Revised California budget softens blow for schools

California school leaders are cautiously optimistic about Gov. Jerry Brown's revised state budget.

Largely because of rosier revenue projections for the coming year, budget experts at the Capitol say schools gained a cushion against cuts – even if Brown fails in his effort to extend 2009 increases to income taxes.

The result appears to be flat funding for school districts in the coming year, says Ron Bennett, president of School Services of California.

"Yes! There's light at the end of the tunnel, and this time it's not a freight train," said Debbie Bettencourt, superintendent of the Folsom Cordova Unified School District. "We're happy about flat funding. We're happy they didn't cut us. We're grateful."

The revised budget brings Proposition 98 funding to $52.4 billion, an increase from the $49.4 billion proposed in the January budget. Proposition 98 guarantees minimum funding levels for education.

Bettencourt said the revised budget proposal is likely to result in the rehiring of some Folsom Cordova employees laid off Monday.

Officials at Twin Rivers Unified also are planning to rehire eight teacher-librarians, based on the proposed budget, but are holding off on other rehires until the budget is final.

But most districts, worried the budget will change again or the tax extensions won't be approved, are taking a more cautious stance.

Elk Grove Unified is sticking with its worst-case budget scenario of $672 per student in cuts until the budget is finalized, said Superintendent Steven Ladd.

"If it gets better, should it get better, we can definitely do amendments," Ladd said.

But nothing is certain. If the tax extensions aren't approved, a $2.5 billion deferral could be put back into play, said officials from School Services of California. That means the money, which is supposed to go to schools in the 2011-12 school year, would not actually be paid until the following school year.

The state already has had four payment deferrals, built into the law in 2008. The 2010 budget includes five – including a deferral of $1.7 billion until July of 2011 – for a total of $7 billion.

The deferrals have meant a cash-flow problem for districts, forced to borrow money and pay interest to meet payroll and keep the lights on.

"It puts a huge strain on cash," said Mike Dencavage, chief financial officer for San Juan Unified. "A couple of years ago that wasn't a significant issue. Now we focus on cash equally or more so than the budget."

Nonetheless, the financial picture for districts looks much brighter than it did a few months ago when some analysts were telling school districts to brace for cuts of as much as $700 per student. School Services had told districts to plan for $350 less per student.

"For the moment, we are temporarily experiencing some cautious optimism," said Frank Porter, superintendent of Twin Rivers Unified in Sacramento. "We are certainly not out of the woods yet."

The revised budget includes a few other changes that affect schools, including the suspension of funding for a computer data system known as CALPADS that collects information on student achievement and demographics, and CALTIDES, a system that was to collect information on teachers.

The budget revision cites a need to reform testing and accountability requirements as the reason for the suspension of $3.5 million in funding for the data systems.

The budget also includes $27.5 million to provide block grants and other funding for charter schools, according to officials from School Services.

• Read more articles by Diana Lambert

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