Gov. Jerry Brown speaks at news conference in Sacramento on Nov. 7, 2012 (Rich Pedroncelli / Associated Press)
UC system, K-12 among biggest winners in Brown's new budget proposal
By Larry Gordon, Teresa Watanabe and Carla Rivera | LA Times |http://lat.ms/1L7kywX
14 May 2015 :: The big winners in Gov. Jerry Brown's plan to sharply increase education funding are California undergraduates at UC, who will have their tuition frozen for two more years, and the millions of elementary, secondary and community college students who are likely to see more teachers and counselors hired on their campuses.
With state revenues growing faster than previously expected, Brown said Thursday that he wants to pay down $436 million in UC's pension debts over the next three years and boost spending by $3,000 for each of the state's 6 million K-12 students. Additional money will also be given to public schools with large numbers of low-income students.
Brown's revised budget was welcomed by campuses and school districts that had suffered layoffs and cuts in programs during the recession.
“This is spectacularly good news and a huge opportunity for schools,” said David N. Plank, executive director of the Policy Analysis for California Education, a research partnership of Stanford University, UC Davis and USC. “We're finally coming to an end of a cycle where we're restoring what was cut in 2007. This is a moment where districts can launch in new directions.”
The two-year tuition freeze for undergraduate state residents at UC is the highlight of an agreement between Brown and UC President Janet Napolitano after months of negotiations to avoid threatened increases as high as 5% in each of the next five years. In-state students now pay about $12,200 a year for basic systemwide tuition and fees; that figure is triple what it was in 2002.
Starting in the 2017-18 school year and in the following year, UC tuition for Californians will rise again in a formula that will involve the general inflation rate but will be capped at 5% annually, according to the plan.
“I think we've reached a very good agreement from the perspective of the university and for California,” Napolitano said in an interview. The pact, she said, will produce “a tremendous period of predictable tuition for California residents and will provide the additional financial resources we so sorely needed.”
Brown said that his proposal to pay some of UC's pension debts will “stabilize their finances going forward” and that the agreement to freeze tuition for another two years “is very good indeed.”
California's elementary and secondary schools laid off about 30,000 teachers and staff during the recession and some shortened their school years. Under Brown's revised spending plan, public schools and community colleges can attribute much of their improved finances to Proposition 98, a 1988 voter-approved constitutional amendment that guarantees them the largest portion of state money.
The governor's budget is seeking $6 billion more for K-12 schools and community colleges over his January budget, with a third of that targeted for students who are low-income, learning English or in foster care. Brown also proposed an additional $2.4 billion to help train teachers and provide instructional materials on new state standards in English and math known as Common Core, and $60 million for students with special needs.
Los Angeles Unified officials hailed the moves. Schools Supt. Ramon Cortines said the estimated $300 million to $400 million in additional money would particularly benefit the district's many disadvantaged students. School board members said that the priority will be to close what had been a $160-million budget deficit for next year.
Funding for California's 112 community colleges is set to improve by $1 billion over last year, according to the governor's new proposal. That is expected to accommodate about 65,000 more students in 2015-16 and add 600 full-time faculty, among other things, officials said.
“Our colleges are still dealing with the consequences of recession-era cuts that forced us to ration education,” community colleges Chancellor Brice Harris said.
California State University officials were disappointed that the governor didn't fund their full request for the 23-campus system. Rather, the CSU system would receive $157.5 million more than last year under Brown's plan. But that amount is nearly $60 million less than Cal State requested from the state to increase enrollment, hire more faculty and academic advisors and chip away at its backlog of maintenance needs.
Still, Cal State chancellor Timothy P. White previously announced that annual undergraduate tuition — $5,472 — would not increase in 2015-16 and that pledge remained in place Thursday, he said, even as he seeks more money.
State Senate leader Kevin de León (D-Los Angeles) expressed disappointment that the governor's revised budget didn't provide more for Cal State, which enrolls nearly 450,000 students. “We are pleased UC students and their families will avoid paying higher tuition next year,” he said in a statement. “But CSU, the workhorse of our higher education system, has been shortchanged.”
