California: Continued Funding Increases Highlight Continuing Concerns

Earlier this month, Governor Jerry Brown unveiled his budget proposal for the 2016 fiscal year. Although this budget will be revised to account for the upcoming tax season, it is clear that increased funding for education remains a priority for Governor Brown.

California State Funding Towards Education Since 2001. From NPR's California Report. http://ww2.kqed.org/news/2016/01/31/schools-enjoy-rise-in-state-funding-but-pension-costs-and-recession-worries-loom-large

Although the increase in projected funding was met with mixed reviews from various members of state government (which unsurprisingly seemed split buy party lines), most within the realm of education have been relatively supportive of Governor's Brown's commitment to increased funding. How could they not be? As the graphic above shows, education spending is well above even those years before the 2008 financial downturn.

Many experts, however, remain skeptical about the long-term feasibility of the funding bubble that the chart seems to depict. A recent story from KQED's California Report highlights many of these concerns.

Schools Enjoy Funding Boost, But Long-Term Costs and Recession Worries Loom

Most notable of these anxieties:

• Increased funding is directly linked to Governor Brown's tax measures in Proposition 30. Approved in 2012 by voters, this law increased personal income tax rates on individuals making over $250,000 per year and also increased the sales tax each year through 2016. While these increased tax measures are still projected to create additional funding for California schools in the upcoming years, the law expires at the end of 2018--meaning that state legislators will need to enact a new law or find new sources of funding.

• Connected to this funding concern is the on-going pension dilemma created in-part from the 2008 recession. Again, while increased state funding from Prop 30 helps alleviate some of this debt, many are concerned about what will happen after that increased revenue stream is run dry--a situation that could occur at any time before 2019 given the always volatile nature of the state's economy.

While these issues will (hopefully) create a sense of urgency within Sacramento, this skepticism speaks to a much larger issue with regards to education funding in California. Specifically, these issues highlight the perils of relying almost exclusively on state revenue streams (as opposed to more local sources) for the majority of funding. Again, while the recent Prop 30 tax increases have significantly raised revenue for education, this system leaves funding in a delicate balance in Sacramento--one that can be easily and dramatically tilted by the legislative process and/or another economic downturn (as seen in the large dip that took between the years 2008-2012 in the above graph). 

Although this balance is rooted in a variety of factors, many point to the changes in tax law (mainly, property taxes) that were enacted with Proposition 13 in 1978. While the law addressed the pressing need for property-tax reform in the wake of astronomically rising rates, the shifts created unimaginable effects in local funding for public education. Mainly, it forced local schools to rely primarily on Sacramento for the majority of their funding.

To explain more about Proposition 13, I once again defer to The California Report and a recent infographic that was recently published. The graphic traces the history of Proposition 13 and it's consequences for California public schools.

How Proposition 13 Transformed California [Illustrated Infographic]

Again, while we should praise the current state of public education funding in California, we would be wise--as always--to remain hopefully cautious.

Questions to Consider

• What are some of the impacts that Proposition 13 might have had on lower income communities and their public schools?

• How might these same communities and schools be impacted after the measures in Proposition 30 end in 2019?