Coming out of the Great Recession that ravaged the state budget, Governor Jerry Brown and the state’s teachers’ unions joined forces to successfully push Proposition 30, a 2012 ballot initiative labeled, “Temporary Taxes to Fund Education.”
Yet, despite a General Fund that grew 42 percent since Governor Brown became governor and Proposition 98 education spending that increased 52 percent over the same time period, a new ballot initiative, Proposition 55 will ask voters to continue the income tax portion of Proposition 30 for another dozen years. The Legislative Analyst’s Office and the Governor’s Director of Finance project this initiative could bring in between $5 and $11 billion dollars per year.
Not all the money will go toward education if Proposition 55 passes because of a compromise over the revenue reached by the teachers’ unions and health care providers, which will direct about $2 billion a year to Medi-Cal.
There is a question of how much of the already collected Proposition 30 money actually went into the classroom to boost education.
The State Controller’s Office tracks Proposition 30 money, which is sent to county education offices and forwarded to school districts. However, as Stanford lecturer, research scholar on economic policy, and member of the State Budget Crisis Task Force David Crane pointed out because the state shifted more pension obligations on to school districts, pensions are eating up the Proposition 30 funds.
Since CalSTRS, the teacher retirement fund, recently reported funds were well below investment goals, and officials project the fund could have negative cash flow for 15 years or more, Proposition 55 education money likely would also go to help offset the pension shortfall.
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