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Talking Points

Talking Points

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Published by lousif

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Published by: lousif on Dec 08, 2010
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12/08/2010

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Version 4 – 11/23
Talking Points
Major Points
The year 2007-08 was the year right before the current fiscal crisis. It is the year withthe State’s highest revenues and expenditures.The 2010-11 budget was signed by the Governor on October 8, 2010. It is called theenacted budget. In November, less than two months after the enactment of the 2010-11budget, the Legislative Analyst (LAO) has already stated that the 2010-11 expendituresprojections will be $6 billion higher than the enacted budget. The talking points beloware based on the LAO’s
2010-11 California Spending Plan
– enacted budget – and theLAO’ s
Fiscal Outlook 
, which contains the revised forecast for the 2010-11 budget andthe new forecast for 2011-12.The following are the three most important talking points:
The 2010-11 Level of Funding Compared to 2007-08 :
K-14 education (Prop. 98) has been cut by $6.9 billion or -12%.All the other state programs have only been cut by $.6billion or -.7%
Our schools, our school children, our child developmentcenters, and our community colleges have been cut 11 timesmore than the other state programs.In addition, K-14 education is having revenue deferrals of $8.2 billion (the deferrals started in 2003-04). The state’scash flow problems are transferred to our students.
The 2010-11 Level of Funding Compared 2009-10
K-14 education (Prop 98) received a decrease of .3% or -$141 million.
Even under the enacted budget all the other state programswould have received an increase of $7 billion or 9.4%.
Under the real budget, all the other state programs willreceive an increase of $12.9 billion or 17.4%.
Conclusion: K-14 Education (Prop 98) was
not
 
even close
 
to being the Number One Priority of this Legislature or of thisGovernor.
 
Version 3 – 11/22
2010-11 Budget
1.“We estimate that well over two-thirds of the 2010-11 budgetsolutions are one-time or temporary in nature” LAO
2.
The state will be unable to secure $3.5 billion of federal funds.
3.
Higher prison cost and other programs.
4.
The passage of Proposition 22 will cost the state at least $800million.
5.
The 2010-11 budget is already projecting a $6 billion deficit that willbe carried into 2011-12.
6.
That means when the LAO produced their 2010 State Plan, the2010-11 (current year) General Fund Expenditures were estimated to be$86.6 billion. Now in their Fiscal Outlook the 2010 GF Expenditures haveincreased to $92.5 billion in less than a month or two.
7.
The 2011-12 deficit is $19 billion. The total deficit is $25 billion.
8.
According to the LAO, the 2011-12 deficit of $19 billion is $2 billionless that they projected a year ago. Education cuts are that major contributor to this decline (read improvement) of $2 billion – Why aren’t wesurprised! Evidently, no one else got cut.
Education Funding
9.
The 2010-11 (current year) level of funding for 
Proposition 98
isequal to the level of funding
six years ago
in 2004-5
10.
The highest level of funding was in 2007-08, just prior to this latestfiscal crisis. In 2010-11 the level K-12 education funding has dropped by
$6.6 billion
or 
13%
compared to 2007-08 (see Table 2). The K-14 TotalProposition 98 funding level has dropped by $6.9 billion or 12%.
11.
That is equivalent to cutting the funding for ever K-12 child by$1,100.
12.
The LAO is estimating that we
may
just barely reach our 2007-08level of funding in 2014-15, four years from now and seven years from2007-08.
2
 
Version 3 – 11/22
13.
Our educational funds for our K-12 needy students (categoricalprograms) were cut by
20%
compared to a general aid cut of 
10%
14.
In 2008-09 the K-12 cut from 2007-08 was $7.3 billion. In 2009-10the cut was $6.6 compared to 2007-08. In 2010-11, the cut from the2007-08 funding levels was $6.6 billion.
15.
The
total three year K-12 cut
is
$20.5
billion from the 2007-08funding levels (please note, this is not a cumulative cut). That is howmuch was taken away from us over those three years to fund other programs. This is equivalent to a cut of $3,400 per student. Our studentsdid not receive $3,400 per student during the three year time period. Thisdoes not include the increases from 2007-08 that we should havereceived.
16.
This does not include
$7.4 billion of deferrals for K-12
educationand
$832 million of deferrals for the Community Colleges
. The totaldeferrals is $8.2 billion. The state is transferring its cash flow problems toour children!
17.
This year the
FIRST
 
$8.2 billion or 23% of our Proposition 98state funds
must be used to pay for services that we have alreadyprovided in the prior year. There are already threats that things will getworse in 2011-12 and that the deferrals will increase by at least $2.5billion perhaps as early as this year!
18.
The LAO is projecting that K-12 Proposition 98 will
decrease
byanother 
$1.9 billion in 2011-12
. That is a total
decrease of $8.5 billion
or 
17%
from the 2007-08 levels.
19.
On the other hand, the LAO is projecting that non K-14 stateprograms will
INCREASE BY 20.5%.
(see Figure 1 on page 6)
20.
Once again it looks like we are the only program that will getcut.
Comparing the 2010-11 Level of Funding to 2007-08
It is extremely distressing to compare the decrease of K-14 funding from
2007-08
to the funding change for the other state programs.
21.
For the enacted 2010-11 Budget Totals, our K-14 Proposition 98amount decrease from 2007-08 was 12%, the decrease for other stateprograms was only 7.5%.
22.
For the actual or 
real
2010-11 Budget Totals, our K-14 decreasewas once again
12%
, however, the decrease for other state programs was
3

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