Voters in California will face two competing measures on the November ballot with an eye at increasing education funding after years of budget cuts to schools.
Proposition 30 is a temporary sales and personal income tax increase measure with provisions to direct new revenue into public education. Gov. Jerry Brown, the California Teachers Association and most other teacher and school worker unions support Proposition 30.
Molly Munger, a Pasadena civil rights lawyer, and the California Parent Teacher Association are promoting Proposition 38, an alternate measure.
Here’s what each would do, according to the ballot summaries:
“Increases personal income tax on annual earnings over $250,000 for seven years. Increases sales and use tax by 1⁄4 cent for four years. Allocates temporary tax revenues 89 percent to K-12 schools and 11 percent to community colleges. Bars use of funds for administrative costs but provides local school governing boards discretion to decide, in open meetings and subject to annual audit, how funds are to be spent. Guarantees funding for public safety services realigned from state to local governments.”
California’s sales tax would increase from 7.25 percent to 7.5 percent for the next four years. (Many counties and cities have an additional local sales tax so the sales tax for a specific area may be higher than 7.5 percent.) Also, for California residents earning over $250,000 annually, income taxes would rise for seven years. For those earning between $250,000 and $300,000, the state income tax rate would be 10.3 percent; for those with incomes between $300,000 and $500,000, the tax rate would be 11.3 percent; for those earning more than $500,000, it’s 12.3 percent.
Annual revenue estimates from Prop. 30 in its first year range from $6 billion to $9 billion.
“Increases personal income tax rates for annual earnings over $7,316 using a sliding scale from .4 percent for lowest individual earners to 2.2 percent for individuals earning over $2.5 million, for 12 years. During the first four years, 60 percent of revenues go to K-12 schools, 30 percent to repaying state debt, and 10 percent to early childhood programs. Thereafter, allocates 85 percent of revenues to K-12 schools, 15 percent to early childhood programs. Provides K-12 funds on school specific, per-pupil basis, subject to local control, audits, and public input. Prohibits state from directing or using new funds.”
Proposition 38 would boost income taxes for almost all earners on a sliding scale; the more money earned, the greater the tax rate percentage increase. The measure is estimated to bring in about $10 billion annually.
Many educators favor Proposition 30 over Proposition 38 because they say there are fewer strings attached. Proposition 38 also does not give money to community colleges; neither helps California’s four-year public universities.
If they both pass
The two propositions can’t work together since they have conflicting points. If both pass, School Services of California, Inc., says that the proposition receiving the most votes wins in any conflicting language. That means if Proposition 30 receives more votes, because it handles both income and sales tax, it would invalidate Proposition 38. If Proposition 38 garners more votes, its income tax increases would go into effect but it’s not clear if the sales tax portion from Proposition 30 would take effect. The courts could be left to decide and the issue could be tied up in court for a while, which may delay any new funding reaching schools.
If they both fail
Many school districts say they would implement more budget cuts if not this year then next year. Brown says he would let school districts lower the minimum number of instructional days from 175 to 160 to allow them the flexibility to cut more instructional days from their calendar. While Brown would allow school districts to do this, districts would still have to negotiate all of this with employee unions.
Effect on the Temecula Valley Unified School District
The TVUSD adopted its current 2012-2013 budget of $196 million assuming both proposition would fail. The current budget has a $12.1 million reduction from last year. “We’re still deficit spending. We’re still hurting,” said Lori Ordway-Peck, assistant superintendent of Support Services for TVUSD.
The current budget in place this year includes 10 furlough days and a reduction of $441 in spending per student, down to $5,309 spent per student, she said. Kindergarten classes that had 20 students three years ago now have an average of 30 pupils. If both propositions fail, more cuts would come next year, including possibly even more furlough days, Ordway-Peck said.
If one or both measures pass, Ordway-Peck said the district and its teacher and employee unions would have to re-open negotiations to discuss what cuts to restore – do they add back school days, bring back laid-off employees or something else – and it’s unknown yet how or when that would happen. TVUSD wouldn’t know right away when it would receive new tax funds or if the money would be deferred, she said.
Effect on the Murrieta Valley Unified School District
MVUSD’s budget for this year also assumes both propositions will fail, said Stacy Coleman, assistant Superintendent of Business Services for the Murrieta district. Revenue this year is projected at $142.5 million and expenditures are projected at $150.3 million, he said, so the MVUSD also has a deficit. Murrieta schools had five furlough days already this year and six more are planned if both propositions fail – four in February and two at the end of the year.
If both measures fail, the district will have a $21 million deficit for 2013-14, Coleman said. The district will decide after the election how to proceed and would have to negotiate with unions. MVUSD is holding budget workshops now to look at various budget scenarios. The next one is planned for Oct. 11 at 5 p.m. and the public is encouraged to attend.
“We’re really going to be encouraging parents to go to that Oct. 11 board meeting,” said MVUSD spokeswoman Karen Parris, adding that the meeting will help parents understand both propositions and their impacts to local schools and students.
Parris added that MVUSD has had to cut more than $105 million from its budget in the past five years. “This is not a spending problem. It’s a funding problem.”
If Proposition 38 passes or both pass but Proposition 38 wins more votes, MVUSD would still face a mid-year cut of $10 million this year – $451 per student less – because the 38 funds are not part of the money California guarantees to schools, Coleman said.
If Proposition 30 only passes, MVUSD would cancel this year’s remaining school furlough days, he said. Next year, assuming MVUSD receives the funds, the district could use that money to reduce their deficit by half. Coleman said it’s not known at this point if Murrieta schools would have furlough days next year.
The Board Workshop will be held at 5 p.m. Oct. 11 at Murrieta Mesa High School’s Performing Arts Center, located at 24801 Monroe in Murrieta.
Amy Bentley is a local writer and regular contributor to SWRNN.