The nonpartisan Legislative Analyst's Office, in a report released today, said Gov. Arnold Schwarzenegger's proposed spending plan for K-14 schools contains risky assumptions that could ultimately undermine the state budget.
"The Governor's overall (K-14) funding plan is tenuously held together," the LAO report states. "As a result, the plan could quickly unravel under certain circumstances related to constitutional interpretation, revenue assumptions and federal requirements. If any of the Governor's key assumptions do not come to pass, then the plan would no longer be workable."
LAO notes that the governor's budget relies on a controversial interpretation of Proposition 98 that reopens last summer's dispute over how much California owed schools then and in future years. (Proposition 98 is the 1988 constitutional amendment that dictates the minimum level of funding for K-14 schools.) Schwarzenegger's budget reclassifies education funds from 2008-09 so as to reduce the amount the state would have to give schools in 2009-10 and 2010-11.
Education groups on Wednesday gathered at the California Teachers Association office in Sacramento to charge that the governor had reneged on his agreement in last year's budget. While education leaders said they hoped not to litigate the issue, a CTA attorney was among the participants in the press conference, and they said they believed they would prevail if they had to ask the courts to hold Schwarzenegger to last year's budget deal.
LAO states that "the Governor's proposed funding level is based on his interpretation of the constitutional provisions of Proposition 98 regarding the creation and payment of maintenance factor. If a different interpretation were to prevail, the minimum guarantee would be significantly higher." LAO says the state would owe schools $2.2 billion more in 2009-10 and $3.2 billion more in 2010-11 than the governor wants to give them.
The LAO report questions Schwarzenegger's assertion that he is protecting education funding, noting that the governor treats the different levels of public schools in disparate ways. Schwarzenegger's budget would cut K-12 funding by $1.9 billion in 2010-11 but increase funding for community colleges by $200 million and for the California State University and University of California by $800 million.
The Legislative Analyst's Office says the governor's overall plan "heads in the right direction by finding some ways to reduce costs, providing additional flexibility and seeking additional federal funding." But it also questions some of the policy changes, such as why the governor would suspend nearly all mandated programs in 2010-11 rather than consider each one on its merits. LAO points out that the plan treats a mandate that students receive potentially lifesaving immunizations before entering school no differently from a "duplicative physical education requirement."
LAO recommends that the Legislature pursue one of two paths -- suspend Proposition 98 or increase revenues. Both options are politically difficult. To do the first, the Legislature would have to confront the powerful education lobby and an electorate that prioritizes public schools. As for the second? Schwarzenegger and Senate President Pro Tem Darrell Steinberg already have said they will not pursue general tax increases this year, largely a recognition that Republicans are unlikely to approve tax hikes.
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