Under the agreement with UC, the 10-campus system will receive 4% increases in state general revenue funding in each of the next four years, for a cumulative total of $507 million. Plus, in the sweetener that sealed the deal, UC is expected to receive an additional total of $436 million over three years from the state's rainy day and debt reduction fund to help pay its pension obligations. UC also will receive about $50 million for deferred maintenance and energy efficiency projects.
Beyond the tuition freeze that Brown insisted upon, UC has agreed to tackle some of the governor's other pet causes: capping pension benefits for future employees, increasing the number of transfer students by making the process smoother, expanding summer school, adding more online classes and making it easier for some students to graduate in three years. UC also will study why costs of similar courses vary widely among campuses.
Left unsettled so far is whether the number of California undergraduates at UC will be increased. Napolitano said in March that enrollment for in-state students would not grow without more state funds devoted to it, and Brown's plan does not specifically set aside money for that increase.
Clearly the state's much improved fiscal situation helped break the deadlock between two veteran politicians: Brown, who is in his fourth term, and Napolitano, who had been Arizona governor and U.S. secretary of Homeland Security before coming to the 238,400-student UC system in 2013.
Brown, who is a UC regent, and Napolitano formed an unusual two-person committee in January to privately examine UC's spending and revenues. Their meetings seemed to calm the two sides and move them away from confrontation.
UC Student Assn. President Jefferson Kuoch-Seng said many students will be pleased with the tuition freeze but he said he wished it had been extended across the board to out-of-state and all graduate students. The proposal “is definitely a good start” to what he said was “a long-term solution to California's higher education systems.
By Josh Dulaney, LA Daily News | http://bit.ly/1A4TeP2
Posted: 05/14/15, 3:30 PM PDT :: Gov. Jerry Brown on Thursday proposed a record $115.3 billion California spending plan that would send millions more to the California State University system, freeze in-state undergraduate tuition at the University of California and establish a new state tax credit for the working poor.
The spending plan reflects surging revenues that have climbed by $6.7 billion since Brown offered his preliminary budget proposal in January.
Lawmakers have until midnight on June 15 to enact a balanced budget and send it to Brown for his signature.
Brown’s budget revision calls for another $38 million in funding for the CSU, which is on top of the $119.5 million he proposed for the system in January, drawing the total of new funding to nearly $158 million. CSU trustees had asked for a boost of $269 million, including $216.6 million from state funds and $52.4 million from net tuition revenue linked to enrollment increases.
The Governor’s Office said Thursday the budget revision “invests in the quality and affordability of the state’s higher education system,” with CSU agreeing to maintain current tuition and fee rates through 2015‑16 and looking at a funded enrollment growth of 4,000 students.
Despite the increase, officials in the 23-campus system said it still won’t be enough to address the needs of students and faculty.
“The intent of the university is to continue to work with lawmakers and encourage them to stand with the CSU and approve a budget that adequately provides for the needs of our students,” said CSU spokeswoman Laurie Weidner.
CSU trustees are expected to discuss the budget revision during meetings next week.
The additional $38 million in funding will be divided in half, with part the money going to fund enrollment growth and investing in ways to get students through college faster. The system has shut out more than 20,000 and 30,000 qualified students each year dating back to the recession.
“We’re certainly happy to get more, but it isn’t really enough to deal with the problems that continue to plague the CSU,” said Lillian Taiz, president of the California Faculty Association and a history professor at Cal State Los Angeles. “We can’t get out of the hole if the state won’t make an investment, and it just takes a toll on everyone involved. It takes a toll on students slow in their program. It takes a toll on faculty who are desperately trying to them through. It’s disappointing.”
The remaining portion of the increase will fund so-called student success measures, including hiring more tenure-track faculty and academic advisers, expanding concurrent online enrollment, fueling the Early Start program that prepares students for college coursework, and investing in applied research and internship programs for students.
The governor also reached agreement with University of California President Janet Napolitano on an in-state undergraduate tuition freeze for at least two years in exchange for an extra $436 million in state funding for the university system to offset pension costs.
The 10-campus system could still raise tuition for nonresidents and students earning professional degrees.
The nonprofit Campaign for College Opportunity, based in Los Angeles, said Brown’s revised budget proposal is good for higher education and provides multi-year financial stability. But the group called Brown’s plan for an additional 4,000 students “woefully inadequate.”
