Governor’s budget proposal looks promising for schools

As part of his first budget press conference on Jan. 10, Gov. Gavin Newsom good-naturedly name-dropped California school board members and CSBA, highlighting the persistent and ardent advocacy of CSBA and governing board members statewide on pensions and other fiscal concerns.

“We are adding an additional $3 billion into immediate relief to school districts to address their STRS anxiety…,” the Governor said. The Governor’s $3 billion proposal for CalSTRS contribution rates is one-time non-Proposition 98 General Fund money and would all be paid out during the 2019-20 budget year. The proposal includes a $700 million ($350 million each for 2019-20 and 2020-21) direct buy-down of employer contribution rates, reducing rates by 1 percent in each of those two budget years, and $2.3 billion committed to reduce the employer unfunded liability, with a resulting 0.5 percent projected reduction in employer contributions beginning in 2021-22.

A separate proposal from Gov. Newsom is related to CalPERS but does not impact schools, as this investment would apply to the state as an employer, and not to local educational agencies for classified staff wages.

“Gov. Newsom’s first budget takes a significant step towards addressing many of the issues CSBA has been advocating for — pension relief, additional funding for schools that supplements, not supplants Proposition 98, the release of Prop. 51 funds for school construction and modernization, and more resources for special education,” said CSBA CEO & Executive Director Vernon M. Billy. “The Governor has checked almost all the boxes.”

Increased Proposition 51 funds

In other promising budget news, Gov. Newsom announced a notable shift from his predecessors’ policies pertaining to school facilities. When California voters approved Proposition 51 in 2016, which provided $7 billion for K-12 school facilities construction and modernization projects, then-Gov. Jerry Brown was less than supportive of the bond measure, due to his concerns over the existing School Facilities Program. As a result, his subsequent budget provided only $653 million in Proposition 51 funds, during a time when the Office of Public School Construction had received more than $3 billion in school funding applications.

Gov. Newsom’s proposed 2019-20 budget reflects his support for school facilities and recognition of the growing need that is a decade in the making. He proposes releasing $1.5 billion in Proposition 51 school facilities bonds, and also plans to invest an additional $1.2 million to hire 10 more positions within the OPSC to process the outstanding funding applications.

CSBA has been working with a coalition composed of the Coalition of Adequate School Housing, the Association of California School Administrators and others during the past year to better inform the Legislature about the growing backlog of projects. Additionally, CSBA is requesting that school projects on the OPSC Workload List be processed immediately and submitted to the State Allocation Board for funding. Many of the projects on the Workload List have been awaiting funding since 2014.

While the $1.5 billion proposed in the January budget is a tremendous recognition, there is still more work to be done. CSBA and others have been working with legislative offices (such as Sen. Mike McGuire and Assembly member Patrick O’Donnell) to increase the proposed funding levels. CSBA recognizes that the longer these school projects linger on the Workload List, the cost of construction continues to escalate, reducing the local buying power to build necessary school construction projects and fulfill the promises made to the local communities.