Controller’s April Cash Report Shows Sluggish State Revenues

May 22, 2017

In one of the most crucial months for collections, California revenues of $15.98 billion for April fell short of projections in the governor’s proposed 2017-18 budget by $1.05 billion, or 6.2 percent, State Controller Betty T. Yee reported on May 10.

For the first ten months of the 2016-17 fiscal year that began in July, total revenues of $96.88 billion are $1.83 billion below last summer’s budget estimates and $211.3 million shy of January’s revised fiscal year-to-date predictions. Total fiscal year-to-date revenues are $1.74 billion higher than for the same period of the prior fiscal year.

April personal income tax (PIT) receipts of $12.76 billion lagged by $707.6 million, or 5.3 percent. In the current fiscal year, California has collected total PIT receipts of $67.66 billion, or 0.2 percent less than January’s revised estimate. Last year, nearly 17 percent of PIT receipts arrived in April...

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LAO Posts Update on COLA for K-14 Education Programs

May 8, 2017


(On April 28, the California Legislative Analyst’s Office posted the following update on the Cost of Living Adjustment for California school districts and other state-funded education programs:)

The federal government recently released updated information that affects the cost-of-living adjustment (COLA) that the state provides to certain school and community college programs. Below, we provide background on the COLA, share the recent data, and examine its budget effects.


Statutory COLA Determined by Price Index for State and Local Governments. State law specifies that certain school and community college programs are to receive an annual COLA. The statutory COLA rate is tied to a national price index developed by the Bureau of Economic Analysis (a division of the U.S. Department of Commerce)...

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New Study Finds More Equitable Funding but Persistent Access Gaps Three Years into LCFF

April 24, 2017

A few years into California’s Local Control Funding Formula (LCFF), school district funding is more equitable but access gaps persist according to The Steep Road to Resource Equity in California Education: The Local Control Funding Formula After Three Years, a new research study by The Education Trust–West. Through comprehensive data analysis, the report finds that LCFF has reversed inequitable revenue gaps that used to exist between the highest and lowest poverty school districts. The revenue gap was at its widest point right before LCFF, with the highest poverty districts receiving $829 less per student in 2012-13. The analysis found that funding three years into LCFF was more equitable, with the highest poverty districts receiving an average of $334 more per student in 2015-16.

While this research finds that funding has become more equitable, it did not find evidence that this funding has yet translated into more equitable opportunities for students in low-income schools...

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Controller: State Revenues Top March Projections

April 24, 2017

California revenues of $7.63 billion for March beat projections in the governor’s proposed 2017-18 budget by $1.73 billion, or 29.2 percent, State Controller Betty T. Yee reported on April 10. March revenues were just $56.5 million above estimates in the 2016-17 Budget Act signed last summer.

For the first nine months of the 2016-17 fiscal year that began in July, total revenues of $80.91 billion are $607.3 million below last summer’s budget estimates, but $837.1 million ahead of January’s revised fiscal year-to-date predictions.

March personal income tax (PIT) receipts of $3.93 billion topped projections in the governor’s proposed budget by nearly $1.09 billion, or 38.2 percent...

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Assembly Subcommittee Rebuffs Governor, Restores $527 million in Child Care/Early Education Funding

April 10, 2017

On April 4, a subcommittee of California legislators gave a thumbs down to Governor Brown’s proposed reduction in funding for California’s child care and early education programs.

Assemblymember Kevin McCarty (D - Sacramento), Chair of the Assembly Budget Subcommittee on Education Finance led a bipartisan effort to reject Governor Jerry Brown’s proposal to reduce support for state child care and preschool programs and voted to restore $527 million in critical child care and preschool funding.

California families are typically eligible for subsidized child care if their household income is below 70 percent of the 2007-08 State Median Income (about $42,000 for a family of three), if the parents have a need for care related to work, training, or education, and if the children are under 13 years-old...

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CSBA “Deeply Concerned” About Trump’s Newest Plan to Slash Federal Education Funding

April 10, 2017

“The California School Boards Association is deeply concerned about the Trump Administration’s plan to slash federal education spending. The $9.2 billion in cuts for the upcoming fiscal year was bad enough, but proposing an additional $3 billion in surprise mid-year cuts is particularly worrisome,” said CSBA President Susan Henry on March 31. “These reductions target funds marked for important teacher training and class-size reduction programs that improve student learning and teacher quality, areas where we need to invest more resources, not cut funding.”

On Tuesday, March 28, the Trump administration called for a $3 billion reduction to the U.S. Department of Education’s budget for the remainder of the 2017 fiscal year. This reduction comes in addition to the proposed $9.2 billion decrease to education funding for next year. The “skinny budget” presented by the Trump Administration aims to slice Title II, Part A funding in half for the rest of this year before completely eradicating the $2.4 billion program next year...

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Trump Budget Would Dismantle Public Education, Hurting Kids, Working Families, and Teachers

By Stephenie Johnson, Neil Campbell, Kami Spicklemire and Lisette Partelow - Rep: March 27, 2017

On March 16, President Donald Trump released his devastating budget for the 2018 fiscal year. It would dismantle public schools through massive cuts to teacher training, after-school programs in public schools, and transfers of public funds to private school vouchers. Every budget is a statement of values and this one could not be clearer in the vision it presents: starve the public school system and privatize education.

The Trump budget would slash $9 billion – 13 percent of the U.S. Department of Education’s funding – while investing $1.4 billion of new money in school choice, including private school vouchers, sending a clear signal that the Trump administration prioritizes ideologically driven voucher schemes over great public schools...

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Broad Negative Implications for PreK-12 Education in Initial Blueprint of Trump’s “America First” Budget

By Abigail Swisher, Lisa Guernsey, Abbie Lieberman, Melissa Tooley, Elena Silva and Roxanne Garza - Rep: March 27, 2017

In the unlikely event that you haven’t heard, the Trump Administration released its 2018 budget blueprint on March 16. Far from a final version, the document is short on details and is only a request by the President to Congress, which is ultimately in charge of how to divvy up federal funds and make cuts. Still, it signals an administration’s broad budget priorities for the coming year.  New America’s education policy team has previously written about the proposed budget’s implications for higher education, for afterschool programs, and for programs designed to improve teaching and help people gain skills to acquire good jobs. In this post we will provide a broad overview of what the proposed budget means for public education across the PreK-12 grade span...

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Education Leaders Vow to Fight President Trump’s Proposed Federal Budget Cuts to Education

March 27, 2017

President Donald Trump rolled out his “Budget Blueprint” document on March 16, and several leaders in the field of K-12 education were quick to object to multiple cuts in funding for school programs.

In California, the California Department of Education released a statement on behalf of State Superintendent of Public Instruction Tom Torlakson, saying:

President Donald Trump’s proposed budget is very disappointing and goes in the wrong direction with funding cuts that would hurt disadvantaged children, after school programs, teacher training, and other important services.

Torlakson said these cuts hurt programs that help prepare California students for jobs in the fiercely competitive, 21st century global economy...

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LAO Looks at the 2017-18 State Budget

Analysis of Special Education “Disconnect”

March 13, 2017


(Editor’s note: On March 1, the California Legislative Analyst’s Office released the following “budget and policy post” analyzing special education funding in the context of the 2017-18 state budget)

Some Groups Claim Special Education “Deficit.” For the past few years, some groups, including the California Department of Education (CDE), have expressed concerns about a deficit in state special education funding. This complaint relates to a somewhat complicated issue dating back to 2013-14, a year in which the state special education budget appropriation and associated trailer legislation were disconnected. Below, we provide background on the issue and offer two options for rectifying the disconnect.

Most State Special Education Funding Distributed According to Overall Student Population. About 85 percent of state special education funding is distributed according to a student-based formula commonly called AB 602 (after the legislation that introduced it in 1998)...

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Controller: State Revenues Fell Short of February Projections

March 13, 2017

California revenues of $6.52 billion for February fell short of projections in the governor’s proposed 2017-18 budget by $772.7 million, or 10.6 percent, State Controller Betty T. Yee reported on March 10.

Recent month-to-month fluctuations have not developed a clear pattern. January revenues beat projections by 6.2 percent. The variance can often be as simple as one large payment due on the first of the month being recorded on the last day of the prior month.

Personal income taxes (PIT), corporation taxes, and retail sales and use taxes all fell short of January’s revised budget estimates for February, and only corporation taxes – the smallest of the three – topped fiscal year-to-date projections in the governor’s proposed 2017-2018 budget...

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Controller Reports State Revenues Top January Projections

February 27, 2017

California revenues of $15.04 billion for January beat projections in the proposed 2017-18 budget Governor Jerry Brown introduced last month by $884.4 million, or 6.2 percent, State Controller Betty T. Yee reported on February 10.

In December, the “big three” sources of California general fund dollars – personal income taxes, corporation taxes, and retail sales and use taxes – all fell short of monthly and fiscal year-to-date budget estimates. For January, all three outpaced 2016-17 Budget Act assumptions and projections in the governor’s proposed 2017-18 budget.

For the first seven months of the fiscal year that began in July, total revenues of $66.76 billion are now $392.5 million below last summer’s budget estimates, and just $115.5 million short of January’s revised fiscal year-to-date predictions, or 0.2 percent...

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LAO Releases Report Examining Mission, Funding and Future of County Offices of Education

February 13, 2017


(Editor’s Note: On February 6, the California Legislative Analyst’s Office (LAO) released a report titled ldquo;Reinvisioning County Offices of Education: A Study of Their Mission and Funding.” The report’s executive summary is reprinted below. Click on the link at the end of the executive summary to read the entire report.)

Executive Summary


State Constitution Establishes Role of County in Schools. The State Constitution establishes county superintendents of schools. Today, each of the state’s 58 counties currently has its own superintendent. County superintendents and their staff commonly are referred to as county offices of education (COEs).

State Law Tasks COEs with Some Specific Responsibilities. The state gives COEs a role in alternative education (designed for students who require or could benefit from a nontraditional school setting). Specifically, state law requires COEs to ensure that students incarcerated at county jails receive an education. To this end, most COEs receive state funding to operate juvenile “court schools...

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Torlakson Announces “Small School District Assistance Initiative” for State School Bonds

February 13, 2017

State Superintendent of Public Instruction Tom Torlakson announced on February 8 that the California Department of Education (CDE) is offering a new “Small School District Assistance Initiative” to help small and rural school districts apply for state school bond funds.

California voters in November 2016 approved Proposition 51, which will provide $9 billion in state school bond funds for construction and modernization.

Prop. 51 is the latest in a series of state school bonds approved since 1998, but about 100 of the state’s 1,025 public school districts have never applied for bond funding. Small and rural districts often don’t have the staff or resources available to apply, even if they need to build new schools or upgrade aging school buildings, Torlakson said.

“We want to get small and rural schools in line for Prop. 51 funding and build modern school facilities that will help students succeed on their way to 21st century careers and college,” Torlakson said...

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LAO Maintains Gov. Brown Is Underestimating State Revenue Projections for 2017-18 Budget

January 30, 2017

In a report released on January 13, California’s independent Legislative Analyst’s Office (LAO) maintained that Governor Jerry Brown’s January budget proposal (released on January 10) was unduly cautious in its projections of anticipated state revenues during the coming year.

Highlights of the LAO’s report are reprinted below:


Executive Summary

This publication is our office’s initial response to the 2017-18 Governor’s Budget proposal, which was presented to the Legislature on January 10, 2017. (Over the next couple of months, we will publish analyses considering key parts of the proposal in more detail.)

Governor Identifies $1.6 Billion Budget Problem. In preparing the 2017-18 budget, the administration concluded that the state’s fiscal condition has worsened. According to the administration, absent new budget solutions, the state would face a deficit of $1.6 billion at the end of 2017-18...

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Torlakson Announces Funding Relief for School Closures Due to Flooding, Winter Storms

January 30, 2017

On January 23, State Superintendent of Public Instruction Tom Torlakson directed the California Department of Education to work with all schools and school districts forced to close as a result of recent flooding and other winter storm related issues so that they may qualify for relief from the loss of Average Daily Attendance (ADA) funding.

“Creating and maintaining a safe environment for students and school staff is a top priority of the California Department of Education. Any schools forced to close as a result of the extreme winter weather we’ve seen this month may be able to recoup these important ADA funds,” Torlakson said. “I’ve directed my staff to help affected school administrators through the process of applying for waivers due to school closures. Schools in California should not suffer financially or in any other way for putting the safety of our students first in any kind of emergency.”...

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Governor Proposes Cautious Budget for 2017-18

January 16, 2017


That’s the word Gov. Jerry Brown used several times to describe his January budget proposal for 2017-18, announced in Sacramento on January 10. Brown alluded to the likelihood of another recession beginning in the next few years, and also hinted at budget uncertainty stemming from the new administration in Washington, which could very well result in California receiving fewer federal dollars than anticipated, as he outlined a generally cautious budget proposal.

“We are in very uncertain times,” Brown said. “We are subject to a lot of unpredictability. ... I think it is time for precaution.”

The Governor’s Press Office described Brown’s proposal as:

“A balanced state budget that eliminates a projected $2 billion deficit and bolsters the state’s Rainy Day Fund while continuing to invest in education, health care expansion and other core programs.”...

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Controller Reports “Big Three” State Revenue Sources Fell Below Budget Estimates for December

January 16, 2017

California revenues of $12.85 billion for December missed projections in the 2016-17 Budget Act that Governor Jerry Brown signed in June by $1.87 billion, a shortfall of 12.7 percent, State Controller Betty T. Yee reported on January 10 – just as the Governor’s Department of Finance released its proposed 2017-18 budget.

“Given the state’s revenue shortfall and an inevitable future economic downturn, coupled with unpredictable federal funding under the new president, Governor Brown is right to be cautious,” said Controller Yee, the state’s chief fiscal officer and board member of CalPERS and CalSTRS. “After CalPERS’ recent action to reduce the discount rate, I am pleased the proposed 2017-18 state budget would increase the state employer contribution by $172 million. This will help to stabilize the pension fund as the Board continues to work judiciously to secure public employees’ earned benefits.”

The “big three” sources of California general fund dollars – personal income taxes, corporation taxes, and retail sales and use taxes – all missed the monthly mark and are now behind fiscal year-to-date estimates. For the first half of the fiscal year that began in July, total revenues of $51.72 billion are $1.66 billion below budget estimates, or 3.1 percent...

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Controller Reports State Revenues Top November Budget Estimates, On Par for Fiscal Year

December 19, 2016

California revenues of almost $7.98 billion for November topped projections in the 2016-17 Budget Act that Governor Jerry Brown signed in June by $556.9 million, or 7.5 percent, State Controller Betty T. Yee reported today.

The fiscal year-to-date total of nearly $38.87 billion in revenues is now 0.5 percent above estimates.

November personal income tax (PIT) receipts of $4.55 billion outpaced budget projections by $559.7 million, or 14.0 percent. Five months into the new fiscal year, California has collected total PIT receipts of $26.00 billion, beating estimates by $560.7 million.

Gross corporation tax collections of $294.6 million for November beat projections by $53.6 million. However, corporation tax refunds of $399.7 million were $110.7 million higher than expected. In total, corporation tax receipts for November were in the red by $105.1 million...

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Torlakson Announces $11.9 Million in Microsoft Settlement Technology Funds Available for Schools

December 5, 2016

More than 8,000 California public schools and districts are eligible to share $11.9 million in the latest round of Education Technology K-12 Voucher Program funding, State Superintendent of Public Instruction Tom Torlakson announced on November 29. Funds are available through a 2003 antitrust settlement agreement between Microsoft Corporation and California consumers and businesses.

The list of eligible and potentially eligible schools and districts is available on the California Department of Education K-12 Voucher Program: Funding Web page. Today’s announcement is the fifth distribution of the Microsoft settlement funds. The first four distributions, in 2006, 2010, 2014, and 2015, totaled more than $470 million...

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LAO Releases Outlook for California’s State Budget

November 21, 2016

Executive Summary

In this report, we describe our office’s assessment of the condition of the California economy and budget over the 2016-17 through 2020-21 period.

Outlook Subject to Considerable Uncertainty. The condition of the state’s budget depends on many volatile and unpredictable economic conditions, including fluctuations in the stock market. Even in the short term, these conditions cannot be predicted with precision. They are even more difficult to anticipate years in the future. As such, while we have reasonable confidence in our expectations about the economy’s performance in 2017-18, we are much less able to anticipate the economic future in each year thereafter. To reflect these uncertainties, this report emphasizes one estimate of the near-term budget condition through 2017-18 and displays two different estimates of the budget’s condition in 2018-19 through 2020-21...

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Controller Reports State Revenues Below Expectations Four Months into Fiscal Year

November 21, 2016

California revenues of nearly $6.34 billion for October missed projections in the 2016-17 Budget Act that Governor Jerry Brown signed in June, off by $330.5 million or 5.0 percent, State Controller Betty T. Yee reported on November 10.

The fiscal year-to-date total of $30.89 billion in revenues is now 1.1 percent below estimates.

October personal income tax (PIT) receipts of more than $5.13 billion fell short of budget projections by $176.7 million, or 3.3 percent. Four months into the new fiscal year, California has collected total PIT receipts of more than $21.45 billion, topping estimates by just $1.1 million...

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CDE Releases $100 Million in College Readiness Grants

November 7, 2016

State Superintendent of Public Instruction Tom Torlakson announced on October 26 that nearly 1,000 local educational agencies (LEA), including school districts, county offices of education, and charter schools, will receive about $100 million in grants to help students prepare to attend college.

The grants, which are available for expenditure through the 2018-19 fiscal year, come from a $200 million College Readiness Block Grant (CRBG) program administered by the California Department of Education (CDE) and approved by the Governor and the Legislature.

The grants were established to increase the number of students who enroll in institutions of higher education and complete an undergraduate degree in four years, with a special emphasis on helping English learners, economically disadvantaged students, and foster youth...

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Torlakson Praises New $27 Million Grant Program to Help Keep Students in School

November 7, 2016

On October 17, State Superintendent of Public Instruction Tom Torlakson applauded new legislation providing $27 million in grants to school districts for programs to reduce high rates of chronic absenteeism, out-of-school suspension, dropouts, and crime.

The California Department of Education (CDE), which will administer the funding, has already begun developing grant guidelines.

“Chronic absenteeism is one of the biggest challenges we face. If a student is not at school, she or he cannot learn,” said Torlakson. “That’s what makes this investment so important. It will help our most at-risk students remain in school so they can learn, thrive, and graduate with the skills that will prepare them to succeed in 21st century careers and college.”...

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California’s Spending per Student Has Increased Due to Proposition 30, but Still Trails the Rest of the Nation

By Jonathan Kaplan - Rep: October 24, 2016

Spending on K-12 schools is one of the most critical public investments we make. California voters’ approval of Proposition 30 in November 2012 has provided more dollars for the state to support schools and helped the state gain on the rest of the US in K-12 spending per student.

  1. In 2012-13, the gap between California’s spending per student and the rest of the US had grown to its widest point. The drop in state revenue due to the Great Recession led to dramatic cuts to state spending on K-12 schools. As a result, the gap between California spending per K-12 student and the rest of the US grew to more than $2,600, the widest in at least 45 years, even after adjusting for inflation.
  2. California’s spending per K-12 student has increased relative to the rest of the US since voters passed Prop. 30. California spent an estimated $2,000 more per K-12 student in 2015-16 than in 2012-13, inflation-adjusted. Largely as a result, the gap in spending per student between California and the rest of the US narrowed from more than $2,600 in 2012-13 to roughly $1,000 in 2015-16 (see chart)...

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Controller Betty Yee Reports State Revenues Continue to Exceed Expectations

October 24, 2016

California revenues of more than $10.57 billion for September beat projections in the 2016-17 Budget Act Governor Jerry Brown signed in June by $151.6 million, or 1.5 percent, State Controller Betty T. Yee reported on October 12. Total revenues have outpaced expectations for two straight months after four months of shortfalls.

The fiscal year-to-date total of $24.55 billion in revenues is now just 0.1 percent below estimates.

Personal income tax (PIT) continues to represent the largest portion of General Fund receipts. September PIT receipts of almost $7.14 billion exceeded budget projections by $127.7 million, or 1.8 percent. Three months into the new fiscal year, California has collected total PIT receipts of almost $16.32 billion, topping estimates by $177.8 million – a difference of 1.1 percent...

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Poll Finds Prop. 51 Drawing 47% Yes and 43% No, While Prop. 55 Drawing 54% Yes and 38% No

September 26, 2016

Two education-related ballot propositions that will go before California voters in the November 8 election appear to have more supporters than opponents – but one proposition has a substantially larger lead than the other.

That was finding of a recent survey of “likely voters” by the Public Policy Institute of California (PPIC), the results of which were announced on September 21.

The survey asked about two education-related initiatives on the November ballot – both require simple majorities to pass.

  1. Proposition 51 (School Bonds). When likely voters are read the ballot title and label, 47 percent would vote yes and 43 percent would vote no on this measure, which would authorize the state to issue $9 billion in bonds to fund construction and modernization of K–12 schools and community college facilities...

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Parent Awareness of California School Finance Accountability Law Abysmal, According to Poll

By Emily Gersema - Rep: September 26, 2016

Parents are among the many Californians who say they have not heard or read about the state’s school funding and accountability system that aims to increase public input in school spending decisions, according to the latest results of the annual PACE/USC Rossier School of Education poll. The poll results were released on September 12.

Fifty-four percent of the registered voters who participated in the statewide poll said they were unaware of the Local Control Funding Formula. That is a slight improvement since 2015 when 65 percent of poll respondents had not heard about the law, but somewhat worse than 2014 when only 45 percent had not heard about it.

Enacted in 2013, the funding formula replaced a 40-year-old system that relied primarily on categorical funding for schools. It also gave new flexibility and a weighted student funding formula allocating additional tax dollars for high-needs students. It requires districts to engage their communities in spending decisions...

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Controller Reports State Revenues Beating Estimates after Four Months of Shortfalls

September 26, 2016

After four straight months of missed budget projections, California’s August revenues of $8.56 billion outpaced expectations by $425.2 million, or 5.2 percent, based largely on the strength of personal income tax receipts, State Controller Betty T. Yee reported on Sept. 12.

Personal income tax (PIT) receipts of $4.79 billion in August were $373.4 million higher than predicted in the 2016-17 Budget Act signed by Governor Jerry Brown in June – a difference of 8.5 percent. For the first two months of the fiscal year, PIT receipts are on target – just 0.5 percent higher than expected.

Two months into the new fiscal year, total year-to-date revenues of $13.98 billion are just $166.1 million below projections, or 1.2 percent.

“Under our outdated tax structure, revenues fluctuate greatly from month to month,” said Controller Yee, the state’s chief fiscal officer. “After the lengthy period of sustained growth California has enjoyed, I would expect to see some degree of economic plateau.”...

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Federal Government Awards California $11 Million in Grants to Help Students from Low-Income Families Take AP Tests

September 26, 2016

The U.S. Department of Education announced on September 20 that it has awarded $28.4 million in Advanced Placement (AP) grants to 41 states and Washington, D.C. as part of its efforts to boost college- and career-readiness for historically underserved students. The grants will help defray the costs of taking advanced placement tests for students from low-income families.

The California Department of Education received $11,043,703 from the U.S. Department of Education.

"The cost of a test should never prevent students from taking their first step towards higher education through advanced placement courses," said James Cole Jr., general counsel delegated the duties of deputy secretary. "These grants are an important tool for states, and ultimately schools, to empower students from low-income neighborhoods to succeed in challenging courses."...

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Report Shows the Significant Impact of Proposition 30 on State Funding for K-12 Education

September 12, 2016

Nearly four years since California voters approved Proposition 30, a new Issue Brief from the California Budget & Policy Center looks at what Prop. 30 has meant for the state’s fiscal picture and investment in key public services. This brief highlights how Prop. 30’s boost to state revenues has helped California reinvest in schools and community colleges and other systems while also increasing the state’s capacity to build its budget reserve and pay down debt.

Passed in November 2012, Prop. 30 raised the personal income tax rates for very-high-income Californians (single filers with taxable incomes above $250,000 and joint filers with incomes above $500,000) through 2018 and raised the state sales tax rate by a quarter-cent through 2016.

Overall, tax rate changes in Prop. 30 have boosted state revenues by $7 billion to $8 billion annually. The effects of Prop. 30 revenues, which predominantly come from California’s wealthiest residents, include the following:...

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Controller’s July Cash Report Shows State Revenues Well Short of Budget Projections

August 22, 2016

July state revenues came in below projections in the 2016-17 Budget Act approved the previous month by $591.3 million, or 9.8 percent, with all three of the state’s main revenue sources falling short of expectations for the first month of the fiscal year, State Controller Betty T. Yee reported on August 11.

Retail sales and use taxes missed the mark by the widest margin. Estimated at $907.9 million, they came in at just $694.5 million – 23.5 percent, or $213.5 million, lower.

Personal income tax receipts of $4.39 billion were $323.3 million lower than anticipated in the Budget Act, missing estimates by 6.9 percent. Corporation tax receipts of $227.3 million were $49.5 million below estimates, or 17.9 percent...

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Getting Students from High-Need Schools into the UC System

By Jacob Jackson, Public Policy Institute of California (PPIC) - Rep: July 25, 2016

The newly approved state budget contains two strategies to enroll more students from disadvantaged backgrounds in the University of California (UC) system and other postsecondary institutions. These spending commitments are designed to increase college readiness and access for the state’s most vulnerable students.

First, the state allocated $200 million to the new College Readiness Block Grant program, which funds “additional services that support access and successful transition to college” for three categories of students: English Learners, students from low-income families, and foster youth. This grant may support a variety of activities related to college readiness – including efforts to increase the number of students completing college preparation courses, such as the a–g course sequence required to attend UC. The College Readiness Block Grant is available to any school that serves students from these designated categories...

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Controller’s June Cash Report Highlights Volatility of Personal Income Taxes

July 25, 2016

California total revenues fell short of expectations for the third straight month in June, but overall revenues for the fiscal year outpaced projections made in the 2015-16 budget by $978.6 million, according to State Controller Betty T. Yee’s monthly report of California’s cash balance, receipts, and disbursements published on July 11.

June revenues were $524.4 million – or 3.1 percent – lower than anticipated in the Governor’s revised budget released two months ago. Of the state’s three major revenue sources, only corporation taxes outpaced expectations in June, coming in at $2.5 billion, which was 7.8 percent higher than anticipated.

Personal income taxes, the primary and highly volatile source of California’s General Fund revenues, fell short of May Revision estimates by $803.8 million in June. Retail sales and use taxes also missed projections by $14.5 million...

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Governor Brown Signs 2016-2017 State Budget

July 6, 2016

On June 27, Gov. Jerry Brown quietly signed the 2016-17 state budget – and Brown did so without announcing any line-item vetoes.

In comparison with recent years, this year’s budget signing was low key. During the state budget crisis a few years ago, Brown would often call a formal news conference to announce that he had signed the budget, and the Governor’s remarks would include budget charts on easels as visual illustrations, and the Governor’s message would be sent out live in a webcast on The California Channel.

This year, there was a simple print announcement on the Governor’s webpage, saying (in part):

Governor Edmund G. Brown Jr. (on June 27) signed a balanced, on-time state budget that doubles California’s Rainy Day Fund, pays down debt, increases school funding and boosts programs to combat poverty and homelessness.

"This solid budget makes responsible investments in California and sets aside billions of dollars to prepare for the next recession," said Governor Brown...

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May Cash Report Shows Lower-than-Expected State Revenues

June 13, 2016

May state revenues fell short of projections in Gov. Jerry Brown’s revised budget proposal by $154.3 million, weighed down by corporation tax refunds far higher than expected, State Controller Betty T. Yee reported on June 10.

“The state’s other major taxes came close to or exceeded estimates in May, so we should not jump to conclusions about a downturn,” said Controller Yee, the state’s chief fiscal officer. “However, it is worth noting that this is the second month in a row in which overall revenues have fallen short. At this point, the signals are mixed.”

In his May revision of the 2016-17 budget, Gov. Brown anticipated $152.0 million from the corporation tax. Instead, the state paid out more in refunds than it brought in, resulting in a net loss of $281.4 million...

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LAO Releases Analysis of May Budget Revision on Prop. 98

May 31, 2016

Executive Summary

Relatively Small Changes in Overall Proposition 98 Funding. The May Revision increases Proposition 98 funding by a combined $626 million over the 2014-15 through 2016-17 period. Compared with the administration’s January estimates, Proposition 98 funding is up $463 million in 2014-15, down $125 million in 2015-16, and up $288 million in 2016-17. These revisions are driven primarily by changes in state revenue.

Relatively Small Differences in Administration’s and LAO’s Estimates. Our estimates of the minimum guarantee are $305 million higher across the three-year period than the administration’s estimates. Our estimates of the guarantee are slightly higher due primarily to our slightly higher estimates of state revenue. In addition, our estimate of local property tax revenue exceeds the administration’s estimate by $353 million across 2015-16 and 2016-17 combined. All else constant, this higher local revenue increases the Proposition 98 General Fund obligation in 2016-17 by $58 million and frees up $295 million General Fund that could be used for any state priority...

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ACSA Analyses Legislative Response to Governor’s May Budget Revision

May 31, 2016

As the Legislature begins to move toward the end of session, budget committees in both the Assembly and Senate wrapped up their hearings this week on various spending plans. Following is an update from ACSA Legislative Advocate Martha Alvarez on some key budget proposals that have emerged since Gov. Brown released his May Revision on May 13.

In response to the governor’s May Revision and as part of the relatively short process to finalize the 2016 Budget Act, the Senate Budget and Fiscal Review Committee adopted their Proposition 98 budget package on May 24, while the Assembly Budget Committee took following major actions on May 26.

Revenues and non-Proposition 98 spending. The governor’s May Revision reduced General Fund (GF) revenue estimates by $1.938 billion over the three-year forecast period (2014-15, 2015-16 and 2016-17). Despite the lower GF revenue estimates, Proposition 98 funding was increased by $626 million in the May Revision...

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Governor Brown Stresses “Fiscal Prudence” – and Caution in General – with May Budget Revision

May 16, 2016

Governor Jerry Brown announced his May Budget Revision on Friday (May 13), emphasizing “fiscal prudence” in light of state revenues that came in $1.1 billion short of projections during the critical month of April, and stressing that “there are no halcyon days ahead where massive new programs can be financed,” even if California voters approve an extension of some Proposition 30 revenues in the coming November election. (And Brown once again reiterated that he is not endorsing an extension of Proposition 30, saying he will let California voters decide.)

The Governor added that the current economic recovery is unlikely to continue indefinitely, and the state needs to prepare for the possibility of another recession sometime in the next few years. Comparing the current economic climate to mid-summer, the Governor warned that “winter is coming sometime down the road” and advised that “(new state) spending now is (going to be like) a cut later” when the next recession results in falling state revenues...

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April State Revenues Fall $1.1 Billion Short of Estimates

May 16, 2016

April state revenues fell short of estimates in Gov. Jerry Brown’s proposed 2016-17 budget by $1.19 billion, mostly the result of lower-than-expected receipts from the personal income tax in one of the most important months for collections, State Controller Betty T. Yee reported on May 10.

