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California School Fiscal Services

Providing comprehensive business office and consulting services to K-12 traditional schools and charters



Legislature passes budget and the bullet train is alive again!

Posted on June 14, 2014 at 9:15 AM

Yesterday, California lawmakers approved a 156 billion dollar state budget. It now goes to Governor Brown to approve and he has until the end of the month to move it forward or exercise his veto power.

As always, there were some interesting funding priorities. On a statewide level, the now infamous bullet train is alive again with a quarter of the budget or $68 million dollar devoted to the project. Now that is one expensive piece of transportation!

From an educational perspective, Brown made the controversial move to limit how much money a school district or charter can keep in its reserve account. This decision will surely result in much scrutiny from school business officials. As we all well know, the minimum economic uncertainty has never reported to be enough to negate any true emergency. Brown's response is that schools won't need to save a much cash since the state will have its own rainy day fund.

O.k, USC graduates...we know better...... First of all, we have just spent the last 5-7 years arranging for cash borrowing so that our districts and charters could survive the multitude to cash deferrals. In fact, we are all still dealing with this next month as we patiently wait for our April, May and June payment to arrive in July. We have struggled and struggled to manage our cash as the state passed on their cash problems to school districts to manage. Now we get to depend on the state's rainy day fund?

Second, the state is claiming it has a rainy day fund so there is really no reason for a school district to increase it reserves. Does this mean that when districts or charters need to access this rainy day fund that we can avoid the 20-30 years of consequences that occur with a state takeover? We know this is certainly not the case.

Last, while it is important that we steer clear of the politics inherent in the business office, we still have to weigh all of the facts. The California Teachers Assn. spent $4.7 million to help elect Brown in 2010 and donated nearly $290,000 to lawmakers, mostly Democrats, for this year's campaigns. This clearly raises the question "Is this a nod to the CTA to assist in making more funds available for compensation increases?"


Let me know your thoughts! Happy Monday.

Categories: California State Budget (2014-15)

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