The California State Budget
STATE BUDGET TIMELINE
January – Governor’s Proposed Budget
This budget reflects the Governor's goals and objectives for the forthcoming year including significant issues, policies, and initiatives of the Administration.
May – May Revision (AKA The May Revise)
Revised budget provides an update of revenues, expenditures, and reserve estimates based upon the latest economic forecast and changes in population, caseload, or enrollment estimates
June – Final Budget
The Enacted Budget reflects the state spending plan passed by the Legislature and signed by the Governor. The Legislature is constitutionally required to pass the budget by June 15, though in recent years it rarely has met the deadline. The Budget needs a 2/3 vote of each house to pass. (In most states only a simple majority is required.) The Governor may use line-item vetoes.
TERMS
Revenue Limit
General purpose money districts receive per pupil (ADA) from a combination of state taxes and local property taxes. Originally, revenue limits were calculated for each district based on historical spending patterns and varied considerably.
Equalization
Funds allocated, on occasion, by the Legislature to address inequalities and raise the funding level of school districts with lower revenue limits toward the statewide average based on size and type of district.
Mandate
Federal or State required services and programs that must be provided by a school district.
Categorical Funding
Funds to qualifying districts for a particular purpose or special program in addition to their revenue limit. Special Education and Class Size Reduction are two of the largest state programs in terms of dollars. In general, schools or districts must spend the money for the specific purpose.
IMPORTANT EVENTS IN CALIFORNIA SCHOOL FUNDING
Serrano v. Priest - 1976
California Supreme Court decision declared the local property tax-based system of school funding to be unconstitutional, violating the equal protection clause. Required basic per pupil funding of school districts (within categories of districts) to be equal or within a small margin. Categorical funding is excluded from the formula.
ADA - Average Daily Attendance
A measure of student attendance--the total number of days of student attendance divided by the total number of days in the regular school year— used by the state to determine a school district’s general purpose funding. A school district’s general fund or unrestricted money is figured by multiplying ADA times the district’s Revenue Limit. Schools are funded based on the number of students in attendance, not the number of students enrolled.
Proposition 13 – 1978
Constitutional amendment passed by California voters. Capped property tax rate & limited increases in assessed values. Required two-thirds vote for new local taxes. Local property taxes no longer the major source of school funding—shift to state funding. The governor and the legislature took over the allocation of local property taxes to schools, cities, counties, and special districts.
COLA - Cost of Living Adjustment
Increase in state or federal funding based on inflation figures. In California, the law states that schools should receive a certain COLA based on the Implicit Price Deflator for State and Local Government Purchases of Goods and Services.
Lottery
Gambling games approved by California voters in November 1984. 34% of lottery revenues are distributed to public schools, colleges, and universities educational purposes. Lottery income comprises less than 2% of K– 12 education funding annually.
Proposition 98 – 1988
Constitutional amendment passed by California voters. Guarantees a minimum funding level for K-14 public education, figured by a complex formula based on tax revenue. The Prop 98 guarantee may be suspended for a year by a two-thirds vote of the legislature with the governor’s signature.