“We know that state revenues cannot defy gravity forever,” said Controller Yee, the state’s chief fiscal officer. “It is too early to call this a trend rather than a one-time occurrence. However, we should always expect peaks and valleys in the state’s financial performance.”

Most Californians file their tax returns in April, and the month’s total is closely watched as a possible bellwether of the state’s fiscal fortunes. April personal income tax revenues of $13.40 billion fell short by $1.22 billion, 8.4 percent less than projected in the January proposed budget. Retail sales and use tax revenues of $816.1 million lagged by $53.9 million, or 6.2 percent. Only the corporation tax beat estimates, with revenues of $1.98 billion coming in $95.4 million higher than expected, or 5.1 percent...

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PPIC Poll: Seeing Need for School Funding, Most Favor Prop. 30 Extension, Construction Bond

May 2, 2016

Most Californians say state funding for their local public schools is inadequate, and most favor two proposals that are likely to be on the November ballot to increase it: an extension of the Proposition 30 tax increase on higher incomes and a bond measure to pay for school construction projects.

These are among the key findings in the 12th annual statewide survey on Californians and Education released on April 20 by the Public Policy Institute of California (PPIC).

Although state spending on local schools has recently increased, 61 percent of adults and 60 percent of likely voters say the current level of funding is not enough. Democrats (73%) and Independents (65%) are far more likely to hold this view than are Republicans (42%)...

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Controller’s March Cash Report Shows Higher-Than-Expected Revenues

April 18, 2016

March state revenues surpassed estimates in Gov. Jerry Brown’s proposed 2016-17 budget by $218.6 million, with both the corporation tax and the retail sales and use tax beating expectations, State Controller Betty T. Yee reported April 11.

Overall, total revenues of $7.40 billion outstripped projections in the proposed budget released in January by 3 percent. Corporation tax revenues of $1.71 billion were $47.5 million, or 2.9 percent, higher than expected. Sales tax revenues of $1.79 billion beat expectations by $36.0 million, or 2.0 percent. Only the personal income tax, which has normally surpassed projections in the past few years, came up short. Revenues of $3.49 billion were $31.2 million, or 0.9 percent, less than expected.

Through the first nine months of the fiscal year, revenues of $78.37 billion are $512.5 million, or 0.7 percent, more than expected in the governor’s proposed budget. The personal income tax and the corporation tax are both beating projections, by 0.1 percent and 7.4 percent, respectively. The sales tax, meanwhile, is lagging by 0.9 percent for the fiscal year to date...

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PPIC Poll: Majority of Californians Favor Extending Proposition 30 Tax on High Income Earners

April 4, 2016

A statewide poll conducted on behalf of the Public Policy Institute of California (PPIC) found that a majority of California voters favor the idea of an initiative extending some Proposition 30 taxes currently supporting education.

The survey asked about one initiative that may be on the November ballot: an extension of one of the temporary taxes voters approved in Proposition 30 in 2012. The new initiative would extend for 12 years the tax on earnings over $250,000 to fund education and health care. Most adults (61%) and likely voters (58%) are in favor, with sharp divisions along party lines (77% Democrats, 52% independents, 37% Republicans favor). Regardless of how they feel about the initiative, solid majorities of adults (66%), voters across party lines, and likely voters (70%) believe Californians should decide whether to extend Proposition 30 tax increases by voting on an initiative in November...

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Controller’s February Cash Report Shows Revenues Surpassing Estimates

March 21, 2016

February state revenues exceeded projections in Governor Jerry Brown’s proposed 2016-17 budget by $439.1 million, with the personal income tax and the corporation tax both beating forecasts, State Controller Betty T. Yee reported on March 10.

“It is encouraging to see that revenues remain strong,” said Yee, the state’s chief fiscal officer. “At the same time, we must be prudent in setting aside money during the good times to bolster our fiscal position for the inevitable next downturn.”

Total revenues for February of $6.85 billion surpassed projections in the budget for the coming fiscal year, released by Gov. Brown in early January, by 6.8 percent. Personal income tax revenues of $2.88 billion beat estimates by $304.7 million, or 11.8 percent, while corporation tax revenues of $189.5 million were more than 10 times what was expected. For the second month in a row, corporation tax refunds were lower than expected, increasing overall collections...

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California PTA President Calls for Family-Engagement Funding in State Budget

March 7, 2016

On February 23, California State PTA President Justine Fischer offered insights on behalf of the state’s largest child-advocacy organization upon release of Families in Schools’ new report, Ready or Not: How California School Districts Are Reimagining Parent Engagement in the Era of the Local Control Funding Formula:

“California State PTA applauds Families in Schools' work on the urgent issue of family engagement, especially as it relates to California's new requirements to ensure that parents’ voices are heard in important school decisions.”

"While noting some successes, Ready or Not shines a spotlight on the struggles that many school districts are facing to make meaningful – and legally required – family engagement a reality. Among the report’s six major recommendations gleaned from interviews with school-district administrators and officers are calls to ‘invest funding and resources in parent engagement to meet Local Control and Accountability Plan (LCAP) goals’ as well as to ‘provide professional development on family engagement’ – two key issues that could be tackled by dedicated state-budget family-engagement funding.”...

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New Study Hints That Publicizing Education Budgets May Decrease Support for Greater Funding

By Leah Shafer - February 22, 2016

It’s no secret that school districts face continual financial pressures. But among the many roadblocks to securing increased funding is the challenge of candidly communicating such a need with voters. A new study sheds light on just how complicated this can be.


In a new paper, education policy expert Martin West and advanced doctoral student Beth Schueler, both of Harvard Graduate School of Education, reveal that Americans tend to vastly underestimate the average salary of a public school teacher in their state. They also underestimate the amount their local school district spends per pupil. And when provided with the actual numbers on salaries and spending, the researchers say, Americans experience “sticker shock” – and become much less likely to support an increase in government funding for public schools...

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Controller’s January Cash Report Shows Revenues Falling Short of Estimates

February 22, 2016

January state revenues fell short of projections included in Gov. Jerry Brown’s budget proposal by $239.8 million, with both the personal income tax and the retail sales and use tax failing to meet projections, State Controller Betty T. Yee reported on February 10.

“The governor has emphasized the need to be alert to changes in the state’s fiscal fortunes,” said Yee, the state’s chief fiscal officer. “While one month of faltering revenues does not make a trend, I will continue to closely monitor the state’s cash position.”

A month ago, as part of his proposed budget for the fiscal year that starts July 1, the governor estimated January revenues of about $13.24 billion. In fact, collections were closer to $13.0 billion, $239.8 million less than expected.

The corporation tax brought in $362.6 million, 81.1 percent more than estimated, largely the result of fewer refunds than expected...

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Feds Grant NCLB Waiver, Giving California Districts Flexibility in Spending About $233 Million in Funding

February 8, 2016

State Superintendent of Public Instruction Tom Torlakson announced on February 1 that the federal government has granted California’s request to be free of the No Child Left Behind Act (NCLB) rules regarding Supplemental Educational Services (SES) for the 2016–17 school year, the last year those rules would have been in effect.

SES funds are used to provide tutoring or other academic instruction outside the regular school day for academically deficient students at certain Title I schools, which have high numbers and high percentages of low-income students. Programs are often away from school grounds and require travel.

The decision, contained in a letter from the U.S. Department of Education last week, allows California school districts to have the flexibility to make their own decisions about how to spend an estimated $233 million in SES and transportation funds for public school choice. The estimate is based on the amount of funding allocated by California districts this year: $222 million for SES and $11 million for transportation...

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CSBA Report Suggests California Schools Underfunded by as Much as $22 to $42 Billion

February 8, 2016

California is underfunding K-12 schools by as much as $42 billion annually according to a new report released on January 20 by the California School Boards Association (CSBA) and its Education Legal Alliance. The study, “California’s Challenge–Adequately Funding Education in the 21st Century” looks at current state funding levels and what it would actually take for all students to meet California State Standards and be prepared for college and career upon high school graduation.

“There is a direct correlation between what we invest in our schools and our schools’ ability to prepare the next generation for college, career and civic life. Right now, our school finance system places our children at a huge competitive disadvantage,” explained CSBA President Chris Ungar who is also a school board member in the San Luis Coastal Unified School District in San Luis Obispo County. “By nearly every measure, be it funding, staffing, or infrastructure, we’re lagging behind other states and countries in terms of the support we provide our students. We need to jumpstart a discussion among elected officials and the public about once and for all devoting the resources necessary to ensure the success of all California students.”...

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State Commission Says Cost for School Districts to Administer CAASPP Tests Is a Reimbursable Mandate

January 25, 2016

On January 22, the Commission on State Mandates found that the technology, internet access and training required to administer California’s new student testing program known as the California Assessment of Student Performance and Progress (“CAASPP”) constitute a reimbursable state mandate. This new mandate, with an estimated annual statewide cost of $600 million, would require the state to reimburse school districts and county offices of education for these costs. The commission’s finding is a victory for students and schools – and the result of efforts led by the California School Board Association’s Education Legal Alliance and five local education agencies (LEAs) on behalf of LEAs across the state.

“Today’s decision recognizes the constitutional obligation of the state to ensure that the state provides school districts and county offices of education with resources necessary to implement new state programs,” said Chris Ungar...

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Governor’s January Budget Proposal Would Boost Per Pupil Funding; Initial Reaction Largely Favorable

January 11, 2016

On January 7, Governor Edmund G. Brown proposed a $122.6 billion General Fund budget plan for 2016-17 that makes increases in funding for education, health care and state infrastructure, while bolstering the state’s Rainy Day Fund and paying down state debts and liabilities.

Among the aspects of the proposed budget that are of particular interest to educators, the Governor’s press office stressed the following points:

Builds Up the Rainy Day Fund

The Governor’s budget makes a supplemental deposit of $2 billion into the state’s Rainy Day Fund – boosting the balance from 37 percent today to 65 percent of its constitutional target. Building up the fund is the best insurance policy against deep budget cuts in the next economic downturn...

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LAO: “State Budget Better Prepared for an Economic Downturn than at Any Point in Decades”

November 30, 2015

(Editor’s note: On November 18, the Legislative Analyst’s Office in Sacramento issued its annual Fiscal Outlook report. The summary of the LAO’s findings are reprinted below, click on the link at the end of this story to read the full report.)


California’s state budget is better prepared for an economic downturn than it has been at any point in decades. Under the main economic scenario in this year’s LAO Fiscal Outlook, 2016-17 would end with reserves of $11.5 billion, assuming the state makes no new budget commitments through next year. If the economy continues to grow through 2019-20, annual operating surpluses and larger reserves could materialize, and there may be capacity for some new budget commitments – whether spending increases or tax reductions. An economic or stock market downturn, however, could occur during our outlook period. To illustrate this economic uncertainty, we provide projections under alternative scenarios such as a hypothetical recession that causes budget deficits to re-emerge. The more new budget commitments are made in 2016-17, the more likely it is that the state would face difficult choices – such as spending cuts and tax increases – later...

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Controller’s October Cash Report Shows Robust Income Tax Revenues

November 12, 2015

Driven by another strong month of personal income tax proceeds, state revenues in October beat estimates by $191.9 million, or 3.1 percent, State Controller Betty T. Yee reported on November 10.

Personal income tax revenues of $5.1 billion for the month exceeded projections in the state budget signed in July by $234.5 million, or 4.8 percent. That was more than enough to offset lower-than-expected collections from the states two other largest revenue sources, the retail sales and use tax and the corporation tax. Sales tax revenue of $935.0 million fell short of projections by $2.0 million, or 0.2 percent. The corporation tax missed estimates by $89.8 million, or 33.5 percent.

For the fiscal year that started July 1, state revenues are $542.9 million, or 1.9 percent, greater than estimated, with strong collections from the personal income tax erasing shortfalls in the retail sales and use tax and the corporation tax. Revenues from the personal income tax are running $840.7 million, or 4.3 percent, above expectations for the fiscal year so far. Retail sales and use taxes have fallen short by $381.1 million, or 5.5 percent, while the corporation tax to date has brought in $190.4 million, or 11.5 percent less than expected...

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Controller’s September Cash Report Shows Revenues Slightly Lower than Estimates

October 29, 2015

State revenues fell short of Department of Finance projections by 2.6 percent in September, but are still outpacing estimates for the first quarter of the 2015-16 fiscal year, State Controller Betty T. Yee reported on October 9.

In September, two of the state’s three top revenue sources failed to match projections. Retail sales and use tax revenues of $1.7 billion were $392.5 million, or 18.8 percent, less than estimates. Corporation tax revenues of $836.6 million came up $135.2 million short of projections, or 13.9 percent.

Only the personal income tax beat Department of Finance expectations. Revenues of $6.7 billion were $447.0 million (or 7.2 percent) greater than anticipated in the budget, driven by strong proceeds from paycheck withholding, tax returns, estimated payments, and other categories...

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Petition Drive Qualifies $9 Billion School Facilities Bond for November 2016 Ballot

October 1, 2015

A $9 billion school facilities bond measure has qualified for the November 8, 2016 ballot. California Secretary of State Alex Padilla said on September 18 that the proposed school facilities bond had reached the threshold of 365,880 valid petition signatures, which is equal to five percent of the total votes cast for governor in the November 2014 General Election.

According to the California Attorney General’s office, the ballot text for the proposed school facilities bond will be:


School Bonds. Funding for K-12 School and Community College Facilities. Initiative Statutory Amendment. Authorizes $9 billion in general obligation bonds: $3 billion for new construction and $3 billion for modernization of K-12 public school facilities; $1 billion for charter schools and vocational education facilities; and $2 billion for California Community Colleges facilities. Bars amendment to existing authority to levy developer fees to fund school facilities, until new construction bond proceeds are spent or December 31, 2020, whichever is earlier...

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CSBA’s Education Legal Alliance Files Lawsuit Challenging Proposition 98 Manipulation

October 1, 2015

On September 22, the California School Boards Association’s Education Legal Alliance filed a lawsuit against the State of California over the unconstitutional manipulation of the Proposition 98 guarantee.

Proposition 98 was approved by voters in 1988 to ensure a guaranteed minimum spending level each year for K-12 public schools and community college districts by providing them with a stable and predictable source of funding that grows with the economy and state General Fund revenues.

“This lawsuit is about protecting students and the educational programs funded by Proposition 98,” said CSBA President Jesús Holguín...

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Controller’s August Cash Report Shows State Revenues Exceeding Projections by $637 Million

October 1, 2015

Boosted by strong retail sales and use tax revenues, the state in August brought in $637.8 million more than expected when the 2015-16 budget was finalized two months ago, according to State Controller Betty T. Yee’s monthly report of California’s cash balance, receipts, and disbursements published on September 10.

For more than a year, personal income tax drove state revenues to surpass expectations. In August, by contrast, retail sales and use tax took the lead, exceeding estimates by $127.2 million, or 4.3 percent. Personal income tax continued to show strength, beating projections by $39.7 million, or 1.0 percent. The last of the state’s “big three” revenue sources – the corporation tax – also came in higher than anticipated by $35.7 million, or 28.9 percent.

After July revenue came in close to expectations, the strong August numbers pushed overall receipts for the 2015-16 fiscal year to $674.7 million, or 5.0 percent, above projections. For the fiscal year to date, all three major sources of revenue are surpassing expectations...

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State Provides $50 Million to Connect Schools to the Internet

September 3, 2015

State Superintendent of Public Instruction Tom Torlakson announced on August 24 that a second round of Broadband Infrastructure and Improvement Grants (BIIG 2.0) is available for California schools and districts to enhance their network connectivity.

"Because of a wise investment approved by the Legislature and Governor Jerry Brown, an additional $50 million is available to help schools connect to the state's education network," said Torlakson. "This will give students access to technology that will prepare them for college and careers, and give teachers more resources to improve instruction."

BIIG 2.0 builds on the first round of funding earlier this year that provided nearly $27 million to 227 school sites. Schools and districts can start applying today for the BIIG 2.0 grants through the K-12 High Speed Network (K12HSN). Eligible applicants will be prioritized based on their external connectivity...

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Assemblymember: Pension Ballot Measure Would Negatively Impact Teacher Retirement Security

August 6, 2015

The retirement security of California’s retired, current, and future teachers and the stability of the state’s pension fund for educators would be put at risk if a ballot measure addressing those issues is approved by California voters next November, according to an internal analysis by CalSTRS, requested by and released by Assemblymember Rob Bonta (D-Oakland), Chairman of the Assembly’s Committee on Public Employees, Retirement, and Social Security.

"The Legislative Analyst said this measure would cause ‘significant uncertainty.’ But what is certain is that it would undermine the retirement security of our state’s current and future teachers, particularly women," said Assemblymember Bonta. "At a time when there already is a crisis in attracting and retaining teachers, this measure would be a major disincentive to attract our best and brightest to educate our children, and would cause irreparable harm to a system on which retirees and current teachers depend."...

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Controller Yee’s June Cash Report Shows another Surge to End 2014-15 Fiscal Year

July 23, 2015

California ended the fiscal year with another unexpected revenue surge in June, with total General Fund receipts surpassing the Governor’s May estimates by $859.4 million, according to State Controller Betty T. Yee’s monthly report of California’s cash balance, receipts, and disbursements published on July 14.

For the second year in a row, the General Fund ended with a positive cash balance.

June capped a 12-month boom in state revenues, driven largely by personal income tax. For the fiscal year ending June 30, total revenues for the General Fund (the source of most state spending) were $6.8 billion more than anticipated a year ago, when the 2014-15 budget was enacted. This was 6.4 percent higher than projected. Compared to the previous fiscal year, California revenues were $12.7 billion higher, a bump of 12.5 percent...

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Bill Signed on June 24

Governor Reaches Budget Agreement with Legislative Leaders – More Money for Schools

June 25, 2015

California’s state budget will not be a matter of last-minute suspense as the end of June approaches. On June 16, Governor Edmund G. Brown Jr. announced a budget agreement with Assembly Speaker Toni Atkins and Senate President pro Tempore Kevin de León – and the budget bill even received a few votes from Republican legislators as it sailed through both houses of the California legislature. The Governor signed the budget and related bills on June 24.

In a press release, the Governor’s press office stressed the following highlights of the budget agreement:

More Money for Schools: The agreement makes significant investments in schools – $14.3 billion for the K-12 system and community colleges, including $6 billion to continue to implement the Local Control Funding Formula which targets increased resources to students who face the greatest challenges...

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Governor Indicates He’s Open to New Taxes for Roads, Health Care – But Still Opposes Extension of Prop. 30

June 25, 2015

After Governor Brown announced an agreement with Democratic legislative leaders on the state budget, the Governor also announced he was calling special legislative sessions to work on legislation relating to repairing California’s roads and highways, and to provide health care coverage for low income households – and Brown indicated he might be willing to accept new taxes in those areas.

Capital Public Radio in Sacramento reported on June 18 that Gov. Jerry Brown “says he’s changed his position on taxes now that he’s been elected to another term.” Reporter Ben Adler pointed out that the no-new-taxes pledge “was a core promise of Brown’s 2010 campaign, repeated in TV ads, debates and campaign events.”

But Adler noted that after announcing a budget agreement with legislative Democrats, “Jerry Brown called two special legislative sessions as part of the state budget deal – one on transportation, the other on Medi-Cal – and he says both could lead to tax increases on products from gasoline to tobacco.”...

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May Cash Report Shows Receipts $69.1 Million above Budget Projections

June 25, 2015

Less than a month after the Governor revised his proposed 2015-16 state budget, May receipts for the state’s General Fund exceeded the Governor’s new projections by $69.1 million, according to State Controller Betty T. Yee’s monthly report of California’s cash balance, receipts, and disbursements published on June 10.

At the same time, May receipts were $317.9 million less than anticipated when the budget for the 2014-15 fiscal year was enacted a year ago. All told, General Fund receipts through May 31 outstripped projections in last year’s Budget Act by $5.8 billion, or 6.2 percent, and receipts have exceeded last year’s actual receipts by $10.7 billion, or 12 percent, reflecting a stronger California economy.

May retail sales and use taxes surpassed estimates in the May budget revision by $29.8 million...

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Voters Overwhelmingly Support Proposition 13 According to New Business Roundtable Statewide Poll

June 11, 2015

California voters continue to overwhelmingly support Prop. 13, according to a new statewide poll conducted by M4 Strategies on behalf of the California Business Roundtable.

“Prop. 13 is one of the few protections homeowners and businesses have left in a state where the special interest groups and the legislature are frequently looking for new sources of increased revenue. Californians clearly understand that Prop. 13 provides an invaluable level of certainty in a very high tax state,” said Rob Lapsley, president of the California Business Roundtable.

Key Findings:

  1. Nearly 80 percent of likely voters are either very or somewhat familiar with Prop. 13.
  2. More than 60 percent of likely voters think Prop. 13 has been good for California...

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Census Bureau:

Per Pupil Spending Varies Heavily Across the United States

June 11, 2015

Per pupil spending for the nation was $10,700 during fiscal year 2013, a 0.9 percent increase from 2012, but varied heavily among states with a high of $19,818 in New York and a low of $6,555 in Utah.

These findings come from Public Education Finances: 2013, which provides figures on revenues, expenditures, debt and assets (cash and security holdings) for the nation’s elementary and secondary public school systems. The report and tables, released annually, include detailed statistics on spending – such as instruction, student transportation, salaries and employee benefits – at the national, state and school district levels. The report was released on June 2 by the U.S. Census Bureau.

“These statistics provide researchers, policymakers and the public with a picture of the nation’s public school system education revenue and spending,” said Stephen Wheeler, an analyst with the Census Bureau’s Educational Finance Branch...

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Analysis of May Budget Revision

It’s Great to be Funded By Proposition 98... (At Least This Year)

By Adonai Mack, Association of California School Administrators
May 28, 2015

On May 14, Governor Brown released the May Revision to the 2015-16 State Budget. The May Revision includes updated revenue estimates, a new tax credit proposal and increased spending for public education. The governor continues to note that the state budget is “precariously balanced” and still has ongoing liabilities such as state infrastructure and retiree health care benefits. Some of the highlights of the May Revision include the following:

  1. The budget includes a $6.7 billion increase in General Fund Revenues
  2. $633 million be saved in the Rainy Day Fund and an additional $633 million used to pay down debts and liabilities as required by Proposition 2
  3. Creates an Earned Income Tax Credit that provides $380 million in benefits to 2 million Californian residents...

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How Does the May Budget Revision Look from a Local School District Perspective?

May 28, 2015

(Editor’s note: California school districts have now had a week or two to size up how the May Budget Revision will impact their local district budget. EdBrief checked with several high-ranking administrators to find out how they think their district will fare under Governor Brown’s budget proposal – and after enduring year-on-year budget cuts during the recession, they were happy to finally see a budget that restores some of what was lost during the economic downturn. See the budget analysis by Adonai Mack of the Association of California School Administrators elsewhere in this edition of EdBrief for a more detailed look at the May Budget Revision. The California Legislature has until June 15 to pass a state budget – which may potentially include elements that were not part of the Governor’s May Budget Revision, particularly in the area of childcare and related pre-K services – and send it to the Governor.)...

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Governor Brown Dubs May Budget Revision a “Historic Investment” in Education

May 14, 2015

Governor Edmund G. Brown, Jr. unveiled his May Budget Revision on Thursday in Sacramento. And as expected, with state revenues running higher than projected in the Governor’s original January budget proposal, the May Budget Revision proposes more funding for K-14 education, as well as setting aside more money in the state’s “Rainy Day” fund. The Governor also proposed a state Earned Income Tax Credit (which would benefit low income households), and proposed additional funding for the state’s public university systems (in exchange for an agreement not to raise tuition for the next two years). But some Democratic legislators were disappointed that the Governor did not propose more funding for state-supported childcare and other social programs.

"I can say very simply the state is definitely on the rebound from just a few years ago, when the state was mired in red ink," Brown said. "The finances of California have stabilized, we are balancing our budget, and just since January, several billion dollars have come into the state treasury."...

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CSBA Calls for Repeal of New Law that Prevents School Districts from Saving for a Rainy Day

May 7, 2015

On April 28, school board members representing school districts in the Central Valley, and the League of Women Voters of California urged legislators and Governor Brown to repeal SB 858 – a bill that limits the ability of school districts to maintain adequate reserves to save for a rainy day.

Late last year, the Legislature passed SB 858 that undermines local control and fiscal prudence by preventing school districts from maintaining the budget reserves necessary to prepare for the next economic downturn, maintain fiscal solvency and protect the students of California. SB 858 maintains that if the state deposits as little as $1 into the statewide rainy day fund for schools – which could happen sooner than previously expected based on an improving economy – local school districts statewide could be forced to eliminate between $5 and $14 billion in savings that took years to build up...

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PPIC Report: A Well-Designed Parcel Tax Is a Useful Tool for Local Governments

April 23, 2015

The parcel tax has advantages over other types of taxes as a source of discretionary revenue for local governments. It is a useful fiscal tool that can help California's diverse localities tailor services to meet the needs of their communities. These are among the findings of a report released on April 15 by the Public Policy Institute of California (PPIC).

In recent years, an increasing number of local governments have responded to Proposition 13's limits on property tax revenue by turning to the parcel tax to fund services such as police and fire protection, parks, and libraries. Between 2003 and 2012, cities, school districts, and local districts put 691 parcel tax proposals to fund services on the ballot, and 53 percent received the two-thirds vote required for passage. Most of these taxes were relatively small. The median was $60 for cities, $96 for school districts, and $68 for special districts...

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Controller’s March Estimate Shows Receipts $547 Million Over Budget Projections

April 23, 2015

March receipts for the state’s General Fund continued to show strength, coming in $547 million higher than anticipated in the Governor’s proposed budget, according to State Controller Betty T. Yee’s monthly report of California’s cash balance, receipts, and disbursements published on April 10.

Leading the way was personal income tax, which beat projections by $498 million. This included $400 million more than expected in the amount withheld from workers’ paychecks and estimated tax payments $42 million higher than estimated in the Governor’s proposed budget...

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California Budget Compared to National Average

Gap Between State’s K-12 Spending and That in the Rest of the US Has Narrowed Since 2012-13

By Jonathan Kaplan - Rep: April 9, 2015

(Editor’s Note: the California Budget and Policy Center – formerly known as the California Budget Project – has released a brief fact sheet examining public school funding in the state, as compared to the nation, which is reproduced below.)

California’s K-12 school spending has increased since voters approved Proposition 30’s tax increases in November 2012. Partly as a result, California now ranks 29th among all states and the District of Columbia in spending per student, up from 42nd two years ago. While ranking per pupil spending is a common way of comparing states’ investment in K-12 schools, this approach fails to take into account differences in states’ wealth and thus provides an incomplete picture of state support for K-12 education...

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New Funding Formula Poses Challenge

Districts Face Dilemma When Schools with Many High Needs Students Are Not in High-Needs Districts

March 26, 2015

The uneven distribution of needy students in many California school districts poses challenges to the successful implementation of the state’s new funding formula, according to a report released on March 12 by the Public Policy Institute of California (PPIC).

The Local Control Funding Formula provides extra funds for low-income, English learner, and foster care students. Schools districts receive a base grant for each student in attendance and a "supplemental grant” for each high-need student. Districts in which more than 55 percent of students are high need get additional "concentration grants.” The PPIC report finds that 54,000 high-need students attend schools in districts that don’t receive concentration funding...

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CDE Reports Fewer Districts with Budget Problems

March 12, 2015

State Superintendent of Public Instruction Tom Torlakson announced on March 4 another sign of the improving fiscal health of California schools – the number of California school districts in financial jeopardy continues to drop and has returned to pre-recession levels.

The First Interim Status Report for Fiscal Year 2014-15 shows 43 local educational agencies (LEAs) have either a negative or qualified certification. This is down from 49 a year ago, and down substantially from the height of the Great Recession in 2011-12, when 188 LEAs were facing financial difficulties...

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CSBA Delivers More than 800 Letters to Governor, Urging Repeal of Reserve Cap

March 12, 2015

On March 10, the California School Boards Association delivered more than 800 resolutions and letters from school board members throughout California to Governor Brown, calling for the repeal of the reserve cap contained in SB 858 that limits school district reserves.

CSBA President and Moreno Valley Unified School District board member Jesús M. Holguín personally delivered the appeals to the Governor’s office, and said that the repeal of the reserve cap is CSBA’s number one priority in 2015. Holguín was joined by Vernon M. Billy, CEO & Executive Director of CSBA, and fellow school board members who were in Sacramento to meet with Legislators to discuss key education issues...

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Education Funding Debate Underway in Sacramento

February 26, 2015

Capital Public Radio’s Ben Adler, capitol bureau chief for the Sacramento-based NPR affiliate, reported on February 9 that:

California’s economy is on the rebound, but there’s little extra revenue to go around for the next state budget. Yet there’s one area that will see a big increase in funding: education. And that’s sparking a debate at the Capitol over how to spend the money.

Governor Jerry Brown and the Legislature’s majority Democrats agree on the need to raise per-pupil K-through-12 spending. The governor also wants to set aside money for adult education and career tech programs...

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Controller: State Revenues for January Lag Slightly Behind Governor’s Proposed Budget Estimate

February 26, 2015

On February 10, State Controller Betty T. Yee released her monthly report covering California’s cash balance, receipts and disbursements in January 2015. Revenues for the month totaled $12.6 billion, underperforming estimates in the 2015-16 Governor’s proposed budget by $138.1 million, or 1.1 percent.

Year-to-date revenues are $15.5 million behind estimates adjusted upward a month ago, when the Governor released his budget proposal. Year-to-date income tax receipts have exceeded the Governor’s expectations by $9.3 million. Corporate tax receipts are currently $144.3 million ahead of fiscal year estimates, or 3.7 percent. Sales and use taxes total $129.1 million, or 1.1 percent below expectations for the fiscal year...

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LAO Releases Critique of 2015-16 Budget Proposal

January 29, 2015


Editor’s note: On January 13, the California Legislative Analyst’s Office (LAO) released an analysis of the 2015-16 state budget proposal announced by Gov. Brown on Jan. 9. The LAO’s executive summary concluded that “the Governor’s priorities (are) generally prudent ones” and noted that state revenues have been running ahead of the Governor’s budget projections. But the LAO also cautioned that “history tells us that the current strength of state revenues, bolstered by a soaring stock market last year, may not continue for long. As the Governor argues, the budget remains vulnerable to downturns that may re–emerge with little warning. Building budget reserves and paying down state debts remain important goals.” Reproduced below at the LAO’s analysis regarding funding for K-12 school districts and adult education. There is a link to the complete LAO report at the end.

Proposition 98

Funding for Schools and Colleges Largely Driven by Formulas. State budgeting for K-12 education, the California Community Colleges (CCC), subsidized preschool, and various other state education programs is governed largely by Proposition 98, passed by voters in 1988. The measure establishes a minimum funding requirement, commonly referred to as the minimum guarantee...

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CSBA’s Education Legal Alliance Files Mandate Test Claim to Increase SBAC Test Funding

January 29, 2015

The California School Board Association’s Education Legal Alliance (ELA) is part of a team that has filed a mandate test claim with the Commission on State Mandates to secure more funding for school districts and county offices of education (COE) administering the new California Assessment of Student Performance and Progress (CAASPP) tests. The ELA is supporting and guiding Santa Ana USD, Plumas COE, Plumas USD, Porterville USD, and Vallejo USD, and it is estimated that the annual, ongoing cost to school districts and COEs from the CAASPP, which includes the Smarter Balanced Assessments (SBA) is at least $1 billion.

Under the California Constitution, the state is required to reimburse school districts for the cost of any new program or higher level of service imposed on district by state law...

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LAO: Repeal Caps on School District Reserves

January 29, 2015


Editor’s note: On January 21, the California Legislative Analyst’s Office (LAO) released an analysis of recent legislation that put a cap on school district reserve funds. The LAO said the January 21 report “analyzes how district reserve levels have changed over time and describes some of the key factors that cause reserve levels to vary from district to district. After assessing recent changes, this report recommends the Legislature repeal the reserve caps and modify the disclosure provision.” The executive summary of the LAO’s report is reprinted below, with a link to the complete report at the end of the executive summary.

Executive Summary

Many Questions About School District Reserves and Recent Legislation. In June 2014, the state enacted a new law to cap school district reserves in certain years and require greater disclosure of district reserve levels each year. Since last June, members of the Legislature have asked for more information about reserves and the administration has expressed interest in further discussing reserve caps. This report begins by analyzing recent trends in district reserves and then makes recommendations regarding reserve caps and reserve-disclosure requirements...

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Torlakson Appoints New Fiscal Deputy Superintendent

January 29, 2015

On January 20, State Superintendent of Public Instruction Tom Torlakson today named Nick Schweizer to the position of Deputy Superintendent for the Services for Administration, Finance, Technology, and Infrastructure Branch of the California Department of Education (CDE).

“We are pleased to find an outstanding leader with a deep knowledge of education, the state budget, and fiscal issues,” said Torlakson. “Nick brings so much to the department. I look forward to working with him.”

Schweizer has been at the California Department of Finance since 1998 and has served in a variety of roles, including overseeing and developing budget policies affecting K-12 education, community colleges, state universities, college financial aid, teacher credentialing, and child care. Schweizer also spent one year as executive director of the State Board of Education where he provided leadership and direction to the board members and staff...

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Report Describes First-Year Implementation of California’s Local Control Funding Formula

January 12, 2015

California’s landmark Local Control Funding Formula (LCFF) dramatically changed the way the state funds its school districts, directing greater resources to districts serving large numbers of low-income students, English learners, and students in foster care. LCFF also shifted substantially more control to school districts and communities. A new report released on December 16 from The Education Trust—West describes California’s first-year implementation of LCFF.

“LCFF offers great promise for all of California’s students, but especially for our state’s highest need students,” said Ryan J. Smith, executive director of The Education Trust—West, a statewide education advocacy organization that works to close gaps in opportunity and achievement for students of color and students in poverty. “A year into this bold reform, now is the time to pause and ask ourselves if we have made decisions that will raise the achievement of our low-income students, English learners, and foster youth.”...

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Governor’s Budget Greeted by K-12 Stakeholders, But Gets Lukewarm Reaction from UC Leadership

January 12, 2015

Governor Jerry Brown released his January budget proposal last Friday (Jan. 9), proposing increased funding for K-12 education, a move that drew favorable responses from most stakeholders in K-12 education. However, the Governor proposed less funding for the University of California than UC President Janet Napolitano had been hoping for, and it remains to be seen whether UC will go through with a proposed tuition increase as a result.

Brown described his proposal as a “carefully balanced budget (that) builds for the future by saving money, paying down debt and investing in our state’s core needs. Our long-term fiscal health depends on the wise and prudent actions we take today.”...

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Most Want More Higher Education Funding – But Oppose Raising Student Fees or Taxes

December 11, 2014

Most Californians say the state is not providing enough funding for public colleges and universities. However, most residents are unwilling to pay higher taxes to maintain current funding for these institutions. And—amid debate over a tuition increase at the University of California—a record-high majority oppose raising student fees to do so.

These are among the key findings in a statewide survey released on December 1 by the Public Policy Institute of California (PPIC).

In the survey—a wide-ranging examination of California’s post-election political landscape—an overwhelming majority of residents (76%) say the state’s public higher education system is very important to its quality of life and economic vitality over the next 20 years...

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Controller: November Revenues Short of Projections

December 11, 2014

On December 9, State Controller John Chiang released his monthly report covering California's cash balance, receipts and disbursements in November 2014. Total revenues for the fifth month of Fiscal Year 2014-15 were $6.4 billion, coming in below Budget Act estimates by $154.7 million, or 2.3 percent.

For the fiscal year to date (July 1-November 30), total revenues reached $34.3 billion, beating estimates by $1 billion, or 3.1 percent.

“California is experiencing a solid post-Recession upswing, which has brightened the State’s revenue picture,” Chiang said. “However, while the timing is unpredictable, history reminds us that booming economic times are always followed by painful lows...

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Department of Finance November Bulletin Sees “Slow But Steady” Improvement in California Economy

November 19, 2014

In its November Finance Bulletin, the California Department of Finance reported that California and the U.S. continue to see slow but steady improvements in the labor market. U.S. real GDP grew by 3.5 percent in the third quarter after an upwardly revised 4.6 percent growth in the second quarter. As expected, the Federal Reserve ended the quantitative easing bond purchase program at the end of October.

Labor Market Conditions

  1. California's unemployment rate fell by 0.1 percentage point in September to 7.3 percent – the lowest rate since July 2008. This followed the 0.2 percentage point drop in the U.S. unemployment rate to 5.9 percent in September, and the U.S. rate dropped again in October to 5.8 percent...

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LAO Forecasts “Moderate Revenue Growth,” with “Especially Favorable” Near-Term Outlook for Schools

November 19, 2014


(Editor’s note: On Wednesday, Nov. 19, the California Legislative Analyst’s Office released a report titled “The 2015-16 Budget: California's Fiscal Outlook.” Highlights of interest to K-12 educators are reprinted below, click on the link at the end of the article to see the full LAO report.)


Executive Summary

Keys to Understanding This Report. This report estimates the fiscal outlook of the General Fund – the state’s main operating account. The main scenario we use to develop the outlook assumes continued moderate economic growth through 2020. We base our outlook on today’s laws and budget practices, thereby providing state policymakers a sense of the available resources to guide future policy changes...

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State Revenues Running $1.2 Billion Ahead of Budget Projections, According to Controller’s October Report

November 13, 2014

On November 10, State Controller John Chiang released his monthly report covering California's cash balance, receipts and disbursements in October 2014. Total revenues for the fourth month of Fiscal Year 2014-15 were $6.0 billion, coming in above Budget Act estimates by $662.2 million, or 12.3 percent.

For the fiscal year to date (July 1-October 31), total revenues reached $27.9 billion, beating estimates by $1.2 billion, or 4.5 percent.

“Four months into the fiscal year, California's coffers overflow by $1.2 billion. The news comes on the heels of two other positive developments: the vote to strengthen California's rainy-day fund through Proposition 2, and the credit upgrade that followed one day later," Chiang said...

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New Study Offers First Look at Local Control Funding in California School Districts

November 13, 2014

Education officials from school districts and county offices of education across the state are enthusiastic about California’s new Local Control Funding Formula. But they are concerned about the future of the effort and challenged by a lack of time, information, skills, funding and other resources needed for its full and effective implementation, according to a new study released on October 28 by a team of researchers from across California.

“Our research suggests strong support for the local control of school funding and cautious optimism about the future of the new law,” says Daniel Humphrey, senior researcher at SRI International and a co-author of the report. “But at the same time this enthusiasm is tempered by concerns over significant challenges to the law’s full implementation.”...

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California Applies for Federal Grant Funding of $140 Million for Early Childhood Education Programs

October 30, 2014

State Superintendent of Public Instruction Tom Torlakson and State Board of Education President Michael W. Kirst announced on October 20 that California has submitted an application for the U.S. Department of Education Preschool Expansion Grant.

The grant could provide California with $140 million – $35 million per year over a four-year period – to support the development of high-quality state preschool programs. This funding would provide for more than 3,700 new and improved preschool spaces for low-income and special needs children...

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LAO Report Offers Broad Overview of Changes in California’s System of K–12 Education Finance

October 16, 2014

(Editor’s Note: On October 13, the California Legislative Analyst’s Office released a broad overview of changes in California’s system of K–12 education finance, as well as the state budget overall. The portions of the report dealing with K–12 education follow, along with a link to the full report.)

Proposition 98

Calculating the Minimum Annual Funding Requirement for Schools and Community Colleges. Approved by voters in 1988, Proposition 98 establishes a minimum annual funding requirement for schools and the California Community Colleges (CCC). This funding level, commonly known as the “minimum guarantee,” is determined by one of three formulas...

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September Cash Update Shows State Revenues Still Running Ahead of Budget Projection

October 16, 2014

On October 10, California State Controller John Chiang released his monthly report covering California's cash balance, receipts and disbursements in September 2014. Total revenues for the third month of Fiscal Year 2014-15 were $9.8 billion, coming in above Budget Act estimates by $671.4 million, or 7.4 percent.

"Driven by an upswing in consumer activity and job growth, September revenues beat projections by more than $670 million," said Chiang. "If we remain disciplined in paying down the State’s debt, building a healthy reserve, and tackling the $64 billion unfunded liability associated with providing health benefits to our retired public workforce, Californians will have longer to enjoy this newfound prosperity."...

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State Revenues for August Miss Budget Projection Due to Transfer of State Funds

September 18, 2014

On September 9, State Controller John Chiang released his monthly report covering California's cash balance, receipts and disbursements in August 2014. Total revenues for the second month of Fiscal Year 2014-15 were $6.7 billion, coming in below estimates in the Budget Act by $370.1 million, or 5.3 percent. Most of this shortfall reflected a one-time transfer of $343.3 million in sales tax revenues from the State’s General Fund to local governments.

"If not for a one-time transfer of sales tax revenues to local governments, August revenues closely tracked budget projections," said Chiang. "As Californians enjoy this period of economic stability, we can actively work to sustain it by continuing to pay down debt accumulated during the Great Recession, undo the accounting gimmicks sprinkled throughout past budgets, and get serious about addressing the State’s unfunded retiree health care liability."...

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“Strong Start” for New Fiscal Year, with State Revenue Rising in July

September 4, 2014

State Controller John Chiang released his monthly report on August 11, covering California's cash balance, receipts and disbursements in July 2014. Total revenues for the first month of Fiscal Year 2014-15 totaled $5.4 billion, beating estimates in the Budget Act by $231.9 million, or 4.5 percent.

"Even though July is usually a weak revenue collection month, the new fiscal year is off to a strong start," Chiang said. "While the State plans to borrow operating funds through revenue anticipation notes, the $2.8 billion needed solely for smoothing out the timing of revenues is at the lowest level since the 2006-07 fiscal year. If we can continue to reduce short- and long-term debts, we can continue to improve our fiscal condition."...

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Saving for a Rainy Day – the Right Way

Rep. September 4, 2014 - By Randy Delling, 2014-15 ACSA President

Saving for a rainy day is the way Americans have done it for generations. But nothing stays the same.

Today, school districts are being told how to save through a proposed cap enforced by law. The reality is the education provisions in Proposition 2 hurt local control and put school districts in jeopardy of financial collapse. This is especially true for California’s smaller districts.

That’s the reason ACSA recently stood side-by-side with lawmakers in support of Assembly Bill 146, legislation designed to override the cap and restore local decision making on how much should be saved for a rainy day. Our support for AB 146 shows our dedication to students and our mission to create positive learning environments...

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Controller: California Finishes Fiscal Year with First Positive Cash Balance Since 2007

July 21, 2014

On July 10, State Controller John Chiang released his monthly cash report for the month of June, and announced that the state's General Fund – the primary account from which California funds its day-to-day operations and programs – ended the fiscal year with a positive cash balance for the first time since June 30, 2007. A positive cash balance means that the state had funds available to meet all of its payment obligations without needing to borrow from Wall Street or the $23.8 billion available in its more than 700 internal special funds and accounts.

"While this is welcome news after seven years of record-high borrowing just to pay our everyday bills, we still have much work to do," Chiang said...

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SBE Approves Revised LCAP Regulations, Template

July 21, 2014

The State Board of Education voted unanimously on July 10 to approve revised permanent regulations for California’s new Local Control and Accountability Plan (LCAP) system, as well as changes to the LCAP template.

The vote was preceded by several hours of public comment, with most speakers limited to 60 seconds to make their points. Major education stakeholder groups by and large spoke favorably of the revised LCAP regulations and template, though there as a significant difference of opinion over a revision that said supplemental LCAP funds should be “principally directed” towards high needs students. Some said the insertion of the words “principally directed” was essential, others described the added language as overly restrictive...

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Governor Signs 2014-15 State Budget, Analysts Offer Differing Views Regarding the Details

July 7, 2014

Governor Jerry Brown signed the 2014-15 State Budget on June 20. The Governor’s Press Office issued a statement that said (in part):

"This on-time budget provides for today and saves for the future," said Governor Brown. "We're paying off the state's credit card, saving for the next rainy day and fixing the broken teachers' retirement system."

The budget includes a plan of shared responsibility among the state, school districts and teachers to shore up the State Teachers' Retirement System (STRS). The first year's contributions from all three entities total approximately $276 million, growing in subsequent years to more than $5 billion annually. This is projected to eliminate the unfunded liability in the system by 2046...

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Objections Raised to Last Minute Addition

State Budget Approved – Including Cap on Fiscal Reserves Vehemently Opposed by ACSA, CSBA

June 19, 2014

The California Legislature approved a new $156 billion state budget last Sunday, meeting its mandated deadline to produce a budget no later than June 15 with a few hours to spare.

But the budget process turned controversial during its closing hours, with the Association of California School Administrators (ACSA) and the California School Boards Association (CSBA) strenuously criticizing the last minute insertion of language in a budget trailer bill, which would cap the local financial reserves that school districts can maintain under many circumstances...

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CDE Reports Significant Drop in Number of Districts in Financial Jeopardy

June 19, 2014

A new report shows that the number of California school districts in financial jeopardy has been slashed by more than two-thirds over the past year, State Superintendent of Public Instruction Tom Torlakson announced on June 11.

This year's Second Interim Status Report, FY 2013-14 shows a total of 30 local educational agencies (LEAs) are either in negative or qualified financial status. This is down significantly from the last report – in March 2014 – that showed 49 LEAs with this status. This is also down even more significantly from the same report a year ago. In the Second Interim Status report of 2013, there were 92 LEAs in financial jeopardy...

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Controller: May Cash Receipts Fall Short, But Year-to-Date Revenues Still Exceed Budget Forecast

June 19, 2014

On June 10, State Controller John Chiang released his monthly report, covering California's cash balance, receipts and disbursements for May 2014. Revenues for the month totaled $6.7 billion, missing estimates in the Governor's January proposed budget by $389.1 million, or 5.5 percent. Year-to-date, revenues still exceed expectations by $1.8 billion, or 2.1 percent.

"While this is the first time in six months that revenues have fallen short, the overall budgetary health remains stable and there is no threat to the State's ability to pay its bills on time and in full." said Chiang...

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State Budget Negotiations Enter Final Phase

June 11, 2014

Democratic legislators and Gov. Jerry Brown continued to hammer out the final details of a state budget bill this week, with the Legislature facing a Sunday (June 15) deadline for approving a budget that will then go to the Governor.

With state revenues running somewhat higher than anticipated, many Democratic legislators want to put more money into social programs. California Senate President Pro Tem Darrell Steinberg (D- Sacramento) has been pushing to fund a $378 million preschool program for children of low-income families, which a scaled-down version of his original legislation that would have funded transitional kindergarten for all California four year-olds...

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In May Budget Revision, Gov. Brown Proposes Funding to Bolster CalSTRS, Pay Off Deferrals

May 15, 2014

Governor Edmund G. Brown Jr. released his May Budget Revision on May 13, which – among other proposals – called for the state, school districts and teachers to pay in billions of dollars more annually over the next three decades to fully funds the California State Teachers Retirement System (CalSTRS).

"This May Revision is good news for California," said Governor Brown. "It shows that California can afford to provide health care to many more people, while at the same time paying its debts and shoring up the long-troubled teachers' retirement system."...

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LAO Calls on State, Districts, Teachers to “Make CalSTRS a Top Priority,” Add $5B in Funding Annually

May 15, 2014

(Editor’s Note: On May 7, the Legislative Analyst’s Office released a report titled “Addressing California’s Key Liabilities.” A section of the report addressed the unfunded liabilities in the California State Teacher Requirement System (CalSTRS), and this section of the report is reprinted below.)

Make CalSTRS Top Priority.  Due to its massive unfunded liability and relatively fast growth rate, we recommend that the Legislature make the CalSTRS pension program a top priority in addressing the state’s key liabilities. We recommend that the Legislature aim to fully fund the system in about 30 years. Doing so will be difficult. Depending on the funding arrangement, the additional contributions from the state, teachers, and districts combined could total over $5 billion per year by the early 2020s. Addressing this difficult challenge, however, only grows more costly the longer we wait, meaning that the most important action the state can take to minimize costs is to act quickly to increase contributions to CalSTRS...

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Fund for Education Might Rarely See Deposits

Beyond “Boom and Bust”? An Initial Analysis of the Governor’s Rainy Day Fund Proposal

May 1, 2014 - By Chris Hoene, executive director, California Budget Project

The California Legislature recently met in a special session – called by Governor Jerry Brown – to discuss California’s rainy day fund. In convening this session, the Governor released details of his own rainy day fund proposal, which would restructure the state’s existing rainy day fund, the Budget Stabilization Account (BSA). An alternative proposal known as ACA 4 – a constitutional amendment approved by the Legislature in 2010 and subject to voter approval – is currently scheduled to appear on the statewide ballot in November. The Governor is asking the Legislature for the two-thirds vote needed to replace ACA 4 on the ballot with his rainy day fund proposal. If then approved by voters, the Governor’s approach would be codified in the state Constitution...

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ACSA Offering Resource to Strategically Use LCAP

May 1, 2014

The Association of California School Administrators (ACSA) is launching a new online tool to assist members as they delve into their Local Control and Accountability Plans and prepare for the July 1 reporting deadline. LCAP CA is a web-based tool intended to help school leaders utilize the LCAP as a means to achieve school reform and meet reporting requirements.

The LCAP CA will help capture and report out key data in three needed formats: for the State Board of Education, for local communities, and for districts and school boards. The online tool will allow educators to utilize one site for data reporting and make it useable in the forms needed for the LCAP...

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Concern about Students Using Nicotine-Delivery Devices

Torlakson Announces Tobacco-Use Prevention Grants

April 17, 2014

Work by educators to decrease smoking among students received a boost on April 9 as State Superintendent of Public Instruction Tom Torlakson announced 14 California school districts will share almost $17 million in tobacco-use prevention grants from the state.

The list of grantees for the total $16.6 million in Tobacco-Use Prevention Education (TUPE): Grades 6-12 Cohort J Tier 2 grants is attached.

"The safety and well-being of our students are at the heart of what we do as educators," Torlakson said...

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State Revenues Run 7.9 Percent above Projections in March, Employment Nearing Pre-Recession Peak

April 17, 2014

State Controller John Chiang released his monthly report on April 9, covering California's cash balance, receipts and disbursements in March 2014. Revenues for the month totaled $6.4 billion, surpassing estimates in the 2014-15 Governor’s Budget by $470.9 million, or 7.9 percent.

"As employment in California nears its pre-recession peak, the State is seeing positive gains in many of its primary revenue sources," said Chiang. "As we enter the important month of April, all eyes will be on the State's income tax receipts – and whether they size up against budget estimates."...

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Report Shows Significant Drop in Number of Districts in Financial Jeopardy

March 21, 2014

A new report shows that the number of California school districts in financial jeopardy has dropped sharply for the second year in a row, State Superintendent of Public Instruction Tom Torlakson announced on March 11.

This year's First Interim Status Report, FY 2013-14 shows that a total of 49 local educational agencies (LEAs) are either in negative or qualified financial status. This is down significantly from the last report – in May 2013 – that showed 92 LEAs with this status, and is down even more significantly from the same report a year ago. In the First Interim Status report of 2013, there were 124 LEAs in financial jeopardy. And going back to early 2012, there were 188 LEAs in financial jeopardy...

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Millions More in Microsoft Technology Funds Available to California Schools from 2003 Settlement

March 21, 2014

More than 8,000 California public schools and districts are eligible to share $188.4 million in Education Technology K-12 Voucher Program funds, State Superintendent of Public Instruction Tom Torlakson announced on March 4.

The state's Education Technology K-12 Voucher Program is funded through a 2003 antitrust settlement agreement between Microsoft Corporation and California consumers and businesses. This month’s announcement is the third distribution of the resulting cy pres fund. The first two distributions, in 2006 and 2010, totaled more than $269 million...

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Controller Releases February Report, State Revenues Run Nearly $1B Above Projections

March 21, 2014

California State Controller John Chiang released his monthly report on March 10, covering California's cash balance, receipts and disbursements in February 2014. Revenues for the month totaled $5.6 billion, surpassing estimates in the 2014-15 Governor's Budget by $968.9 million, or 20.9 percent.

"Driven by strong retail sales and personal income tax withholdings, February receipts poured in at nearly $1 billion above projections," said Chiang. "How we conserve and invest during the upswings of California's notorious boom-or-bust revenue cycles will determine how critical programs – such as public safety and education – will weather the next economic dip.  With fiscal discipline and a focus on slashing debt, we can make California more recession-resistant and prosperity a more enduring hallmark of our state."...

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LAO Releases Lengthy Analysis of School Mandates

March 6, 2014


The California Constitution requires the state to reimburse local governments for new programs or higher levels of service the state imposes on them. In the area of education, local governments that qualify for reimbursement include school districts, county offices of education (COEs), and community colleges – collectively referred to as local educational agencies (LEAs).

Assessment of Mandate Funding Process

Traditional Mandate Reimbursement Process Based on Claimed Costs. Under the traditional mandate reimbursement process, the Commission on State Mandates (CSM) first determines whether an activity is a mandate...

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LAO Issues Report on Prop. 98 Analysis for 2014-15

February 20, 2014

(Editor’s note: On Feb. 14, the California Legislative Analyst’s Office issued a report titled “Proposition 98 Education Analysis.” We reprint the Executive Summary and Conclusions here; you can read the entire LAO report by clicking on the link at the end of this article.)

Executive Summary

Governor Proposes $11.8 Billion in Additional Proposition 98 Spending. Proposition 98 funds K–12 education, the California Community Colleges (CCC), preschool, and various other state education programs. The Governor’s budget includes $11.8 billion in Proposition 98 spending increases (attributable to 2012–13, 2013–14, and 2014–15). Of that amount, the Governor dedicates $6.7 billion to paying off outstanding one–time obligations and $5.1 billion for ongoing programmatic increases...

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Governor Brown to Introduce Budget on Friday

January 8, 2014

Governor Edmund G. Brown Jr. will introduce his 2014-15 budget proposal on Friday, January 10, at a 9 a.m. news conference in Sacramento.

The news conference will be webcast at: www.calchannel.com.

Education stakeholders will be following the Governor’s announcement with keen interest. With California’s economy recovering, and state revenues running ahead of projections in several categories, it is widely expected that the Governor could propose budget increases for K-12 education. Teachers’ unions are already pressing for higher salaries, noting that it has been several years since the state budget has included a cost of living adjustment (COLA)...

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Letters Urged as SBE Takes Up LCFF/LCAP in January

December 17, 2013

The Association of California School Administrators (ACSA) is asking members to write letters and attend the State Board of Education’s Jan. 15-16 meeting, when final action is expected on the Local Control Funding Formula (LCFF) regulations and Local Control and Accountability Plan (LCAP) template. See www.acsa.org/advocacy for LCFF resources, including ACSA’s Accountability Recommendations for LCFF.

Legislation requires the regulations to be adopted by Jan. 31, 2014. Templates for the LCAPs that must be adopted by LEAs are due before March 31, 2014...

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Department of Finance Notes “Slow Recovery,” With State Revenues Slightly Higher Than Forecast

December 17, 2013

The California Department of Finance released its December Finance Bulletin on Monday (Dec. 16). The report might be characterized as cautiously optimistic, noting that “Economic indicators continue to point to a slow recovery, but the impact of the federal government shutdown appears to be relatively contained.”

Elsewhere, the report found General Fund agency cash continues to run a bit higher than predicted in the current state budget:

Preliminary General Fund agency cash for November was $121 million above the 2013-14 Budget Act forecast of $5.341 billion. Year-to-date revenues are $627 million above the expected $31.456 billion...

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Differences in Perception by High-Income, Low-Income Parents

Most Parents Don’t Know About New Funding Formula, But Willing to Participate in School Budget Decisions

December 5, 2013

Most parents say they don’t know about the new funding system in California schools, but want to get involved in guiding how the funds are spent, according to a new survey by EdSource.

The statewide survey is the first to look at how connected and involved parents are with their child's schools. It comes at a time when parents have been given a role by the State Legislature to provide input into how state education funds are spent through the Local Control Funding Formula now being implemented in schools across the state. Signed in July by Governor Brown, the law also names parent involvement as one of several "priority areas" that schools must focus on...

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Some Evidence of Slowing Economic Conditions, But State Revenues Running Above Budget Projections

December 5, 2013

In its November Finance Bulletin, the California Department of Finance observed that “There is evidence of slowing economic conditions, although employment data were delayed by the federal government shutdown.” The bulletin likewise noted that “Home sales in California declined for the second straight month in September. Sales of existing single‑family homes slowed to a seasonally adjusted annualized rate of 412,880 units, down 5.1 percent from August and down 2.6 percent from September 2012.”

In addition, the bulletin observed that “the statewide median price of existing single-family homes declined in September for the first time since February, but was still higher on a year-over-year basis...

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California LAO’s November Report Examines Impact of 2013-2014 Budget on Education

November 14, 2013

(Editor’s note: On November 4, the California Legislative Analyst’s Office released a report including analysis of Prop. 98 funding for education, the impact of the Local Control Funding Formula on school districts, payment of deferrals, and other topics of considerable interest to school districts. Here are sections of the LAO’s report.)

Proposition 98

Approved by voters in 1988, Proposition 98 established a set of rules relating to education funding. Most importantly, Proposition 98 established a funding requirement commonly referred to as the minimum guarantee. Each year the minimum guarantee is determined by one of three formulas, known as “tests.” The tests take into account a number of inputs, including General Fund revenues, per capita personal income, and K–12 average daily attendance (ADA). In certain cases, the state can provide less than otherwise required, but it must keep track of a resulting “maintenance factor” obligation...

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Torlakson Announces Second Half of $1.25 Billion Going to Schools for Common Core Transition

November 14, 2013

School districts are receiving the second half of a $1.25 billion block grant from the state to support their move to the Common Core academic standards, State Superintendent of Public Instruction Tom Torlakson announced this week.

Districts received the first half of the funds in September and the second half — about $622 million —this week. They can decide for themselves how to use the funds to train teachers, buy new materials, or purchase technology, all with the purpose of implementing the Common Core State Standards. The total amounts to some $200 per student...

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Guest Commentary

Achieving the Goals and Vision Behind California’s New Local Control Funding Formula (LCFF)

By Dr. Jay G. Chambers, Mahala R. Archer, and Dr. Jesse D. Levin
Rep: October 31, 2013

(Editor’s note: This is a longer and more detailed version of a commentary and analysis, originally published by School Services of California. It is reprinted here with the permission of the authors.)

What the new funding formula means for local education agencies?

As California moves toward a more equitable, rational, and efficient approach to allocating resources to school districts, this is an important time for local education agencies (LEAs) to consider how well they are doing in achieving equitable allocations of resources and improving outcomes for all students. LEA leaders need to think seriously about how they can achieve a more equitable distribution of resourcesacross schools and to determine what they can do to facilitatebetter ways for the central office and school sites to connect resources to goals, elevate accountability for performance, and improve transparency by engaginga wide range of stakeholders in the process...

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“The Bottom Line… California Can Afford To Invest More”

California Spends Smaller Share on K-12 Education Than Other States, Despite Greater Financial Resources

October 17, 2013

Although California's K-12 public schools educate a student population that, compared to the rest of the U.S., presents greater challenges and costs more to educate, the state invests far less in K-12 schools than the rest of the U.S., according to a new analysis from the California Budget Project.

Rising to the Challenge: Why Greater Investment in K-12 Education Matters for California's Students shows that California's schools enroll the largest share of English learners (ELs) in the U.S. and that the share of students from low-income families is greater in California than in the rest of the nation. California's large number of ELs and economically disadvantaged students means that its students as a whole cost more to educate than those in other states...

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Federal Shutdown Largely Idles Education Department

October 3, 2013

(Editor’s note: The U.S. Department of Education was one of the federal agencies that was largely shut down this week due to the ongoing dispute in the nation’s capital between House Republicans and the other branches of government, resulting in a lapse of appropriations for funding that keeps federal agencies in operation. James Shelton, Acting Deputy Secretary of Education, posted the following Contingency Plan that outlines the federal Department of Education’s response to the situation; it was posted on the Education Department’s website on Sept. 30.)

The contingency plan for the Department of Education (the Department) was developed pursuant to applicable legal requirements governing a Federal lapse in appropriation.  In the event of an interruption or absence of an appropriation or continuing resolution, the Department, in the interim, will perform only work that is supported by permanent or multi-year appropriations, or that otherwise supports an activity that is considered an “exception” to the Antideficiency Act and “excepted” from the shutdown...

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Taxpayers Can Support Arts Education Programs Through New “Keep Arts in Schools Fund”

October 3, 2013

Californians will once again have the opportunity to support the California Arts Council and its arts programs for children through their state individual tax refund. On Monday (Sept. 30), Governor Edmund G. Brown Jr. signed Senate Bill 571 (Senator Carol Liu, D-La Canada/Flintridge), returning the arts to the voluntary contribution portion of California tax return forms through the new “Keep Arts in Schools Fund”.

“This is wonderful news for California’s young people,” said Craig Watson, Director of the California Arts Council. “We hope all those who know arts education results in future success for California’s children will take advantage of this opportunity to directly contribute to arts education via their tax return.”...

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Study Concludes Lower Threshold for Approval of School Parcel Taxes Might Not Broaden Their Use

September 19, 2013

Lowering the vote threshold for passage of local school parcel taxes would likely allow far more to pass. But there is no evidence that it would expand their use beyond the sort of wealthy Bay Area school districts that already have them. These are the key findings of a report released on Monday by the Public Policy Institute of California (PPIC).

The report assesses the potential effect of reducing the vote required to pass these taxes from two-thirds to 55 percent — a proposal the state legislature has been discussing. Although a parcel tax is one of the only local revenue options available to school districts, these taxes are not widespread. Only about 10 percent of districts have passed one, and the money raised amounts to less than 1 percent of total K–12 revenue...

