Governor’s Latest Budget Still Leaves Local Schools $13 Million in the Hole

By Mark McGuigan and Jorge Casuso

May 16 -- The School District still faces a $13 million crisis, despite the money restored for education in the revised State budget unveiled by Governor Gray Davis this week, district officials said Friday.

If there is any good news in the governor’s latest proposal -- which includes a provision to cut $1.5 billion in education funding statewide -- it is that there are “no new cuts,” said Superintendent John Deasy.

Although the new State budget for the upcoming fiscal year restores about $403 million in cuts made to school districts in the January budget, local district officials had already taken the increase into account when they hammered out budget figures for the upcoming school year.

In recent months, the School Board has cut 91 teachers, as well as nurses, librarians, administrators and service personnel for the upcoming school year. It also scrapped class reduction programs and boosted the cost of transportation and school lunches.

“If the (State) budget gets passed,” Deasy said, “we don’t have to cut any more. Our budget is very accurate. We didn’t cut everything (Davis) said he would cut. We took the cuts he assumed he would make.”

The proposed cuts, Deasy said, reflect $18.3 million in reductions from the 2002-2003 funding level, an approximately 26.7 percent drop.

“Combined, these cuts reduce funding by more than $1,000 per student,” Deasy said. “Therefore, as of today, our budget for next year remains (unfortunately) accurate.”

If anything, the governor’s latest budget ties the hands of district officials by targeting the proposed cuts, Deasy said.

“The biggest difference is that before, (Davis) said, ‘I’m whacking this amount,” and now he’s saying, ‘It’s going to be targeted in these specific areas,’” Deasy said.

The Governor’s proposed budget, released Wednesday, tackles the funding shortfall with “targeted cuts, reversions and a reduction to the revenue limit in 2003-2004,” Deasy said.

To help bridge the deficit, the governor proposed that districts be allowed to use reserves "more flexibly," but did not specify what that actually means.

“There’s no direction whatsoever,” Deasy said. “Did he mean the sacred general fund reserves, reserves in categorical funds or the money put aside to maintain buildings?”

If the governor’s direction on using reserves remains unclear, his budget outlines specific cuts in a number of areas and defers State-mandated reimbursements for a second year in a row.

While the reimbursements would save the State -- which faces an historic $35-billion budget shortfall -- $125.4 million, they would result in a “multi-million dollar loss" for the Santa Monica-Malibu School District, Deasy said.

The governor’s budget would also eliminate Math Academies in the seventh and eighth grades and the Intensive Reading Program in Kindergarten through the fourth grade. In addition, it reduces school library materials by 99 percent and supplemental instruction by $25 million.

The Governor's revised budget also reduces Supplemental Grants to school districts by approximately 33 percent, a major blow to the local school district, which relies on the grants to fund key programs, including transportation.

The cuts, however, hinge on whether Wall Street approves more than $10 billion in proposed loans to the State and on the State legislature’s approval of the budget.

“This whole thing is a house of cards,” Deasy said. “If those bonds are not passed, we have to cut more. It is important to remember that this is only a proposed budget… It is already not assured to be adopted. This would prove grave.”

Regardless of what happens in Sacramento and Wall Street, the district will have to rely on funds generated by Prop S, a $225-a-year parcel tax that -- if approved by voters June 3 -- would pump $6.5 million a year into the district for six years.