The State Assembly Education Committee voted earlier this month to hold a bill sponsored by California State Representative Lois Wolk (D-Davis), which aimed to give school districts more flexibility in balancing their budgets during difficult years.
As California’s $16 billion budget deficit trickles down into schools, most districts are scrambling to find ways to balance their budgets. Assembly Bill 1908 would allow school districts to transfer unspent funds reserved for specific programs – categorical funds – into the unrestricted general fund for use in balancing the budget during difficult budget years.
“While the bill would not provide districts with a complete solution to the huge budget cuts proposed by the governor, it would provide districts with immediate, modest budget flexibility to assist them in difficult budget times such as California is experiencing now,” said Wolk in a press release.
The bill allows for the transfer of categorical funds only during years in which Proposition 98 is suspended. Proposition 98 created a formula for determining how much money the state gives school districts and set the minimum amount at 40 percent of the state budget.
The proposition, passed by California voters in 1988, can be suspended during difficult fiscal years to lower education funding below the 40 percent guarantee – an action Governor Schwarzenegger has suggested the legislature take in the 2008 to 2009 fiscal year.
After the bill was held in committee – effectively killing it – Wolk amended it to allow Dixon Unified School District to sell surplus farmland property to generate revenue and help resolve the district’s current financial crisis.
“After the bill died in [the] Assembly Education [Committee], it was amended to address an urgent need in the district,” said Melissa Jones, press secretary for Wolk.
The original bill was supported by both the Davis and Dixon school districts as well as the California School Boards Association.
“It would be helpful to have flexibility rather than having the money sit in the bank,” said Sheila Allen, president of the Davis Joint Unified School District school board. “There is money there that [this bill] would have made available to us.”
Opponents to the bill were concerned about allowing districts to take from important categorical funds that include special English learning programs, class size reduction, the Gifted and Talented Education program, the Advanced Placement program and various arts and music programs.
“[The bill] allowed for the use of funding for programs that are instructional in nature for non-instructional purposes,” said Martha Zaragoza-Diaz, legislative advocate for the Californians Together Coalition. “We believe those funds should stay with the student.”
The Californians Together Coalition, an organization representing language minority students and their immigrant parents, is among the registered opposition to the bill and spoke against it at a previous committee hearing.
“Any categorical reform proposal should be discussed in the context of broader school finance,” Zaragoza-Diaz said. “Categorical reform is just one component of school finance.”
In giving greater flexibility to the districts, the bill assumes the school board is very well-informed, Zaragoza-Diaz said. While this is true in Davis, other districts might not use these reserved funds wisely, she said.
The Education Committee is scheduled to discuss the amended version of AB 1908 regarding only the Dixon school district today.
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