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With Budgets Recovering, Community Colleges See Rising Enrollment as Course Cuts are Restored

September 19, 2013

California community colleges, after experiencing years of declining enrollment brought on by budget cuts, project increases in enrollment this fall, and colleges are making good progress in restoring course section offerings, according to results of a survey conducted by the California Community Colleges. 

The median percentage increase in enrollment projected at community colleges throughout the state is 2.5 percent, and colleges report a 5 percent increase in the number of course sections offered, according to the survey. Last year at this time, colleges were bracing for cuts that led to a 4.8 percent decline in enrollment and a 3.3 percent decline in course offerings. As bad as those cuts were, they would have been far worse had Proposition 30 failed...

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Don’t Delay – Start Identifying Priorities for How Your District Will Use New LCFF Funds

By Adonai Mack and Tahir Ahad - August 29, 2013

The Local Control Funding Formula (or LCFF) is a major restructuring of our state school finance allocation methodology, based on key precepts of local decision making, equity, accountability and transparency. The shift from the old system of categorical funding means that districts now have to be strategic in their spending and instructional program delivery.

The LCFF money hasn’t even started to flow into districts. But already, the expectations are running higher than ever, and competing demands are piling up… from the community groups that long to bring back abandoned or truncated past programs, to employee groups who have been wanting increases so their compensation will once again keep pace with inflation, to advocacy and interest groups who wants funds to be spent to address the specific needs for which they carry flags...

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Districts Invited to Apply for $120 Million in Race to the Top Funds to Support Classroom-Level Reform Efforts

August 15, 2013

The U.S. Department of Education announced on July 30 that it has finalized the application for the 2013 Race to the Top-District competition, which will provide nearly $120 million to support locally directed improvements in learning and teaching that will directly improve student achievement and educator effectiveness.

This year, the Race to the Top-District competition seeks to build on the strategies already employed in classrooms across the country. This year's competition invites applicants to demonstrate how they can personalize education for all students and is aimed squarely at classrooms and the all-important relationship between teachers and students...

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Controller: California’s Recovering Economy Means Less Cash Flow Borrowing by State

August 15, 2013

On Monday (August 12), State Controller John Chiang released his monthly report covering California's cash balance, receipts and disbursements in July 2013, the first month of the State's fiscal year.  Revenues for the month totaled $4.8 billion, coming in below estimates contained in the state budget by 6 percent.

"Reflective of the State's improving fiscal health, California’s upcoming cash flow borrowing is shaping up to be the smallest in four years," said Chiang.  "While this month's numbers disappoint, reaction must be tempered by the fact that July is often the State's least significant revenue collection month."...

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Questions Regarding LCFF Abound – Torlakson and Kirst Provide Some Details in August Letter

August 15, 2013

Public input sessions on implementation of the state’s new Local Control Funding Formula (LCFF) for K-12 education drew plenty of comment on August 8 in the Los Angeles area, and August 12 in the Sacramento area.

According to Andrea Ball and Terri Burns, Sr. of the California School Boards Association (CSBA), the Southern California session drew “capacity crowds,” with more than 150 people in the main room, and more people following the discussion on video screens in three overflow rooms nearby, plus another 100 people at following the meeting at a remote site in San Diego County...

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SBE, CDE Holding Meetings in August to Seek Stakeholder Input on LCFF Implementation

July 25, 2013

The State Board of Education (SBE) and California Department of Education (CDE) invite all interested stakeholders to come and share their input and ideas to inform implementation of the Local Control Funding Formula (LCFF). Sessions are scheduled in locations throughout the state. Staff from the SBE and CDE will be present at the primary locations with remote locations connected via video conference with an on site facilitator to help direct comments between locations.

Sessions begin at 9:30 a.m. and end at or before noon at each location...

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State Supreme Court Leaves Lower Court Ruling Striking Down Portions of Alameda Parcel Tax In Effect

July 11, 2013

The California Supreme Court decided on June 12 not to review a lower court decision striking down aspects of a school parcel tax approved by two-thirds of voters in the Alameda Unified School District. The decision will impact legal challenges against several other school parcel taxes approved by local voters in other parts of the state.

After the Supreme Court decided not to review the case, the Alameda Unified School District issued a statement saying:

The California Supreme Court has denied the District’s petition for review in the case of Borikas et al. v. AUSD, the lawsuit filed by parcel tax opponents challenging the legality of Measure H...

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Controller Releases June Cash Update, State Revenues Top Governor’s May Budget Estimate by $1.2 Billion

July 11, 2013

On Wednesday (July 10), State Controller John Chiang released his monthly report covering California's cash balance, receipts and disbursements in June 2013. Total revenues for the month equaled $13.1 billion, beating the Governor’s May Revision estimate by $1.2 billion (10.1 percent).

Total revenues for the fiscal year ending June 30 were $100.1 billion, topping estimates by $2.0 billion (2.0 percent).

"Rising employment, economic expansion and voter-approved tax increases have generated revenues outperforming even the rosiest of projections," said Chiang...

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NEA Gives Brown “Education Governor” Award

Governor Signs Budget Bills, Launching Reorganization of Funding for K-12 Schools

July 11, 2013

Governor Edmund G. Brown Jr. signed the new state budget on June 27 in Sacramento, ushering in the new Local Control Funding Formula (LCFF) that will reorganize funding for K-12 education.

“California’s finances are in very solid shape for the first time in a decade,” said Governor Brown, “We’re making significant investments in the things Californians care most about – the education of our children and adequate health care.”

Significant aspects of the 2013-14 state budget (approved in mid-June by California legislators) include:...

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With CABs, It’s All About the Cost of Money

By Dr. Barry Schimmel - June 20, 2013

In recent months, school boards and administrators have been critiqued for not fully understanding the use of the bond sale as a financial instrument. Capital Appreciation Bonds (CAB) have come to the forefront as a discussion item because of the large, and in general inappropriate amount of interest charged to the public. I would suggest school board members and executives are in need of much more than a few tips to provide for prudent use of taxpayer money.

First of all, the selling of bonds is big business. Money is a commodity in a very competitive market. School executives are generally not skilled in the language terminology used to create fees. After all, most chief business officials sell bonds no more than once every five years...

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Brown, Steinberg, Pérez Reach Accord

Legislature Sends Budget Bill to Governor

June 17, 2013

California moved several steps closer to a new State budget last week – and Governor Jerry Brown appears to have gotten much of what he wanted in terms of overhauling K-12 education funding via his proposed Local Control Funding Formula.

On Tuesday (June 11), Brown and the legislative Democratic leaders – Assembly Speaker John Pérez and Senate President pro Tem Darrel Steinberg – announced they’d reached a budget agreement in a joint news conference at the State capitol. Actual details of the agreement were still pretty sketchy at that point, but it was clear that the three men had reached a mutually acceptable agreement that would even out the differences between the Governor’s May Budget Revision and the competing version developed by the California Assembly and the California Senate...

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With Prop. 30 Funding in Place, State Sees Big Drop in Number of School Districts in Financial Jeopardy

June 6, 2013

A new report shows that less than half as many California school districts are in financial jeopardy now as compared with a year ago, State Superintendent of Public Instruction Tom Torlakson announced last week.

The state's Second Interim Status Report for 2012-13  shows that 92 local educational agencies (LEAs) are either in negative or qualified financial status. The same report from a year ago showed a record 188 LEAs in financial jeopardy.

“When the number of districts struggling financially is cut in half, we know we are making tremendous progress — especially after years of tough budget cuts,” Torlakson said...

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Clock Keeps Ticking in Sacramento as Legislature’s June 15 Budget Deadline Nears

June 6, 2013

The clock is ticking in Sacramento, where legislators face a June 15 deadline for passing a new state budget. And while there are some legislative committees holding hearings about Governor Brown’s proposed Local Control Funding Formula for K-12 education – as well as alternative versions of the Governor’s proposal that have been advanced by Democrats in the California Assembly and the California Senate – the more substantial discussions are going on behind closed doors.

The major players in the budget drama admit as much. Last week, Gov. Jerry Brown told reporters that negotiations over the state budget would take place "a lot in private, and a little bit in public." And Sen. Darrell Steinberg (D-Sacramento, the Democratic leader in the California Senate, was equally cagey in his public statements...

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Looming Vote on LCFF Prompts Plea from Ramanathan

June 6, 2013

(Editor’s Note: With the June 15 deadline for legislative action on California’s state budget drawing near, public discussion of the Governor’s proposed Local Control Funding Formula is moving into the foreground in the editorial pages of the state’s newspapers. On June 4, Dr. Arun Ramanathan, executive director of The Education Trust—West, published an opinion piece in the San Jose Mercury-News urging support of the LCFF. Here are some highlights from Ramanathan’s article.)

The LCFF would increase funding for all schools, according to the governor, while providing additional dollars for low-income students and English learners. The proposal creates a base grant for every student, a supplemental grant for disadvantaged students and a concentration grant that provides extra dollars for California's highest-poverty districts...

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LAO Reviews May Budget Revision, Says Governor’s View of State’s Revenues “Seems Too Pessimistic”

May 23, 2013

California’s nonpartisan Legislative Analyst’s Office (LAO) issued a report on Gov. Brown’s May Budget Revision last Friday, and the LAO differed with the Governor on a number of points – including the amount of revenue that the state is likely to receive during the coming year.
According to the LAO’s executive summary:

Revenue Forecast Up Slightly. The administration’s May Revision forecast projects that weaker tax collections in the coming months will erode the vast majority of the $4.5 billion of unexpected tax revenues collected since January. For 2011–12, 2012–13, and 2013–14 combined, the administration’s updated forecast anticipates that revenues will be only $749 million higher than indicated in its January estimates (not counting a new $500 million loan proposal in the May Revision, which is booked to the revenue side of the budget)...

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May Budget Revision

Brown Pulls Back on Plan to Shift of Adult Education Programs to Community Colleges

May 23, 2013

Much of the coverage of last week’s release of Gov. Brown’s May Budget Revision focused on the inclusion of $1 billion in one-time funding to implement the Common Core academic standards, and the Governor’s continued dedication to his Local Control Funding Formula for education.

Somewhat obscured in the hubbub surrounding the May Budget Revision’s rollout was the Governor’s shift from his initial January budget proposal regarding adult education programs, which have long been offered by many K-12 school districts. In January, the Governor proposed transferring responsibility for most adult ed programs to the community college system. But in the May Budget Revision, the Governor stepped back from that stance, at least in the short term...

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Governor Rolls Out May Budget Revision

Brown Seeks $240 Million Addition to LCFF, Plus $1 Billion in Funding to Implement Common Core

Jeff Hudson - May 15, 2013

Gov. Jerry Brown released his May Budget Revision on Tuesday, and the updated version of the Governor’s January budget proposal included more funding for K-12 education in several areas.
The Governor proposed gradually increasing the Proposition 98 guarantee by more than $19 billion by 2016-17, with a boost of about $1,046 more per pupil in 2013-14 (as compared to 2011-12), and an increase of $2,754 per pupil by 2016-17.

The Governor also proposed a one-time allocation of $1 billion – or about $170 per pupil – to assist districts as they implement the new Common Core academic standards. This money would come with some flexibility, and could be used to pay for professional development, technology enhancements, and instructional materials...

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Gov. Brown, Superintendents Meet to Advance Local Control Funding Formula Proposal

April 25, 2013

Governor Edmund G. Brown Jr.  held a meeting Wednesday with twenty school superintendents from across California to drum up support for his Local Control Funding Formula in the proposed state budget, which is intended to direct additional resources to the state’s neediest students and restore local control over how money is spent in schools.

“This is not an ordinary legislative measure, this is a cause. It’s a cause for the children of California, and it’s a cause for our own future as Californians,” said Governor Brown. “Kids can’t wait, California can’t wait, and that’s why the superintendents and thousands of people throughout California are going to work to see the passage of our bill.”...

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Senate Democrats Roll Out Alternative Local Control Funding Formula, Brown Vows to Fight for His Plan

April 25, 2013

Senate Democrats formally introduced their own version of the Local Control Funding Formula on Thursday. In some ways, the Senate Democrats’ plan parallels the Local Control Funding Formula (LCFF) proposal that was part of Gov. Jerry Brown’s January budget proposal – but in other ways, the Senate Democrats’ version backs off on aspects of the Governor’s plans to allocate extra funding to school districts with high percentages of students who are English Learners or come from low-income households, reflecting the concerns of some school districts in affluent communities (represented by Democratic legislators) who contend that the base level of funding under the Governor’s version might be too low...

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Most Favor Extra Funds For Needier Students

PPIC Poll Finds Support for Key Elements of Governor’s School Funding Proposal

April 25, 2013

Majorities of Californians favor Governor Jerry Brown’s proposal to give extra K–12 funding to school districts with more English Learners and lower-income students, according to a statewide survey released on April 17 by the Public Policy Institute of California (PPIC). Californians also favor another component of the governor’s proposal: giving local school districts more flexibility over how state money is spent.

A strong majority of all adults (71%) — but fewer likely voters (60%) — support the governor’s plan to direct more funding to English Learners and lower-income students...

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Education Coalition Sets Budget Priorities

April 25, 2013

The Education Coalition, a statewide stakeholders group of which Association of California School Administrators (ACSA) is a member, has issued a position paper on the Governor’s proposed budget, including his Local Control Funding Formula. ACSA Interim Executive Director Bob Noyes said the paper reflects many of the priorities the association has been advocating or at the Capitol.

Noyes, along with ACSA President David Gomez and Legislative Advocates Sherry Skelly Griffith and Adonai Mack, attended a recent Ed Coalition meeting that focused on finalizing the School Finance Principles statement for the 2013-14 budget...

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Next Rounds of Race to the Top Announced, Including Plan to Expand High-Quality Early Learning

April 25, 2013

The U.S. Department of Education and U.S. Department of Health and Human Services announced on April 16 they will invest the majority of the 2013 Race to the Top funds for a second Race to the Top-Early Learning Challenge competition. About $370 million will be available this year for states to develop new approaches to increase high-quality early learning opportunities and close the school readiness gap. Today's announcement furthers the Administration's work to expand access to high-quality early learning programs for all children, especially those in disadvantaged communities...

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Torlakson Says He’d Like to Keep Adult Ed Programs in Local School Districts

By Rob Kuznia, Torrance Daily Breeze - Rep: April 11, 2013

In a speech addressing the state of education in California on March 28, Superintendent of Public Instruction Tom Torlakson celebrated a recent wave of voter-approved taxes that are expected to stabilize a dire education budget, and touted other initiatives that would bring still more tax dollars to public schools.

Speaking at the Centinela Valley Center for the Arts in Lawndale, Torlakson also let it be known where he stood on some of Gov. Jerry Brown's key education initiatives...

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Alameda Parcel Tax Case Headed for California Supreme Court, Proposed Legislation Still Pending

By Jeff Hudson - March 28, 2013

The month of March has produced several developments concerning the Alameda Unified School District’s parcel tax – Measure H, approved by Alameda voters by a greater-than-two-thirds majority in 2008.

Back on December 6, 2012, an appeals court ruled in favor of a legal challenge by Alameda property owner George Borikas and several others, who contended that Measure H was unlawful because it charged residential homeowners at one rate, and commercial property owners at a different rate, and therefore does not meet the “uniformity” standard for parcel taxes under state law...

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Fewer First Time Students Enrolling

Steep Cuts in State Funding Lead to Sharp Decline in Access to Community Colleges

March 28, 2013

Student enrollment rates in California's community colleges have dropped to a 20-year low in the wake of unprecedented cuts in state funding, according to a report released on Monday by the Public Policy Institute of California (PPIC).

In the Great Recession and its aftermath, the community college system sustained $1.5 billion in budget cuts between 2007–08 and 2011–12, the report finds. These cuts are far larger than those made during past economic downturns in the state. The colleges responded by reducing staff, most notably among instructors. Courses were cut and class sizes increased...

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Budget Subcommittee Discussion of LCFF Generates More Questions than Answers

By Jeff Hudson - March 14, 2013

The Assembly Budget Subcommittee on Education examined Gov. Brown’s proposed Local Control Funding Formula on Tuesday, and the discussion pointed out several trends.

--There was widespread agreement that the state’s current funding system for K-12 education, with base funding and various categorical programs, is complicated and out of date, and forces school districts to spend too much time proving that categorical funds have been used in approved ways...

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ACSA Analysis of Budget Proposal

DOF’s Funding Formula Assumptions Raise Questions

March 14, 2013

With the release of data by the Department of Finance on the implementation of the governor’s proposed Local Control Funding Formula (LCFF), the Association of California School Administrators’ Legislative Advocate Adonai Mack has issued an analysis that addresses several items and assumptions.

The data provided at www.dof.ca.gov in a PDF document includes all school districts and charter schools. However, county offices of education are excluded. Basic Aid districts and state designated “Necessary Small Schools” are included...

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Controller Releases February Cash Update; Revenues within a Percentage Point of Budget Estimates

March 14, 2013

On Monday, State Controller John Chiang released his monthly report covering California's cash balance, receipts and disbursements in February 2013. Total revenues for the month of February nearly matched estimates found in the Governor’s proposed 2013-14 State Budget.

"February's revenues came within a percentage point of estimates," said Chiang. "Healthy revenues, along with recovering home prices, a steep drop in foreclosures, and increased car sales are harbingers of a California economy that is starting to warm-up."...

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UC Davis Researchers Offer Report Analyzing Impact of Local Control Funding Formula

March 14, 2013

The achievement gap between economically disadvantaged students and their more affluent peers has raised many questions about whether California’s school finance system provides disadvantaged students with enough revenue to meet the state’s academic goals. This report examines how revenue is currently allocated among California school districts. On average, unified school districts in which all of the students are economically disadvantaged receive about 36 percent more revenue per pupil than districts that do not have any economically disadvantaged students...

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Seven Districts “Negative,” 117 “Qualified”

Smaller Number of Districts in Financial Jeopardy

March 14, 2013

State Superintendent of Public Instruction Tom Torlakson reported on March 4 that 500,000 fewer California students attend school districts in financial jeopardy now than last May, though an unacceptably high number of districts still face deep fiscal challenges.

The state's First Interim Status Report for 2012-13 shows that 124 local educational agencies (LEAs) serving 2.1 million students are in either a negative or qualified certification, down from the 188 LEAs serving 2.6 million students reported in Second Interim Status Report for 2011-12 issued in May 2012...

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Department of Finance Releases List Estimating How Districts Would Fare Under Local Control Funding Formula

February 28, 2013

Current funding for schools is inequitably distributed, not tied to student demographics, largely state controlled, and lacking appropriate accountability measures. These inequities are primarily the result of how the current general purpose “revenue limit” funding system was created in response to court rulings and Proposition 13, freezing in funding decisions made decades ago. In addition, over time, the state created more than 60 categorical programs, each with accounting and reporting requirements, many of which are not outcome-focused. These categorical program funding allocations have also been frozen due to recent fiscal constraints and no longer are reflective of current demographics...

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LAO Sizes Up Governor’s “Local Control Funding Formula” Proposal to Restructure K-12 Funding

February 28, 2013

Executive Summary

Governor Proposes to Restructure State’s Approach to Allocating Education Funding. The Governor proposes to restructure the way the state allocates funding for K–12 education. Under the Governor’s plan, the state would replace the vast majority of existing revenue limit and categorical funding formulas with a new, streamlined set of funding formulas—one applying to school districts and charter schools and the other applying to county offices of education (COEs). The Governor refers to his collection of proposals as the “Local Control Funding Formula” (LCFF). The Governor’s budget provides $1.6 billion in 2013–14 to begin implementing the new formulas...

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LAO Suggests Alternative to Gov’s Prop. 39 Proposal

February 28, 2013


Governor’s Proposal. The Governor’s 2013–14 budget includes a plan to implement the provisions of Proposition 39, which increases state corporate tax (CT) revenues and requires that half of these revenues for a five–year period be used for energy efficiency and alternative energy projects. The Governor proposes to count all associated revenues toward the Proposition 98 minimum guarantee for schools and community colleges. The Governor also proposes to designate all energy–related Proposition 39 funds to schools ($400.5 million) and community colleges ($49.5 million) in 2013–14 and for the following four years. The proposal provides this funding to the California Department of Education (CDE) and the California Community Colleges (CCC) Chancellor’s Office to distribute on a per–student basis...

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Report Gauges Impact on Latinos, African Americans, Others

Analysis of Governor’s “Local Control” Budget Proposal Raises Several Questions

February 28, 2013

Gov. Brown’s proposed 2013-14 budget includes $138.6 billion in General Fund and special fund spending, up 4.5 percent from 2012-13. According to the Administration, the state’s General Fund budgetary reserve will be $1 billion by the end of 2013-14, if the governor’s plan is implemented as proposed. However, while the governor’s proposal provides increased or similar funding into California’s safety net from 2012-13, 16.6 percent of Californians still live below the poverty line (up from 16.3 percent last year) with American Indian and Alaska Native, African Americans, and Hispanic or Latino populations having the highest rates of poverty: 25.5 percent, 25 percent, and 23.4 percent respectively...

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Torlakson, Duncan Urge Congress to Act Swiftly to Prevent Looming Sequestration Cuts

February 28, 2013

State Superintendent of Public Instruction Tom Torlakson sent a letter on Tuesday urging Congressional leaders to work together and immediately pass legislation that would repeal drastic budget cuts set to take effect Friday under sequestration.

“Without Congressional intervention, automatic budget cuts from sequestration will take effect on March 1,” said Torlakson in a letter to Congressional leaders. “After years of extensive state and federal budget cuts to education, these cuts will devastate communities across California…. These automatic cuts will cause long-lasting and irreparable harm.”...

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Alameda Parcel Tax Ruling Prompts Lawsuits in Other School Districts, Assemblyman Introduces Legislation

February 14, 2013

A recent court ruling that struck down portions of a 2008 Alameda school parcel tax has prompted new lawsuits against four school districts that won voter approval of school parcel taxes in November. It appears the issue could be headed for the State Supreme Court – alternately, a recently-introduced bill by Assemblymember Rob Bonta (D-Oakland) could defuse the litigation.

According to reporter Michele Ellson of the online Alameda County publication The Alamedan on February 4:

Lawsuits were filed against the San Leandro, West Contra Costa and Davis school districts and a group of suburban Los Angeles districts alleging the districts violated state law by imposing taxes that charge different types of property owners different rates...

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ACSA Reacts “With Concern” to Advice from Torlakson, Lockyer Regarding Capital Appreciation Bonds

February 14, 2013

State Treasurer Bill Lockyer and Superintendent of Public Instruction Tom Torlakson issued a joint letter (reported in EdBrief in January) to all county and district superintendents regarding the potential use of the bonds. In it, they recommend schools not issue CABs until the Legislature and the governor have completed their consideration of this year’s proposals to reform the issuance process. The aim of the legislation is to improve transparency and protect taxpayers against exorbitant debt service payments.

The letter has created concerns by some in the education community who work on the financial side of schools...

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Foggiato to Lead CDE’s School Fiscal Services Division

February 14, 2013

The California Department of Education announced Peter Foggiato as the new director of the CDE’s School Fiscal Services Division on February 6.

"Peter brings a wealth of knowledge to his new position at the department," said Tom Torlakson, State Superintendent of Public Instruction. "School districts across the state rely on the department's fiscal experts for help navigating the complex world of school finance, and we're lucky to have Peter heading up that outstanding team."

Foggiato has worked at the CDE for seven years having served most recently as an education fiscal services administrator...

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Court to Reconsider Ruling in Alameda Parcel Tax Case

January 31, 2013

The California Court of Appeal has granted the Alameda Unified School District’s petition for a rehearing in the case of Borikas et al. v. Alameda Unified School District, a lawsuit filed by parcel tax opponents challenging the legality of Measure H, a parcel tax passed in 2008.

Last month the Court of Appeal issued a ruling that reversed in part and affirmed in part a previous trial court ruling in favor of the District that had dismissed the legal challenge to Measure H. After receiving the ruling from the Court of Appeal, the District filed a petition for rehearing arguing that the Court of Appeal’s decision was factually and legally erroneous...

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Torlakson, Lockyer Caution School Districts Against Issuance of Capital Appreciation Bonds

January 31, 2013

State Superintendent of Public Instruction Tom Torlakson and State Treasurer Bill Lockyer sent the following letter to local educational agencies on January 17, advising them to use caution when considering the issuance of capital appreciation bonds:

Dear County and District Superintendents:


We understand many districts face a critical need to build or modernize facilities for their children, and we recognize that falling property tax assessments, revenue losses, and statutory debt service limits have all combined to reduce districts' debt financing options...

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Governor’s January Budget Proposal the Most Promising for Education in Last Five Years

By Michael Hulsizer - January 18, 2013

Governor Brown unveiled his 2013-14 Budget Proposals last week. As in his previous budgets, the Governor highlighted two overarching priorities that guided the development of this budget: continued fiscal discipline and the importance of education investment.

The Governor spent much of his budget announcement press conference explaining that, with the help of California voters, he was pleased to be able to continue his commitment to reducing California’s “wall of debt” (an amount he estimated at $35 billion in 2011) and propose spending increases in public education...

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LAO Sizes Up Governor’s January Budget Proposal

January 18, 2013


Editor's Note:This week, the Legislative Analyst’s Office (LAO) released an assessment of Governor Brown’s January Budget Proposal. Here are the LAO’s highlights regarding K-12 education

Proposition 98

Proposition 98 funds K–12 education, the California Community Colleges (CCC), preschool, and various other state education programs. The Governor’s budget increases total Proposition 98 funding by $2.7 billion—a 5 percent increase from the revised current–year level. As shown in Figure 9, the General Fund share of Proposition 98 increases by 9 percent whereas the share from local property tax revenues is projected to drop by 4 percent...

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Budget Plan Includes More Resources for Low-Income Students, English Learners

Governor Proposes New Funding Formulas for Education, with Greater Local Autonomy

By Jeff Hudson - January 10, 2013

Governor Jerry Brown rolled out his much-anticipated January budget proposal on Thursday – and as expected, his proposal includes a major overhaul of K-12 education finance.

The Governor proposes a transition to a new state funding formula for school districts, directing more resources toward school districts with high percentages of students who particulate in free- or reduced-price meal programs (based on modest family income) and students who are English language learners. Students who are foster children would also receive additional targeted funding...

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Controller Chiang Releases “Disappointing” Cash Update; Personal and Corporate Tax Revenues Down

December 13, 2012

On December 7, State Controller John Chiang released his monthly report covering California's cash balance, receipts and disbursements in November 2012, showing total revenues were $806.8 million below (-10.8 percent) projections contained in the 2012-13 State budget.

"November's disappointing revenues stand in stark contrast to recent news that California is leading the nation in job growth, has significantly improved its cash liquidity to pay bills, and even long-distressed home values are starting to inch upward," said Chiang. "This serves as a sobering reminder that, while the economy is expanding, it is doing so at a slow and uneven pace that will require the State to exercise care and discipline...

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CSBA, NSBA Ramp Up Drive to Oppose Automatic "Fiscal Cliff" Federal Funding Cuts

November 29, 2012

Although most local educational agencies would not feel a direct impact until next fall, the California School Boards Association (CSBA) and other advocates for public education are urging governance teams to tell Congress to act now to avoid the automatic and devastating cuts to virtually every federal program under the Budget Control Act of 2011, also known as sequestration.

Sequestration, which is part of the upcoming “fiscal cliff” — Beltway shorthand for the expiration of tax credits and those automatic, across-the-board cuts, including $4 billion for education — will go into effect Jan. 2 unless federal lawmakers and President Obama make a budget deal...

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U.S. Department of Education Releases Early Snapshot of School Improvement Grants Data

November 29, 2012

In mid-November, the U.S. Department of Education released an early snapshot of student performance data at schools that have received federal School Improvement Grants (SIG) program funds, a key component of the Department’s blueprint for helping states and districts turn around the nation’s lowest-performing schools.

Under the Obama Administration, the SIG program has invested up to $2 million per school at more than 1,300 of the country’s lowest-performing schools. The data released provides the first overview of performance for the first cohort of schools after one year of implementing SIG. The data begins in the 2009-2010 school year and ends in the 2010-2011 school year, the first year schools received SIG funds...

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Education Nonprofits Founded by George Lucas May Benefit from Sale of Lucasfilm to Disney

November 29, 2012

According to a recent report in the Marin Independent-Journal, George Lucas intends to use his wealth to benefit education.

In an article by reporter Nels Johnson, the I-J reported that Lucas, who sold his highly regarded company Lucasfilm to Disney in October for $2 billion in cash and $2 billion in Disney stock, indicated in a written statement, he will use most of his wealth to educate children elaborating on earlier word that educational endeavors will be the big beneficiary of his philanthropy.

"As long as I have the resources at my disposal, I will seek to raise the bar for future generations of students of all ages," Lucas said in a formal "pledge" to improve education...

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Voters Approve 85 of 106 School Bond Measures

November 15, 2012

A preliminary post-election survey conducted by California City Finance concluded that 85 of the 106 local school bond measures on the November 6 ballot were approved by voters in their school district or other local jurisdiction.

Most of these school bond measures required 55% approval. The 85 California school bond measures that appeared to be headed for approval total some $12.8 billion, among these a $2.8 billion bond in San Diego.

Final election results are still being determined. Several elections were too close to call, with county elections offices still counting vote-by-mail ballots that were turned in on election day...

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"Strong Possibility" of Budget Surpluses In A Few Years

LAO Issues Rosy Budget Forecast for 2013-14

November 15, 2012

The California Legislative Analyst’s office issued a cautious but quite hopeful budget forecast for the 2013-14 fiscal year on Wednesday, including the “strong possibility of multi-billion-dollar operating surpluses within a few years.” The forecast is a sharp contrast to the warnings of lingering debt and financial difficulties that have figured prominently in the LAO’s remarks during the past few years. The LAO’s summary released on Wednesday stated:

Budget Situation Has Improved Sharply.

The state’s economic recovery, prior budget cuts, and the additional, temporary taxes provided by Proposition 30 have combined to bring California to a promising moment: the possible end of a decade of acute state budget challenges...

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State Controller Chiang Says October Revenues Top Budget Projections By 4.4 Percent

November 15, 2012

State Controller John Chiang released his monthly report on November 9 covering California's cash balance, receipts and disbursements in October 2012, showing that total revenues were $207.9 million above (4.4 percent) projections contained in the 2012-13 state budget.

“October's numbers were positive, due in large part to strong income tax receipts,” said Chiang. “More importantly, total year-to-date revenue is spot-on with the budget's projection.”

Personal income taxes in the month of October rose $378.4 million above (10.6 percent) projections, while sales taxes also were up by $28.8 million (4.4 percent)...

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School Districts Should Benefit as Proposition 30's Passage Spurs Credit Rating Upgrade

November 15, 2012

Bloomberg News reported on November 9 that “California debt is rallying the most in three months as Governor Jerry Brown’s tax-vote victory (as California voters approved Proposition 30) leads investors to bet the state will get its first credit-rating upgrade since 2006.”

