1st in a Series: Focus–School Bonds, Propositions and LCFF

How 2017 Will Shift the Sails of Public Education

Local education foundations need to stay in tune with state and federal funding moves because they could impact what they fund and support. The first few months of 2017 are showing us that there are many issues that will impact public education over the next few years. With the inauguration of the new president, joined with the Governor’s 2017-18 budget projections, our school districts face a road ahead that is a mixed bag of certainty and uncertainty.

With the appointment of the U.S. Secretary of Education, Betsy DeVos, it is clear that President Trump’s education agenda focuses on increasing funding and opportunities for school choice, particularly for charter schools and private schools, including potential federal vouchers and revisions to the Every Student Succeeds Act.

The governor’s proposed budget has the greatest impacts on the teacher shortage, preschool and early childhood education, school bonds, and special education funding reforms.

The CCEF has developed a white paper for members that summarizes the 2017-18 budget forecast and the ways in which education foundations can work together and support their districts.

 The following article reviews the following portions of the 2017-18 budget forecast and analyzes how districts could be impacted. Keep in mind this article provides only a broad general overview of potential impacts. Individual education foundations should meet with their district’s superintendent or chief business officer to determine how the budget forecast would specifically impact their lead educational agency. They should also explore the role the foundation can play. Be sure to read the section on How Education Foundations can help.

School Bonds and Proposition 51

In November, voters passed Proposition 51, with a 55 percent majority. Brown opposed it because it kept the state’s current first-come, first-served formula for allocating state building aid, which he said favors wealthy districts with full-time construction staff. In his budget address, he re-stated his displeasure with this proposition, and he is expected to push for revisions through regulations.

In January, Governor Brown said that his administration would not issue any of the $7 billion bonds for K-12 school facilities that voters approved in November until the Legislature established better auditing procedures to document how the money will be spent. This process could take a year to 18 months in order for corrective laws and regulations to be passed and for training districts in new auditing methods. As a result, school construction bond projects will likely face delays in being completed.

At the February hearing, the State Department of Finance reassured law makers that it would release the first batch of school bonds this fall. However, there still remain some process challenges that may impact the overall timing of districts receiving their bond funds and project approvals. At the hearing, Chris Ferguson and Jeff Bell, who oversee education policy for the department, said that Brown’s two preconditions for moving forward – the creation of new grant agreements laying out districts’ commitments in receiving state funding and imposition of tighter audits – should be in place by summer. The auditing requirement will be in the “trailer bill,” statutory language accompanying the state budget.

At the hearing, Superintendent of Public Instruction Tom Torlakson announced a program that may help some districts, including 100 of the smaller districts in the state that have never gotten state bond dollars. Under the Small School District Assistance Initiative, staff from the California Department of Education will help districts write their construction proposals and navigate what critics have called an unnecessarily fragmented and complicated process involving multiple state agencies. As an example of how the initiative will work, the department said it is assisting the 1,000-student Santa Ynez Valley Union High School District in Santa Barbara County, which is eligible for $7 million in Prop. 51 funding.

State and district officials who testified at the hearing cited a need to ramp up staffing at the Office of Public School Construction to deal with the expected rush of districts’ construction projects; the number of employees is down about 60 percent from when there was state money to allocate. Brown included no new staff for the office in the proposed 2017-18 state budget, and in an interview, Bell made no commitments to add positions in the revised budget in May.

Over the coming months, the Legislature will be considering different approaches to resolving the processes and procedures for different agencies to process the school bond funds.

The bottom line: School districts may experience a delay in school bond projects moving forward, and smaller districts may see long-awaited bond projects move more quickly than previously.

Proposition 98: Declining revenues lowered the minimum spending guarantee under the Proposition 98 funding formula by $1.8 billion over three years. The projected increase in 2017-18 would be only 2.1 percent above what the Legislature approved in June for K-12 schools and community colleges.

The bottom line: Much of the Proposition 98 budget package is outlined in the CCEF’s White Paper on the Governor’s budget forecast. Michael Cohen, the director of the state Department of Finance, said that districts would not have to cut their budgets this year, however; they would just get the amount they had expected a month late at the start of next year, in July.

Proposition 55: In November, voters approved extending the increase on income tax rates for the state’s top 2 percent of earners. But Proposition 55 will not kick in fully until 2018-19 and will not affect next year’s budget. Proposition 55 is projected to provide at least $2 billion more for schools and community colleges in 2019–20, and, if the economy backslides, as Brown and the Department of Finance say is likely, potentially shelter schools from larger cuts.

Proposition 55 will not revive the sales tax increase, which generated $1.5 billion annually. Continuing the income tax increase will yield $4 billion to $11 billion per year, depending on stock market gains, according to the Legislative Analyst’s Office.

