Gov. pulls trigger, hits education

Budget cuts slam higher education, almost spare K-12

(John Fensterwald coauthored this article.)

Midyear budget cuts hit California like a tornado on Tuesday, leaving public schools with less damage than anticipated while bearing down on state colleges and universities with full force. Gov. Jerry Brown announced that although state revenues rose, it wasn’t enough to stave off the so-called “trigger cuts” built into this year’s budget.

With revenues more than $2.2 billion below projections, Brown said the state has to cut another $1 billion in spending. Of that, about $328 million will come from K-12 education, which is significantly less than the $1.4 billion worst-case scenario.

There was no such reprieve for higher education; the University of California, California State University, and the state’s community college system will each lose an additional $100 million in the new year.

"We have to live within our means," said Gov. Brown in announcing nearly $1 billion in mid-year cuts. (source:  Governor's press conference) Click to enlarge.

"We have to live within our means," said Gov. Brown in announcing nearly $1 billion in midyear cuts. (Source: Governor's press conference) Click to enlarge.

I want to invoke a Latin phrase here,” said Brown at a press conference in the Capitol. “Nemo dat [quod] non habet; it means no man gives what he does not have. The state cannot give what it does not have.”

Several times during his comments, the governor acknowledged that he’s sensitive to the hardships the reductions will cause, but said the state has to live within its means or it will end up like Greece, Italy, and Spain, countries that overspent to excess and are now unable to climb out of the holes they dug.

Higher ed, higher fees

His argument didn’t sway critics, especially at the three college and university systems, which have already lost billions of dollars in state funding in recent years.

“The governor is the Grinch that stole Christmas,” said Foothill-De Anza Community College District Chancellor Linda Thor, only half jokingly. Although she knew the cuts were a strong probability, Thor said it still means another $2.8 million from her district ($3.3 million if you count the lack of cost-of-living increases), and that’s on top of $24.6 million in cuts over the last three years.

For the rest of the academic year Foothill-De Anza will dig into a rainy day fund established during better times, but that’s running low after several years of stormy economic weather.

What’s more, starting this summer student fees will jump from $36 a credit to $46. That’s far below the rest of the nation, but it’s still nearly $1400 a year for a full-time student, and community colleges have a high percentage of low-income students.

De Anza College awarded financial aid to more students in the current fall quarter than it did to all students in the entire 2010-11 academic year.

California State University students will also be paying more. Last month the Board of Trustees approved a 10 percent fee hike that will kick in next fall. CSU has already raised fees by 29 percent over the past year and a half.

“It is disheartening to say the least when your budget is cut by an initial $650 million, but to face an additional $100 million reduction midyear makes things extremely challenging,” said CSU Chancellor Charles Reed in a statement on the university’s website.

Cuts put brakes on school buses

Funding cuts for K-12 schools under Proposition 98 are a bit fuzzier. The governor and legislative leaders had predicted that revenues would rise $4 billion over the May revise amount.  If revenues were down by the full $4 billion, public schools would have been cut $1.4 billion, or about 3 percent.  Since revenues weren’t that low, schools will see a midyear total cut of $328 million, or about 0.7 percent. That’s an average of $55 per student.

But that’s not exactly how the governor presented it. Brown broke the reductions into two parts: First, a $79.6 million reduction in the basic school funding, called revenue limit funding. That’s the equivalent of about a half-day of school cut, instead of a potential elimination of a whole week.

The second cut is more substantial; a $248 million reduction in home-to-school transportation, in other words, school buses. Taken together, they amount to an average of $55 per student.

However, because school transportation funding primarily affects rural and low-income urban districts ­– and uses an outdated, quirky formula ­– the impact will vary widely among districts, from less than $7 per student in the 19,000-student Antioch Unified, to a whopping $638 per student in the 744-student Southern Humboldt Joint Unified.

Los Angeles Unified, the state’s largest district, which will be absorbing the biggest transportation hit of $38.6 million – $59 per student – announced that it plans to file suit today to halt the cut. The district contends that the cuts would violate a 30-year-old court mandate resulting from a desegregation lawsuit that set up magnet schools and a school choice program; 35,000 students in the district now take buses. At the same time, the alternative – cutting additional services to the classroom ­– would violate the state’s constitutional duty to provide equal educational opportunities.

