July 1, 2009

Education Cuts Not Made Before Deadline

By David Walrath

The Legislature did not pass the 2008-09 education cuts prior to the midnight June 30 deadline for such cuts.  The state probably will look at ways to recover the education fund cuts through other means.  At this time, however, schools should consider that their 2008-09 funding level is the February 2009 Budget Act level for 2008-09, plus the federal stimulus funds that have been received.

The Senate Republican blocking action appears to be positive for schools while it is absolutely detrimental to the rest of the State Budget.

Balancing the 2009-10 State Budget will be much more difficult and there will be fewer options available particularly after the Appeals Court ruled yesterday that prior public transportation fund transfers (potentially up to $3.5 billion) were illegal and those funds would have to be repaid to local government transportation accounts and public transportation programs. 

The Governor has indicated that he will propose new cuts to replace the cuts that were not made by midnight June 30. While there is no list at this time, speculation is that the Governor will propose suspending Proposition 98 and not paying funds deferred from 2008-09 into 2009-10.