Proposition 30, which won voter approval Nov. 6, temporarily raises some levies for top earners in the most-populous U.S. state. Passage averted $5.5 billion of cuts to public schools.

The approval of Proposition 30 by California voters contrasts with the 1978 passage of tax limits known as Proposition 13...

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Local Voters Approve 14 School Parcel Tax Measures, but Reject 7 Others

By Jeff Hudson - November 8, 2012

California voters approved 14 school parcel tax measures on Tuesday – including a few in Southern California, where school districts have often struggled to get such measures approved in the past.

But seven other school parcel tax measures failed – including a few in coastal Northern California counties that have generally supported such efforts in the past.

Parcel tax measures need a two-thirds majority (66.7 percent-plus) for approval – and two-thirds is always a tall mountain to climb in electoral terms...

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Field Poll Indicates Undecided Voters Will Drive Outcome

Prop. 30 Hovering at 48 Percent, in Striking Distance – Prop. 38 Now Trailing by a Double Digit Margin

By Mark DiCamillo and Mervin Field - November 1, 2012

A new Field Poll, released on Nov. 1, finds that while support for Proposition 30, the income and sales tax increase initiative advanced by Governor Jerry Brown, has fallen below the majority needed for passage, Yes voters continue to outnumber No voters 48% to 38%. Another 14% of likely voters are undecided.

By contrast Proposition 38, the competing income tax increase initiative supported by civil rights attorney Molly Munger, now trails among likely voters by a double-digit margin, 34% to 49%. This represents a significant decline in voter support from mid-September when 41% were on the Yes side and 44% on the No side...

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Moody's: Some California School Districts Face Possible Downgrade If Both Tax Initiatives Fail

November 1, 2012

If California voters reject the two tax initiatives for school funding on the November ballet, Propositions 30 and 38, Moody's Investors Service would place school districts with weak liquidity on review for possible rating downgrade soon after the election. In the report "California School Districts Face Mounting Credit Pressure If Tax Initiative Fails in November Election," released October 24, Moody's says school districts with weak liquidity are not well-positioned to handle the mandated trigger cuts in state funding should Proposition 30 be defeated and Proposition 38 also not pass...

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California Business Roundtable / Pepperdine Survey Shows Prop. 30 in Tight Race, and Prop. 38 Lagging

October 18, 2012

On October 11, The California Business Roundtable and Pepperdine University School of Public Policy today released the most recent results in their bi-monthly initiative survey series leading up to the November election. The poll showed major movement in Proposition 37 while Propositions 30, 32 and 38 tightened, but did not show significant movement.

"This week we've seen the major campaigns intensify both on the air and in the press," said Rob Lapsley, President of the California Business Roundtable...

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Proposition 30 Still Favored by Slim Majority of Voters, But Support Continues to Erode

October 4, 2012

A majority of California voters support a November ballot initiative that would temporarily increase the state’s income tax on high earners and raise the sales tax to support education – but this support has taken a tumble in the last few months, according to the latest results from the USC Dornsife/Los Angeles Times Poll.

Backed by Gov. Jerry Brown, Prop. 30 would raise the state income tax on those earning more than $250,000 a year for seven years and increase the sales tax by a quarter of a cent to fund public education and public safety...

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State Controller Reports August Revenues Top Budget Projections by $434 Million

September 20, 2012

On Sept. 11, State Controller John Chiang released his monthly report covering California's cash balance, receipts and disbursements in August 2012, showing that total revenues were $434 million above the projections contained in the 2012-13 state budget. 

“This month's positive total offsets losses seen in July, and brings our total revenues right in line with projections,” said Chiang.

Personal income taxes in the month of August rose $222.5 million above (6.5 percent) projections, while sales taxes also were up $187.3 million (8.1 percent)...

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State Takes Over Financially Troubled Inglewood Unified

September 20, 2012

In the wake of Governor Brown’s decision earlier this month to sign Senate Bill 533, providing for an emergency loan and state takeover of the Inglewood Unified School District, State Superintendent of Public Instruction Tom Torlakson said “The Governor's action was necessary to keep Inglewood's public schools operating and serving students despite the district's extreme financial difficulties. The California Department of Education will consult with the Los Angeles County Office of Education to name an experienced administrator to oversee the long and difficult process of returning the district to solvency and, ultimately, local control.”...

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District's Bond Plan Stirs Up Fiery Controversy

By Jeff Hudson - August 23, 2012

A financial controversy is swirling around San Diego County’s Poway Unified School District.

The story took wing earlier this month, when Bloomberg News -- the highly-respected New York-based news service specializing in business and financial coverage -- carried a story on August 7 that began:

A California school district is shouldering $1 billion in interest on a $105 million bond in a deal intended to defer most of the payments for 35 to 40 years...

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Problems Loom Due to Super Committee's Failure to Act

Sequestration of Federal Funds to Impact 2013-14

August 9, 2012

Education advocates, including the Association of California School Administrators (ACSA), have been fearful of the impact of failed negotiations in the U.S. Joint Select Committee on Deficit Reduction, leading to federal budget cuts.

The bipartisan, 12-member panel, also known as the “Super Committee,” was created by the Congressional Budget Control Act of 2011 to allow the government to raise the federal debt ceiling...

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Brown's Initiative Fares Better In Survey Than Munger's

Field Poll Finds Prop. 30 Clinging to Narrow Majority

By Mark DiCamillo and Mervin Field - July 19, 2012

California voters will be asked to consider three different tax increase proposals in the upcoming November election. Two of the proposals, one sponsored by Governor Jerry Brown and the other by attorney Molly Munger, would raise personal income taxes, while a third led by hedge-fund manager Tom Steyer, would increase taxes on multi-state businesses operating in California.

A Field Poll released on July 5 finds voters supporting the Brown initiative 54% to 38%, but evenly divided on the other two tax proposals...

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School Year Could Shrink to 160 Days for Next Two Years

Democrats Push Through Trailer Bills, Brown Signs Main Budget, Republicans Predict Further Conflict

By Jeff Hudson - June 28, 2012

Democratic legislators pushed through 21 budget trailer bills on Wednesday – approving them quickly on largely party-line votes.

Gov. Jerry Brown signed the main budget bill (approved by the Legislature on June 15), issuing a press release announcing his decision six minutes before midnight – the statutory deadline by which he had to either sign or veto the main budget bill. Brown will act on the individual trailer bills over the next few days...

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RAND Study Examines How California School Districts Used Budget Flexibility to Retain Staff When Possible

June 28, 2012

Most California school districts with new flexibility about how to spend $4.5 billion in education funds opted to move most of the money into their general funds to balance budgets and avoid teacher layoffs, according to a new report from RAND Corporation and the University of California.

Some local school districts drew on this experiment with fiscal deregulation – initially advanced in 2008 by then-Gov. Arnold Schwarzenegger – to focus resources in new ways on improving the quality of teaching and instruction...

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LAO Criticizes Governor's Treatment of Prop. 98 Maintenance Factor, Recommends Alternative Method

June 14, 2012

The Governor's Proposition 98 budget package is built on two main assumptions regarding the creation and payment of "maintenance factor." These two assumptions produce unreasonable outcomes for schools and the rest of the state budget both in the near term and over the long term. In particular, the Governor's approach would ratchet down the Proposition 98 base in some years, ratchet up the base in other years, and, in some cases, lead to schools receiving almost exclusive benefit from any growth in state revenues. In these cases, the Governor's maintenance factor treatment can produce not only impractical but nonsensical results...

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Controller Releases May Cash Update — And This Month, Revenues (Barely) Top Projections

June 14, 2012

State Controller John Chiang released his monthly report on June 11, covering California’s cash balance, receipts and disbursements in May, showing monthly revenues came in $83.5 million above (1.3 percent) the latest projections contained in the Governor’s May Revision budget proposal.

“While May revenues were steady, June revenues are the ones to watch,” said Chiang. “The last month of the fiscal year is now the biggest, and will signal how well the 2012-13 budget gets out of the gate.”...

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Local Voters Approve Majority of School Bond Measures, School Parcel Tax Proposals Do Well in SF Bay Area

By Jeff Hudson - June 14, 2012

School bond measures and school parcel taxes fared comparatively well in the June 5 election, with local voters approving most – but by no means all – of the ballot measures put before them by local school boards.

Of the 34 school bond measures submitted to voters – which require a 55 percent majority for approval – 23 measures were approved, in all regions of the state. These included...

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LAO Releases Analysis of the May Revision, Questioning Some of Governor's Assumptions, Proposals

May 31, 2012

On May 18, the California Legislative Analyst’s Office released a report on the Governor’s May budget revision. The LAO’s report raised several questions about some of Governor’s short- and long-term approaches to school funding.

The Governor’s May Revise relies on applying a maintenance factor payment; a tactic the LAO says is questionable. The LAO maintains paying the maintenance factor during a Test 1 year has never happened before and is a contributing factor in a proposed increase to the Prop. 98 guarantee...

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CDE Releases Second Interim Report – Record Number of Districts Now in Financial Jeopardy

May 31, 2012

State Superintendent of Public Instruction Tom Torlakson warned on May 21 that 2.6 million California children now attend schools in districts that are in financial jeopardy — the highest number of financially troubled districts in state history.

"This is the kind of record no one wants to set. Across California, parents, teachers, and administrators are increasingly wondering how to keep their schools' lights on, their bills paid, and their doors open," Torlakson said. "The deep cuts this budget crisis has forced—and the uncertainties about what lies ahead—are taking an unprecedented and unacceptable toll on our schools."...

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New PPIC Poll Finds Voters Narrowly Favor Brown's Initiative – and Big Majority Opposes New Trigger Cuts

May 31, 2012

In a poll released on May 23, just over half of likely voters (56%) say they would vote yes on Brown's November tax initiative, with 38 percent saying they would vote no, and 7 percent said they are still undecided.

This is similar to the results of the April survey in which 54 percent said they would vote yes (39% no, 6% undecided). Today, 75 percent of Democrats and 57 percent of independents would vote yes, while 62 percent of Republicans would vote no...

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Nearly $16 Billion in Red Ink, $8.3 Billion in Cuts Proposed

Brown's May Budget Revise Discloses State Deficit Much Larger Than January Estimate

May 15, 2012

Governor Jerry Brown unveiled his May Budget Revise in two phases:

—On Saturday, the Governor made a pre-emptive announcement in the form of a YouTube video disclosing that the state’s budget deficit has grown to nearly $16 billion – much larger than the $9 billion forecast in his January budget proposal, and substantially more than recent estimates by the State Controller. The Governor apparently wanted to make this announcement, and let the budgetary and political implications sink in for two days, before releasing the formal May Budget Revise proposal...

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Reactions to the Governor's May Budget Revise

May 15, 2012

Elected officials, stakeholder groups and advocates with differing points of view on education were quick to respond to the Governor’s announcement of the May Budget Revise on Monday.


State Superintendent  of Public Instruction Tom Torlakson

Torlakson’s response was basically a message urging voters to support the Governor’s November ballot initiative that would fund education and public safety – but also recognized that the Governor’s proposal is likely to be reworked by the Legislature:...

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Around 180 California School Districts Headed for Qualified or Negative Budget Ratingss

May 15, 2012

A record number of California school districts are headed for qualified or negative budget ratings.

That was the conclusion expressed by Joel Montero, chief executive officer of FCMAT (Fiscal Crisis and Management Assistance Team), which provides financial services to school districts and county offices around the state.

On May 8, Montero told the Assembly Budget Subcommittee #2 on Education Finance that about 170 or 171 districts are moving toward “self-certification as qualified,” and another nine districts are headed for negative budget status...

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Layoffs, Budget Cuts Taking Their Toll

Report Documents Multiple Forms of Stress on California's K-12 School Districts

May 10, 2012

California's 30 largest school districts — which educate nearly 2 million students — are facing multiple forms of stress tied to the economic crisis at a state and national level, threatening their ability to provide a quality education to California's children, according to a new EdSource report.

Using an innovative approach to gauge the mounting pressures facing school districts since the onset of the Great Recession in the 2007-08 school year, the report identifies eight "stress factors" that are affecting California school districts to varying degrees...

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May Budget Revise Due Next Week

Controller's April Report Finds State Revenues Still Lagging Billions Short of Budget Expectations

May 10, 2012

Relative to the 2012-13 Governor’s Budget estimates, General Fund revenue disappointed in April 2012. Total revenues were $2.4 billion below the estimates with all three major sources of revenue — personal income tax, sales and use tax, and corporate taxes — all falling short of expectations.

The largest variance came from personal income tax, which came in almost $2.0 billion lower (-21.5%) than anticipated. However, sales taxes also underperformed the Governor’s Budget expectations by $445.8 million (-54.4%). The $1.4 billion in corporate tax receipts collected was $142.7 million lower than projected in April...

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California to Receive Additional $63 Million in SIG Grants to Turn Around Lowest-Performing Schools

May 3, 2012

U.S. Secretary of Education Arne Duncan announced on April 30 that California will receive an additional $63 million to continue the work of turning around its persistently lowest-achieving schools through the Education Department's School Improvement Grants (SIG) program.

The funds are part of $535 million provided through the fiscal year 2011 budget and made available to states under the program. To date, California has received $547.9 million since the SIG program was redesigned in 2009...

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LAO Reviews Two Decades of School District Fiscal Oversight and Intervention, Deems System "Effective"

May 3, 2012

This report provides an overview and assessment of the state's comprehensive system for monitoring the fiscal condition of school districts. Under this system, County Offices of Education review the fiscal condition of school districts at several points during the year and provide additional support for districts showing signs of fiscal distress. In the most serious case—when a district no longer appears able to meet its financial obligations—the state provides the district with an emergency loan and assumes administrative control...

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Reports Indicate State Revenues Still Lagging; Governor Estimates That State Deficit Has Grown

April 19, 2012

During the past two weeks there has been some good news and some bad news – as well as rumblings of possible troubles ahead – regarding California’s ongoing saga of budget woes.

—On April 10, State Controller John Chiang released his monthly report covering California's cash balance, receipts and disbursements in March, showing monthly revenues came in $233.5 million below (-4.2 percent) the latest estimates contained in the Governor's proposed 2012-13 Budget...

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California Budget Project Confirms Schools Have Experienced Deep Funding Cuts Since 2007-08

April 19, 2012

A new fact sheet released by the California Budget Project last week confirmed what K-12 school district financial officers already know – state funding to most school districts has declined by around $500 per pupil per year, and in some school districts, the reduction has been more than $600 per pupil per year.

The fact sheet, released on April 10, concludes that:
In response to sizeable budget shortfalls, lawmakers have repeatedly cut state spending in recent years. The Legislature reduced General Fund spending from $103.0 billion in 2007-08 to $91.6 billion in 2010-11 – a drop of 11.1 percent...

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Poll Indicates Sizeable Majority of Voters Willing to Raise Taxes if Money Goes for Education

April 4, 2012

By hefty margins, Californian voters favor raising sales taxes and taxes on wealthier citizens if they’re told the money goes to public schools, community colleges and public safety, according to the latest results from the USC Dornsife College of Letters, Arts and Sciences/Los Angeles Times Poll.

Californian voters were split on whether to tackle the state’s $9 billion budget deficit through a combination of spending cuts and tax increases, or through spending cuts alone...

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Controller Says State Revenues Stabilizing, California "Will Be Able To Pay Its Bills" For Remainder of Year

March 22, 2012

After several months of baleful warnings, State Controller John Chiang offered a somewhat less gloomy picture of California’s financial situation last week.

On March 12, State Controller John Chiang released his monthly report covering California's cash balance, receipts and disbursements in February, showing monthly revenues came in $146.3 million below (-3.2 percent) the latest projections contained in the Governor's proposed 2012-13 Budget. That shortfall was likely caused by a large increase in early tax refunds going out during the month of February...

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Brown, CFT Merge Competing Ballot Propositions; California State PTA Still Backing Munger Initiative

March 22, 2012

Governor Jerry Brown (and the California Teachers Association) struck a deal with the California Federation of Teachers last week, announcing a hybrid merger of their competing ballot propositions designed to restore state funding education. But the California State PTA is still backing lawyer/activist Molly Munger’s proposed ballot measure (“Our Children, Our Future”), so the state’s voters may still be faced with a choice between two rival measures on the November ballot.

On March 14, Brown announced the deal, with support from Assembly Speaker John A. Pérez and Senate President pro Tem Darrell Steinberg and others...

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Education Coalition Stresses Need for New Revenues, Opposes Weighted Pupil Funding Formula

March 22, 2012

The Education Coalition held a press briefing March 13 to outline its position on the state budget, highlighting the harm of March 15 layoff notices to educators, and explaining why revenues must be part of California’s budget solution.

At the press briefing, Executive Director Bob Wells of the Association of California School Administrators (ACSA) pointed out that California ranks at the bottom nationally in number of teachers, administrators, librarians and counselors per student, far behind other populous states such as New York, Florida and Texas...

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No Consensus on Competing Revenue Initiatives

Education Coalition Decries Further Cuts to Schools

March 8, 2012

The Association of California School Administrators (ACSA) and related partners in the Education Coalition have finalized a position paper on the governor’s proposed budget.

While the coalition agrees there is a desperate need for revenues for schools, there is no consensus on the various revenue initiatives now being circulated for signature gathering.

“The main topic of discussion, of course, was the state budget, but it is very difficult to discuss those issues without touching on the relationship to the proposed November initiatives,” said ACSA Executive Director Bob Wells...

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Poll Shows Two of Three Competing School Funding Initiatives Draw Support from Majority of Voters

March 1, 2012 - By Mark DiCamillo and Mervin Field – the Field Poll

Voters hold differing views about three proposed tax increase initiatives for the November general election ballot aimed at helping the state close its $9 billion budget deficit.

The initiatives – one proposed by Governor Jerry Brown, another by the California Federation of Teachers (CFT), and a third by wealthy civil rights attorney Molly Munger – each recently received their official ballot titles and descriptions and have been cleared for signature gathering by the California Secretary of State...

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LAO Says Governor's Revenue Projections Too Rosy

March 1, 2012

(Editor’s Note: On Monday, the California Legislative Analyst’s Office (LAO) released a report on the 2012-13 state budget, updating the LAO’s assessment of the state’s economic climate and anticipated revenues for the year ahead. The executive summary of the LAO’s report offers the following conclusions:)

Economic data currently is providing plenty of mixed signals to California’s policymakers, as they continue to craft state and local budgets in a constrained fiscal environment. California’s economy now is clearly improving in many important ways, including employment growth. Nevertheless, significant impediments block the state’s path to a more robust recovery from the recent, staggering economic downturn...

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120 Districts Get "Qualified" Budget Rating, Seven "Negative"

Torlakson: One Student in Three Attends a School District in Financial Jeopardy

February 23, 2012

State Superintendent of Public Instruction Tom Torlakson warned on Thursday that the latest review of school district budgets shows that one-third of public school students in California attend a district in financial jeopardy.

The state’s First Interim Status Report for fiscal year 2011-12 indicates that 127 districts are either in negative or qualified financial status, totaling 17 more than at this point last year. Combined, nearly 2 million students attend school in a district with serious financial challenges...

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"January Revenues Disappointing on Almost Every Front"

Controller Chiang's Gloomy Update – Revenues Ran $1.2 Billion Below Budget Estimates

February 23, 2012

On February 10, State Controller John Chiang released his monthly report covering California's cash balance, receipts and disbursements in January, showing monthly revenues came in $528 million below the latest projections contained in the Governor's proposed 2012-13 Budget. When compared against the 2011-12 Budget Act, January revenues were $1.2 billion below estimates.

“January revenues were disappointing on almost every front,” said Chiang. “Thankfully the decisive actions taken recently by the State to stabilize its cash flow will ensure that California can pay its bills through the end of the fiscal year.”...

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LAO Recommends Modified Version of Governor’s Proposal to Restructure K-12 Education Funding

February 23, 2012

On February 16, the California Legislative Analyst’s Office offered an assessment of the Governor’s proposal to restructure state funding for K-12 education. The LAO’s assessment was delivered at a meeting of the Senate Budget and Fiscal Review Committee, chaired by Sen. Mark Leno (D-San Francisco).

The LAO concluded that there is a consensus that the current system needs and overhaul, and offered a review of recent actions.

The LAO then offered the following bullet points summarizing the Governor’s proposal...

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LAO Sizes Up January Budget Revise, Warns Trigger Cuts Could Trim $4.8 Billion from K-12

February 9, 2012

The California Legislative Analyst’s Office (LAO) released a report on Monday assessing the impact of the Governor’s January Budget Revise on Prop. 98 funding and K-12 education. The following are highlights from the report.

Executive Summary

This report analyzes the Governor's 2012–13 Proposition 98 budget package. The report provides detailed assessments of the Governor's: (1) basic budget plan (which assumes passage of his November 2012 ballot measure to raise certain taxes temporarily), (2) major policy proposals, (3) multiyear plan to retire existing education obligations, and (4) back–up budget plan (in the event his ballot measure fails)...

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Transportation Funds Saved Through Quick Advocacy and Legislative Response

February 9, 2012

The California School Boards Association and other members of the education community say that $248 million in funding that helps get students to school has been spared from the chopping block, at least for this school year.

Responding to concerns about a $248 million cut to the state’s Home-to-School Transportation Program, triggered in December by insufficient state revenues, CSBA and other members of the Education Coalition helped move Senate Bill 81 to replace the transportation cut with an across-the-board reduction in revenue limits in the same amount. The revenue limit cut, while undesirable, was generally deemed to be more equitable. The bill was swiftly passed by the state Legislature and sent to Gov. Jerry Brown Feb. 2...

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State of the State Message

Brown Calls for Better Funding for K-12 Schools, Hints at Changes in Standardized Testing

January 26, 2012

Governor Jerry Brown’s annual “State of the State” address – delivered in Sacramento on January 18 – contained several points relating to K-12 education.

The Governor urged Californians to approve his upcoming ballot proposition (to go before voters in the November election) that would provide additional funding for education through temporary taxes. (See related story in this week’s EdBrief about the recent poll by the Public Policy Institute of California that indicates strong public support for this ballot measure.)...

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PPIC Poll Finds Strong Support for Brown Tax Plan, Opposition to More School "Trigger Cuts"

January 26, 2012

Strong majorities of Californians favor Governor Jerry Brown's proposed tax initiative and oppose the automatic cuts that public schools will face if voters fail to approve the measure in November. These are among the key findings of a statewide survey released Tuesday by the Public Policy Institute of California (PPIC), with funding from The James Irvine Foundation.

The initiative would temporarily increase the state sales tax and the personal income taxes of wealthy Californians, with the new revenue going to K–12 education. When read a summary, 72 percent of adults and 68 percent of likely voters favor the proposal...

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New Funding Formula Proposed, Many Categoricals Would Be Cut

Governor's January Budget Proposal Cuts Funding for Transitional Kindergarten, and Could Result in Shorter School Year

By Jeff Hudson - January 12, 2012

Governor Jerry Brown’s January budget proposal came out last Thursday – five days earlier than expected. The plan addresses an estimated $9.2 billion deficit in the state budget with a variety of cuts, as well as a ballot measure that would increase state revenues – if that ballot measure is approved by California voters. And the Governor’s proposal contained several items that have gotten the attention of K-12 educators. Among them:

—More “trigger cuts” possible – as well as a shorter school year. If California voters do not approve the Governor’s $6.9 billion revenue plan – to be presented in the form of a ballot proposition in the November 2012 election – the trigger includes a $4.8 billion reduction to Proposition 98 funding...

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State Funding for School Transportation Slashed

Brown Announces $1 Billion in Midyear Trigger Cuts – Including Roughly $400 Million in K-12 Reductions

By Jeff Hudson - December 15, 2011

Governor Jerry Brown announced nearly $1 billion in “trigger cuts” to California’s state budget on Tuesday – a figure that was considerably lower than the roughly $2 billion in “trigger cuts” that were forecast in a November estimate by the Legislative Analyst’s Office (LAO). Brown opted instead to go with the somewhat less gloomy December forecast by the Department of Finance (DoF). The DoF estimate reflected an additional month of tax revenue, which showed an uptick in November.

Some observers described the Governor’s announced as “bittersweet at best.” On the one hand, K-12 schools did not get hit by the $1.1 billion midyear cut to revenue limit funding (plus cuts in state support for school transportation) that the LAO had discussed, which would have forced some districts to cut their instructional year by as much as seven days...

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California State PTA Backs November 2012 Ballot Measure That Would Generate Funding for Schools

December 1, 2011

The California State PTA announced on Monday that the organization is backing a proposed November 2012 ballot measure – titled the “Our Children, Our Future: Local Schools and Early Education Act.” Proponents of the ballot measure are expected to start circulating petitions soon to qualify the measure for the ballot.

In a letter sent on Monday, California State PTA President Carol Kocivar told members and supporters that
As you may remember, our recent survey showed that “adequate school funding” is extremely important or important to 98.5 percent of you — the highest-rated issue by far.”...

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Feds Say State's Application "Incomplete"

California Left Out Again in RTTT3 Funding

December 1, 2011

For the third time in a row, California is not among the states eligible for a portion of federal Race to the Top education funding.

The U.S. Department of Education announced on Nov. 23 that seven states eligible for Race to the Top Round 3 (RTTT3) funds had submitted complete applications for a share of $200 million provided by Congress in 2010 to help drive reform. They include Arizona, Colorado, Illinois, Kentucky, Louisiana, New Jersey, and Pennsylvania.

The U.S. Department of Education also determined that nine states that were runners-up in the initial Race to the Top competition were eligible for RTTT3, but South Carolina opted out and California submitted what was described as “an incomplete application.”...

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Federal Study Finds More Than 40% of Low-Income Schools Don't Get a Fair Share of State and Local Funds

December 1, 2011

A new report released Wednesday by the U.S. Department of Education documents that schools serving low-income students are being shortchanged because school districts across the country are inequitably distributing their state and local funds.

The analysis of new data on 2008-09 school-level expenditures shows that many high-poverty schools receive less than their fair share of state and local funding, leaving students in high-poverty schools with fewer resources than schools attended by their wealthier peers...

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"Trigger Cuts" Could Hit School Bus Service

CSBA Estimates Impact of Midyear Transport Cuts

November 17, 2011

A new document from the California School Board Association’s Governmental Relations Department examines the potential impact of one major component of possible midyear state budget cuts.

The report – “Estimated Impact of Triggered Pupil Transportation Cuts on Local Education Agencies” – details the dollars that would be lost to each school district or county office of education that depends on pupil transportation apportionments if state revenues fall $2 billion short of projections, triggering midyear cuts...

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LAO Report Forecasts $2 Billion in Trigger Cuts

November 17, 2011

Last Thursday, State Controller John Chiang released his monthly report covering California's cash balance, receipts and disbursements in October, showing revenues came in $810.5 million below projections from the recently passed state budget.

“October's poor revenues capped a very disappointing first four months of the fiscal year,” said Chiang. “Unless revenues and expenditures begin to track with projections, the State will face increasing cash pressure in the months ahead.”...

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Officials Quick to React to Trigger Cuts Announcement

November 17, 2011

Here’s an overview of the initial reaction to Wednesday’s announcement by the Legislative Analyst’s Office that mid-year trigger cuts are likely for California’s state budget, with education taking another blow.

Governor Jerry Brown

“California’s budget gap is the result of a decade of poor fiscal choices and a global recession. This year, we cut the problem in half. Next year, we’ll continue to make the tough choices necessary until the problem is solved.”...

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Parcel Tax, Bond Measures Do Well in Several Districts

November 10, 2011

California voters approved most – but not all – of the school parcel tax measures and school bond measures that were on local ballots on Tuesday in various areas of the state.

Four parcel tax measures – which require a two-thirds majority for approval – got the “thumbs up” from voters in four school districts, including:

—Burlingame Elementary (San Mateo County), Measure E, $76/year for four years, 67.4 percent “yes” vote...

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LAO Praises Many Aspects of Governor's Pension Plan Proposal, But Raises Questions about CalSTRS

November 10, 2011

The California Legislative Analyst’s Office (LAO) issued a report on Tuesday evaluating Gov. Jerry Brown’s plan for changes in pension and retiree health plan offerings to public employees. While the LAO generally applauded the “bold changes” that the Governor has proposed, the LAO also raised questions about unfunded liabilities in the California State Teachers’ Retirement (CalSTRS) system.

The summary of the report said:

The Governor’s 12-point pension and retiree health plan would result in bold changes for California’s public employee retirement programs...

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"These Numbers Do Not Paint a Hopeful Picture"

State Controller Warns Recovery Appears to Have Lost Momentum, Hints Again at Trigger Cuts in December

October 20, 2011

State Controller John Chiang last week released his monthly report covering California's cash balance, receipts and disbursements in September, showing revenues came in $301.6 million below projections from the recently passed state budget.

“For better or worse, the potential for revenue shortfalls is precisely why the Governor and Legislature included trigger cuts in this year's State spending plan," said State Controller John Chiang. "September's revenues alone do not guarantee that triggers will be pulled. But as the largest revenue month before December, these numbers do not paint a hopeful picture.”...

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State Now Ranks 46th Out of 50

Study Concludes California's Per-Student Spending Lags Other States by Widest Gap in Decades

October 20, 2011

California has fallen further behind the rest of the United States with respect to spending on K-12 education over the past decade and now ranks near the bottom on several key measures, according to an analysis released last week by the California Budget Project.

A Decade of Disinvestment: California Education Spending Nears the Bottom finds that California schools spent $2,856 less per student than the rest of the U.S. in 2010-11 ($8,908 compared with $11,764) and ranks 46th – four spots from the bottom – on per-student spending. The gap between California and the rest of the nation represents more than a fourfold increase from the $691 gap in 2001-02 and is at its widest point in the past four decades...

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Stakeholder Groups and School Districts File Suit to Restore $2 Billion in Proposition 98 Education Funding

September 29, 2011

The ongoing dispute over California’s state budget entered a new phase on Wednesday, as the California School Boards Association (CSBA), the Association of California School Administrators (ACSA) and several California school districts filed a lawsuit seeking to restore more than $2 billion that had been designated for California public schools under the voter-approved Proposition 98 formula, but which was cut from the 2011-12 state budget.

“California schools and schoolchildren were shortchanged in this last budget cycle,” said CSBA President Martha Fluor...

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"Trigger Cuts" Loom in December

Stakeholders Assail 'Unworkable' Budget Bill; Propose Emergency Authority for Mid-Year Teacher Lay Offs

September 22, 2011

The California School Boards Association (CSBA) and several other education advocacy groups have asked Gov. Jerry Brown to either exempt schools from midyear funding cuts that could be triggered by a shortfall in state revenues or, failing that, to give local educational agencies one-time emergency authority to lay off teachers if the cuts occur.

In a Sept. 15 letter to the governor, CSBA President Martha Fluor and leaders from the Association of California School Administrators (ACSA), the California Association of School Business Officials (CASBO) and a number of other education organizations express “deep concerns” about the potentially devastating impacts of Assembly Bill 114...

