Gov. Jerry Brown on Thursday presented a budget plan that makes fundamental changes to the way schools and colleges are funded, implements the federal Affordable Health Care Act and, for the first time in years, offers a financial plan with no deficit.
The $97.6 billion general fund budget plan predicts a surplus for the state of $851 million in 2013-14, $47 million in 2014-15, $414 million in 2015-16, and $994 million in 2016-17.
“The deficit is gone, the wall of debt remains,” Brown said at a press conference Thursday, adding that his plan will help the state reduce its debt from $27.8 billion at the end of this year to $4.3 billion in 2016-17.
“Right now, for the next four years, we’re talking about a balanced budget,” Brown said. “We’re talking about living within our means.”
Pajaro Valley Unified School District Chief Financial Officer Brett McFadden said the proposal would mean a “significant increase” to the district’s per-student funding.
McFadden said it is too early to predict just how the budget might affect PVUSD schools, but he did say that the district “stands to benefit a great deal from this budget.”
“This proposal is the most bold and ambitious plan to reform and change California’s school finance system that I’ve seen in my 25-year career,” McFadden said.
Brown said the state has weathered 15 years of “great fiscal difficulty” caused in part by overspending and by making unsustainable tax reductions.
The good budget news, he said, was made possible by cuts such as the elimination of redevelopment agencies and by the approval of Proposition 30 by voters in November, which raised personal income taxes for wealthy Californians and imposed a temporary sales tax increase.
But despite the good news, the message throughout the hour-long press conference was clear: lawmakers should use caution when making financial decisions, particularly in light of an unstable federal budget that could force further reductions in California.
“We want to avoid the boom and the bust, the borrow and spend,” Brown said. “I want to advance the progressive agenda but be consistent with the amount of money we have.”
Brown’s budget increases per-pupil funding to $2,700 by the 2016-17 school year. That means a $2.7 billion increase for K-12 and community colleges net for the year and $19 billion by 2017.
Under the new plan, every school would still receive the same level of per-pupil funding that was lost when the recession hit.
But it dramatically shifts the way schools are funded, increasing funding to districts with large numbers of economically disadvantaged students and English language learners.
“What the governor proposes to do is a fundamental realignment of how the state allocates dollars to students,” McFadden said.
Brown acknowledged that portion of the plan could mean wealthier districts would receive less funding.
“That’s controversial, but it is fair and it is right and it is just,” he said.
“All that will be part of a formula that will direct money where it is most needed,” Brown added. “That is a classic case of justice to unequals — we have to give more to approach equality.”
The budget also gives school districts local control over how they spend their money and eliminates the bureaucracy of categorical funding programs controlled by the state.
McFadden said that previous budget proposals have left him disappointed and wondering how he would make necessary cuts.
“I’m not feeling that,” he said. “I’m feeling cautious optimism. I’m happy in that I don’t think I’m going to have to cut anything. That’s over now.
“I’m optimistic that the final product will be the beginning of more money into public education after six very long years.”
• Higher education
The proposal increases funding for each of the UC and CSU systems by an additional $250 million, a 5 percent increase.
Brown said the budget would require universities to allocate their teaching resources more effectively, and to find a way to educate students without increasing costs.
In addition, college students would be limited in the number of classes they can take above what is required to earn a degree, this freeing up space for other students and fast-tracking their graduation.
“That’s going to be a challenge for universities, we understand that,” Brown said. “I’m going to do everything I can to make it affordable to the state and the students.”
• Health care
The budget also implements President Barack Obama’s Affordable Health Care Act, also known as Obamacare, which he said will place another 1 million people on Medicare with a subsequent jump in costs.
In particular, the plan eases Medi-Cal eligibility and gives coverage to childless adults and uninsured parents.
• Lawmaker responses
State Superintendent of Public Instruction Tom Torlakson said improving the financial health of the state’s schools is an ongoing project.
“It will take years to bring our education system back to financial health, and I applaud the governor for beginning that work in earnest,” he said.
Torlakson also said that he wants to see early education programs benefitting from the budget.
“I admire the governor’s determination to move forward with an overhaul of California’s confusing system of school finance, and I share his desire to direct more help to students and schools with the greatest needs.”
Assemblyman Luis Alejo, D-Salinas, also praised the proposal, and called it a “starting point.”
“I’m ready to roll up my sleeves and bring the voice of the Central Coast to the table,” he said.
Brown's budget proposal goes to the Legislature next, and will be revised in May. California lawmakers have until the middle of June to submit their own budget suggestions.
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