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Top California Budget Analyst Praises Governor's K-12 Plan, Amid Fiscal Caution

Late last week, California Gov. Jerry Brown unveiled his fiscal 2016 spending proposal that includes roughly a $4 billion increase for the state's Local Control Funding Formula (LCFF). A few days later, one of the most relied-upon budget analysts in the Golden State has run the rule over the governor's K-12 budget and says that, with respect to public school spending and the overall budget, Brown appears to have taken a prudent approach, especially given that the state's rosy fiscal picture could abruptly turn very dark. 

Mac Taylor, a legislative analyst with the non-partisan California Legislative Analyst's Office, notes that because of requirements of Proposition 98 (the basic legal framework for education spending in California), the bulk of governor's spending increases in his proposed budget go to education, although some of those increases will go to community colleges as well as public schools. And the single largest increase is the $4 billion increase for the local funding formula, which gives districts more control than they previously had over state aid, specifically for disadvantaged populations like English-language learners. That's about a third of the increase districts will need in order to get from their fiscal 2015 state aid levels to full funding for the formula, slated to be in place in 2020.

Taylor includes a chart on where additional state K-12 (and other education-related) dollars are headed in Brown's budget proposal in the chart below:

 CaliforniaLAO.PNG

Regarding the $100 million designated for Internet expansion in schools, Taylor expresses concerns that the spending doesn't take into account several factors, such as whether broadband providers will be eager to spend the required funds to increase access in certain parts of the state. 

More broadly, Taylor notes that while state revenues could be up sharply by the spring of this year, that could present challenges as well as promise for California lawmakers. Specifically, he says that they should be wary of committing money to "ongoing" purposes, because under that scenario, a downturn could quicky force state government to slow the funding increases called for under the funding formula . 

"As the governor argues, the budget remains vulnerable to downturns that may re-emerge with little warning," Taylor writes of the overall state spending plan proposed by Brown. "Building budget reserves and paying down state debts remain important goals."

Taylor expands on the "boom and bust" theme by cautioning that the state's estimated $3.4 billion in funding reserves heading into fiscal 2016 under Brown's plan doesn't provide a great deal of protection for the state's finances. 

If you're wondering what downturns can lead to for K-12 in California, at the end of 2011 my colleague Lesli Maxwell noted that California schools had lost roughly $18 billion in state revenue over the proceeding five years, and also had $10 billion in state spending deferred, to be paid back at a future date. Brown's fiscal 2016 spending plan would retire the remaining amount of those deferrals to schools, Taylor notes. 

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