July 1, 2011

Final State Budget Update

Yesterday Governor Brown signed the State Budget that was passed by the Legislature late Tuesday night.  The Governor vetoed out funding for California Longitudinal Teacher Integrated Data System (CalTIDES) and some state operations funds, but made no other adjustments to the K-12 provisions.  He left in California Longitudinal Pupil Achievement Data System (CalPADS).

The easiest way to explain this State Budget is to start with the January budget proposal and explain the differences, because the budget essentially is the January proposal but with many major and a few minor changes. 

Major Changes

• The $19 per Average Daily Attendance (ADA) cut to the revenue limit was restored.
• The potential $330 per ADA loss, because a special election did not occur, changed to a potential $250 per ADA loss if state General Fund revenues are between $2 billion to $4 billion less than anticipated.
• A new disproportionate cut of 50% to Home-to-School and Special Education transportation was added if state General Fund revenues are between $2 billion to $4 billion less than anticipated. Consequently, some districts could have much greater than a $330 cut per ADA if the revenues do not materialize as anticipated.
• New language attempting to dictate how schools budget and staff. Essentially, the Legislature and Governor are attempting to force schools to budget the same way as the state budgets with possibly the same outcome for school budgets as historically has been the outcome for state budgets.
• $1.1 billion of Child Development funds transferred out of Proposition 98 and Proposition 98 rebenched down for the transfer.
• Loss of $2.1 billion in Proposition 98 funding because of sales tax transfer to cities and counties for public safety purposes.  This $2.1 billion could return in 2012-13 depending upon ballot propositions on the November 2012 ballot.
• Settle-up account increase of $2.1 billion also depending upon the ballot propositions for the November 2012 ballot.
• Proposition 98 rebenching $1.7 billion to allow the state to achieve an equal amount of General Fund savings as the property tax transfer from redevelopment agencies to schools.
• Increases the Proposition 98 minimum guarantee by approximately $220 million to repeal AB 3632 and shift student mental health services from counties to schools.
• Deletes all reimbursement for the cost of filing state mandated cost reimbursement claims.

Minor Changes

• Funding corrections for new schools that have been created, charter school categorical block grant, unemployment insurance, ADA growth, and other workload issues.

~Dave Walrath