Prop. 98 guarantee could reach $80B by 2020
(Calif.) The minimum funding guarantee for K-12 schools and community colleges is expected to surge to $77.5 billion by the 2019-20 school year – marking a five-year cycle of increases that will total more than $14 billion, according to a forecast released Wednesday by the nonpartisan Legislative Analyst.
Economic uncertainties could threaten the rosy outlook but in its annual report on the general condition of the California economy and the picture moving forward over the next five years, the LAO suggested the state’s fiscal health couldn’t be much better.
In fact, “the state budget is better prepared for an economic downturn than it has been at any point in decades,” the Legislature’s chief financial adviser said.
For public education the news is also welcomed, tempered only in the sense that Gov. Jerry Brown’s efforts to pay off outstanding debts run up over the past 10 to 15 years, has reduced – at least in part – the requirement that all new state income be shared dollar-for-dollar with schools.
Indeed, the LAO projected that the state will end the 2015-16 fiscal year with an additional $3.6 billion in revenue above the forecast used in last summer’s budget process. Although some of those unanticipated dollars will be available for spending, the lion’s share will go into the state’s new rainy day fund that was created by voters in 2014 with the passage of Proposition 2.
The analyst predicted that by the end of 2016-17, state reserves would reach close to $11.5 billion.
If the restrictions imposed by Proposition 2 have few loopholes to allow new spending, the message from the governor Wednesday shows Brown has not changed his tight-fisted approach to money management.
“The strong economy is good news for California, but the recession scenario outlined by the Legislative Analyst is a sobering reminder that we must continue to pursue fiscal discipline, pay Prop. 98 guarantee could reach $80B by 2020 :: SI&A Cabinet Report :: The Essential Resource for Superintendents and the Cabinet: