California's education funding is guided by the mandates of Proposition 98, a formula for setting minimum annual funding for K-12 schools and community colleges. It was passed by voters in 1998 and amended the State Constitution significantly. It has had a decisive impact on budgets since its passage.
In late 2008, while trying to pass the new budget, Kindegarten Classroom (Image: Wikimedia Commons)disagreements arose between Gov. Arnold Schwarzenegger and the California school system over how much money Proposition 98 requires the state to spend on education. Schwarzenegger claimed that his office owed $8 billion less than the schools said they did. Schwarzenegger and school groups were able to reach a compromise which promises the schools the $8 billion but not until the 2011-12 fiscal year.
Proposition 1B would amend the state consitution by changing aspects of California Constitution regarding Proposition 98 to allow the state to use education funds to address the state's budget Budget Reform Now (Image: Budget Reform Now)problems in the short term. The measure would then guarantee the state would pay back these funds in the future. Under the initiative, the state would allocate 1.5 percent of reveneues to the Supplemental Education Payment Account (SEPA), created by Prop. 1A. The payments would be made beginning in the 2010-2011 until $9.5 billion had been reached for education. This money would become part of the funding used to calculate the following year's Prop. 98 minimum and would essentially negate Prop. 98 funding requirements for 2007-08 and 2008-09. $200 million from each year's SEPA payment would be set aside for school districts that receive low per-pupil revenue limit amounts.
Prop. 1B would allow the Governor and the Legislature to determine how the supplemental payments would be distributed. Funds provided to the K-12 school system are restricted on the base of revenue limits and each school district's per-pupil rate. The measure provides no direction on community college spending.
Proposition 1A Component
The provisions of Proposition 1B will not go into effect unless Proposition 1A passes. Prop. 1A would require 1.5 percent of state revenues put into the Rainy Day Fund annually to go to California public education costs. The funds would be deposited into the fund until the entire $9.3 billion in supplemental payments had been paid. If Prop. 1B does not pass, then the education requirements in Prop. 1A would not go into effect.
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Public Opinon Resources
Reports and Studies
The Basics of Proposition 98: A Tutorial for State Policymakers. Legislative Analysts Office, May 2009.
California general election, 1988 (Nov.8), Proposition 98, school funding initiative : campaign ephemera and newspaper clippings. See IGS library, call #: f 91 00146.
Goldfinger, Paul M. Revenues and limits: A guide to school finance in California. Sacramento, Calif. : School Services of California, 1999.
Proposition 98: a Primer. Sacramento, Calif.: Legislative Analysts Office, Feb. 2005. .
Audio and Video
Center for Governmental Studies