Governor’s budget proposal boosts base spending, allocations for LCFF

by Dennis Meyers, Assistant Executive Director, Governmental Relations, and Andrea Ball, Legislative Advocate

Happy New Year! Gov. Jerry Brown presented his 2014-15 budget proposal on Thursday, Jan. 9. The governor’s word of the day was prudence. His budget proposal continues a focus on paying down the state wall of debt. That being said, the budget does provide a Proposition 98 level of spending that is more than $6 billion above the enacted 2013-14 level. Total Prop 98 spending comes to $61 billion—this is about $5 billion more than the level of Prop 98 in 2008-09. Under the governor’s proposal, per-pupil funding from all sources comes to $9,194 in Prop 98 funds and $12,833 when all funds are considered, including federal money.

On the same day the budget was formally unveiled, Ed Week’s Quality Counts issue arrived at our office. The Ed Week’s Research Center includes analysis of school finance, equity and achievement indicators using 2011 data from the 50 states and the District of Columbia. California is 15th from the bottom in school finance. Let’s hope that with better funding ahead and Local Control Funding Formula implementation our state ranking in school finance, equity and achievement will rise. The outlook is certainly more promising than it has been in years.

Below is a brief summary of K-12 highlights from the governor’s budget. We will provide more detailed analyses in the weeks and months ahead. Budget overview hearings by legislative committees begin the second half of January and the real fun begins with the release of the governor’s revised budget proposal in May.

Highlights:

• A $6.3 billion increase in Prop 98 from the 2013-14 enacted budget level.
• $3.3 billion in additional funds from previous years ($1.8 billion from 2012-13 and $1.5 billion from 2013-14).
• Per-pupil Prop 98 spending (ongoing) up $725 between 2013-14 and 2014-15.  Up $2,188 since 2012-13.  It is estimated that per-pupil spending in 2014-15 will reach $9,194 in Prop 98 funds and $12,833 when all funds are considered, including federal funds.
• Local Control Funding Formula (LCFF)

1. Provides $4.5 billion in new funding for the Local Control Funding Formula.
2. The budget summary notes that the proposed level of funding and means the state is closing an approximate 28 percent of the statewide gap to full LCFF implementation.
3. Proposes legislation to create a continuous appropriation for LCFF.

• Combines $3.3 billion in prior year money with $2.2 billion in 2014-15 money to fully pay off remaining apportionment deferrals.
• Calls for paying off prior state mandate claims by 2017-18.
• Includes $363 million for energy efficiency from Prop 39.
• Raises questions about state’s continued involvement in school construction finance and does not call for a bond to be placed on the Nov. 2014 ballot.  Talks about the state process being overly complex.

1. Transfers $211 million in remaining state bond authority to new construction ($105.5 million) and modernization ($105.5 million).
2. Funds $188.1 million from Prop 98 for the Emergency Repair Program.

• Proposes a Constitutional Amendment to help strengthen the state rainy day fund and to establish a Proposition 98 reserve account which is intended to smooth year-to-year allocation levels to schools but would make no changes to the Proposition 98 guarantee.
• Calls for a new Adult Education program in 2015-16 for K-12 and community colleges.
• Proposes legislation to streamline and expand instructional opportunities available through non-classroom-based independent study.
• Proposes $46.5 million to implement AB 484, the revised student assessment system aligned to Common Core State Standards.
• Proposes to engage stakeholders to develop strategies to address the teacher retirement future liability issue.
• No proposal was made for preschool or Transitional Kindergarten, something we know is a priority with both Assembly and Senate Democrats.

Please stay tuned for updates and future blogs posts as the year unfolds and register now for the CSBA Forecast Webcast which will be held Wednesday, Jan. 22 at 10 a.m.