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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, the state budget trailer bill dealing with education that was approved in last-minute action by the Legislature in June.

AB 114 could cause “enormous financial distress and, in some cases, financial insolvency” for local educational agencies, the letter warns, because the legislation requires Local Education Agencies (LEAs) to assume in their own budget planning that state revenues will remain stable for the next two years — and it contains a new ban on mid-year teacher layoffs, along with limits on other budget-balancing strategies.

Although AB 114 required LEAs to ignore the possibility of mid-year budget cuts as they created their budgets, other portions of the state’s budget package — much of it passed without public review or discussion — contain triggers that could cut schools by nearly $2 billion this fiscal year if state revenues fall below estimates.

“The fact that the budget contains a mid-year reduction trigger demonstrates that the Legislature and Governor acknowledge the need for contingency planning. It is painfully ironic that this same ability was denied schools,” Fluor and other education leaders observe in their letter to Brown.

Schools have already absorbed nearly $8 billion in cuts since fiscal 2008-09, the letter points out, and many LEAs have been forced to pay for short-term loans to compensate for an additional $9.3 billion in deferred funds—money the state owes schools but has not yet paid.

Banning midyear teacher layoffs in the event of a fiscal emergency would force LEAs to cut more deeply into classified staff, an option that is simply not feasible for many schools, the letter says.

“Not only have the ranks of custodians, bus drivers and other classified staff already been decimated by prior budget cuts, these layoffs will not result in enough savings during the remainder of the fiscal year. For many districts the outcome will be extreme fiscal distress or even outright insolvency,” the letter says.

Districts are always reluctant to lay off teachers, but because teacher compensation constitutes the largest portion of school budgets, the letter argues it’s essential that LEAs have the authority to cut teacher jobs in the event of a fiscal emergency.

“If this authority is not provided, then it would be imperative that the trigger not be pulled and that additional deferrals not be levied, even if revenues fall short of budget projections,” the letter advises.

Supporters of AB 114 have argued that the law gives districts new authority to reduce the academic year by up to seven days if necessary to absorb midyear cuts. But the letter calls this provision “virtually unworkable” because LEAs would have to reopen contract bargaining and negotiate such reductions with employee unions. “If bargaining units refuse to discuss a shorter school year, that option is not available,” the letter says.

Source:  California School Boards Association