Education Funding

New Calif. Budget Offers Mixed Results for Schools

By Joetta L. Sack — August 11, 2004 3 min read

California’s fiscal 2005 budget came in a month late and offered only slight increases for K-12 education. It also suspended a state law that would have doled out much more money for schools.

Students watch as California State University-Long Beach President Robert Maxon, at lectern, acknowledges state lawmakers July 30 for passing a new state budget.
Students watch as California State University-Long Beach President Robert Maxon, at lectern, acknowledges state lawmakers July 30 for passing a new state budget.
—Photograph by Kevin Chang/(Long Beach) Press-Telegram/AP

Gov. Arnold Schwarzenegger signed the $78.7 billion state budget on July 31, one month after the June 30 constitutional deadline. It took nearly four weeks for legislative leaders from both sides of the aisle and the Republican governor to agree on a final plan.

The process slowed when some Republican legislators unsuccessfully attempted to repeal a 2002 union-backed law that prohibits school districts from contracting with private firms for transportation.

But the major delay was over negotiations with local governments on whether they should be guaranteed an annual minimum funding amount from the state. That issue was not completely resolved, and supporters of the idea have placed it on a ballot initiative for the November elections.

In a move that the governor’s office calls “rebasing,” the budget temporarily suspends the state’s constitutional guarantee of minimum per-pupil funding under a 1988 ballot measure, Proposition 98.

State Superintendent of Public Instruction Jack O’Connell was disappointed.

“The public should be aware that in this difficult budget year, our schools sacrificed more than $2 billion of the amount guaranteed … under Proposition 98,” he said in a statement. “That sacrifice lowers the funding to schools for several years to come, and at a time when the needs of our students are greater than ever.”

Many education groups opposed the efforts by the local governments to seek guarantees of minimum funding, arguing that those protections would have been stronger than the Proposition 98 guarantees for schools, and could have taken money away from schools during economic downturns.

The K-12 budget totaled $49.2 billion, up 5 percent from $46.6 billion in fiscal 2004. But much of the funding increase was directed toward specific programs that had seen large cuts in recent years, and the budget does not compensate for enrollment increases and inflation as called for in the Proposition 98 formula.

‘Fair and Responsible’

Many educators expressed relief that the process was over. Most agreed that while the numbers were not as bad as they could have been, further tough times lie ahead.

“Had we not made the agreement with the governor, we almost certainly would have been looking at cuts of $1 billion,” said Kevin Gordon, the executive director of the California Association of School Business Officials. “Most districts have now made the cuts in anticipation of this.”

Gov. Schwarzenegger, meanwhile, gave an upbeat speech before signing the measure. He noted that the budget is balanced and does not raise taxes.

“This is a fair and responsible budget,” he said. “And most importantly, this budget keeps California on track for economic recovery.”

The budget also includes $188 million for a proposed settlement in the Williams v. State of California lawsuit, a school-finance-equity case filed in 1999 by advocates for students from low-income families. (“Settlement of School Equity Case Caught Up in Calif. Budget Battle,” July 14, 2004.)

The funds, if approved by lawyers for the parties in the case, will go toward instructional supplies and facilities upkeep in some of the state’s neediest school systems. At press time last week, lawyers were still working out the details of the settlement.

Many of the budget’s education provisions were directed toward the higher education system, which has seen large cuts in state funding and sharp increases in tuition and fees over the past four years.

After forging an agreement with higher education leaders in May on academic accountability measures, the budget guarantees more funding and allowances for enrollment increases in coming years. The budget also helps community college students by rolling back some fee increases.

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