The Governor’s School Budget: The Race To Mediocrity

January 18, 2010

On Friday, Gov. Arnold Schwarzenegger and other state officials signed California’s grand, ambitious, 550-page application for federal Race to the Top (RTTT) education funding. It came just a week after the governor submitted a budget plan for the coming year that’s so riddled with holes, misrepresentations and improbabilities that you’d never know they applied to the same state.

The application for RTTT funding boasted that despite the California’s fiscal crisis, the “State has made education funding a priority over the last several years.” But it does not tell the federal reviewers that California is among the lowest three or four states in the nation in what spends per pupil in school funding, and perhaps the lowest and that it’s done almost nothing to change it. .

And while the application insists that California had made education a top spending priority, its own application shows the steep decline in spending for K-12 schools and higher education from roughly $48 billion in 2007-8 to roughly $40 billion in succeeding years. But it uses those numbers to show that as a percentage of the total state budget (from $105 billion to $85 billion) it’s slightly up

What it doesn’t tell the feds is that despite the scandalously low funding of its schools and colleges, California has resolutely refused to increase revenues, even in good times. On the contrary, the same governor who signed that application on Friday and put out a press release boasting of intentions to achieve “historic education reforms to empower parents and transform under-performing schools,” cut taxes on his first day in office, at a cost of $6 billion annually and with one small desperation-driven exception has stoutly resisted all tax increases in the years since.

It does not tell the officials at the U.S. Department of Education who’ll pick winners and losers among state applicants for a piece of the $4.3 billion in federal RTTT funds that his budget – and the education funding it does provide — rests on blue-sky expectations of revenue, including $6.9 billion from Washington, that it’s unlikely ever to get.

Those expectations represent far and away the biggest chunk of the governor’s “solution” in closing the state’s $20 billion deficit. The governor vows that if he doesn’t get all the money he wants from Washington, he’ll totally wipe out some of the health, welfare and other social services programs that he’d already cutting to the bone. But those cuts – plus his proposed raid on a major state program for young children – would affect the chances of closing the state’s achievement gaps almost as much, if not more, than cutting school spending.

(That Schwarzenegger accompanied his demand for the federal money with attacks on the federal health care program and, more generally, on the feds for stiffing California — by inference a slap at California’s congressional representatives — hardly improved his chances for any sort of federal help).

In addition, according to the Legislative Analyst’s Office, the governor seems to be counting on nearly $900 million in estate tax revenue the state probably won’t get and ignores the cost of tax breaks for “green” technology.

But those are only the most obvious parts of the cadaverous budget plan he sent down the other day. Schwarzenegger pretends that it was the recession which put the biggest hole in his budget. But in fact the largest single element was the cost of litigation growing out of the baseless assumptions and illegal cuts in Schwarzenegger’s prior budgets. This year’s budget has a lot more of the same.

And while the governor tells Californians that he’s fully funding education, by almost every definition his budget falls well short of that. He’s whacking $1.2 billion out of administrative school funding even as the state and feds are demanding more from school administrators. And since “administration” includes everything from truant officers to school buses, it’s hard to know from where he expects the local districts to get it. He assumes that districts can save another $300 million by contracting out for services, but since many are already doing that, it’s hard to know where they’ll get it.

And he’s asking for major changes in the state’s gas tax policy – hoping to convert the state’s sales tax on motor vehicle fuels to a somewhat smaller increase in the per-gallon tax on gas. The additional per-gallon tax would go into the highway fund to pay off transportation bonds and to fund other road projects.

None of it would go to transit or rail, none, either now or anytime in the future. That in itself is a huge policy shift that’s hardly been mentioned. And since the gas tax wouldn’t go into the general fund it would no longer count in the constitution’s school funding formula – which in turn lowers the meaning of “fully funding” the schools to the tune of nearly $900 million in 2009-10 and $1.5 billion in 2010-11.

To make all that fiscal medicine go down, Schwarzenegger is asking the legislature to cut the school year from 180 days to 175, and allow schools to disregard seniority in assigning or laying off teachers. The last would be a worthy reform, but since most union contracts include seniority provisions, that provision would have to be renegotiated by local districts.

Additionally, since the state, in order to get federal stimulus money last year agreed to “maintenance of effort” in school funding, the cuts the governor is proposing this year would probably also require a federal waiver. If you’re trying to impress Washington that your state is a worthy recipient of federal money aimed at turning around failing schools and raise the achievement levels of American students, California has found an odd way to do it.