Governor and Legislature Reach Budget Agreement

Governor Arnold Schwarzenegger and legislative leaders emerged from their “Big Five” meeting on July 5 to announce that an agreement has been reached on the estimated $116 billion 2005-06 State Budget.
Initial intelligence from the Legislature and the Governor’s press statements indicate the following:

• The Budget modifies the proposal to shift the cost of STRS to local school districts by agreeing to a compromise to take one-half the money ($235 million) from the state�s general fund and count the other half against the funding schools would have received under Proposition 98�meaning a sharp reduction from the $247 million proposed by the Budget Committees for funding for prior-year mandated cost claim reimbursement. School districts will not have to expend any local funds, according to reports.
• The Budget provides the same level of funding for schools as the Governor�s May Revise, increasing Proposition 98 funding by $3 billion, but does not provide the $3.1 billion owed to schools under the Proposition 98 formulas.

It was also reported that the Governor plans to use the “good will” that seemingly came out of the Budget talks to try to work out a compromise over the spending control measure (see “The ‘California Live Within Our Means’ Act–What It Means for California Public Schools” in the June 24, 2005, Community College Update, page 159) that will be on the November special election ballot. Read the rest of this entry »