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Attempt to Move Education Higher on Administration Agenda

Torlakson Sends Letter Urging President Obama to Protect Education Jobs, and Invest in Schools

September 8, 2011

With President Barack Obama’s agenda increasingly focusing on job creation and economic growth, State Superintendent of Public Instruction Tom Torlakson sent the President a letter on Monday urging him to protect education jobs and help rebuild California schools.

Torlakson letter appears to be an attempt to get the President to focus a little more on education. So far this year, the political focus in the nation’s capital (as well as California’s state capital of Sacramento) has gone directly from “budget, budget, budget” to “jobs, jobs, jobs.”...

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California Eligible for Up to $49 Million in STEM Grants

U.S. Department of Education Releases Proposed Requirements for Race to the Top Round Three

September 8, 2011

On Wednesday, the U.S. Department of Education released the proposed requirements for Race to the Top round three (RTT3), a $200 million grant fund to continue State-led K-12 reform. RTT3 will invite finalists from round two — Arizona, California, Colorado, Illinois, Kentucky, Louisiana, New Jersey, Pennsylvania and South Carolina — to apply for a grant that supports a portion of their previously established Race to the Top plan and includes a meaningful focus on science, technology, engineering, and mathematics (STEM) education...

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Graduating High School Seniors Could Feel Impact

CSU, Community College Chancellors Warn Trigger Cuts Could Mean 670,000 Students May Go Unserved

August 25, 2011

California Community Colleges Chancellor Jack Scott and California State University Chancellor Charles B. Reed warned during a press conference on Monday that their systems are preparing for the possibility of additional budget cuts in the middle of the academic year – and that could impact access to both systems for high school students preparing to graduate.

“The financial situation is dire and we don’t see it getting any better soon, in fact it may get worse in December if the trigger cuts are made,” said Scott, the leader of the nation’s largest community college system with more than 2.76 million students...

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December "Trigger Cuts" Could Loom for Schools

Controller Says State Revenues Running Ten Percent below Projections in Recently-Passed State Budget

August 11, 2011

State Controller John Chiang on Tuesday released his monthly report covering California's cash balance, receipts and disbursements in July, showing revenues were down $538.8 million (-10.3 percent) below projections from the recently passed state budget.

“While July's revenues performed remarkably similar to last year's, they still did not meet the budget's projections,” said Chiang. “While we hope for better news in the months ahead, every drop in revenues puts us closer to the drastic trigger cuts that could be imposed next year.”...

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Torlakson Letter Provides Overview of Impact of State Budget, Trailer Bills on K-12 Education

July 28, 2011

State Superintendent of Public Instruction Tom Torlakson issued a lengthy letter on Monday, summarizing and clarifying budget-related legislative action this year, including the “trailer bills” that accompanied the final budget package. The letter provides an overview of the outcome of this year’s long and complex budget negotiations.

* * *

Dear County and District Superintendents, Direct-Funded Charter School Administrators, and County Chief Business Officers...

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CSBA Launches Campaign to Repeal Budget Bill Weakening County Fiscal Oversight of Districts

July 14, 2011

Last week, EdBrief reported on the Legislature’s hasty late-night passage of a budget trailer bill (AB 114) that weakened fiscal oversight of school district budgets by their county office of education. Several education stakeholder groups quickly raised objections to the bill, but Gov. Jerry Brown signed it anyway, and then the Fourth of July holiday shut down news coverage of the topic for several days.

The issue, however, does not seem to be going away quietly. This week, the California School Boards Association launched a campaign to repeal AB 114...

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If Trend Continues, More Budget Reductions Could Loom

State Revenue Running Above May Projections, But Not High Enough To Avoid December "Trigger Cuts"

July 14, 2011

California State Controller John Chiang released a report on Monday indicating that California’s slowly-improving economy has resulted in state revenues that are higher than anticipated under Gov. Brown’s May Budget Revision. But state revenues are still running several hundred million dollars lower than the level needed to avoid mid-December “trigger cuts” to education and other programs under the new state budget approved by the Legislature and signed by the Governor in late June.

Monday’s statement from the Controller’s office offered this analysis...

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In Wake of New State Budget, CSU Quickly Hikes Tuition 12 Percent, UC Ponders 9.6 Percent Increase

July 14, 2011

Last week, EdBrief reported on a new study that found the rising cost of community college is putting that option out of reach for many of California’s lower-income students.

This week, more doors closed for some prospective college students from lower-income backgrounds. On Tuesday, the California State University board of trustees responded to the recently-adopted state budget by raising tuition by 12 percent.  And the University of California Board of Regents is expected to approve a 9.6 percent tuition increase on Thursday...

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Legislation Weakens Financial Oversight by County Office

Some Stakeholder Groups Object to Last-Minute Budget Trailer Bill, Gov. Brown Signs It Anyway

By Jeff Hudson - July 7, 2011

A last minute fracas over a budget “trailer bill” prompted several of the state’s education stakeholder groups to urge Gov. Jerry Brown to veto the measure.  But Brown went ahead and signed the trailer bill anyway, issuing a piquantly-worded statement that took one last jab at legislative Republicans.

The brief controversy ignited on the afternoon of Wednesday, June 29, as education stakeholder groups sized up the contents of AB 114 – a last-minute, 100-plus page trailer bill that the Legislature had pushed through without debate on the evening of June 28, as part of the new state budget package...

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Governor Brown Drops Insistence on Tax Extensions This Year

Democrats Push Through Budget Deal – Schools Get More Deferrals, and Midyear "Trigger Cuts" Loom

By Jeff Hudson - June 29, 2011

California’s longstanding budget stalemate came to a swift conclusion this week. On Monday afternoon, Gov. Jerry Brown and the two Democratic legislative leaders, Senate President pro Tem Darrell Steinberg (D-Sacramento) and Assembly Speaker John Pérez – held a “press availability” webcast, announcing they had agreed on a budget bill that the Legislature could approve on a party-line vote . . . one which Gov. Brown (who had vetoed a previous Democratic budget bill two weeks earlier) was willing to sign.

The California Assembly and California Senate voted through the budget bills on Tuesday evening with a simple majority of Democratic votes, with no Republican legislators backing the plan. Gov. Brown is expected to sign the bills on Wednesday or Thursday...

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Recently Formed Twin Rivers District Survives "Perfect Storm" By Implementing Budget Flexibility to the Max

By Jeff Hudson - June 29, 2011

(Third in a series)

In late May, the RAND Corporation released a preliminary report, “Deregulating School Aid in California - How Local Educators Allocate Flexible Tier 3 Categorical Funds: Findings from 10 School Districts in the First Implementation Year, 2009-2010.”

After examining the situation in ten school districts, the report concluded that California school districts – wielding new fiscal flexibility granted by state lawmakers – had cut deeply into several popular programs to balance local budgets, due to financial hardship brought on by the state budget crisis...

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State Funding Flexibility

San Mateo Superintendent Manages Gradual Cuts in District Where Private Sector Economy is Booming

By Jeff Hudson - June 23, 2011

(Part Two in a series)

In late May, the RAND Corporation released a preliminary report, “Deregulating School Aid in California - How Local Educators Allocate Flexible Tier 3 Categorical Funds: Findings from 10 School Districts in the First Implementation Year, 2009-2010.”

After examining the situation in ten school districts, the report concluded that California school districts – wielding new fiscal flexibility granted by state lawmakers – had cut deeply into several popular programs to balance local budgets, due to financial hardship brought on by the state budget crisis...

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Chiang Also Cites Inadequate Funding for Education

State Controller Withholds Legislators Pay, Saying Last Week's Vetoed State Budget Did Not Balance

By Jeff Hudson - June 23, 2011

State Controller John Chiang ruled this week that last week’s state budget – approved by a simple majority by legislative Democrats on a party-line vote, and then vetoed the following by Gov. Jerry Brown (a fellow Democrat) – did not meet the requirements of Proposition 25, a measure approved by voters last year requiring a balanced budget be adopted by the Legislature by June 15.

Chiang responded by invoking another provision of Proposition 25, and ruling that legislators will now go without pay until a balanced budget is approved...

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Lawmakers, Governor Still Seeking Alternatives

Democrats Approve Unpopular Budget on Party Line Vote; Brown Vetoes Bill, Asks Again for Tax Extensions

By Jeff Hudson - June 16, 2011

The California Legislature pushed through a budget on party-line votes on Wednesday – and Gov. Jerry Brown promptly vetoed the bill on Thursday morning.

In a terse message released shortly before 11 a.m., Brown said:

I am returning Senate Bill 69 and Assembly Bill 98 without my signature.

In January, I presented a balanced budget solution with a mix of deep spending cuts and temporary tax extensions subject to voter approval. My plan would put these extended revenues in a lockbox, ensuring that they are only used to protect education and public safety...

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Updated CDE List Shows 130 Districts Now Have "Qualified" Budget Status, 13 Have "Negative" Status

June 16, 2011

As the California Legislature pushed through a state budget bill on Wednesday that included some $3 billion in budget deferrals for K-14 education, the California Department of Education (CDE) quietly posted an updated list of districts with “Qualified” or “Negative” budget status, meaning they may face challenges meeting their financial obligations during the next three years, after a budgetary review by their county office of education.

The updated list, covering the 2010-11 Second Interim reporting period, shows 130 districts with “Qualified” status, and 13 districts with “Negative” status. This reflects an uptick of six more districts with a “Qualified” status when an earlier version of the Second Interim list was posted in early May...

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Budget Negotiations in Sacramento Continue

Legislators Face "No Budget, No Paycheck" Prospect If There's No Deal by June 15 Deadline

By Jeff Hudson - June 9, 2011

Will this be the week that Democrats and Republicans in Sacramento finally hammer out a deal on a new state budget? Or will the process drag out into late June, July, August, or even September?

As of Thursday morning, it was still too soon to say. But several factors point toward the possibility of an agreement sooner rather than later.

The constitutional deadline for the Legislature to adopt a budget is June 15 – just a few days hence. And there is a new incentive for California’s legislators (who have routinely ignored the constitutional deadline in past years) to get the job done by next Wednesday...

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California Budget Project Issues a List Detailing District Budget Cuts Due to State Budget Crisis

June 9, 2011

The non-profit California Budget Project issued a report on Tuesday that detailed reductions in funding on a district-by-district basis.

According to the report:

In response to sizeable budget shortfalls, lawmakers have repeatedly cut state spending in recent years. The Legislature reduced General Fund spending from $103.0 billion in 2007-08 to $87.3 billion in 2009-10 – a drop of 15.3 percent – as policymakers responded to the dramatic decline in revenues caused by the most severe economic downturn since the 1930s. In 2010-11, General Fund spending is estimated to be lower as a share of the state’s economy than in 33 of the prior 40 years, and expenditures will be lower under the spending plan approved by the Legislature in March...

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District CBO Offers Feedback to the Recent RAND Report

"Without Flexibility, There's No Way My District Could Have Stayed Alive Fiscally and Programmatically"

By Jeff Hudson - June 9, 2011

(Part One in a series)

In late May, the RAND Corporation released a preliminary report, “Deregulating School Aid in California - How Local Educators Allocate Flexible Tier 3 Categorical Funds: Findings from 10 School Districts in the First Implementation Year, 2009-2010.”

After examining the situation in ten school districts, the report concluded that California school districts – wielding new fiscal flexibility granted by state lawmakers – had cut deeply into several popular programs to balance local budgets, due to financial hardship brought on by the state budget crisis...

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Advice for Budget Planners

We Have the May Revise….What Do We Do Now?

By Kari Sousa - May 26, 2011

Long gone are the days of using the May Revise to make final adjustments to our school district budgets before the June adoption.  Even though this year’s May Revise contains largely the same proposals the Governor presented in January, a state budget deal remains far from done – and school districts are left wondering what to do next.

While the Governor would like you to plan your district budgets around the optimistic picture presented in his May Revision, the amount of uncertainty surrounding this proposal, as well as the severity of the budget alternatives if the proposed tax extension does not pass, are too much for many districts and County Offices of Education to ignore...

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Veteran ACSA Expert Sizes Up May Budget Revision

By Adonai Mack - May 2011

Last week, Governor Brown released the 2011-12 May Budget Revision. The Governor addressed his plan to close the remainder of the state’s $25 billion budget deficit estimated to be approximately $12 billion. The Governor continued with a similar theme initiated in the January Budget Proposal; a budget proposal balanced with expenditure reductions and revenues while prioritizing public education and public safety. The following is ACSA’s analysis of the May Revision and the next steps necessary for the Legislature to pass a balanced budget.

What is the May Revision?

Historically, the May Revision is an update to the Governor’s January Budget Proposal. The document is an annual event that marks the “real” start of the budget development process because it contains up-to-date revenue projections that include April tax receipts...

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LAO Finds May Revise Mostly "Reasonable," Warns Rebenching Prop. 98 "Raises Many Dicey Issues"

May 26, 2011

(Editor’s Note: Last Thursday, the California Legislative Analyst’s Office (LAO) released a lengthy analysis of the Governor’s May Budget Revision, which had been announced earlier that week. Here are the highlights of the LAO’s report relating to K-12 education.)


Significantly improved General Fund revenue trends since January and over $13 billion of budget actions already approved by the Legislature have reduced the size of the budget gap still to be addressed by California’s elected leaders. The administration identifies a $9.6 billion remaining budget problem based on generally reasonable 2010-11 and 2011-12 revenue and expenditure assumptions...

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Governor Releases Long-Awaited May Budget Revise; Educators See Proposal as Good News (Mostly)

By Jeff Hudson - May 19, 2011

Governor Jerry Brown finally released his May Budget Revision on Monday. And as many observers had anticipated, the Governor’s proposal met with general approval from many of the state’s education leaders (though they also found elements of the plan they didn’t like).

There was also quick criticism from Republican legislative leaders, who said they can’t support any plan that involves tax extensions, which are part of the Governor’s May package.

The Governor’s proposal came on the heels of an announcement by State Controller John Chiang that revenues to state government were a little higher than projected for April...

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Budget Analysis

With Governor's May Revision, School Districts Now Find Themselves "Quantifying the Unknowable"

By Bob Blattner - May 19, 2011

As we did several months ago, before $6.6 billion in unexpected revenue to state government rode in to rescue (we hope) California schools from a fiscal blood bath, we will try once again to quantify the possible revenue alternatives that school district decision-makers will be facing in the coming weeks, now that the Governor has announced his May Budget Revision.

We will also share our thoughts on the probabilities for each of these alternatives actually coming to pass, as well our suggestions as to which course prudent districts should pursue.

Keep in mind: Russian Roulette has a five in six chance – better than 83% – of a benign outcome...

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CTA President Voluntarily Arrested

Thousands Rally at Capitol to Protest Education Cuts

May 19, 2011

Education stakeholder groups pressed their case in Sacramento last week, with daily rallies designed to put pressure on California legislators, urging them to approve limited extensions of three existing taxes, rather than make further reductions in state funding for California’s public schools.

In an attempt to create “visuals” that would drive home the contention that tens of thousands of teachers and other school employees have lost their jobs as a result of reduced state funding, some 400 folding chairs (with the number “100” taped on each chair) were arranged on the lawn outside the State Capitol...

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Republicans Release State Budget Proposal, which Democrats and Educators Quickly Criticize

May 19, 2011

In a move that appears to have been timed to draw attention away from last week’s series of rallies at the State Capitol by educators, and Monday’s release of the May Budget Revise by Governor Jerry Brown, legislative Republicans put forward their own budget proposal last Thursday.

It has been on relatively few occasions in recent years that legislative Republicans have put forward their own detailed state budget proposal. As expected, the plan called for no new taxes – a sharp contrast to the budget plans being promoted by Democrats, who are calling for an extension of three taxes that are about to expire, as an alternative to further funding cuts to education...

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Rallies Held around State to Protest Cuts to Education

May 12, 2011

The California Teachers Association (CTA) and other stakeholder groups made a splash in the state capitol this week, with demonstrations and speeches aimed at pressuring the state legislature to approve short-term tax extensions that would prevent the layoff of more teachers.

More than 300 CTA members and supporters marched around the state Capitol to drive home to lawmakers and the governor the fact that schools have suffered more than $20 billion in cuts.

The CTA also put that message on a large, highly visible billboard next to eastbound Interstate 80 in West Sacramento...

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All Would Have Been Approved If 55 Percent Were Threshold

Voters Approve Nine Parcel Tax Measures, Four Fail

By Jeff Hudson - May 5, 2011

Thirteen local school parcel tax measures went before Northern California voters in vote-by-mail elections that concluded on Tuesday.

And of those 13 efforts, nine school parcel tax proposals were approved, while four came up short of the required two-thirds majority for passage.

There are several lessons to be learned by other school districts contemplating a local parcel tax in their area...

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EdSource Releases Two-Page Summary of Fiscal Crisis and "All-Cuts" Budget Designed for Community Groups

May 5, 2011

EdSource, the non-partisan, nonprofit research organization based in Sacramento, has released a two-page summary titled “California’s Budget Crisis: What Does It Mean for Schools.” The document is designed for use with local community groups and their leaders.

This EdSource Q&A provides clear, accurate answers to some of the most common questions about the current state of education funding in California and what the state's fiscal crisis means for schools.

School districts and other education stakeholders can share this brief with their communities and cite it in addressing questions about the potential impact of an all-cuts budget on our public schools...

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"All-Cuts" Budget Would Reduce Funding for Public Schools By Approximately $764 per Student

May 5, 2011

How would an "all-cuts" budget affect California's public schools?

In February, the Legislative Analyst's Office outlined a path for closing the state's $26.6 billion budget shortfall that included a $4.6 billion reduction to public school funding – a cut of approximately $764 per student.

Two new California Budget Project fact sheets, released last week, outline the local impact of an "all-cuts" budget on schools, by district and county...

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Budget Emergency Called for Education, Schools Urged to Hold Events Prior to May Budget Revise

May 5, 2011

As California educators prepare for the Governor’s release of his May Budget Revision in mid-month, the Association of California School Administrator is urging school leaders to prepare themselves for a variety of outcomes.

ACSA is encouraging school leaders to express outrage and concern over any possible budget reductions for public education. This is a time for action and advocacy.

To this end, ACSA is joining forces with other education, labor and community groups to declare a Public School State of Emergency...

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Less than 30 Percent of Voters Want 'All-Cuts' Budget

Poll Shows Support for Budget Solution Including Both Spending Cuts and Tax Increases

April 28, 2011

A majority of California voters support an approach to solving the budget crisis that combines spending cuts and tax increases — and they want to vote on it, according to the latest USC Dornsife College of Letters, Arts and Sciences/Los Angeles Times Poll, released earlier this week.

Of the more than 1,500 voters surveyed by the poll in April, 53 percent favor a combination approach to the budget crisis that includes both spending cuts and tax increases. This includes 60 percent of Democratic voters, 42 percent of Republican voters and 56 percent of voters registered “decline-to-state.”...

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Majorities Favor Special Election on Brown's Package

PPIC Poll Finds Most Californians Support Income Tax Hike — But Only for State's Wealthiest

April 28, 2011

Most Californians are very concerned that the state’s budget deficit will result in cuts to public schools, the area of the budget they most want to protect, according to a statewide survey released Wednesday by the Public Policy Institute of California (PPIC).

To maintain current funding for K–12 education, a strong majority favor raising income taxes for the wealthiest Californians, but most oppose raising the state sales tax or personal income taxes overall.

With California leaders at a standoff over how to fill the state’s $26 billion budget gap, strong majorities of Californians (68%), likely voters (65%), and public school parents (74%) say the quality of K–12 education will suffer if cuts are made...

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CTA Leader, Speaker Pérez Cooling on Statewide Ballot Measure in Fall, Now Seek Legislative Budget Solution

By Jeff Hudson - April 14, 2011

Two major participants in the ongoing tussle over the state budget repositioned themselves on Tuesday – even as Governor Jerry Brown was speaking up and down the state, trying to drum up support for a statewide ballot measure sometime in the fall that would be designed to extend certain sales and income taxes.  Most political observers agree that it’s now much too late to schedule such a ballot measure for the month of June, which had been Brown’s original goal.

David Sanchez, the outgoing president of the California Teacher’s Association, told the San Francisco Chronicle “If the Governor were to propose an election say in September or November, it no longer becomes a question of extending the current taxes...

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Dysfunctional Budget Talks Drag On in Sacramento and Washington, as Federal Government Faces Shutdown

By Jeff Hudson - April 7, 2011

California educators witness the unhappy spectacle of dysfunctional budget negotiations in both Sacramento and the nation’s capital this week, as the partisan deadlock over the state and federal budgets played out for yet another week – with the federal government teetering on the edge of a shutdown if some kind of agreement isn’t reached by Friday.

In Sacramento, Gov. Jerry Brown continued to seek a deal that would put a set of tax extensions before California voters, as an alternative to an “all cuts budget” that would include more reductions for K-12 and higher education...

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Brown, Republicans Break Off Budget Negotiations

April 1, 2011

Gov. Jerry Brown and legislative Republicans have given up on budget negotiations, and Brown appears headed toward placing his long-sought after statewide ballot proposition extending sales and income taxes on the November ballot via the petition process.

The negotiations soured last Friday, when Senate Republican leader Bob Dutton of Rancho Cucamonga presented the Governor with a list of items he felt were necessary before Republicans could support the Governor’s statewide proposition in the legislature. “We made the presentation to the governor as far as what we felt was necessary to restore California and help create jobs," Dutton said after a meeting with the Governor...

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Hope Fades for June Proposition to Prevent Further Education Cuts, Brown Ponders November Election

By Jeff Hudson - March 24, 2011

With no budget deal in sight between Gov. Brown and legislative Republicans, and with the 88-day window for scheduling a statewide proposition extending certain sales and income taxes for an election in June, there was widespread speculation in Sacramento this week that Brown and legislative Democrats are now turning their attention to “Plan B” – which may involve launching a petition drive to place a statewide proposition before voters in November.

But a November ballot proposition, even if it is ultimately approved, will almost certainly come several months too late for many of the nearly 19,000 California teachers who received preliminary layoff notices by the state-mandated March 15 deadline...

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13 Districts Get "Negative" Rating, 97 More "Qualified"

Torlakson: Nearly Two Million California Students Attend Financially Troubled Districts

March 24, 2011

Nearly 2 million students — roughly 30 percent of pupils in California — now attend school in a district facing serious financial jeopardy, State Superintendent of Public Instruction Tom Torlakson announced on Monday.

“The emergency confronting California's schools is widening and deepening," Torlakson said. "As disturbing as these numbers are, unless the Legislature moves to place the Governor's tax extension plan on the ballot, they are just the tip of the financial iceberg facing school districts up and down the state.”...

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Legislature Votes on Budget Cuts, Fate of Tax Extensions Unclear

By Vernon Billy and Jeff Hudson - March 17, 2011

Predictions from Democratic legislative leaders that the Assembly and the Senate would get a floor vote on a new state budget on Wednesday proved overly optimistic. With negotiations still underway with a handful of Republican legislators, any final vote on the full budget and potential revenue measures will have to wait.

Legislators did advance those portions of the Governor’s budget that enjoy bipartisan support – the Governor’s proposed program cuts...

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Superintendent to Gauge Impact of $4.5 Billion in School Cuts

Torlakson Warns Districts to "Plan for the Worst," Asks Districts to Share Details on Pink Slips

March 17, 2011

State Superintendent of Public Instruction Tom Torlakson advised school districts last week that they need to plan for the worst, and took steps to tally the impacts on California schools if the state's temporary taxes expire July 1.

"Californians cherish their schools," Torlakson said. "Before we miss the chance to help our state's 6.2 million schoolchildren weather this financial emergency, people have a right to know the consequences."...

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Governor's 60-Day Budget Deadline Arrives – Brown Extends Negotiations

By Sean P. Farrell and Jeff Hudson - March 10, 2011

It appears that Gov. Jerry Brown’s self-declared 60-day deadline for adoption of a new stage budget will come and go without much action as  the Governor announced he needs more time for negotiations to reach a budget agreement.

In a statement released by the Governor’s Press Office at the end of the day on Wednesday, press secretary Gil Duran said “Governor Brown has continued to engage in positive and productive budget discussions with legislators on both sides of the aisle. For this reason, he has asked the Pro Tem (of the California Senate, Darrell Steinberg) and the Speaker (of the California Assembly, John Pérez) to temporarily delay any vote on the budget in order to allow more time to find common ground and to put the state’s finances back in balance.”...

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Pointers for Answering Community Questions about March Layoff Notices, Budget Uncertainty

By Dr. Barry Schimmel - March 3, 2011

California School Finance and Personnel Law have never been aligned.

Certificated personnel, teachers, and administrators must be sent initial layoff notices by March 15th, before the school district’s actual income for the following year is known or real.

Some of the facts to consider:

  1. Income for schools varies from year to year
  2. Schools are dependent upon the legislature to act
  3. The legislature is dependent upon state income...

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The Budget Proposal Slowly Marches Onward

By Vernon Billy and Sean P. Farrell - February 24, 2011

Governor Brown’s budget proposal continued to advance through legislative committees during the past week – but a new group of Republican legislators also renewed their pledge to oppose any tax increase, unless there is a corresponding tax decrease in some other area of the budget.

This past Friday, the Senate and Assembly budget committees adopted their versions of the 2011-12 budget. On Wednesday, February 23, a two-house conference committee met to craft the semi-final version of the budget...

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Legislative Analyst's Office Gives Clues to Future of K-12 Categorical Funding, Flexibility and Deferrals

By Kari Sousa - February 17, 2011

In the Fall of 2010, the Legislative Analyst’s Office (LAO) surveyed local school districts regarding the impact of various methods of budget stabilization, including federal stimulus funds, funding deferrals and categorical flexibility.  Responses from 382 out of the approximately 1,000 school districts in California were used by the LAO to formulate recommendations in a February 7 report to the Assembly Budget Subcommittee on the future of these temporary budget stabilization measures during difficult budget negotiations...

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Just the Cuts

LAO Says Education Could Lose $4.1B This Year Alone

By Sean P. Farrell - February 17, 2011

In response to a request from Senator Mark Leno (D- San Francisco), the Legislative Analyst's Office (LAO) released an example this week of what the budget could look like if the Governor's tax increases and extensions were rejected by the legislature or the California voters.

The focus of the non-partisan agency's plan was the $13.5 billion hole left remaining in the deficit by the exclusion of the tax contingencies. Since the Governor made efforts to reduce funding in every other area aside from education, the LAO saw education as the most logical place to start...

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Obama Proposes Increase in Support for K-12 Schools

February 17, 2011

On Tuesday, President Obama proposed a 2012 Department of Education budget that would – if approved – increase overall federal spending for K-12 public schools, as well as making cuts in some education programs.

The Obama Administration proposal came during a year when the federal government is cutting funds in many areas.  “These are very tough choices but with rising demand, we have to stretch our dollars as far as possible and do more with less,” Duncan said...

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One Budget? Two Budgets or More… That’s the Question

By Tahir Ahad and Kari Sousa - February 10, 2011

The uncertainty surrounding the proposed state budget is unprecedented for several reasons, including, most importantly, half of Governor Brown’s budget balancing solutions that hinge upon the extension of $12 billion in taxes to be voted upon in a June special election.    Not only does this special election have critical funding implications for K-12 schools, but it will also serve as a litmus test for the strength of voter confidence in the Governor, voter confidence in economic recovery, voter support for K-12 education, and the strength and influence of the educational lobby...

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LAO Releases Survey on District Budgets and Deferrals, Recommends More Fiscal Flexibility in Short Term

February 10, 2011

On Monday, the California Legislative Analyst’s Office (LAO) released a survey of school districts regarding their reductions in state funding, budget flexibility, and deferrals of payments by the state.

According to the report’s Executive Summary:

Since 2007–08, state support for K–12 education has dropped notably. The reduction in state funding, however, has been partly offset by one–time federal aid and state K–12 payment deferrals...

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California Treasurer Shares a Few Choice Words

Lockyer Warns of IOUs, Decries "Gingrich Kool-Aid"

January 27, 2011

California Treasurer Bill Lockyer, who likes to contribute pithy observations to the public debate during times of budget crisis, came forward with two observations during the past week.

On Saturday, Lockyer said that California could be forced to once again issue IOUs – perhaps as early as April or May – if legislators in Sacramento don't make deep cuts in state spending soon...

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Heavy Cash Burden Placed On School Districts

LAO Analyzes Effects of K–12 Payment Deferrals

January 27, 2011

The Legislative Analyst’s Office in Sacramento released a report on Monday with an analysis of the effects of K-12 payment deferrals on California school districts.

In the introduction, the report says “Over the last several years, the state has deferred payments to school districts as a way to achieve significant Proposition 98 savings. Since 2007–08, forty-two percent of the K–12 Proposition 98 solution has come from deferrals (with almost 46 percent coming from program reductions and 12 percent from funding swaps)...

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New Governor's Budget Proposal

Governor Brown's Education Budget; Sacramento Leaders and Advocates Weigh In

By Jeff Hudson - January 13, 2011

Governor Jerry Brown released his much-anticipated budget proposal on Monday – a plan that would slash spending by $12.5 billion, including an eight to 10 percent cut in take-home pay for most state employees, and proposes a “vast and historic” restructuring of government operations.

Brown’s budget proposes total spending of $127.4 billion for the 2011-12 fiscal year. Of this amount, proposed General Fund spending is $84.6 billion...

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LAO Calls Brown Budget "A Good Starting Point"

January 13, 2011

California’s nonpartisan Legislative Analyst’s office released a report on Wednesday examining the proposed Brown Administration budget. The following are some of the LAO’s major conclusions:

–Governor’s Proposal Is a Good Starting Point. The state faces another huge budget deficit. In light of this dire circumstance, the Governor’s proposal includes reductions in nearly every area of the state budget and a package of revenue proposals that merit serious legislative consideration...

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Torlakson Declares "Financial Emergency" in Schools

January 13, 2011

State Superintendent of Public Instruction Tom Torlakson declared a state of financial emergency in California’s schools last Thursday, launching a department-wide review and urging Californians to come to the aid of schools across the state.

“There’s simply no other way to describe it: this is an emergency,” Torlakson said. “Every day, teachers, school employees, and principals are performing miracles, but the $18 billion in cuts over the last three years are taking their toll...

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"Fasten Your Seat Belts"

Incoming Gov. Jerry Brown Warns of Further Reduction to State's K-12 Education Funding

By Jeff Hudson - December 16, 2010

Warning that the state budget deficit is “worse than I expected,” incoming Gov. Jerry Brown warned educators on Tuesday that further cuts in state funding for K-12 education are basically inevitable.

"I can't promise you there won't be more cuts, because there will be," Brown told an audience of some 200 educators at a “budget forum” gathering he convened at UCLA...

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Schwarzenegger Releases New Budget Plan, Gov-Elect Brown Replies with His Own Budget Summit

By Jeff Hudson - December 9, 2010

Outgoing Governor Arnold Schwarzenegger made one last try at overhauling California’s budget on Monday, calling a special session of the legislature and releasing a new budget proposal, even though he has only a few weeks remaining in his term.

Not to be outdone, incoming Governor Jerry Brown held a high profile “budget summit” in Sacramento on Wednesday.  The event did not yield a great deal in the way of substance – the reality is that Brown can’t really do anything until he is sworn in during the first few days of January...

