The recently passed state budget is unfortunately all smoke and mirrors. It is business as usual for our state legislators; they continue to have no courage to make the financial cuts needed to face the reality of this ongoing financial crisis. The reality is that there is no financial crisis; the crisis is our new reality. This new reality is where our state will exist for many years to come. The revenue forecasts in this new budget are rosy and without foundation. The budget assumes $7.5 billion in cuts and yet a third of the year has passed without any such cuts. Although UCLA economists predict a personal income growth of 1.9% in 2010 and 3.7% in 2011, the state budget assumes 3.2% and 4.5% in those years to balance the budget.
Through the smoke and mirrors it appears that K-14 education receives an increase in spending authority based upon a deferral of $1.7 billion. This deferral gives school districts the right to borrow this money to expend it, but not the cash. Let me repeat that so that you will understand what I am saying. The increase to our spending limit is based upon our ability to BORROW money. The increase does NOT give us additional funding of cash. Fortunately for Coronado residents, because of proper planning and intelligent foresight, this school district will not need to borrow. Many districts across the state will take this borrowing option because it bails them out of their own financial hole.
This budget is beyond incredible; it is beyond what any reputable accountant would recommend. It is irresponsible, negligent, and cowardly. Because this budget appears to give school districts a 5.17% revenue increase, collective bargaining units will want to negotiate to receive a portion of this increase. However, this increase is not real; it is based on borrowing money.
But on the other hand, it is now state law; the increase and the subsequent borrowing is now a legal action deemed appropriate by our state government. Irresponsible, but appropriate. Legal, but of disrepute. The appearance of growing financial strength, but without any foundation.
This is a sad day for California.
The education budget sent to the governor contains the following:
· Suspension of Prop 98 cutting K-14 funding approximately $4.1 billion below the guarantee twice voted on by Californians.
· In January, 2010, the Governor proposed $1.7 billion in cuts to district and county revenue limits. Now the governor restores $1.7 billion, then (by magic) defers $1.7 billion in payments from Spring 2010 into July 2011, the next fiscal year.
· Provides approximately $300 million in one-time funds for current year mandate claims and to begin paying off prior year claims, leaving millions of dollars more in unfunded mandate claims without hope of being reimbursed.
· Categorical funding levels remain largely unchanged from prior year cuts.
· Allows districts to continue raising K-3 class sizes through “flexibility” adjustments.
Jeff Felix, Superintendent
Coronado Unified School District
