A day of reckoning?
Analysis from CSBA’s Governmental Relations Department
Published: June 2, 2009
“California’s day of reckoning is here,” Gov. Arnold Schwarzenegger said in an address to a rare joint session of the Legislature this morning. The governor urged immediate action to cut spending but didn’t include any new proposals, instead emphasizing the need to focus on reform and to eliminate and consolidate state departments, boards and commissions. He specifically cited the Integrated Waste Management Board, seen by some as a plumb appointment with a $120,000 annual salary for its members, who include former legislators. The governor stated that he wouldn’t cut any more dollars from education until first cutting the board.
The governor’s speech comes on the heels of two modifications to his May Revision last week, when he sought to address an additional $3 billion decline in revenues and the decision not to pursue additional borrowing to balance the state budget. The amendments represent an additional cut of $8.5 billion and include eliminating CalWORKs, releasing non-violent prisons a year early, phasing out Cal Grants to low-income college students and cutting Medi-Cal services such as dialysis.
Implications for schools
For education, Schwarzenegger is proposing an additional $680 million cut to revenue limits in 2009-10. While the plan includes a contingency provision in case revenues don’t drop by the full amount now expected, districts should plan on this cut occurring and then hope it doesn’t. The governor is also proposing a $403 million cut to home-to-school transportation—a 65 percent cut to the program!
If the Legislature approves the governor’s proposals within the next two weeks, it would likely mean an additional cut of $1.4 billion to schools in the year ending just four weeks from now, which would be compounded next year by the $650 million in cuts already approved in February and the additional cut of $2.4 billion from the May Revisions.