and be approved, such an initiative would raise at least $5 billion a year for instructional materials, teacher training, additional counselors, arts programs, and hiring highly qualified teachers.

Districts are already “having to cut into direct programs and services to kids,” said Rick Pratt, the assistant executive director for governmental relations at the California School Boards Association.

Because many districts have had to take out short-term loans to cover payroll, the governor’s plan to defer aid payments until summer is also problematic. Districts are usually required to pay back those debts before the end of the fiscal year, in June.

Mr. Pratt added that even though the governor is proposing to give districts the option of cutting the school year to 175 days from 180, for most districts, “that is the last thing they would do.”

State Superintendent Jack O’Connell, who is an independently elected official, says he is"adamantly opposed” to cutting school days.

“To close the achievement gap and prepare our students for success in the competitive global economy, we should be talking about making the school year longer, not shorter,” he said during a Jan. 9 press conference.

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A version of this article appeared in the January 21, 2009 edition of Education Week as California Challenge: Avoid ‘Dysfunction’ in Resolving Budget


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