If voters OK tax hikes, GUSD school budget stays intact

Bills

School administrators in all sectors were waiting with bated
breath pending the unveiling of Gov. Jerry Brown’s 2011-2012
proposed budget. Now that it’s been revealed, school districts will
have to hold their breath for another five months to see if things
will stay bad, or get worse.
School administrators in all sectors were waiting with bated breath pending the unveiling of Gov. Jerry Brown’s 2011-2012 proposed budget.

Now that it’s been revealed, school districts will have to hold their breath for another five months to see if things will stay bad, or get worse.

“This is going to be our most challenging budget year,” said GUSD Superintendent Deborah Flores. “It will be necessary to make significant cuts in order to maintain fiscal stability.”

Though Brown’s budget leaves K-12 districts virtually untouched, GUSD administrators are still in the dark when it comes to fiscal planning. As it was, they were preparing to gauge program cuts and were set to make a decision on whether they have to announce layoffs by a required March 15 deadline.

The fact that everything hinges on a tentative June vote to extend temporary tax increases is just another frustrating factor.

“I guess there is a little bit of good news that nothing was cut, but it’s built on a very shaky foundation,” said GUSD Board President Rhoda Bress. “We knew we were going to be making cuts because we’re not receiving federal stimulus money, and now we don’t know the extent of those cuts. We have to wait on an election.”

K-12 school districts were the only agencies sparred from financial slashing in Brown’s aggressive plan aimed at dragging California out of $25.4 billion deficit and onto the road toward financial recovery. But even if the district’s piggy bank is left untouched and tax extensions are approved, GUSD administrators were already unnerved by next year’s ominous absence of one-time stimulus monies for GUSD – $6.5 million in 2009-2010 and $2 million this year – coupled with a slice of the funding pie going to Gilroy Prep School set to open fall 2011.

Though the budget would decrease K-12 school funding by $49.7 million to $49.3 million, Kirsten Perez, GUSD fiscal services director, said trustees aren’t exactly sighing with relief.

They now have to wait on the outcome of a special June election, where voters will decide on a measure to extend two temporary tax increases and a fee for another five years, which were set to expire June 30, 2011, according to the California Legislative Analyst’s Office.

Perez said they have to plan for the unsavory, likely making reductions as they have in the past in areas such as restructuring programs, transportation, special education, increasing class sizes and authorizing furlough days.

“The best we can hope for is for this tax extension to get passed,” she said, describing the situation as “precarious.”

Tough budget for tough times

The new governor’s “painful” proposal urges voters to take their medicine now, asking them to choose between even deeper cuts in state spending versus tolerating existing temporary tax increases.

“We protect kindergarten through 12th grade education,” said Brown at a budget proposal press conference.

“Now with my program – including the extension of the taxes – schools will be held even at $49 billion.”

Since they’ve taken the bulk of the cuts, Brown said, it makes sense to him.

“I think K-12 educators should be reasonably pleased, but cautiously optimistic,” said Brian Edwards, senior policy analyst for EdSource – an independent not-for-profit organization whose mission is to clarify complex education issues.

In this economic climate, he said, continuing to get flat funding from Proposition 98, which was passed in 1998 and guarantees minimum state funding for schools, is pretty good.

“It’s a welcome relief from cuts in the recent times that have been somewhat disproportionate,” he said, but adds everything hinges on the mercy of voters.

Assuming Brown gains support from legislation and gets the measure on the special election ballot in June – a feat Edwards said could take some political wrangling – voters will decide whether to approve a 5-year extension on two temporary taxes increases and a fee adopted in 2009. This includes a personal income tax increase, a sales tax increase and a hike in California’s vehicle license fee.

If the measure fails to pass, Edwards said Proposition 98 could drop by $2.2 billion.

For GUSD, Perez added, this could mean a potential loss of $380 per GUSD student.

“My understanding is if the increase in taxes is approved by voters, Brown is saying there won’t be any additional cuts,” said GUSD trustee Mark Good. “But if not, there will be additional cuts – on top of the cuts we’ve already gotten.”

Community colleges affected by proposed cuts

Things aren’t looking breezy for Gavilan College in Gilroy, either.

Brown’s proposed budget calls for higher education establishments such as community, University of California and California State University systems to sacrifice for the greater good by approximately $1.4 billion.

In an attempt to patch at least half of a $25.4 billion 2011-2012 gap, Brown said he is hoping to scrape up $12.5 billion in spending reductions; $4 million of which would come from community college funds.

Jan Bernstein-Chargin, director of public information for Gavilan College, echoed Perez; more or less indicating it’s better to rip the Band-Aid off then peel it slowly.

If Brown’s proposal is implemented and taxes are maintained, she pointed out there will be a 6.39 percent reduction to community college funding, according to the Community College League of California.

If not, the CCLC states there will be a 14.35 percent reduction, including a fee increase from the current $26 per unit to $36 per unit.

Reflecting on education’s economic landscape, Edwards said pressures created by high health care and salary costs, coupled with fallen revenues, is a bad mix.

While Brown was “pretty smart to protect education,” Edwards said everything is contingent on how well the new governor can sell his idea.

“A lot of it will depend on how much he takes it to the pulpit, and makes a case for the tax extension,” said Edwards. “What it would mean to extend them, and what it would mean not to.”

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