Governor's May Revise Provides Hope to School Districts, Supports Tax Extensions

The health of finances hinges on the state Legislature’s reaction to Gov. Jerry Brown’s revised budget presented last week, but the revised budget gave many school districts hope that they’ll receive adequate funding.

During Thursday’s meeting of the DUSD Board of Education meeting, Chief Business Official Cecile Nunley gave the board a sense of what the governor’s May revise means to DUSD.

The revised budget recognizes $2.8 billion in additional revenue for 2010-111 and $3.5 billion for 2011-12. In addition, the governor’s budget continues to support tax extensions – including the extension of expiring sales taxes, vehicle license fees and personal income tax – that would help school districts keep afloat, Nunley told the board.

Nunley gave both good and bad news to the board Thursday. Highlights included the aforementioned additional revenue; Proposition 98 base funding increased to $52.4 billion from $49.4 billion in 2011-12; and no suspension of Prop 98 funding for the 2011-12 school year.

Nunley told the board that the Education Coalition – comprised of the California Teachers Association, the state Parent Teachers Association and the California School Boards Association – separately praised the governor’s approach to the budget. The governor is proposing that all of the $2.8 billion in revenue is used to eliminate $2 billion in late payments, otherwise known as deferrals, to school districts throughout the state.

But along with the good news, came the bad. The governor has told school districts to budget for $52.5 billion in school funding, but should the tax extensions not receive the necessary vote in the state Legislature, and subsequent ballot vote by the public in November, a suspension of the Prop 98 guaranteed funds would be necessary, Nunley said. The suspension of those funds would result in a loss of $5 billion to schools, which equate to eliminating a month from the school year.

 “If the taxes are extended, then we could see a real increase in school funding,” Nunley said.

If the tax extensions do not come to fruition, the district would have to make deep cuts to its budget.

Nunley told the board:  “Overall funding for schools will be roughly flat under the May Revision, rather than the initially perceived significant boost. For this to work, taxes must be extended.”

Nunley’s cautions also included:

• The governor proposed to shift mental health services to schools. But Nunley said that the state would give schools money to do this initially, but that the funding would not last forever and that schools would eventually have to take this expenditure on themselves.

• Proposes suspension of funding the California Longitudinal Pupil Achievement Data System (CALPADS) and the California Longitudinal Teacher Integrated Data Education System (CALTIDES). Both are databases used to measure data systems that are used to provide information about student achievement (CALPADS) and teacher information (CALTIDES).

Nunley said told the board, as Thursday’s presentation was just for information and not action, that the most districts are planning on a reduction of about $349 per Average Daily Attendance (ADA) based on the governor’s January budget.

She also said that if the tax extensions do not pass the state Legislature, the district would need to brace for cuts because of a $5 billion reduction in education adding another $330 per ADA cut for a total of $679.

Nunley’s advice to the board was to “take a deep breath, listen to experts and continue to lobby for the revenue extensions.”

After the meeting, Nunley said that concerned residents could write to their state legislators and lobby for the approval of the tax extensions. The district will know more in mid June when the Legislature is expected to act on the budget.