July 7, 2008

To:                   ACSA Leadership and Members

From:               Adonai Mack, Legislative Advocate

Re:          FY 2008-09 Questions and Answers:  Stay Vigilant In Protecting Proposition 98

We have now reached the constitutional deadline for the passage and signature of a budget and again the deadline was passed without a budget being passed or signed.  We have reached the stage in the budget process where the specifics of the budget are being negotiated by the "Big 5" - the Governor, Senate Pro Tem, Assembly Speaker, and the leaders of the Senate and Assembly Republican Caucus.

As we press forward in our advocacy to protect Proposition 98, you should continue discussing the budget with your local legislators and your community.  In an effort to ensure that you are prepared for those discussions we have updated our Q&A with some of the most recent topics and questions that you might run into:

1)       Proposition 98 was fully funded in the Governor's May Revision.

·         While we recognize the effort by the Governor to prevent a suspension of Proposition 98, we argue that Proposition 98 was not fully funded by the Governor's May Revision.

·         The May Revision did not include funding for a cost-of-living-adjustment.  With the increasing costs of gasoline and continued increases to health care costs, the loss of a COLA will still result in cuts to educational programs.

·         The May Revision also still proposes a 6.5% cut across the board to all categorical programs. This cut will still devastate many programs across the state.

·         The loss of a COLA and the cut to categorical programs cuts $4.3 billion from the education budget.  

·         The true reason the governor decided against suspending Proposition 98 is because he did not have to.  The revenues in the state dropped low enough that the Proposition 98 calculation determined that a suspension was unnecessary. 

·         The May Revision also relies on several proposals that could negatively impact school funding.  These include the Budget Stabilization Act (BSA) and the securitization of the lottery.  Neither of these proposals would help solve the current budget deficit.

·         The BSA has several flaws that could negatively impact education funding.  The BSA would permanently reduce school funding without a vote of the people and allow any governor to reduce funding to education permanently.  It gives any governor unilateral authority to make mid-year cuts without going through the legislative process, therefore undermining the democratic system of checks and balances.

2)       School districts waste funding and fail to dedicate enough resources to the classroom.

·         While a majority of district revenue limit funding is dedicated to salaries and benefits via contractual commitments, almost all of Proposition 98 funding is "heavily committed" through categorical programs making it difficult for school districts to reduce funding during tough budget times.

·         The recent research conducted on education funding established that the state should increase funding for education.  The Governor's Commission on Education Excellence noted that it would cost an additional $5 billion to fully fund the Commission's reforms for education. In addition, a much needed expansion of preschool would cost $1.1 billion. 

·         All the research included in the "Getting Down to Facts" reports noted that education would need at least a 40% increase in funding to meet the standards required by the state.

3)       Since education takes up the majority of the budget, when education receives its full funding, the Legislature will have to make massive cuts to the non-Prop 98 side of the budget. 

·         Our students did not create this problem, and their futures shouldn't be shortchanged because of it. 

·         The Governor's budget proposes to balance the state budget through cuts alone.  This approach would be devastating to our students and to the future of California.  The final budget agreement must include increased revenues as part of any approach to balancing the budget.

·         The education side of the budget has not increased at the rate of the non-education side.  Over the last few years, Proposition 98 has increased by 30 percent.  The rest of the general fund budget increased by 40 percent.

·         As educators we are still concerned with the impact that the budget cuts have on the whole child.  

·         We cannot educate a child who is unhealthy or absent.  Children whose families are dropped from the CalWorks program or the Healthy Families Insurance program will still have negative repercussions on our efforts to education the child. 

·         The magnitude of the cuts to CalWORKs will lead to more homelessness and more hunger among children, making it even harder for children to get the education they need.

·         Cuts to child development programs and child care will also impact schools and exasperate the existing achievement gap.  Research has demonstrated that preschool is a valuable program that helps close the achievement gap and prepares children to enter the k-12 system.

4)       The lottery proposal appears to bring in more revenues to the state and guarantees the same level of funding to education. This seems like an excellent deal for school districts.

·         There are two lottery proposals that both pose concerns for continued education funding.

·         The governor's proposal securitizes the state lottery for $15 billion and maintains education's share of lottery proceeds at $1.2 billion.  The Assembly securitizes the lottery and puts education's share of funding into the base for Proposition 98. 

·         While the governor's proposal maintains stable annual funding from the lottery proceeds, education's share of funding would never increase, but could be susceptible to decreases in years where the lottery revenues fail to cover the costs of paying back the debt from securitization.

·         The Assembly proposal is the better of the two proposals because the Assembly would take education completely out of the picture for receiving lottery proceeds and increase the base of Proposition 98 by $1.2 billion.  Further, the Assembly would pay previous debts owed to education in the budget year.

·         While the Assembly proposal increases the base funding for education, it does put more education funding vulnerable to a possibility of suspension or reduction during years in which the state budget faces a deficit.