“LAUSD cannot withstand further budget cuts without adversely impacting the educational benefits offered to its students,” Superintendent John Deasy said in a statement. “We stand with our students to say enough is enough.”

Transportation funding has huge disparities, because it’s based on a decades-old allocation formula that punishes districts that have grown rapidly. California is last in the nation in terms of the proportion of students bused to school: 14 percent, according to Stephen Rhoads, a lobbyist with Strategic Education Services in Sacramento who has focused on the transportation issue.

In his press conference, Brown characterized the transportation cut as flexible, giving districts the ability to backfill bus service by making cuts in other areas. But it’s not as easy as that. Rob Ball, associate superintendent of Twin Rivers Unified in Sacramento County, said that the district already reduced bus routes as much as it could, with some students now walking three miles to a bus stop. Buses also transport high school students through rough neighborhoods in North Sacramento to Grant High; eliminate transportation, and fewer students would show up to school, reducing the state’s tuition reimbursements. This year, said Ball, the district will take the $1 million transportation cut out of its reserves.

Rhoads said that heavily affected districts will lobby legislators to combine the transportation and revenue limit cuts, so that the pain is spread evenly among districts. The Education Coalition, representing the PTA and teachers, administrators, and school boards associations, expressed sympathy. The transportation cut will devastate transportation services and hit poor and neediest students the hardest, it said in a statement. “It will also put at risk the safety and lives of students who will be forced to walk on unsafe roads and through dangerous conditions.”

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  1. Yeah….Way to go Jerry……….
    Hey, let’s keep paying Welfare for Octomon so we can cut School funding,  I mean, a man cannot GIVE away what he does not have, Right?  So, let’s rob the money allocated for the next generation and GIVE it away to the Welfare folks…….Nice choice……..
    Say, here’s a question for you:  Do Politicians EVER get tired of buying votes?  No, didn’t think so……..But, when the money runs out, we WILL become Greece………and you COULD have avoided plunging California into the abyss……..
    You let us down before and California didn’t learn a thing…………

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  2. The subtle impact of transportation costs on ADA funding is an important point. Its amazing when you talk about the number of students in large districts, and how much even a 1% change in attendance rate makes on revenue, let alone a larger change. In other words, this is a cut that earns compound interest.
    In addition, just yesterday I took our district’s yearly attendance rate for each school for each of the last 3 years, sorted them from lowest to highest, then compared them with the API scores for that year. Not surprisingly, the correlation was quite strong. Not, of course, to imply causation. Correlation is sufficient to get people thinking, imho.
    It would be interesting to know whether the impact of transportation on performance could be separated out from other factors.

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  3. Since I live in one of those rural districts, I too would prefer to see the cuts allocated more evenly. In our area, there aren’t sidewalks even if the kids could manage the distance, and many houses are on roads where there is not even a shoulder. It’s not safe for anyone to walk them, even an adult.
    In addition, as I understand it, districts that choose to cut their transportation to match the state allocation will lose those funds forever, even if needed and valuable routes are cut.

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  4. el – that was my understanding too. If a district cuts  the transportation now – that is it for the state allocation in the future. So, districts that are on the brink are now looking at a rock and a rock as far I can tell! The ‘hard place’ option is gone! I agree – safety is critical. Cutting rural buses at the start of winter? 
    There is neither common sense nor wisdom in this “trigger” decision.

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  5. Several points:

    (1) It isn’t fair to solely blame Gov. Brown for the magnitude of these cuts. Although he was complicit in approving the “trigger cut” mechanism (by virtue of signing the Budget Act), the mechanism itself (tying cuts to state General Fund receipts), the amounts of the cuts, and their specific distribution were all developed and approved by the Legislature.

