October 7, 2005


Proposition 76: State Spending and School Funding Limits

Should Californians make major Constitutional changes to create an additional state spending limit, grant the governor substantial new power to unilaterally reduce state spending, and revise key provisions relating to Proposition 98, school and community college funding, and transportation funding authorized by Proposition 42?

Summary: Limits state spending to prior year’s level plus three previous years’ average revenue growth. Changes minimum school funding requirements (Proposition 98). Permits Governor, under specified circumstances, to reduce budget appropriations of Governor’s choosing.

Fiscal Impact: State spending likely reduced relative to current law, due to additional spending limit and new powers granted to Governor. Reductions could apply to schools and shift costs to other local governments.

Meaning of Voting Yes/No

A YES vote on this measure means:

State expenditures would be subject to an additional spending limit based on an average of recent revenue growth. The Governor would be granted new authority to unilaterally reduce state spending during certain fiscal situations. School and community college spending would be more subject to annual budget decisions and less affected by a constitutional funding guarantee.

A NO vote on this measure means:

The state would not adopt an additional spending limit, the Governor would not be granted new powers to reduce state spending during certain fiscal situations, and existing constitutional provisions relating to schools and community college funding would not be changed.

The argument for yes, on this proposition starts by stating the need to control state spending, declaring California’s budget system as broken, citing record deficits, unbalanced budgets and out-of-control spending. All of which is true. But the real question is how did the state get into such a mess? Was it because of state spending on education?

It was just a few years ago that the State budget was sitting on the surplus side of the ledger and then two economic catastrophes occurred. The first was the dot.com crash that practically wiped out Silicon Valley. This was then followed by energy deregulation after which energy companies raised the cost of gas and electricity to obscene rates at the same time creating an artificial shortage in the state.

To keep California up and running Governor Gray Davis wiped out the budget surplus in order to keep the lights on and California has yet to recover.

This of course is a thumbnail sketch and yet it is around these circumstances that the State now finds itself in this difficult position and in response to these recent issues the Governor wants a constitutional amendment giving this governor and all other governors following him unprecedented power over the budget.

In 1988 State voters passed Proposition 98, a State Constitution, which was a minimum fund guarantee for K-12 and community colleges. The Governor wants to change Prop 98 to under fund the educational process during a fiscal emergency. As noted it was not school funding that created the budget deficit, but the Governor is now asking that we sacrifice the education of our children to fix the State’s budget problems. This doesn’t make sense.

The problem with this Proposition is that it does not suggests or recommend any other solution nor does it address the State budget problems nor the origins of the perceived problems. It relies on only one segment of the economy to fix the budget. This proposal would be appreciated more if the Governor set precedent by example, but he is one of the biggest spenders on Capitol Hill as his personal budget has grown. And this proposition would hold water if the state, one of the richest in the world, was at the top in State spending on education-which it is not.

Minority students are already facing serious budget cuts at the national level and at the State level there is not enough funding to ensure that our children are receiving the best education possible. And the cost of attending community college has risen to the point that it is becoming prohibitive for low income families to send their children.

This proposition does nothing to curb outrageous spending by our legislatures, it just changes the rules to maintain the out of control spending and at the same time give dictatorial control over the budget to the sitting governor and hold the school budget as hostage. Don’t shortchange Your Children!

La Prensa San Diego strongly recommends a:

No vote on Prop 76.

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