On January 15, Assistant Superintendent of Business Services Nancy Pfeiffer and I attended a briefing in Sacramento on Governor Gavin Newsom’s proposed budget. While the governor’s proposal prepares for uncertain economic times, it includes some new funding for Pre-K, K-12 and higher education.
California Finance Director Keely Martin Bosler summarizes California’s fiscal outlook as “extraordinary right now, but [it] is punctuated by a lot of uncertainty.” While there are bright spots, there are some warning signs of an economic downturn in the future. The state is currently in the longest economic expansion in history, but UCLA economists predict the nation’s Gross Domestic Product will slow down in the next few years from 3% to 1% and the chances of an economic recession this year are one in six and next year it will be one in three.
So what does the governor’s proposal include for K-12 education? In response to economic uncertainties, the proposal allocates more money towards budgetary stability and supporting state pension systems. Additionally, the proposal includes making large investments into early childhood development.
As a community-supported or “Basic Aid” district which is funding directly by property taxes, CUHSD does not receive all the same benefits from the Governor’s budget as districts that are funded based on Average Daily Attendance (ADA). Changes to our District's revenue may or may not match those suggested in the Governor's proposed budget.
Where we will see a slightly positive impact is with the one-time $6 billion contribution to CalSTRS, the state teachers’ retirement system. Based on current projections, school district contributions would decrease by about one percent over the next few years.
Although the Governor’s new budget proposal addresses the rising costs of CalSTRS, it still doesn’t alleviate the rising costs of CalPERS, the California Public Employees Retirement System, for school districts. Support staff like clerical workers, bus drivers, and food service workers are covered under CalPERS. The proposed budget may provide the District with some relief, but it doesn’t solve all the budgetary challenges we are facing.
Based on these new assumptions, the District’s fiscal department is revising the district’s multi-year budget projections. The goal of my staff and I is to propose to the Board of Trustees a budget proposal that reflects our desire to continue our current educational programs on behalf of our students while ensuring we stay fiscally responsible on behalf of our community.