A chastened Gov. Arnold Schwarzenegger on January 10 unveiled his proposed 2006-2007 $125.6 billion state budget. The plan would provide K-14 schools with a statutorily required Cost-of-Living Adjustment, but it would fail to meet other requirements of the state Constitution's school funding protections.
With his November 2005 ballot agenda overwhelmingly rejected by voters, the governor abandoned the harsh anti-public education, anti-teacher, and anti-union rhetoric that accompanied the release of his budget plan in January 2005.
Even so, CTA budget experts noted quickly that the spending plan - while moving in the right direction - does not go far enough.
"While the Governor's proposals on education are a start, they continue to shortchange local schools, fail to meet the minimum funding requirements of Prop. 98 and make no commitment to repay the money that was borrowed from public education," CTA President Barbara E. Kerr said. "CTA will continue to work with the Legislature and the Governor to make sure our students get the resources they deserve and need to succeed."
Speaking to reporters in an auditorium at the Secretary of State's headquarters on January 10, the governor touted the new spending plan as paying down "inherited debt," avoiding tax increases, and funding his priorities and those voters made clear to him in their November 2005 special election voting, including education, transportation, and infrastructure reconstruction.
The governor declared that his proposal would repay $1.7 billion in funds owed to public education earlier than required and boost per-student funding to nearly $11,000, up $660 per student from the 2005-2006 budget level. The governor put the budget's proposed Proposition 98 spending of $54 billion - including a year-to-year increase he put at $4.3 billion -- and called it the "highest ever."
But CTA fiscal experts noted that the "year-to-year" increase only partly makes up for funding shortfalls and borrowings that were part of the governor's anti-education actions last year.
The governor maintained his position that the state's budget structure forces deficit spending, with some 70% of state spending driven by requirements and formulas. He reiterated that the governor should once again be granted the power to adjust the spending plan mid-year, an element of his Proposition 76 that voters soundly rejected in November. This time, the governor said that his new proposal would exempt public education from any mid-year corrections driven by declining revenues or higher-than-expected expenditures.
During a more detailed budget briefing, the governor's finance director, Michael Genest, told reporters that the spending plan would continue the suspension of the teachers' tax credit, reducing state spending by $220 million.
Genest also told reporters that the budget proposal considers the cost of the governor's after-school program, approved by voters as Proposition 49, as an "education" expenditure under Proposition 98. In fact, the governor's budget would allocate Proposition 98 maintenance factor funding to cover the $428 million cost of the program.
CTA fiscal experts emphasized that the governor's use of Proposition 98 appropriations to fund Proposition 49 violates the commitment made to voters when they passed the initiative and falsely implies that money owed to schools under Proposition 98 is being repaid.
The Association fiscal analysts also pointed to the fact the proposal would fund new educational programs without first fully funding existing ones.
The governor's release of his first budget proposal marks the start of negotiations that will continue until at least the end of June. Lawmakers in both houses will begin examining the governor's spending proposals later this month. The negotiations will become even more intense following the release of the governor's updated budget proposal, the May Revision, in the middle of that month. The legislature will be working against a June 15 constitutional deadline for submitting its spending bill to the governor. The constitution gives the governor until June 30 to sign the measure into law to take effect on the July 1 start of the new fiscal year.