The newly enacted state budget meets the Proposition 98 minimum funding guarantee and protects the jobs of thousands of teachers around the state.
At the same time, however, it suspends the teacher tax credit for one year in an effort to raise discretionary funding for schools above the amount strictly required by state law.
By providing a 2 percent cost-of-living adjustment (COLA) instead of the 1.66 percent COLA mandated by state statute, a layoff window that could have allowed districts around the state to pinkslip teachers has been kept shut.
Under state law, whenever the K-12 COLA falls below 2 percent, a new layoff window opens that allows most districts to issue layoff notices as late as Aug. 15.
CTA's advocacy for the higher COLA and the decision by the governor and lawmakers to approve it reflected their desire to protect the jobs of teachers.
In order to provide the higher COLA and other vital funding - including appropriations to cover the costs of rapidly rising student enrollment - state budget writers were forced to suspend or eliminate some programs, including a popular program aimed at helping teachers recoup their out-of-pocket costs for supplies.
The Teacher Retention Tax Credit Program was enacted in July 2000 to provide credentialed teachers with credits on their state income tax forms of $250 to $1,500, depending upon their years of service.
This year's budget measure suspends this state tax credit for the 2002-03 fiscal year alone. Money that would have gone to the credit is helping provide more discretionary funding that chapters and districts will be able to discuss at the bargaining table.
CTA fiscal experts note that many chapter members have never qualified for the state tax credit, which targets credentialed teachers under a narrow definition.
Among those not eligible for the state credit are counselors, psychologists, nurses and fully credentialed teachers not working in teaching positions. Teachers receiving a stipend for such extra duties as coaching a sports team were not generally allowed to use that portion of their experience or their salary to qualify for the tax credit.
Despite the state action, teachers are still eligible for a recently enacted federal tax deduction. That provision of federal law allows teachers to deduct up to $250 for qualified expenses without itemizing.
Prior to the new federal provisions, teachers could only take such deductions if they were itemized and exceeded 2 percent of their adjusted gross income.
Readers are encouraged to consult tax professionals to see if they qualify for the federal credit. For more information, visit the Internal Revenue Service's website at http://www.irs.gov/ or call (800) 829-3676.
Len Feldman
