Gov. Gavin Newsom revealed his May Budget Revision May 13, proposing a $300.6 billion spending plan as the state budget surplus continues to rise to a record-breaking $97.5 billion. Among the key education proposals were major wins for CSBA’s budget advocacy work on investing in the Local Control Funding Formula base and providing critical support to schools dealing with declining enrollment and lower attendance as they recover from the pandemic.
Proposition 98 guarantee rises to $102 billion
As revenues soar, the proposed Proposition 98 guarantee has risen $8.3 billion since the Governor’s January Budget proposal, totaling $102 billion, of which an estimated $98.2 billion will go to K-12 schools. The Governor noted that all told, per-pupil funding from all sources will rise to a total of $22,850 and increase to $16,991 per pupil under Proposition 98 — however, it is important to note these are statewide figures that do not apply to individual school districts or county offices of education. Proposition 98 remains in Test 1 in all three years through 2022–23.
The May Revision increases the LCFF cost of living increase (COLA) to 6.56 percent or roughly $4.4 billion, an increase of $1.1 billion from the January COLA proposal of 5.33 percent. The proposal also increases COLA for specified categorical programs to 6.56 percent: Special Education, Child Nutrition, Adult Ed Block Grant, Mandate Block Grant, Foster Youth, American Indian Education Centers and American Indian Early Childhood Education.
To accommodate the expansion of Universal Transitional Kindergarten (TK), the January Budget re-benched the Proposition 98 guarantee from 38.02 to 38.4 percent of General Fund, or $639.2 million. Based on new projections of marginally lower TK ADA, the May Revision reduces the re-bench by $25.2 million, or a reduction in the re-bench increase from 38.4 percent to 38.3 percent.
Big wins on LCFF base funding and COVID ADA relief
As proposals to invest in the LCFF circulate in the Senate and Assembly, Gov. Newsom has proposed his own increase to the LCFF base. In addition to the statutory COLA, the May Revision would provide a discretionary increase of $2.1 billion ongoing Proposition 98 General Fund to LCFF base funding for school districts and $101.2 million ongoing to augment LCFF funding for county offices of education. This is a key success for CSBA’s budget advocacy, which has argued that a historic investment in the LCFF should be the centerpiece of this year’s budget. It should be noted that both the Senate and Assembly have proposed larger increases than the Governor; the size of the investment will continue to be a key topic in budget negotiations moving forward.
A second major win is the Governor’s adoption of the CSBA and Association of California School Administrators’ proposal for COVID attendance relief. In response to this joint advocacy effort, the May Revision includes fiscal protections for schools that experienced significant attendance declines in the current school year due to delta and omicron surges. The proposal would allow all local educational agencies to be funded at the greater of their current year average daily attendance or their current year enrollment adjusted for pre-COVID-19 attendance rates in the 2021–22 fiscal year and would also modify the three-year rolling average proposed in the January Budget to conform with this adjustment.
Discretionary Block Grant proposed to offset increased costs
The May Revision includes $8 billion in one-time Proposition 98 General Fund discretionary funds, to be allocated on a per-pupil basis. The intent is to respond to LEA reports of increasing operation costs, including pension contributions, and schools are intended to use funds for purposes including protecting staffing levels, addressing learning challenges and supporting staff and student mental health and wellness. Funds will offset applicable mandates debt.
Additional funds to offset expiration of federal nutrition waiver
The Budget Act of 2021–22 provided $54 million in ongoing Proposition 98 General Fund to provide universal school meals for all students, and the January Budget included an additional $596 million ongoing Proposition 98 General Fund. The May Revision includes an additional $611.8 million to augment the state meal reimbursement rate beginning in 2022–23, to offset the expiration of the federal waiver allowing higher federal reimbursement rates. If the federal government extends the waiver, unused state funding will be made available for school kitchen infrastructure grants.
Facilities funding proposed for new construction and deferred maintenance
The May Revision adds an additional $1.8 billion in non-Proposition 98 General Fund ($4 billion overall) for new construction and facility modernization and extends funding out to 2024–25:
- $2.2 billion in 2021–22 (as proposed in the January Budget)
- $1.2 billion in 2023–24
- $625 million in 2024–25
The proposal also provides an additional $1.8 billion in one-time Proposition 98 General Fund to address deferred maintenance.
Additional funds for community schools and community engagement
The 2021 Budget Act included $3 billion Proposition 98 General Fund, available over several years, to expand and strengthen community schools. Responding to projections from the Department of Education that the initial funds may be insufficient to meet application demand from LEAs in future funding rounds, the May Revision includes an additional $1.5 billion one-time Proposition 98 General Fund to expand access and meet demand.