    (2) From the day it was enacted, everyone has known that the revenue assumptions on which the budget was based were unrealistic and vastly overestimated. The only question has been “by how much?” To those who have followed this issue (including all CBOs and CFOs worth their salt), these cuts should have come as no surprise. Representatives of interest groups claiming to have been blindsided by this issue are either being extremely disingenuous or weren’t doing their jobs. 

    (3) The trigger cut mechanism was a political solution to the Legislature’s stalemate over the budget by (a) allowing both parties to embrace the fiction that they had passed a “balanced” budget (with no new taxes and no new program cuts)  and (b) deflecting blame for program cuts to an impartial “budget machine” when revenues inevitably failed to materialize at the level assumed by the Budget Act.

    (4) Gov. Brown can be blamed for specifying that K-12 education’s trigger-determined cuts would include the elimination of the Home-to-School Transportation program. On the other hand, nothing in the trigger legislation requires that K-12′s cuts be taken entirely from general-purpose revenue limit funding.

    (5) The Home-to-School Transportation program does not pay for school buses. It (partially) reimburses some school districts for the costs (drivers, fuel, maintenance) of operating school buses.

    (6) The state Supreme Court determined long ago that home-to-school transportation was not integral to schools’ educational mission. Accordingly, the state had –and has–  no obligation to provide funding for this purpose.

    (7) By eliminating funding for the Home-to-School Transportation program, Gov. Brown is merely hastening the inevitable and eliminating a significant funding inequity among districts. Some districts are ineligible to receive funding at all; of those who are, per-pupil funding varies widely for no justifiable reason. It has long been the Legislature’s goal to eliminate funding for this program: (a) any decrease in spending results in a permanent funding reduction and (b) no new districts can qualify for the program.

    (8) The reactions of LAUSD and other districts to this cut, while predictable, are without merit. First, the elimination of the Home-to-School Transportation subsidy does not require districts to eliminate home-to-school transportation. If this is a high priority, districts can redirect funding from other sources to continue this service. School districts can also charge fees for this service. Many districts don’t even run their own school buses; instead, they sell students discount passes from public transit systems. Second, the elimination of this program does not affect funding for transportation that is required by special education students’ IEPs. Schools have been, and will continue to be, required to provide this service, which is funded by the state.  Third, transportation services that are required by a court order or settlement agreement are not affected by this cut. These transportation services are funded by an entirely different source: reimbursements for court orders or state mandates that impose new costs or require higher service levels. Finally, LAUSD’s claims that its only other option is cutting funding for classroom services and that such cuts would raise equal protection issues are, in a word, ludicrous. Many other districts have cut “classroom services” without coming close to violating the Constitution (state or federal). It’s also not true that LAUSD has no other option. It can reduce non-classroom expenditures such as maintenance, it can re-negotiate workload and compensation with certificated and classified employees, and (horrors!) it can cut administration. The only way I can think of that  LAUSD would run afoul of equal opportunity requirements would be if it chose to distribute the cuts in a manner that discriminated against protected groups or categories.

    In sum:

    1. The Legislature is at least as culpable as Gov. Brown in determining the magnitude & distribution of the “trigger cuts.”
    2. Everyone in the Capitol knew the budget was bogus & at least some amount of trigger cuts was inevitable.
    3. The trigger mechanism was simply a means for both parties to claim that the budget was “balanced” when they knew fully well that it wasn’t.
    4. While responsibility for the elimination of funding for Home-to-School Transportion can be assigned solely to Gov. Brown, the magnitude of the total cut to K-12 education (and the higher education segments) cannot.
    5. There is a legitimate policy justification for eliminating state funding for Home-to-School Transportation.
    6. The elimination of state funding doesn’t mean districts must eliminate this service. Among other options, they can charge fees to those who use home-to-school transportation.
    7. On the other hand, the state constitution neither requires districts to provide, nor the state to fund, home-to-school transportation.
    8. The elimination of Home-to-School Transportation funding does not affect funding for special education transportation or reimbursements for programs mandated by the court or resolved via settlement agreements.