Schools and community colleges can expect to get about half of that money, as determined by the formula that determines education funding, Proposition 98.

Without Prop. 55, under “optimistic” forecasts, school and community college funding would rise about 2 percent — $1.7 billion — in 2019–20, the first full year after Prop. 30 ends, according to the Legislative Analyst. But most of that would be eaten up by increases in employee retirement costs that the Legislature has mandated.

The bottom line: Increased revenue from Proposition 55 will most likely help districts to offset employee retirement costs, and, according to more optimistic forecasts, potentially help with increasing teacher recruitment.

Proposition 58: Proposition 58, placed on the ballot by the state Legislature, was approved by voters with a 73.5 percent majority on Nov. 8, 2016. The proposition implements the California Multilingual Education Act of 2016, which was introduced in the Legislature by Sen. Ricardo Lara, D-Bell Gardens. The new law goes into effect on July 1, 2017.

The California Multilingual Education Act will give California public schools more control over dual language acquisition programs. Proposition 58 effectively repeals the English-only requirement of Proposition 227 — the initiative approved by voters in 1998 that requires English learners to be taught in English immersion classrooms. Under the new law, students can learn English through multiple programs outside of English immersion classes.

The bottom line: The old law required parents to sign waivers to enroll their children in bilingual or dual immersion programs; the new law does not. This law does not require school districts to create new programs. Schools have the flexibility to design their own programs to suit the needs of both English learners and students already proficient in English who want to learn another language. However, the initiative requires that districts discuss plans for new programs with community members and parents and offer such programs “to the extent possible.” Specifically, the initiative says that if more than 20 parents or guardians from any one grade level or 30 parents or guardians from an entire school make a collective request for a dual language or bilingual program, the school site is required to at least explore the possibility of creating one.

It is likely that many districts will incorporate the consideration and community input on the creation of new programs with their Local Control Funding Formula process.

Local Control Funding Formula

Governor Brown has made it his priority to fund the transition to the new Local Control Funding Formula that provides extra money for high-needs students, including low-income students and English learners. The state is still on target to reach full funding in 2020-21. By 2021 every district will receive at least the inflation-adjusted, pre-recession funding it received in 2007-08. Currently, many districts with large percentages of high-needs students already are funded well above that level. But for next year, funding will remain where it is this year, at 96 percent of full funding. There has been some push back by the Education Trust–West, an education advocacy group, which would like to see this expedited so that districts receive their full funding sooner.

The bottom line: Districts that were poised to receive additional funding have already established their individual LCFF plans with the input of stakeholders, and are already implementing new staffing and programs under this funding structure.

What does this mean for education foundations?

 Let’s start with the good news: The uptick in the economy is a boon for education foundations—with increased buyer confidence, sponsorships, event participation and increases in giving.

The not-so-good-news: There are many challenges – discussed above — that districts will face with the state and federal governments.

 

How education foundations can help?

The CCEF will continue to provide members up-to-date information on these, and other issues that will affect our state’s public schools.   As grass-roots organizations, local education foundations are the voice and conscience of their local school community and play a vital role in supporting their school districts.

  • Stay Informed: Staying informed allows local education foundations to educate their communities regarding current political and economic issues and about their impacts on school districts, district budget, and funding priorities.
  • Stay Connected: Serving as a link between communities and their schools is a major function of local education foundations. Board members of school education foundations serve as ambassadors between the schools and the communitOften LEFs serve the role of honest broker bringing community, business and educational leaders together to address a local need or issue. Serving as an advocate for public schools will become increasingly important as our nation faces decreased federal support and investments shifting from public schools towards independent charter schools and private schools.A community’s students benefit most when the local education foundation, school board, and administration are on the same page and working together to provide enhanced learning opportunities.Sources:Fentsterwald, J. (2017). Brown agrees to issue first school bonds this fall. Retrieved from: https://edsource.org/2017/brown-agrees-to-issue-first-school-bonds-this-fall/576870

    Fentsterwald, J. (2017). Governor proposes minimal funding for K-12 schools next year. Retrieved from: https://edsource.org/2017/governor-proposes-minimal-increase-for-k-12-schools-next-year/575164

    Hopkinson, H. (2017). A new era for education: Explaining California’s Proposition 58. Retrieved from: https://edsource.org/2017/a-new-era-for-bilingual-education-explaining-californias-proposition-58/574852

    Taylor, M. (2017).California Legislative Analyst’s Office Report-Re-envisioning county offices of education: A Study of their mission and funding. Retrieved from: http://www.lao.ca.gov/Publications/Report/3547

    Fentsterwald, J. (2016). Prop. 55: Initiative to extend income tax increases to benefit schools. Retrieved from: https://edsource.org/2016/prop-55-initiative-to-extend-income-tax-increases-to-benefit-schools/570475

     

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