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Dueling Budget Studies Offer Very Different Conclusions on Education Funding

December 9, 2010

As the discussion of California’s perennially debt-ridden state budget once again moved to the front burner in Sacramento, two reports on the topic of state funding for the K-12 public schools were released early this week – with each painting a very different picture of the financial condition of state government.

The California Chamber of Commerce released a voluminous 231-page document prepared by Pepperdine University’s School of Public Policy...

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Natomas Unified Headed For State Takeover

December 9, 2010

Another financially troubled California school district appears to be headed for a state takeover.

Last week, the Natomas Unified School District in Sacramento County missed a deadline for demonstrating that the district has a concrete plan for dealing with a $8.9 million deficit.

Sacramento County Superintendent of Schools Dave Gordon met with the state's Fiscal Crisis Management Team to negotiate the details of state receivership...

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Fiscal Outlook Report Released

LAO Projects Another $2 Billion Drop in Proposition 98 Minimum Guarantee for 2011-2012, Followed By Rebound

November 11, 2010

State budgeting for K–14 education is governed largely by Proposition 98, passed by the voters in 1988. The measure, later modified by Proposition 111 in 1990, establishes a minimum funding requirement, commonly referred to as the “minimum guarantee,” for K–14 education. Both state General Fund and local property tax revenues apply toward meeting the minimum guarantee. Proposition 98 monies support child care, preschool, K–12 education, and the California Community Colleges — accounting for about 70 percent of total funding for these programs...

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CSBA Files Lawsuit against Governor over Suspension, Veto of Mental Health Services Funds

November 11, 2010

The California School Boards Association (CSBA) and its Education Legal Alliance, in collaboration with the Los Angeles Unified School District and Manhattan Beach Unified School District filed a lawsuit on Tuesday requesting the Governor’s “suspension” of mandated mental health services by county offices of mental health (AB 3632 requirements) and veto of funding for that mandate be declared void and set aside...

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The Bill is Signed, and the Ink is Dry . . . But the Budget Maneuvering Continues in Sacramento

By Jeff Hudson - October 21, 2010

The budget deal is done – but as ever, the maneuvering continued in Sacramento this week.

Outgoing State Superintendent of Public Instruction Jack O’Connell held a news conference on Monday to decry outgoing Governor Arnold Schwarzenegger’s veto of nearly $7 million in funding for the California Department of Education’s CALPADS education data system...

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September Report from State Controller

Cash Outlook for State Government Steadies, No New IOUs Planned . . . For the Time Being

September 16, 2010

State Controller John Chiang released his monthly report covering California’s cash balance, receipts and disbursements in August. The month brought welcome news for California’s ability to continue to meet its payment obligations in the near term, with revenues rising above the Governor’s May Revision estimates by $264.6 million, or 3.9 percent.

Total disbursements for the fiscal year were also running behind projections...

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O'Connell Says Budget Stalemate Causing State-Funded Child Care Centers to Close

September 16, 2010

State Superintendent of Public Instruction Jack O'Connell said on Wednesday that state-funded child care centers, already burdened by severe cutbacks over the past few years, are now bearing the brunt of the current state budget stalemate.

“Because of the state budget impasse, child care centers that rely on state funding can’t pay their bills, and are being forced to lay off workers, or even close their doors,” said O’Connell...

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Logjam Could Be Breaking

Federal Education Jobs Fund Bill Finally Advancing to Governor’s Desk for Signature

September 9, 2010

State Superintendent of Public Instruction Jack O'Connell released preliminary calculations last week estimating how much local educational agencies would receive under the federal Education Jobs Fund. Senate Bill (SB) 847, coauthored by Senate President pro Tempore Darrell Steinberg and Assembly Speaker John A. Pérez, and approved by the Legislature in the last night of session. It authorizes the California Department of Education (CDE) to disburse the funds...

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Five Key Points to Remember as You Revise Your Budget

New Federal Education Jobs Fund Represents Fiscal Opportunities – and Management Challenges

By Brett W. McFadden - August 26, 2010

The recent passage of the federal Education Jobs Fund bill came as a surprise for most education leaders.  Based on information provided by state officials, California now stands to receive more than $1.2 billion in one-time federal funds under this legislation.  And the funding for local school districts could arrive soon.  If the process goes as smoothly as it did when the federal government released the State Fiscal Stabilization Fund (SFSF) dollars, school districts could start to receive money under the Education Jobs Fund bill in six to eight weeks...

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Faced With State Cash Shortage, Chiang and Lockyer Defer $2.5 Billion for K-12 Education

By Jeff Hudson - August 26, 2010

Faced with a looming cash shortage in Sacramento because there is still no state budget, State Controller John Chiang and State Treasurer Bill Lockyer moved on Monday to impose deferrals of $2.5 billion in funding for K-12 education in California.

The deferrals had originally been an option in October. Now, the deferral will be fast-tracked to September instead.

The move does not come as a complete surprise to many California school districts, who are by now all too familiar with the state’s ability to postpone payments...

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RTTT Phase 2 Grants Go Mostly to Eastern States – California Out of the Running Again

August 26, 2010

The federal Department of Education awarded 10 grants totaling around $3.4 billion on Tuesday in the Race to the Top Phase 2 competition.

And once again, California’s application failed to attract any Race to the Top funding.  (California also came up empty in the first round of Race to the Top earlier this year.)

“I am deeply disappointed that our application was not chosen as a winner in the Race to the Top competition,” said State Superintendent of Public Instruction Jack O’Connell...

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More Than $487 Million in Additional Federal Recovery Funds Available to California

August 19, 2010

The federal Department of Education announced on Tuesday that an additional $487,549,876 is now available for California under the American Recovery and Reinvestment Act (ARRA) of 2009. To date, California has received $10,849,634,034 through the ARRA. The state recently reported that recovery dollars have been used to provide funding for more than 47,000 education jobs from April 1 to June 30, 2010, while also supporting programs that drive education reform.

California had applied for the additional ARRA funds, which involved forwarding data about teachers and principals (and other information) to the federal government...

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Steinberg: $1.2 Billion from Federal Education Jobs Bill Could Become Part of New State Budget Deal

August 19, 2010

Last week, State Superintendent of Public Instruction hailed the signing of the federal Education Jobs Bill, saying the legislation would bring $1.2 billion to California to help retain laid-off teachers and blunt the impact of state budget cuts.

This week, Darrell Steinberg, California’s Senate President pro Tem, hinted that the $1.2 billion in one-time federal money from the Education Jobs Bill could contribute to a resolution of the long stalemate between Democrats, Republicans, and Gov. Arnold Schwarzenegger over the state budget...

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California Selected as a Finalist in Phase 2 of the Federal Race To The Top Competition

July 29, 2010

State Superintendent of Public Instruction Jack O’Connell on Monday enthusiastically greeted California’s selection as one of 19 states that will be finalists in the competition to receive up to $700 million as part of Phase 2 of the federal Race to the Top (RTTT) competition.

“I am thrilled that our efforts to push for even more progress in improving public education were recognized by the U.S. Department of Education,” O’Connell said. “California remains in the running for the Race to the Top competition. We now will prepare to present our reform plan before reviewers in Washington...

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Second Phase of Funding Coming After State Budget Passes

O'Connell Announces Awards of $34 Million in Federal Ed Tech Grants to School Districts

July 22, 2010

State Superintendent of Public Instruction Jack O'Connell announced last Friday that the California Department of Education (CDE) is awarding $34 million in federal Enhancing Education Through Technology (EETT) funding to 1,062 local educational agencies in the state. The list of school districts being notified of the award is posted online at Funding Results: ARRA Title II, Part D, Enhancing Education Through Technology (Formula).

“In this high-tech age, teachers need the right tools to help prepare students for success in our competitive, global economy,” said O'Connell...

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Multiple Scenarios Needed Since State Budget Still Unclear

Preparing for This Year's 45-day Budget Revise

By Brett McFadden and Helen Bellonzi - July 15, 2010

Before modern weather forecasting, ancient mariners would post lookouts to keep a “weather eye” on the horizon to prepare for bad conditions in their path.   In much the same fashion, education leaders up and down the state are keeping  a close eye on what might happen in Sacramento this summer, or (as some predict) early fall, in regards to the final 2010-11 state budget.

After two of the most challenging fiscal years in history, school districts and county offices are faced with the likelihood of additional budget reductions once the state eventually enacts its 2010-11 budget...

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160 District Budgets "Qualified," 14 More Rated "Negative"

O'Connell Warns "Alarming" Number of School Districts Facing Budgetary Distress

By Jeff Hudson - July 1, 2010

State Superintendent of Public Instruction Jack O'Connell said on Tuesday that the number of school districts that may be unable to meet future financial obligations because of the continuing state budget crisis and inadequate funding for public education has increased by 38 percent since the beginning of the year.

“We are seeing an alarming spike in the number of school districts that are having trouble meeting their financial obligations,” said O'Connell...

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Schools Targeted for Turnaround Can Apply in July

Feds Award $416 Million to California to Turn Around Persistently Lowest-Achieving Schools

June 24, 2010

State Superintendent of Public Instruction Jack O’Connell announced on Thursday afternoon that California was awarded nearly $416 million through the School Improvement Grants (SIG) program from the U.S. Department of Education.

“I am very grateful to President Obama and U.S. Education Secretary Arne Duncan for making this critical funding available for California’s persistently lowest-achieving schools,” said O’Connell...

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Budget Tracker Says Education Gets the Short End of the Stick – and He Has Numbers That Back Up His Case

By Jeff Hudson - June 24, 2010

Michael Hulsizer, a longtime representative of the Kern County Office of Education in Sacramento, is personally convinced that K-14 education has been getting the short end of the stick from California’s governors and legislators for years.

Hulsizer has burrowed through budgets past and present, and compiled statistics that support his assertion.

During the last few weeks, Hulsizer has been quietly circulating a three-page PowerPoint...

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Legislature Misses Deadline to Pass Budget

Budget Conference Committee Takes Few Actions on Education Funding

By Vernon Billy - June 17, 2010

With little fanfare – and following a pattern that is considered par for the course – the Legislature let the June 15th constitutional deadline to approve a budget lapse with little sense of urgency or necessity.  Despite missing the deadline, the Legislature’s two-house budget conference committee did continue to meet this week and made its first pass through the education portion of the Committee’s agenda.

While the Committee reviewed the entire agenda, they took very little action and spent a considerable amount of time having agency staff brief the Committee on the specific topics...

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Schools Make Deep Cuts to Programs Due to Budget Crisis

O'Connell Releases Survey Showing Severe School District Budget Reductions

June 17, 2010

California Superintendent of Public Instruction Jack O’Connell last week released the results of a statewide survey of local educational agencies (LEAs) to find out how state budget cuts to public education are affecting them. O’Connell held a news conference in the Natomas Unified School District (in Sacramento County) where all eight elementary school libraries were shut down to close a budget gap.

“The survey results make clear that school administrators are making heartrending decisions to balance their dwindling budgets while trying valiantly to keep students’ best interests in mind,” said O’Connell...

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Education Coalition Rejects May Revision; Supports Assembly Budget Proposal

June 17, 2010

A group of policy experts from The Education Coalition hosted a budget briefing last week to announce their support of the Assembly budget proposal and to oppose the governor’s May Budget Revision, which cuts more than $4.1 billion from California’s schools and students, according to the legislative analyst.

The governor’s proposed budget would further reduce revenue limit funding by $1.5 billion.  This represents a cut of about $250 per student...

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Duncan, NEA and AFT Endorse Legislation, But Opposition Could Stall Bill in Congress

O'Connell Urges Support of $23 Billion Emergency Federal Education Jobs Fund

June 3, 2010

State and federal education officials are rallying the troops in support of federal legislation that could provide funds to save teacher jobs in local school districts – but the bill is running into opposition from groups worried about the size of the federal budget deficit.

State Superintendent of Public Instruction Jack O’Connell is urging California Congressional representatives to support $23 billion in federal education funding proposed by the Keep Our Educators Working Act of 2010...

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Governor Signs California's Race to the Top Phase 2 Application at Ceremony

June 3, 2010

State Superintendent of Public Instruction Jack O’Connell joined Governor Arnold Schwarzenegger and State Board of Education President Ted Mitchell in Long Beach on Tuesday for a ceremony marking the signing of California’s application for Phase 2 of the federal Race to the Top (RTTT) competition.

O’Connell is undoubtedly hoping for a better outcome the second time around.  California’s application for the previous round of Race to the Top Phase 1 funding was not awarded any money...

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Things To Do Soon: Bell Schedules, School Calendars and Instructional Minutes for 2010-11

By Nancy Walker - May 27, 2010

The school year is just about over for 2009-10, and pretty soon your administrators will be settling into their summer schedule, and probably taking some vacation.

But before they take off, make sure they’ve provided you with next year’s bell schedule, school calendar and the calculation of instructional minutes.  You’ll need to establish a deadline that allows your own staff enough time to verify the accuracy of the calculation and be able to reach staff if necessary...

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O'Connell Supports School Funding Lawsuit, While Governor Predicts He Will Prevail

May 27, 2010

State Superintendent of Public Instruction Jack O'Connell last week announced his support of a lawsuit (Robles-Wong, et al. v. California) filed on May 20 against the State of California by students, districts, school boards, and school administrators:

"California students are the victims of broken budget promises and a broken school funding system,” O’Connell said.  “I applaud this effort to align appropriate funding for our public education with our goal of educating students to master our rigorous academic standards...

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O'Connell Expresses Disappointment

No Federal Grant Money Coming to Support California's New Education Data System

May 27, 2010

State Superintendent of Public Instruction Jack O'Connell expressed disappointment last Friday after California was not named as a winning state in the federal competition for a grant from the Institute for Education Sciences (IES) within the U.S. Department of Education.

O’Connell said “California is strongly supportive of President Obama's education reform goals, including improving teacher effectiveness, adopting standards to ensure that all students are ready for college and careers, turning around lowest-performing schools, and strengthening the collection and use of education data...

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Budget Analysis

May Revise Means Tough Budget Negotiations Ahead – Educators Should Remain Vigilant

By Adonai Mack - May 20, 2010

On Friday, May 14, 2010, the Governor Released his 2010-11 May Budget Revision.  The governor laid out his plan to close a state budget deficit of $19.1 billion.  The following is a brief summary and analysis of the May Revision. 


What is the May Revision?

Historically, the May Revision is an update to the Governor’s January budget proposal.  The document is an annual event that marks the “real” start of the budget development process...

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May Budget Revise

Governor Seeks More Budget Cuts, No New Taxes

By Jeff Hudson and Vernon Billy - May 17, 2010

Governor Schwarzenegger released his May Budget Revise on Friday – a proposal that, in the words of his press spokesman, contains “absolutely terrible cuts” for public education and social programs that impact children – and proposes no new taxes.

As always, the May Revise contains changes and refinements to the Governor’s January budget proposal.  The state’s overall budget shortfall has not changed significantly from the figures that were identified in January...

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Education Groups Quick to Criticize Funding Cuts in Governor's May Budget Revise

May 17, 2010

Here is a quick summary of reactions on Friday to the Governor’s May Budget Revise from several education groups:

State Superintendent of Public Instruction Jack O’Connell said “While we are still working to analyze details of the Governor’s proposal, it appears that the voter-approved guarantee for K-12 education funding does not seem to have been further reduced since the Governor’s January budget proposal...

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State Receipts Drop Again in April, Erasing Four Months of Modest Improvement

May 13, 2010

Last Friday, State Controller John Chiang released his monthly report covering California’s cash balance, receipts and disbursements in April.

The month’s receipts dropped below the Governor’s 2010-11 budget estimates by $3.6 billion, or 26.4 percent -- reversing the slow progress of several previous months.  Through March, the States’ revenues had been tracking more than $2.3 billion ahead of projections


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CDE Posts Budget Tools

With Pending Deferrals from State, Cash Flow Management Critical During Coming Year

April 29, 2010 - By Brett McFadden and Kari Sousa

Maintaining sufficient cash balances remains critical.  Although we are finally starting to witness positive economic news, school districts and county offices of education will likely face two more years of challenging finances.  In addition, a large number of intra and inter-year funding deferrals remain active.  It will probably be several more years until most of them are eliminated from statute.

The critical determinant will be the health of the state’s cash position...

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Keeping Perspective

The Economic Outlook and Education Funding

April 21, 2010 - By Brett McFadden and Tahir Ahad

The recession of the past two years now has an official name.  Economists and historians will from now on refer to it as the “Great Recession.”   The impact of the downturn has been sweeping.  And when all is said and done, it will fundamentally reduce public sector services in a manner that could require over a decade to completely restore.


Multi-year Outlook

We know when the recession started – the fall of 2007.  But has it really ended?  That answer is still anybody’s guess...

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DOF Reports State Revenues Up Again

By Vernon Billy - April 20, 2010

For the third straight month in 2010, state revenues were higher than projected.  The Department of Finance (DOF) recently reported in its Finance Bulletin that the state’s General Fund agency cash for March was $670 million above the 2010-11 Governor’s budget forecast.  According to DOF, year-to-date revenues were $2.68 billion above estimates.

Below is a summary of the DOF March Bulletin.

Personal income tax revenues to the General Fund were $132 million above the month’s forecast of $2.252 billion...

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Palo Alto Unified Among Recipients

Feds Awards Grants to Help School Districts Recover from Student Suicides, School Shooting

April 8, 2010

The U.S. Department of Education's Office of Safe and Drug-Free Schools this week awarded three new Project School Emergency Response to Violence (SERV) grants, totaling more than $137,000, to school districts in California, New Mexico and Alabama to assist with ongoing recovery efforts following a series of student suicides and a middle school shooting. Project SERV grants provide funding to school districts and institutions of higher learning that have experienced a traumatic event and need resources to respond to the event and re-establish a safe learning environment...

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Twelve Districts "Negative," 114 More "Qualified"

Budget Crisis Leads to Dramatic Rise in School Districts on Fiscal Early Warning List

March 25, 2010

State Superintendent of Public Instruction Jack O'Connell on Monday announced a 17 percent increase in the number of school districts that may be unable to meet future financial obligations because of the continuing state budget crisis and cuts to public education.

“In the first interim status report of the 2009-10 fiscal year, 126 local educational agencies are now on the watch list,” said O’Connell – which is up from the 108 school districts on the watch list reported in June 2009...

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Budget Analysis

Trends and Conditions Behind the Rising Number of Qualified and Negative Districts

March 25, 2010 - By Brett McFadden, ACSA

This week’s report on the significant increase in the number of school districts that may not be able to meet their multiyear financial obligations should come as no surprise to education leaders.  What else could have happened when you cut and defer over $17 billion in Proposition 98 funding in as little as two fiscal years?

The number school districts receiving qualified or negative budget certifications at the 1st Interim Report jumped 17 percent over last year...

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State's Revenues Up $219 Million in February

By Vernon Billy - March 18, 2010

For the second month in a row, the State Department of Finance is reporting that State revenues have exceeded the projections contained in the Governor’s 2010-11 budget forecast.

DOF reported that State general fund cash was $219 million above the forecasted amount for February.  This revenue is in addition to the $1.4 billion in higher than expected revenues reported in January.  Year-to-date revenues are almost $2 billion above the State’s forecast...

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Applications Due in May

Secretary Duncan Releases Details for $650 Million "Investing In Innovation" Fund

March 11, 2010

U.S. Secretary of Education Arne Duncan on Tuesday released the Department of Education's final priorities and the grant application for the $650 million Investing in Innovation Fund (i3).  The fund is part of the $5 billion investment in school reform in the American Recovery and Reinvestment Act (ARRA).

Individual school districts or groups of districts can apply for the i3 grants, and entrepreneurial nonprofits can join with school districts or a consortium of schools to submit applications...

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California Gets Zilch in Phase One of RTTT

March 4, 2010

Federal Education Secretary Arne Duncan announced Thursday that 15 states and the District of Columbia will advance for Phase One in the Department of Education’s Race to the Top (RTTT) competition – and California is not on the list.

The phase 1 finalists are: Colorado, Delaware, District of Columbia, Florida, Georgia, Illinois, Kentucky, Louisiana, Massachusetts, New York, North Carolina, Ohio, Pennsylvania, Rhode Island, South Carolina, and Tennessee...

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Budget Update/Alert:

Planning for and Defending against Targeted Reduction to LEA "Administrative Costs"

February 26, 2010 - By Adonai Mack and Brett McFadden

The following update contains two sets of information related to the governor’s proposed targeted cut to K-adult administrative functions in FY 2010-11.  The first focuses on how to plan for such a reduction. The second provides useful information to dispel the myth that California LEAs spend too much on central office administration compared to other functions.

Planning for possible revenue limit reductions

Last week, School Services of California (SSC) released a report detailing...

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More Bad News on State Budget

Legislators Ponder Deferrals, LAO Warns Governor’s Plan Cuts K-12 Funding

By Jeff Hudson - February 26, 2010

There were several new developments on the budget front in Sacramento – most of them discouraging news for financially-battered K-12 school districts.

—On Wednesday, the Assembly Budget Committee rushed through legislation (ABX8 5) that would authorize three additional deferrals of apportionments to K-12 districts – totaling up to $2.5 billion in all – with the deferrals affecting apportionments originally due in July 2010 to be deferred by up to 60 days...

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Tips for Getting Your Position Control System Ready for the New Budget Year

By Nancy Walker - February 19, 2010

As districts are updating and finalizing their budgets for the Second Interim reporting period, it is likely a few districts may have discovered that some of the information in position control may not be accurate – and in fact may need some clean up.  Position control is a vital tool used by districts for both internal control purposes and for budgeting purposes.  For most districts, salary and benefits account for approximately 85% of their general fund budget...

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Class Size Reduction Flexibility Revisited

By Kari Sousa - February 12, 2010

While Class Size Reduction (CSR) flexibility contained in the revised 2008-09 State Budget may seem like old news to many, this flexibility is receiving more attention than ever as many districts are now looking to formerly “sacred cows” – including K-3 Class Size Reduction -- to bridge growing budget gaps.  Due to increased questions, we wanted to revisit the article published in March 2009 discussing the “new” class size reduction flexibility provision...

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Sec. Duncan Cites New Direction

Federal Education Budget Tops $49 Billion for Discretionary Programs, Up $3.5 Billion

February 5, 2010

President Obama's 2011 education budget signals a new direction for federal K-12 education policy with more competitive funding, more flexibility and a focus on the reforms likely to have the greatest impact on student success, according to Secretary of Education Arne Duncan.

All told, the president's budget includes $49.7 billion for the Department of Education's discretionary programs, an increase of $3.5 billion over fiscal year 2010...

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California's Cash Shortage Returns; Feds Offer $1.5 Billion of $6.9 Billion Sought by Governor

By Jeff Hudson - February 5, 2010

The outlook for California’s state budget is once again looking dark and stormy – meaning that school districts are probably well-advised to be prepared for more fiscal turbulence ahead.

The first volley of ominous news came out of State Controller John Chiang’s office on January 22, in the form of a letter sent to Governor Arnold Schwarzenegger and several legislative leaders...

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LAO Rebukes the Governor on Prisons vs. Universities Funding Proposal

By Andrew Keller - January 29, 2010

The Legislative Analyst’s Office recently delivered a tersely written rebuke of Governor Schwarzenegger’s proposal to spend less on prisons than public universities.  In a four page policy brief, the LAO derided the Governor’s plan to cap prison spending at 7% of the budget and secure a minimum of 10% for public universities as an “unnecessary, ill-conceived measure that would do serious harm to the budget process.”...

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Know Your Audience, Be Prepared

Tips for Planning an Effective Budget Presentation – For Any Audience

By Kari Sousa - January 22, 2010

Over the course of a CBO or fiscal director’s career, you will probably give dozens – even hundreds – of presentations on budgets and finance, often speaking to different groups.  Your presentations may contain the same budget information, but depending on the occasion, your audience may include governing board members, union representatives, district employees, parents, community members and occasionally newspaper reporters.  To effectively communicate essential budget information to all stakeholder groups, it is important to remember the following tips...

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The Governor Attempts to 'Divide and Rule' – At the Wrong Time and Wrong Place

By Tahir Ahad and Brett McFadden - January 22, 2010

The Governor’s recently released budget proposal promises to deliver several so-called “reforms” to public education.  But, like much of the proposal, the Governor’s education reform proposals are grounded in faulty assumptions and unclear analysis.

The Governor and his advisors appear to be relying on a centuries-old technique of “divide and rule” (harkening back to the Roman Empire) by proposing a potpourri of changes in the hopes of diverting attention away from reality...

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Governor's January 2010-11 Education Budget Shifts K-12 District Funding in Some Categories

By Vernon Billy - January 12, 2010

Last Friday, Governor Schwarzenegger released his budget proposal for 2010-11.  The Governor’s budget attempts to close a $19.9 billion budget deficit.  About $6.9 billion of the deficit is in the current budget year (2009-10) and $12.3 billion is attributed to the 2010-11 budget year.  The Governor also includes the need to have a $1 billion reserve in the $19.9 billion deficit figure.

The chart below outlines the factors contributing to the $19.9 billion two-year deficit and the Governor’s proposed solutions over the same period...

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Be Aware – Yet Be Wary of the Budget Doom and Gloom

By Tahir Ahad and Nancy Walker - January 8, 2010

Although the Governor announced in his “State of the State” message that he intends to protect education funding in the last budget of his tenure, no one believes that his remarks on Wednesday will be the last word regarding this matter.  Many remain skeptical of his pledge, given the track record of this administration over the last seven years.  In a state budget debate, “it is not over until it is over” and educators appear to be taking a wait-and-see approach, rather than assuming that events will play out as the Governor has suggested over the next several months...

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Economic Forecast:

The Outlook for K-Adult Education Funding and What to Do Next

By Tahir Ahad and Brett McFadden - December 11, 2009

On Wednesday, the UCLA Anderson School of Management released its quarterly economic forecast.  The Anderson Forecast, in combination with several other forecasts, has become a closely-watched barometer for the overall health of our national and state economies.  It is widely used by policymakers to formulate budget and revenue projections at the state level.

We keep a close eye on international, national, and state economic trends because they directly impact the flow and characteristics of state revenues...

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Get Your Budget Process Started on the Right Foot; Use a Budget Development Calendar

By Kari Sousa - December 4, 2009

Like any successful project, the key to a successful budget development process is development of a plan and effective execution of the plan elements.  The best way to begin development of your budget planning process is by creating a budget development calendar.

Designing Your Budget Development Calendar

Budget Development Calendars are used to list important dates and events throughout the budget development process, as well as the individuals...

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Four Models for Federal Funding:

Duncan Readies $3.5 Billion in Title I Grants, Applications Now Available, Due by February 8

December 4, 2009

On Thursday, U.S. Secretary of Education Arne Duncan announced the final requirements for $3.5 billion in Title I School Improvement grants to turn around the nation's lowest performing schools.  The applications are now available at http://www.ed.gov/programs/sif/applicant.html and are due into the Department of Education by Feb. 8, 2010.

“As a country, we all need to get into the turnaround business,” said Duncan.  “Today we are providing $3.5 billion and four models...

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Work with Your Auditor

Reviewing Your Draft Audit Report

By Kari Sousa - November 20, 2009

As the December 15 deadline looms for submission of your annual audit report, you are also busily working on completing your First Interim Budget report, and trying to enjoy some well-deserved holiday time off.

However, don’t overlook the importance of a thorough review of your draft audit report.  A thorough review of your report can reveal some very important items...

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ACSA President Charles Weis:

"California's Lawmakers Have Got To Do More Than Continually Hold Out a Hat for Federal Grant Funding"

November 20, 2009

Charles Weis, president of the Association of California School Administrators (ACSA) and the leaders of the California Schools Boards Association, California Teachers Association, California School Employees Association and California State PTA joined on Tuesday to blast the $17 billion in statewide budget cuts to public schools over the past two years. Acting as The Education Coalition of California, they released a report chronicling the impact of the cuts from the perspective of students, teachers and administrators...

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Your District Audit – December 15 Deadline Looms

Hope for the Best – Yet Plan for the Worst

By Kari Sousa - November 13, 2009

The time of year has come again for your auditors to arrive and place the finishing touches on your 2008-09 annual district audit.  These audits are due to the State Controller’s Office no later than December 15, 2009.  Many audit firms will be busily doing field work through the month of November (and possibly later).  Your audit firm’s rush to submit multiple audit reports by the December 15 deadline could leave your district with little time to appropriately review and discuss your audit report...

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Successful Parcel Tax Campaigns Start With Accurate Polling Data and Careful Planning;

Los Gatos Union Superintendent Offers Pointers

By Jeff Hudson - November 13, 2009

Last week’s election was a very mixed bag for school districts seeking voter approval of local parcel taxes, trying to offset budget reductions for education from the state.

School parcel taxes were approved in several smaller, affluent, suburban communities in Marin County (Larkspur School District and Lagunitas Elementary School District), Alameda County (Albany Unified School District) Contra Costa County (Acalanes Union High School District) and Los Angeles County (Culver City Unified School District)...

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Duncan Announces Application Requirements for Final $11.5 Billion in ARRA Funding

November 13, 2009

Secretary of Education Arne Duncan announced Monday that application requirements for the final $11.5 billion in State Fiscal Stabilization Funds under the American Recovery and Reinvestment Act (ARRA) of 2009 are now available.  

In exchange for this unprecedented funding boost, the department is asking states to provide basic information on teacher distribution, the collection and use of data, standards and assessments, and support for struggling schools...

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Final Version of Race to the Top Application Released, $4.35 Billion in Funding at Stake

November 13, 2009

U.S. Secretary of Education Arne Duncan on Thursday released the final application for more than $4 billion from the Race to the Top Fund, which will reward states that have raised student performance in the past and have the capacity to accelerate achievement gains with innovative reforms.

“The president said last week that Race to the Top will require states to take an all-hands-on-deck approach,” Duncan said. “We will award grants to the states that have led the way in reform and will show the way for the rest of the country to follow.”...

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Parcel Tax Elections Prove To Be A Mixed Bag

By Jeff Hudson - November 6, 2009

The November 3 election was a pretty mixed bag for California school districts that went to voters asking for financial support in the form of a local parcel tax supporting education.

Parcel tax ballot measures ran up big majorities in some communities, but fell short of a simple majority (much less a two-thirds majority) in others. In general, proposed parcel taxes did well in small districts (with fewer than 10,000 students) and failed in larger districts – and in Tuesday’s results, it appeared that the bigger the district, the poorer the proposed parcel tax did at the polls...

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State Plans Three Regional Meetings Next Week to Discuss California's RTTT Application

October 30, 2009

The State of California will hold three meetings next week – one in the Los Angeles area, one in the Bay Area, and one in the Central Valley – to discuss California’s proposal for federal Race to the Top (RTTT) funds.

These regional events, open to all interested parties, are designed to share a general overview of the requirements in the Race to the Top application as well as open up discussions around the four key areas in the application...

