School Services of California, Inc.
May xiv, 2012

Governor Jerry BrownGovernor Jerry Brown yesterday rolled out the May Revision to his 2012-13 Land Upkeep proposal to address the at present $15.7 billion arrears. He proposed to shut the budget gap through a $iv.1 billion increase in cuts to state employee compensation, welfare, health intendance, higher education, courts, and other government programs, for a total of $eight.three billion in cuts.

Gov. Chocolate-brown attributed the college level of upkeep gap to the January revenue forecast being too loftier by $four.3 billion, Proffer 98 spending increasing by $2.iv billion, and the federal authorities and courts blocking budget cuts $one.7 billion. Although the Governor's May Revision reflects an increment in Proposition 98 funding, the growth is used to increase the deferral purchase back and offset lower property tax estimates.

The magnitude of the country budget gap has increased, but the construction of the Gov. Chocolate-brown's proposal for K-12 didactics remains substantially the aforementioned: supposition of passage of a November taxation initiative with increases in Proposition 98 used to maintain existing program and reduce deferrals. Failure of the tax initiative and its resulting loss of revenue will continue to fall largely on K-fourteen schools with proposed cuts of $5.five billion and real programmatic reductions of $ii.vii billion.

Policy Issues

Many of the master policy provisions from the Gov. Chocolate-brown'due south January Budget remain, with some modifications:

  • Weighted Student Funding Formula
    • Increase the base grant from $4,920 to $5,421 per student
    • Require existing arrears gene reduction to be restored before the formula is fully implemented
    • Class bridge adjustment (K-iii, four-6, 7-8, and 9-12) added to acknowledge cost differences
    • Weighting for English language Learners and depression-income students drops from 37% to 20% and these funds would exist required to exist spent on those students
    • Domicile-to-schoolhouse transportation and Targeted Instructional Comeback Grant funds are add together-ons to the formula
    • The continued phase in of the formula in 2013-14 would be contingent upon the cosmos of an accountability system
    • Phase in of the formula increases from v years to seven years
  • Transitional Kindergarten—Brownish retains his proposal to eliminate Transitional Kindergarten but acknowledges failing enrollment erodes the savings; this savings, which Chocolate-brown now estimates to exist $91.five million, would be used to restore reductions to preschool programs
  • Mandate Cake Grant—Continues proposal to block grant mandate funding and distribute it on a per average daily attendance basis; the May Revision eliminates the ability for districts to employ the electric current mandate challenge procedure and would repeal six of the highest-cost mandates
  • Deferrals—Increase of $392.nine meg for a total of $2.6 billion to reduce interyear deferrals from $nine.v billion to $6.9 billion

Trigger

If Gov. Brownish'south tax initiative does not pass in Nov 2012, $6 billion in boosted cuts will go into effect on January ane, 2013, of which $5.v billion would exist to Proposition 98 funding. The May Revision equates the funding decrease to the equivalent of the cost of iii weeks of instruction. Schools volition exist provided flexibility to reduce the school twelvemonth by a combined 15 days in 2012-thirteen and 2013-14. Information technology is unclear how this school-year reduction would be applied, but it is fairly certain it would need to be negotiated at the local level.

The governor's proposal to reduce deferrals by $2.6 billion would be eliminated if the trigger reduction is implemented. The rest of the trigger cuts would come up from continuing the January proposal to shift the price of general obligation bond debt service for Yard-14 facilities into the Proposition 98 guarantee.

When asked how schools should react to the Governor'south Budget relying on the tax initiative, Brown recommended that districts "plan a prudent budget based on their understanding of what nosotros're trying to do."

This study is published here courtesy of Schoolhouse Services of California.   It was written by Michelle McKay Underwood, Michael Ricketts, and Kathleen O'Sullivan, all of whom are on the business firm's staff.

To get more reports like this i, click here to sign up for EdSource'south no-cost daily email on latest developments in educational activity.