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  6. edfundwonk – thank you! I would not dispute your analysis because I follow your postings and pay attention to what you know!
    However … our small school had already made the adjustments in case this cut came, but we are not LAUSD. Some of the small, rural districts/schools, were in the lowest of the tax positions when Prop 13 was formulated, and are just quite inequitably funded from the beginning. I have posted elsewhere that when in San Diego we should have been charged for my step-daughter’s bus transportation, but weren’t. In many smaller ag communities there is already  a great deal of need, and I just think that this hit was disproportionate. Had I not moved to this area in Humboldt, I would not have understood this aspect of busing, but now I do. Part of the problem – California is just so huge, but its politics perhaps overly influenced by more powerful communities. I cannot imagine what 2012-13 is going to bring.
    A question: did Governor Brown have to sign AB 114? 

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  7. Thank you edfundwonk, your clarifications were very helpful. A couple questions and a comment:
    1. you mention the trans funding is already inconsistent; is the disbursement based on need? or is it completely independent of that. It seems such funding would be categorical, is that true? if so, it does not help districts to get ‘too much’ if that is ever the case (though it obviously matters if one gets ‘too little’.
    2. Even though you mention it is the legislatures goal to eliminate the program, and that even the courts indicated it would not be integral to districts’ responsibilities, I do think district boards feel differently, especially when they provide schools of choice that involve low-income families. If there is any kind of pressure, or even mandate by the state to provide such schools, is there not justification to claim unfunded mandate status?  Even where there is no explicit mandate, it seems clear a district could simply believe that both the legislature and the courts are wrong about the impact of transportation on education, especially in dangerous and/or poverty neighborhoods. In fact, it seems exactly what these districts are claiming. If thats the case, it seems clear the approach of legal action is the appropriate response. Thoughts?

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  8. Let me first say that overall this is good news for my district. My back of the envelope calculation suggests that for our district, it means that we will only experience about half of the cut we had planned for. It’s still a blow but it not only helps with our long term outlook in this year, but in future years, because districts were told to plan for that cut to be ongoing in 12-13 and 13-14. (Yes, our district is still doing the three year projections, as is prudent!)
    But, I would love to bring edfundwonk and those in Sacramento out to some of these rural schools to experience some different logistical realities. There is no public bus service of any kind running within our school district boundaries. (There was, once, but county budget cuts took that out ages ago.)
    Operating school buses is a great service to the community – it certainly costs less to run the bus than for individual parents to drive, and it uses less fuel and less pollution, and is statistically safer. This is a Title 1 school. A big fundraiser is around $2,000.The supposition that families in this area can pitch in enough to cover the transportation cut, which is about 1/3 of the total cuts we were expecting, is not realistic. If a fee were instituted, I expect the result would be that substantial numbers would drive and substantial numbers would homeschool, which would make everyone worse off.
    Even simply suspending the use-it-or-lose it aspect would be helpful. It would give districts more flexibility to experiment with crazy ideas in these crazy times.
    If the legislature doesn’t like the program because it is inequitable, then what’s stopping a more equitable solution? Doing a simple calculation of students divided by square miles of district area would create a density coefficient that could be used to great effect. I suspect we have districts in California where that ratio approaches 1 student per square mile.
    The elementary school district that I attended as a child was all suburban and every child could walk to school reasonably. It only used buses for field trips and special ed transportation. It’s important that we not confuse that situation as representing the logistics for every child in California.

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  9. Although schools are allowed to charge a fee to ride a school bus, it’s my understanding that (even if you wanted to) you can’t charge students who are eligible for free or reduced lunch. In a district with 75% of the kids on free or reduced lunch – probably typical for many of our rural districts – that isn’t going to work as a solution.

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  10. To clarify – I should have written that contributions would be on a sliding scale. I agree,  get some people in Sac’to  out to the rural areas  - it is a very different need. 
    Great idea – - suspend the “use it or lose it” – - that would allow districts to keep some routes maybe, but lose others for a while. Even those districts that have planned – - in spite of AB 114 — are looking at some no win decisions. Building in flexibility would make a difference, and since the State has exercised great flexibility with its deferral program to its own benefit , perhaps it could extend  financial flexibility to school districts. You know “a goodwill gesture” for the holidays!

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