The May Revision also provides an additional $100 million in one-time Proposition 98 funds to expand the Community Engagement Initiative, created by the Budget Act of 2018, and align it with work to build community schools.
More investment in the Expanded Learning Opportunities Program
The Budget Act of 2021 provided the ELOP program with $1 billion in ongoing Proposition 98 funds, with an additional $3.4 billion proposed in the January Budget. The May Revision allocates an additional $403 million, for a total of $4.8 billion ongoing for 2022–23. The revision also proposes $63 million in one-time Proposition 98 General Fund for ELOP arts and music program grants, for a total of $1 billion for 2022–23.
Support for workforce development
The 2020–21 budget provided $2.9 billion spread out over many new programs to help increase recruitment, retention and professional development of teachers, including $1.5 billion for the Educator Effectiveness Block Grant and $500 million to establish the Golden State Teacher Grant Program. The Governor’s January Budget provided a modest $52.2 million, mostly to extend teacher examination and credentialing fees to backfill California Commission on Teacher Credentialing revenue losses. The changes proposed in the May Revision include:
- Temporary authority for LEAs to allow teachers with preschool teaching permits and who have an undergraduate degree, pass the CBEST and are enrolled in coursework that leads to a Teaching Credential to teach TK.
- $500 million in one-time Proposition 98 to expand residency slots for teachers and school counselors.
- Expanding eligibility for the Golden State Teacher Grant Program to include school counselor, social worker and psychologist credential candidates.
- $85 million in one-time Proposition 98 General Fund to provide P-12 grade educator resources and professional learning to help implement STEM initiatives, specifically the Next Generation Science Standards, the California Math Framework, the California Computer Science Standards, and the math and science domains of the Preschool Learning Foundations.
- $300 million in one-time Proposition 98 General Fund for the Educator Effective Block Grant with an emphasis on STEM teacher supports.
Additional proposals
In addition to these larger items, the May Revision includes:
- Classified School Employee Summer Assistance Program: An increase of $80 million ongoing Proposition 98 General Fund.
- Accelerated Reading Support: An increase of $15 million one-time Proposition 98 General Fund, over three years, to support 6,000 teachers complete the coursework necessary for supplementary state certification in reading and literacy.
- Center on Teaching Careers: An increase of $1.7 million one-time Proposition 98 General Fund to the Tulare County Office of Education to support the educator recruitment work of the Center on Teaching Careers.
- California School for the Deaf-Riverside Athletic Complex Replacement and Expansion: An increase of $2.5 million General Fund for the study and preliminary plans phases of the project to replace all outdoor sport fields at the Riverside School for the Deaf.
Missed opportunities on pensions, transportation, TK facilities
While the Governor’s May Revision makes admirable investments in a number of key areas, it misses an opportunity to provide funding for home-to-school transportation. As we recover from the pandemic, it’s more critical than ever that students attend schools on-time, every day. Yet, because of severe underfunding for home-to-school transportation programs, California ranks last nationally in home-to-school transportation with just 10 percent of students taking a bus to school. CSBA-sponsored Assembly Bill 2933 is now the best hope of remedying this problem. AB 2933 provides the funding and flexibility local districts need to expand school busing service without taking from other programs in desperate need of resources.
Secondly, while there are proposals aimed at accommodating increased school costs, the May Revise failed to provide continued relief for school employers as they face a 1.2 billion dollar increase in pension rate increases beginning July 1. Without relief, these costs will cut into schools’ ability to serve students. CSBA has been working with legislative partners in both houses to push for non-Proposition 98 funds to alleviate these costs and will continue to advocate as the budget cycle moves forward. Read more about the issue here and ask the Legislature to include pension relief in this year’s budget.
Finally, the facilities funding included in the May Revision does not include dedicated funds for TK facilities. TK classrooms differ from typical classrooms in many ways, from in-class restrooms and separate play yards to proximity to drop-off/loading areas and the height of furniture. LEAs are racing against the clock to construct and prepare facilities, and without dedicated funding for TK facilities it will be difficult to fulfill the state’s goals for TK expansion.
What’s next?
With the release of the May Revision, budget season will begin in earnest. Negotiations with the Legislature and budget hearings in the Senate and Assembly will continue through May until the June 15 budget passage deadline. CSBA will continue to provide updates and opportunities for advocacy as the cycle continues.
CSBA is also co-sponsoring Budget Perspectives Workshops in partnership with Capitol Advisors in counties across the state from May 23 through June 1. Click here for more information and to register.