Michele Siqueiros, president of the Campaign for College Opportunity, said the state cannot have a growing and prosperous middle class without significantly expanding college enrollment for its residents.
“It’s great the state is in a position with greater tax revenue coming in, and it’s certainly an acknowledgment that money should be invested in human capital, but we don’t think it goes far enough,” Siqueiros said.
The Democratic governor also responded to criticism that he hasn’t done enough to help California’s poor by proposing a $380 million earned income tax credit that his administration said would help as many as 825,000 families and up to 2 million Californians.
“It’s just a straight deliverance of funding to people who are working very hard and are earning very little money, so in that sense I think it does a lot of good things,” Brown said of the tax credit.
The average tax credit would be $460 a year with a maximum credit of $2,653 for families with three or more children, to complement the federal tax credit program. It would be available to individuals with incomes of less than $6,580, or up to $13,870 for families with three or more dependents.
The budget sets aside $3.8 billion in 2015-16 to help California weather the next financial downturn, to be evenly split between deposits into the voter-approved rainy day fund and paying down debts, including the UC pension liability.
“I don’t want to get caught in the jaws of the persistent fiscal instability of the state government of California,” he said. “We know a recession is on the way. ... Is it next year? Is it four years from now?”
The restrained approach won praise from Republicans in the state Legislature.
“It takes responsibility to hold the line on growth during years like this,” said Senate Minority Leader Bob Huff, R-Diamond Bar.
Fellow Democrats and social welfare advocates are expected to continue pressing the governor to expand child care, health care and social programs that they say will help close the gap between rich and poor.
“Child care and higher education are important investments to fortify the future of California’s economy,” Senate President Pro Tem Kevin de Leon, D-Los Angeles, said in a statement. “We can and will do more to ensure our budget reflects these priorities.”
The budget also includes:
• $2.2 billion for programs to conserve water, respond to emergency conditions and expand local water supplies in the drought;
• a $1.2 billion increase in revenue from the state’s landmark effort to curb greenhouse gas emissions for a total of $2.2 billion. California’s cap-and-trade program was expanded this year to include fees on gasoline, natural gas, propane and heating oil;
• $62 million to begin enrolling low-income immigrants in Medi-Cal, California’s version of Medicaid, on the assumption that President Barack Obama will prevail in a court battle over his executive order;
• and an additional $600 million above January projections for community colleges.
The Associated Press contributed to this report.
California Budget: Governor's 2015-16 May revision
Gov. Brown's budget: Where your money could be going, other things you need to know
By Chris Megerian | LA Times | http://lat.ms/1ELijdc
15 May 2105 :: Thursday morning marks a critical point in the annual debate over government spending in California. We are updating this page throughout the day as details of the governor's plan are unveiled. You can read a summary here and follow our reporters on Twitter for the latest: @chrismegerian, @mcgreevy99, @melmason, @paigeastjohn and @philwillon.
Here's what you need to know so far:
How is Brown addressing the issue of prisons?
Brown proposes to cut California's reliance on out-of-state private prisons by half, but seeks to postpone longterm discussion about the state's own aging lockups and need to rent space from others until next year.
He calls for shrinking the number of inmates housed outside California in the next year by 4,000 -- reducing related state spending by $73 million. As of this week, the state had a little more than 8,000 inmates in private prisons in Arizona, Mississippi and Oklahoma, and another 6,250 prisoners in contracted lockups within the state.
The governor's prison spending cuts are attributed to sooner-than-expected reductions in the overall state prison population because of passage of Proposition 47, which reduced penalties for drug- and theft-related crimes, and court-ordered releases.
The total prison population currently is 129,700, more than 5,000 inmates fewer than the year before. Brown's administration now projects the inmate population will dip below 128,000 inmates in the next year.
A new tax credit for the poor?
The governor's plans include a new earned income tax credit for poor Californians, which has been a priority for Democrats in the Assembly. As the economy continues to improve, Brown has been under pressure to do more about persistent poverty in the state.
“We’re very excited about it. It’s going to do a lot to help the poorest of the poor, to hopefully lift these folks out of poverty,’’ said Assemblywoman Shirley Weber (D-San Diego), chair of the Assembly Budget Committee.
