Volume I, No. 4

November 25, 2008

California school finance is in for a wild ride over the next 18 months; Education’s Bottom Line provides information regarding the State Budget along with other pertinent information on issues affecting school districts.  

Legislature Meets, Talks, Leaves

By David Walrath -- dwalrath@m-w-h.com

Today the California Legislature met on the last day of their lame duck session regarding the state budget. That problem was not resolved today.  There continues to be a lack of consensus on how to develop a long-term, or even short-term, balanced budget.  It appears both parties want to punt the issue to the next Legislature and hope the federal government will bail out the state sufficiently to avoid any politically difficult decisions.

The Legislature that was elected on November 4, 2008 will be sworn in on December 1, 2008.  This new Legislature will have to address the continuing California budget problem.

As Scarlett said in Gone with the Wind “after all…tomorrow is another day.”

Looking to the Future

By David Walrath -- dwalrath@m-w-h.com

Will the economy ever recover?  Can California balance its budget? Will schools be cut another $3 billion?

These and many other questions come to mind as the stock market looks to have no bottom, economists talk about deflation with a multi-year recession and the new Legislative Analyst projects a possible 6.4% reduction (down to $54.3 billion) in the Proposition 98 guarantee for 2009-10.  more...

Will the State’s Cash Shortage Impact the Flow of State School Facility Bond Funds to School Districts from the State Allocation Board?

By Duwayne Brooks -- dbrooks@m-w-h.com

In the Assembly Budget Committee Hearing on November 14, 2008, the State Department of Finance testified that the state’s cash cushion is falling, and the state could have difficulty selling Revenue Anticipation Notes (RAN’s), which the state typically uses to smooth out General Fund cash flow. We have heard false rumors that the state’s cash problems will result in the state defaulting on their General Obligation (GO) Bond debt service payments, or the cash flow problems might cause an interruption in the allocations to school districts from the SAB.  more...

If you have any questions on the articles in this newsletter, please contact the author of the article in question.

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Murdoch, Walrath & Holmes (MWH) has been instrumental in shaping statewide policy and implementing regulations for K-12 schools for more than two decades.  Strategic relationships have been forged with the State Administration through agencies such as the Department of Education, the State Allocation Board, the Department of Finance and the Office of Public School Construction and, on the federal level, with key Congressional Members and the Executive Branch.  MWH prides itself on having some of the best minds in K-12 education in virtually all aspects of school fiscal needs. 

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