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Districts Are Spending ARRA Funds – But Some May Be Moving at a Slower Pace Than Expected

By Tahir Ahad - October 16, 2009

The State Superintendent of Public Instruction announced on Tuesday that about 28,000 education jobs in prekindergarten through grade twelve were saved by the American Recovery and Reinvestment Act (ARRA) of 2009.  The figure was derived from the first quarterly reports submitted to the California Department of Education (CDE) by school districts and other subrecipients of ARRA funds.

But a survey by the CDE also found that less than half of the ARRA funds in the three largest categories have actually been expended by California school districts thus far...

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Duncan Announces Priorities for $650 Million in Federal Grants for "Investing in Innovation"

October 9, 2009

U.S. Secretary of Education Arne Duncan this week announced the Department's priorities for grants under the $650 million Investing in Innovation Fund (i3).  The fund, which is part of the historic $5 billion investment in school reform in the American Recovery and Reinvestment Act (ARRA), will support local efforts to start or expand research-based innovative programs that help close the achievement gap and improve outcomes for students.

“We're making an unprecedented investment in cutting-edge ideas that will produce the next generation of school reforms,” Duncan said on Tuesday...

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CPEC Awards $2 Million in Grants to Help Teachers in "High Need" Schools

October 9, 2009

The California Postsecondary Education Commission (CPEC) this week awarded $2 million for innovative grant projects to help small teams of K-12 teachers develop projects that enhance teaching and learning in their classrooms.

The funding will flow through the University of California, Los Angeles, and the University of California, Davis, which will each receive three-year grants of $1,010,000 to manage the regional Teacher-Based Reform (T-BAR) Pilot Program.  The grants enable university faculty from schools of education and subject matter departments to work with 24 teams of three to five teachers from high-need schools...

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The Fiscal Outlook for Education: The Challenges of the Next Two Years

By Tahir Ahad and Brett McFadden - September 25, 2009

Public education has certainly taken a beating during the state budget crisis.  Average 2009-10 school district revenue limits are 22% lower than in 2007-08.  That equates to an average revenue limit loss of $840 per student since 2007-08.  That loss in funding becomes even greater when one factors in the 20 percent reduction most categorical programs took in 2008-09 and 2009-10.  Average school district revenue limits are at the same levels they were in 2004-05.

We have communicated for some time that the fiscal outlook for school districts and county offices remains volatile thru 2011-12...

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Study Finds Dropouts Drain California Budget by $1.1 Billion Annually in Juvenile Crime Costs

September 25, 2009

Dropouts cost California $1.1 billion annually in juvenile crime costs alone, according to a study released Thursday from the California Dropout Research Project (CDRP) at UC Santa Barbara.

The new research also shows that cutting the dropout rate in half would reduce the number of juvenile crimes in California by 30,000 each year.

In 2007, California juveniles (ages 10-17) were arrested for one-in-six violent crimes statewide, and over one quarter of all property crimes...

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$1.3 Billion in Federal Stimulus Funds Expedited

By Jeff Hudson and Brett McFadden - September 18, 2009

Some $1.3 billion in expedited State Fiscal Stabilization Funds (SFSF) will soon be available for California’s school districts, colleges and universities.

In May, the U.S. Department of Education provided California $3.2 billion for the first phase of SFSF – representing 67 percent of California’s total $4.9 billion allocation – to help mitigate the effects of budget reductions to education, at least for the next year or so.

The second installment of SFSF funds was scheduled to be released to states in December...

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Schools Won't Lose Funding Because of Wildfires

September 3, 2009

State Superintendent of Public Instruction Jack O'Connell announced on Tuesday that assistance is available for students, schools, and the communities affected by the wildfires in Los Angeles and Placer counties.

“Thankfully, we have not heard of any deaths or injuries of students or school staff, nor damage to any school structures,” said O’Connell. “However, I want to assure school districts whose operations have been affected that they will not lose funding if their facilities are closed by wildfires or used as emergency shelters.”...

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Just Saying No isn't the Answer

By Tahir Ahad and Brett McFadden - August 21, 2009

Last week, we wrote about how the declining economy and resulting budget cuts for public education have affected the priorities in almost every Local Education Agency (LEA).  Although fiscal solvency has always been a prime consideration for any school district, we are now in an era when the emphasis on maintaining financial viability (and thus maintaining programs) is more critical than ever before.

With scarce resources, the need for tighter control is high, and administrators in local school districts and county offices administration must act with great frugality...

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American Recovery and Reinvestment Act

"Race to the Top" Details Emerge

By Timothy McClure - August 21, 2009

The federal Department of Education issued priorities, requirements and selection criteria for the new $4.5 billion incentive grant, “Race to the Top,” a key component of the ARRA (American Recovery and Reinvestment Act of 2009) in a July 29 release.  Attorneys from the Washington DC-based law firm Brustein and Manasevit reviewed the program during a briefing on Wednesday in Sacramento.

The competitive grant is designed to encourage and reward states that are implementing significant education reforms across the ARRA core areas,...

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Duncan Accelerates $11.3 Billion in ARRA Funds

August 7, 2009

Secretary of Education Arne Duncan announced on Monday that the federal Department of Education will accelerate stimulus spending by making $11.37 billion in Title I, IDEA (Individuals with Disabilities Education Act), and Vocational Rehabilitation (VR) funding, as part of the American Recovery and Reinvestment Act (ARRA), available to states one month early to help save jobs and drive reform.

“After accelerating the release of $2.7 billion in Government Services funds earlier this month...

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How are California School Districts Using Federal Stimulus Dollars?

By Brett McFadden and Monica Crouch - August 7, 2009

One thing for certain, federal stimulus money from the American Recovery and Reinvestment Act (ARRA) arrived just in time.  As bad as the budget situation is for California’s school districts and county offices, one can only imagine what it would have been like without the infusion of one-time ARRA funding.

But that also leads to another question – What happens in 2010-11 and 2011-12, when all that one-time money is likely gone?  What will happen then if the state’s fiscal condition does not significantly improve?...

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Governor Signs State Budget, But Financial Crisis in Sacramento Will Likely Continue

By Jeff Hudson - July 31, 2009

Governor Arnold Schwarzenegger signed the new state budget into law on Tuesday, amidst political fanfare that the budget included no new taxes.

But before the day was out, Democratic legislative leaders were angrily criticizing the line item vetoes that the Governor announced when he put his signature on the budget bills.

And over 180 city and county governments, along with the California Redevelopment Association, made it clear that they will soon go to court to block the $2 billion that the state “borrowed”...

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State Takes Control of King City District, More Districts Teeter on Fiscal Edge

By Jeff Hudson - July 24, 2009

State Superintendent of Public Instruction Jack O'Connell appointed Dr. John Bernard on Wednesday as the State Administrator for the King City Joint Union High School District in Monterey County.  The state takeover of the district was required by law after the district was granted a $13 million state loan to avoid bankruptcy.

“Although a state takeover of any school district is a very serious matter, I encourage everyone to look upon this as an opportunity,” said O'Connell.  “Dr. Bernard has the talent and experience and my full support...

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O'Connell, Chiang Announce State Cash Shortage Will Cause Delay in $4 Billion School Funding Payment

July 17, 2009

State Superintendent of Public Instruction Jack O'Connell and State Controller John Chiang announced on July 10 that a $4 billion payment to schools has been delayed for several weeks as a result of the state's ongoing fiscal crisis.

The payment, known as the Principal Apportionment, is the largest annual payment of state funds to California's public education system.  Due to the state's ongoing fiscal crisis and cash shortage, the payment scheduled for release on July 10, which is the last payment for the 2008-09 fiscal year, will instead be issued on July 30, 2009...

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Latest Update on Federal Stimulus Funds

July 10, 2009

The California Department of Education provided an update last week on recent activity relating to the American Recovery and Reinvestment Act, which provides federal stimulus funds:

July 2, 2009

  1. The U.S. Department of Education (ED) released new guidance regarding the American Recovery and Reinvestment Act of 2009 (ARRA) Individuals with Disabilities Education Act (IDEA), Part B program...

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Gridlock in Sacramento

What Gets Paid . . . And What Doesn't: Local Impacts of California's Budget Crisis

By Brett McFadden (ACSA) - July 10, 2009

In what has become an ongoing nightmare, state budget negotiations are once again deadlocked.  How long this latest stalemate will last is anyone’s guess.  Deliberations among state leaders continue . . .  but this could take awhile.

When a stalemate like this occurs, we typically receive inquiries regarding the implications for school district and county office of education program funding, as well as public retirement system funding...

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How Schools Get Paid: A Brief Tutorial

By Brett McFadden (ACSA) - July 10, 2009

Understanding the possible impacts a budget stalemate can have on schools requires a basic understanding of how education funding is released by the state to school districts and county offices of education.  This is not a matter easily understood by the layman observer.  As with most education policies, California’s K-14 funding schedule cannot be explained in simple terms . . . in fact, it is as complex as the Proposition 98 formula that drives it.

Proposition 98 funding rolls out to Local Education Agencies (LEAs) per an apportionment schedule...

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Latest Update on Use, Reporting of ARRA Funds

By Brett McFadden and Jeff Hudson - June 26, 2009

Earlier this week, State Superintendent Jack O’Connell and California Department of Education (CDE) officials hosted a conference call for Local Education Agency (LEA) leaders to provide further information and guidance on federal stimulus funds.

A full range of information regarding the American Recovery and Reinvestment Act K-12 education funds is available on CDE’s website.  After the call, the department provided addresses to the following links that pertain to stimulus dollars:

1. CDE's ARRA Webpage: http://www.cde.ca.gov/ar/...

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Categorical Flexibility

“Flexibility” Really Means . . . Flexibility

By William Spalding, TSS - June 26, 2009

“Unprecedented” is probably overused as a description for the budgetary events for schools these past several months.

But the term is apt, and as events continue to unfold, much of the budgetary and regulatory landscape that we’ve all grown up with in public schools is shifting dramatically. 

Among the major changes for this year and the foreseeable future is the SBx 3_4 special session legislation that gave school districts huge flexibility in the use of categorical funds to try to cushion the financial blows in the current state budget...

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New UCLA Economic Forecast:

District and County Offices Could Face Rough Financial Times into 2011-12

By Brett McFadden (ACSA) - June 19, 2009

Earlier this week, the UCLA Anderson Forecast released its second quarterly economic report of 2009.  The Anderson Forecast is a widely followed economic forecast for California and the nation.  The report upgraded the condition of the national economy, but noted that the patient is still “very sick.”  In terms of California’s economy, the UCLA economists noted that “there is nothing happening in California that will help pull the state out of recession in advance of the nation.”  For school districts and county offices, this confirms the depressing projections we have been providing over the past year and a half...

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District Entitlements for State Fiscal Stabilization Funds Detailed by CDE

By Jeff Hudson - June 15, 2009

Late last Friday afternoon – at an hour when many K-12 administrators and not a few journalists were taking a momentary break after attending local graduation ceremonies in their districts – the California Department of Education (CDE) posted a list describing the disposition of some $880 million in State Fiscal Stabilization Fund entitlements, covering more than 1,500 local education agencies (LEAs) in California.

The funding entitlements are posted online at State Fiscal Stabilization Fund (SFSF) - American Recovery and Reinvestment Act...

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Deadline Nears for Districts to Apply for Federal Teacher Quality Partnership Grants

By Jeff Hudson - June 15, 2009

The State Superintendent of Public Instruction and the Governor’s Secretary of Education are urging school districts to consider applying for a competitive grant opportunity under the American Recovery and Reinvestment Act now available.

“A core reform of the American Recovery and Reinvestment Act (ARRA) is to improve teacher effectiveness and the equitable distribution of qualified teachers for all students,” the Superintendent’s office said in a message this week. “The United States Department of Education is now accepting applications for Teacher Quality Partnership (TQP) Grants...

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California's Cash Flow Situation Worsens:

Educators Should Be On High Alert

By Tahir Ahad (TSS), and Brett McFadden (ACSA) - June 12, 2009

Earlier this week, State Controller John Chiang released his latest figures on state revenues and projected cash flow.  State revenues continue to plummet, with projections that the state will run out of available cash by July 28.

Adding fuel to the fire, the governor announced yesterday that he will block all attempts by the State Controller and others to secure a temporary loan for the state.  The governor stated that this action would merely give the Legislature a further excuse to delay the budget and put off critical decisions that need to happen now.

This news does not bode well for school districts and county offices of education...

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K-14 Payment Deferrals – What gets paid and when

By Brett McFadden and Adonai Mack, ACSA - June 12, 2009

As the state’s fiscal and cash situation has worsened, state government has relied heavily on “interyear” and “intrayear” deferrals to reduce Proposition 98 spending mid-year in response to decreases in the Proposition 98 minimum guarantee.  There have now been so many deferrals that it has become difficult to keep track of all of them.  However, knowing what is being deferred – and when – remains critical to anticipating a local education agency’s (LEA’s) projected cash flow.

The following outlines the interyear and intrayear deferrals that have been approved and proposed as of May 31, 2009...

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Bracing for Still More Cuts:

Education Budget Outlook Grows Dimmer

By Tahir Ahad (TSS), Adonai Mack and Brett McFadden (ACSA) - June 5, 2009

In what has become a nightmare situation for educators, additional developments occurred this week that essentially solidify the likelihood of another round of possible reductions in the state budget, and virtually assure more cuts in 2009-10.  These reductions will be in addition to those that were implemented this past February.   

The size of the cuts

The size of these additional reductions are enormous, especially when factored with the total reductions K-adult programs will incur over a two-year period.  Last February’s 2008-09 and 2009-10 reductions amounted to over $5.15 billion, or roughly $860 per student...

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With May 19 Special Election Just Days Away

State's 2009-10 Fiscal Situation Worsening

By Adonai Mack and Brett McFadden, ACSA - May 15, 2009

Fiscal and political conditions associated with the development of the 2009-10 state budget continue to worsen.  These developments undoubtedly pose significant challenges to local education agencies going into the new fiscal year.

May 19 ballot measures

The Public Policy Institute of California (PPIC) released results of a recent poll on Tuesday indicating that all but one of the six ballot initiatives on the May 19 special election appear to be failing among likely voters...

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Federal Stimulus Money Reaching Districts

By Jeff Hudson - May 8, 2009

Federal stimulus money began flowing to local school districts this week, even as many local school boards were voting on issuing "final" layoff notices to certificated employees, leading up to the May 14 deadline for notification.

On Tuesday, State Superintendent of Public Instruction Jack O’Connell released California Department of Education (CDE) calculations of the amount of Title I funds that local educational agencies (LEAs) in California will receive, as well as the amount of Individuals with Disabilities Education Act (IDEA) Part B funds that Special Education Local Plan Areas (SELPAs) will receive under the American Recovery and Reinvestment Act of 2009 (ARRA)...

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May 4th Application Deadline for Stimulus Funds

May 1, 2009

There's no time for school districts to delay – the deadline for applications from local educational agencies seeking State Fiscal Stabilization Funds (SFSF) under the American Recovery and Reinvestment Act (ARRA) is May 4, 2009 . . . . which is to say "Monday."

The online applications were posted on the California Department of Education (CDE) website last week.  The CDE press release can be reviewed at this link: ...

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Advisory on State Fiscal Stabilization Funds Now Available; Money Starts Flowing in May

By Jeff Hudson - April 24, 2009

The first installment of a two-part policy advisory on State Fiscal Stabilization Funds (SFSF) is now available from the Association of California School Administrators (ACSA).

School districts must apply for SFSF funds no later than May 4, 2009.  The first phase of these funds will start flowing to local school districts sometime in mid-May.

Dated April 22, the ten-page policy advisory from ACSA offers an overview of the American Recovery and Reinvestment Act (ARRA), with an update on the status of federal stimulus funds for California school districts and higher education...

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With May 19 Special Election Just Days Away

State's 2009-10 Fiscal Situation Worsening

By Adonai Mack and Brett McFadden, ACSA - May 12, 2009

Fiscal and political conditions associated with the development of the 2009-10 state budget continue to worsen.  These developments undoubtedly pose significant challenges to local education agencies going into the new fiscal year.

May 19 ballot measures

The Public Policy Institute of California (PPIC) released results of a recent poll on Tuesday indicating that all but one of the six ballot initiatives on the May 19 special election appear to be failing among likely voters...

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Federal Stimulus Dollars Flowing to Districts

By Brett McFadden and Sherry Skelly Griffith, ACSA - April 17, 2009

Federal stimulus dollars have begun flowing to the state.  But Local Educational Agencies (LEAs) are still a few weeks away from getting them in their hands.  LEAs will begin receiving these funds in May.

There are three primary one-time funding sources in the American Recovery and Reinvestment Act (ARRA):  Title I, the Individuals with Disabilities Education Act (IDEA), and the State Fiscal Stabilization Fund (SFSF).  The Association of California School Administrators (ACSA) plans to release a detailed analysis of the federal stimulus package in the next few days...

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Implementing the Budget:
Still no Guidance from State Officials, Legislation also Needed

By Adonai Mack and Brett McFadden, ACSA - April 17, 2009

Various provisions of the recently enacted 2008-09 mid-year reductions and 2009-10 budget require further clarification and regulatory guidance from California Department of Education (CDE) and the Legislature.  As of April 17, such guidance has not been released, but we are told it is forthcoming.

The recently adopted budget correction package included sweeping budget reductions along with major program changes.  As a result, follow-up legislation (also known as a “clean up” bill, or bills) is required to provide further guidance and clarify various aspects of the budget package...

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Review all Alternatives to Budget Reductions

By Tahir Ahad and Kari Sousa - April 10, 2009

Budget reductions are always painful — and they almost always have an adverse impact on the students and their learning.  They are especially hard when they involve the loss of job and livelihood for employees who serve those students.

Therefore, before the administration recommends a reduction in services and a layoff of employees, it must look into all available alternatives and evaluate all options.

The public has been generally supportive of educational measures such as an educational parcel tax...

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Sec. Duncan Releases Applications, Guidelines for Federal Stimulus Funds for Education

By Jeff Hudson - April 3, 2009

Education Secretary Arne Duncan announced on Wednesday that $44 billion is available for education under the American Recovery and Reinvestment Act (ARRA) of 2009.

Duncan released the application and guidelines for $32.6 billion under the State Stabilization fund, representing two-thirds of the total dollars in that fund. This includes $26.6 billion to save jobs and to improve K-12 and higher education and a separate $6 billion in a Government Services Fund to pay for education, public safety or other government services...

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Economic Forecasts Indicate More Turbulence, New Challenges on the Horizon

By Brett McFadden, ACSA and Tahir Ahad, TSS - March 27, 2009

Two recently released economic forecasts indicate that California and the nation will remain in significant recession for the foreseeable future.  The data points to a widespread contraction of state and national economic output.  This will pose significant challenges for school district and county offices of education well into 2010-11.

Economic Forecasts

Economists with the UC Santa Barbara Economic Forecast Project and the Anderson Forecast at UCLA...

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Eastin and Thomas Call for Longer School Year, But Part Ways on State Budget Compromise

By Jeff Hudson - March 27, 2009

Former State Superintendent of Public Instruction Delaine Eastin got into something of a debate with California’s current Secretary of Education Glen Thomas, as well as education finance consultant Bob Blattner, in a lively discussion on Monday.

The occasion was a forum in Davis, organized by the Yolo County School Boards Association.  The event drew quite a few notables, including Gavin Payne (Chief Deputy Secretary of Public Instruction), Harold Levine (Dean of the School of Education at UC Davis), and others...

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Use of One-Time Funds to Generate Long-Term Ongoing Benefits

By Tahir Ahad, TSS and Brett McFadden, ACSA - March 20, 2009

Whether or not one agrees with the causes, logic and rationale of the recently enacted state budget “correction” and federal stimulus packages, the fact remains that they will result in making substantial one-time, uncommitted funds available for local education agency (LEA) governance teams.

Through a combination of fund balance sweep ups, categorical flexibility, and expected federal stimulus funding for schools, a large amount of funds will be available for one-time use during the next several years...

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Recommended Process for Conducting Public Hearings on Categorical Flexibility

By Tahir Ahad, TSS and Brett McFadden, ACSA - March 13, 2009

The recently enacted state budget requires local educational agencies (LEAs) to hold a public hearing prior to the transfer and use of eligible categorical program funds under the new “Tier 3” flexibility options.  The education finance trailer bill, SBX3 4 (Chapter 12/2009), adds Education Code Section 42605(c)(2) requiring an LEA governing board to hold such a hearing.  Specifically, the governing board, “at a regularly scheduled open public hearing shall take testimony from the public, discuss, and approve or disapprove the proposed use of funding.”...

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Court Rules for Reimbursement of School Accountability Report Card Costs

By Jeff Hudson - March 13, 2009

A California Appellate Court ruled on Monday that a 2005 bill that sought to limit state costs for mandated activities of schools and local government is unconstitutional.

The California School Boards Association (CSBA) has been contesting the law, AB 138, since 2006. The bill ordered a Commission on State Mandates to reconsider or eliminate reimbursement to local districts and government agencies for certain Brown Act requirements, for the Mandate Reimbursement Process, and for the School Accountability Report Cart...

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Class Size Reduction Changes with New Budget

By Kari Sousa, CPA and Brett McFadden - March 10, 2009

While the Adopted State Budget did not provide the level of flexibility in K-3 class size reduction that was originally proposed by the Governor, the Budget Act has significantly modified the penalty structure for K-3 class size reduction, resulting in a fiscally significant programmatic decision for Districts.  The revised penalty structure is as follows:...

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Deferred Maintenance Flexibility; What You Can – or Cannot – Do

By Tahir Ahad and Brett McFadden - March 6, 2009

There have been many questions regarding the flexibility associated with deferred maintenance.  Information provided by CDE earlier this week clarifies that prior-year balances for deferred maintenance are not available for “sweep ups” into LEA General Funds.

There has been some confusion in the field because deferred maintenance is not listed in Budget Trailer Bill as a program you could not sweep up prior-year balances.  However, because prior-year balances for deferred maintenance are placed into Fund 14 restricted accounts...

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Categorical Flexibility: Update and Outlook

By Tahir Ahad and Brett McFadden - March 6, 2009

The recently adopted State Budget includes the most significant restructuring of K-adult categorical programs in recent history.  But this restructuring comes at a high price.  Many categorical programs will suffer reductions in funding in 2008-09 and 2009-10.  In addition, there will be no statutory COLA (Cost of Living Adjustment) provided to any Proposition 98 categorical program in 2008-09 and 2009-10, further exacerbating the impact of budget reductions.  A number of them have been identified to benefit from increased flexibility in the use of the funding they receive...

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O’Connell Warns California Budget Deadlock May Limit State’s Access to Federal Stimulus Funds

By Jeff Hudson - February 20, 2009

State Superintendent Jack O’Connell fielded questions from reporters regarding the state’s Budget “Correction” Package and the federal stimulus bill on Wednesday – a conversation that was slightly surreal, since the Budget “Correction” Package was still bottled up in the California Senate as O’Connell spoke.

Ultimately, about 13 hours after O’Connell spoke to reporters, the Senate did pass the budget.  But many of his comments to reporters are still of interest to educators: here is a brief summary...

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Relief Should Be More Than Fiscal – Give Districts More Time On Staffing Decisions

By Tahir Ahad - February 6, 2009

The state’s leadership continues to wrangle with thorny issues that have caused the needed compromise on state budget issues to elude them.

This delay is causing a number of significant problems and inconveniences for the local school officials. And the issues are not only fiscal.  Many problems are procedural . . . which may appear to the lawmakers as trivial.  But these problems still have the clear potential of wreaking havoc on the educational systems...

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$825 Billion Federal Stimulus Plan Moves to Senate

By Jeff Hudson - January 30, 2009

As expected, the House of Representatives approved an $800-billion-plus federal stimulus package on Wednesday.  The bill, which includes about $140 billion in funding for education, was pushed through by the chamber’s Democratic majority by a large 244-188 margin;  the GOP responded by refusing to support the bill, which didn’t get a single Republican vote.

For K-12 education, the federal stimulus package includes funding for Title I-A programs (serving low income students), funding for some construction and modernization projects...

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Federal Bailout Bill Includes Funding for Education

By Jeff Hudson - January 23, 2009

A new $825 billion federal stimulus package, backed by Democrats, is working its way through Congress.  And the legislation currently includes significant funding for K-12 education programs.

The bill has cleared the House Education and Labor Committee, but still has hurdles ahead.

Current features of the bill include:

  1. $20 billion for school construction, including $14 billion for K-12 education...

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Review Your Categorical Programs When Planning Budget Reductions (Part VII)

By Tahir Ahad and Bob Blattner - January 2, 2009

(Part seven in a series on managing school district budget during challenging economic times.)

In this series of articles, the best practices applied in the budget reduction process have been detailed.  Instead of merely reporting on the worsening state budget situation, we are proactively identifying issues and sharing strategies that you may find helpful as you continue to seek ways to balance your district’s next year’s budget.

Although, in principle, we vigorously oppose any reductions in the state education budget...

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The Death of AB 1200?

By Paul Disario, Ed.D. - January 2, 2009

In 1991, a landmark bill called AB 1200 was enacted, after the bankruptcy of Richmond school district in 1990.

AB 1200 was a way of substituting state fiscal oversight for money.  California schools – mired at the bottom of the national ranking of states for in-school spending – were told to keep their finances in order, or face county office and state intervention or takeover.  California’s FCMAT (Fiscal Crisis & Management Assistance Team) was the child of AB 1200, a new state agency to keep an eye on districts’ fiscal health.  It worked . .  until now...

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Evaluate Contributions from Your Unrestricted General Fund (Part VI)

By Tahir Ahad and Nancy Walker - December 12, 2008

(Part six in a series on managing school district budgets in challenging times.)

Before the actual amount of needed reductions in the unrestricted general fund is determined with certainty, the contributions from the unrestricted general fund to restricted programs and other funds must be reviewed.

Before the board is asked to start approving the elimination of positions that are funded through the general fund, and reductions are proposed affecting educational programs, the stakeholders including the employee groups will want to know that all of the draining from the general fund has been stopped...

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Reaffirming Your Budget Assumptions (Part V)

By Tahir Ahad - December 5, 2008

(Part five in a series on managing school district finances during challenging economic times.)

In the previous articles in this series, we discussed cash flow management, and development of enrollment projections.  We also talked about holding conversations with your partners in education such as your employee unions, and communicating with the community and informing the community about budget realities.

Now, it is the time to start preparing for real budget reductions.  Most of school districts have board-approved budget assumptions in place...

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Dust Off and Refresh Your Enrollment Projections (Part IV)

By Tahir Ahad - November 21, 2008

(Fourth in a series on preparing your school district for challenging financial times.)

As you begin your budget deliberation process for the 2009-10 fiscal year and focus on producing a balanced budget, you need to consider revisiting and revising your enrollment projections.

When you develop estimates regarding the magnitude and amount if needed budget reductions, you need to make sure that your estimates are as accurate as possible...

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Tough Times Ahead… So Get Your District Prepared (Part III)

By Nancy Walker - November 14, 2008

(Part Three in a series about managing a school district budget during an economic downturn)

As the State considers enacting mid-year budget cuts, school districts need to prepare.  Where to start?

First things first, develop a budget timeline.  Start with the current month, and prepare a timeline of each step the district plans to take in the following months.  The most important purpose of the budget timeline is to show your stakeholders that you have a plan...

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Managing Cash Flow in Tight Fiscal Times (Part II)

By Kari Sousa - November 7, 2008

(Part Two in a series about managing a school district budget during an economic downturn)

With Gov. Scharzenegger's proposal this week to trim $2.5 billion in state support for public education, many districts are facing the possibility of unprecedented stress on their already adopted budgets.

What should your district monitor as this situation is sorted out in Sacramento?  One of the first and best indicators of a school district in serious financial distress is poor cash flow...

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It's Not Good . . . So Now What? (Part I)

By Tahir Ahad - October 31, 2008

By now, all of us have heard the news – and it is not good. Although the size of the projected deficit keeps changing (depending upon who one talks to), one common thread remains.  The imbalance in the state budget is substantial.

Even the eternally optimistic Governor Schwarzenegger estimates the deficit as high as 10 billion dollars.  And we know he is no "economic girlie-man".  So when he projects doom and gloom, we must listen...

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Professional Development Funding for Special Education Teachers

By Cathy Bui - October 24, 2008

State Superintendent of Public Instruction Jack O’Connell announced 27 school districts throughout California will share $26.6 million in Professional Development in Reading for Special Education Teachers Pilot Program grants.  Eligible applicants included local education agencies with a great need for special education teacher professional development.

The grantees were selected based on the quality of their applications...

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Things to Watch – The Inconvenient Truth

By Tahir Ahad - October 17, 2008

Hundreds of thousands of homeowners across the state have received notices from their local County tax assessors, informing them that their houses are now worth less than last year, and the assessed value has been adjusted downward.

Depressing news to hear, even when it wasn’t unexpected.  However, those homeowners can take heart in knowing that their property taxes will be lower...

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Department of Finance Reports Lagging Revenues

By Jeff Hudson - October 17, 2008

California’s Department of Finance (DOF) released its monthly cash report for October.  And given the recent news about the economy, it comes as no surprise that the DOF’s report indicates that things are slow – a trend that could have implications for future funding of public education.  Among the DOF’s findings in the Monthly Cash Report:

  • Preliminary General Fund agency cash for October was $923 million below the 2008-09 Budget Act forecast of $10.667 billion...

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Bail Out Bill 'Add On'

By Glen Thomas - October 10, 2008

Among the various tax extensions, the federal bail-out bill passed by Congress earlier this month includes a two-year reauthorization for the Qualified Zone Academy Bonds (QZABs), which can be used by school districts with significant populations of lower income students.

The QZAB program allows districts with schools that have at least 35% of their students in free and reduced price lunch programs to borrow money from banks at zero interest to renovate buildings, purchase specific kinds of equipment for energy efficiency, improve curriculum, and to use for professional development...

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Getting the Most Out of Your District Financial Audit

By Kari Sousa - September 26, 2008

Now that your books are closed, it is time to hear those four words that strike fear into the hearts of many a fiscal director . . . "the auditors are coming."

The annual district financial audit represents one of the largest annual professional services contracts that any district makes. Yet many district staffers treat the annual audit like a visit to the doctor – something you do as infrequently as possible, and just hope that you are OK...

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Put Your Categorical Funding to Work

By Tahir Ahad - September 19, 2008

Each year, during the budget development process, the discussion about “flexibility” and use of categorical funds resurfaces.

Of course, this rattles those who hold certain categorical programs near and dear to their hearts, and truly believe that any transfer of funds from their favored categorical programs would be detrimental to their cause.

Consequently, despite rancorous discussions about the flexible transfers and/or expanded use of categorical funds by the Governor...

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Isn't It About Time For A Check Up?
When was the last time your district had a fiscal health review?

By Nancy Walker - September 1, 2008

How is your district doing in comparison to other districts?

Are you working for your categorical programs – or are your categorical programs working for you?

Do you really know how those funds are being used or if they could be used more effectively?

Could your district actually maximize these dollars in a way that may help provide relief to your unrestricted general fund budget?...

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