What's going on between UC chief Janet Napolitano and Gov. Brown?
A two-year freeze on tuition for state residents is the highlight of an agreement between Brown and Napolitano after months of negotiations and lobbying to avoid what UC said might have been hikes as high as 5% in each of the next five years. In-state students now pay about $12,200 a year for basic systemwide tuition and fees, not including room and board and some campus charges; that figure is triple what it was in 2002.
However, out-of-state students – whose rising numbers have irked legislators and California families – are expected to face 5% tuition increases to about $36,900 next year, and further hikes in later years, officials said.
What is California’s budget process?
It begins every January when the governor releases his initial spending plan. The proposal is revised and reissued in May, after the state's revenue picture has become clearer and the governor and lawmakers have discussed their goals. A final budget, due June 15, is then negotiated.
What's happening now?
Gov. Jerry Brown issues his updated budget proposal Thursday morning in the Capitol. In revising his blueprint, he will have taken into account billions of dollars in unexpected revenue that has flowed into state coffers over the last few months.
Where will the extra money go?
California law dictates that most, if not all, of the windfall will go to schools and community colleges. This is a boon for public education, which suffered sharp cuts during the recession, but could leave less money for other areas of the budget.
What happens next?
There are many potential tension points between the governor and the Legislature as they hammer out a final budget.
Many lawmakers, advocates for the poor and others want Brown to make new funding available for more childcare services, healthcare for the needy and other government programs. The governor, who has faced criticism over persistent poverty in California, is proposing a new a tax credit to keep some money in the pockets of the state's poorest residents. It is unclear whether the Legislature's ruling Democrats will press for more aid.
Some lawmakers want money for road repairs and similar infrastructure needs. And the governor and the University of California's leaders have been at odds over whether the state should provide more money to prevent tuition increases.
How does the budget affect the drought?
The governor and lawmakers have passed two emergency spending plans since early last year to support drought relief and water projects. In addition, the state has enacted more stringent regulations on water use in cities and towns. The budget could include additional money to enforce the rules or could provide new details on the state's response to the continuing crisis.
How does the drought affect the budget?
This year, tax collections are unlikely to suffer from the drought, and so far they’ve outpaced expectations. Revenue was roughly $1.3 billion ahead of projections at the end of April, according to the analysts.
What is the on the Assembly Democrats' wish list?
As California tax coffers burst with higher-than-expected revenue, Assembly Democrats have detailed some of the ways they want to use the money.
Topping their wish list are the tax credit for poor Californians, more support for public universities and new funding for overdue road repairs.
Could California's latest budget problem be too much money?
In a worst-case scenario outlined by legislative analysts, a budget gap could result if higher-than-expected revenue collides with California's formula for funding public schools and community colleges.
As state revenue increases, the formula requires more money to be spent on education to compensate for years of budget cuts, and this could cut into other areas of the budget.
What about the healthcare program for California's poor?
California lawmakers announced new legislation that would pump more money into Medi-Cal, which has expanded to cover more residents even as the state has suffered from recession-era funding cuts.
The bills (SB 243 and AB 366) would reverse cuts in payments to doctors who treat Medi-Cal patients. It also would go further, requiring higher payments from managed care plans that contract with the state and boosting funding for hospitals.
Lawmakers said the money is necessary to ensure that there are enough healthcare providers in California willing to treat poor patients through the Medi-Cal program.
What could fees on air polluters mean for the budget?
California could generate much more revenue from fees on polluters than Gov. Jerry Brown expects, legislative analysts say in a report.
Administration officials have estimated $1.7 billion in revenue from the fees by June 30, 2016, the end of the state's next fiscal year. But legislative analysts say the state could rake in between $3.3 billion and $7.7 billion in that period.
Will Obama's immigration action affect California's budget?
President Obama's executive action on immigration may have a major impact on California's budget, according to reports issued by legislative analysts.
The action could shield from deportation millions of immigrants who are in the country illegally, including hundreds of thousands in California. That would result in many becoming eligible for government services like public healthcare.
Others could receive help through state programs that provide caregivers or cash assistance for the elderly and disabled.
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