02.19.09: State Budget Update
By David Walrath
This morning the State Senate and Assembly completed action on both the 2008-09 mid-year budget adjustments and the 2009-10 State Budget including education funding and appropriations. While there were some adjustments in tax revenues, it appears that those adjustments will have a minor affect on Proposition 98 guarantee and education funding. The February 17th update contained the structure of the budget agreement and can be used for developing school district and county office budget plans for March 15 notices. Click here to view the provisions.
The agreement includes the special election provisions outlined below, as well as a new provision for the 2010 election, that provides for an open primary and assurances that legislators cannot receive a pay increase during years when there is a state budget deficit.
The overall changes were to delete the $.12 gasoline tax increase and delete the 5% income tax surcharge with an alternative of a .25% increase in general income tax rates using federal stimulus funds and a commitment from the Governor to make $600 million worth of line-item vetoes.
While basic aid districts will not be affected by the revenue limit deficits, and will not be required to make additional categorical program cuts equal to the revenue limit deficits of equalization districts, basic aid districts will not be eligible for the federal stimulus revenue limit backfill. After the federal stimulus revenue limit backfill, it is believed that basic aid and equalization aid districts essentially will be in the same position.
Special Election May 19, 2009?
The State Budget agreement depends upon voters approving a series of constitutional and initiative changes. The spending cap, lottery securitization, use of Proposition 10 (First Five) funds, use of Proposition 63 (mental health funds) and the Proposition 98 $9.3 billion dollar maintenance factor will be on the ballot.
Assembly Bill 11 of the Third Extraordinary Session calls for a special election on May 19, 2009 to include these provisions. This bill has passed both the State Senate and the State Assembly. It is awaiting the Governor’s signature.
Because of the early May 19 date, or even if it is extended to May 26, it will be almost impossible for school districts to place local school bonds and parcel taxes on this ballot if they have not already been placed for the next statewide election.
