Education and CSEA Members Win Big on State Budget

October 8, 2010

Education and CSEA Members Win Big on State Budget

After and all night session and a budget stalemate that lasted 100 days into the current year, the Legislature passed the budget early this morning. This makes the 2010-11 budget the latest on record. Last week the Governor and Legislative leaders announced that a deal was struck on the budget but it took a week to put together the 20 pieces of legislation to make the agreement operational.

The budget agreement includes approximately $18.3 billion in General Fund solutions and closes the deficit with a combination of $7.5 billion in cuts (far less than the 12.4 billion proposed by the Governor), $5.3 billion in federal funds and $5.9 billion in additional revenues, fund shifts and alternate funding.

CSEA members led the fight to hold legislators and the Governor accountable for keeping the education budget promise from last year. The budget agreement reflects the commitment by Legislative leadership to honor the July 2009 budget promise memorialized in AB 4X 3. To avoid massive cuts to home care, seniors, children’s programs and the disabled the agreement suspends Proposition 98, an action that CSEA and the Education Coalition opposed. In the end, education is funded at $52.5 billion, an increase of approximately $3.1 billion over the Governor’s May Revise proposal.

Major Education Highlights Include:

* Proposition 98 is funded at $49.7 billion for fiscal year 2010-11
* Deferrals totaling $1.9 billion ($1.7 billion for K-12 and $189 million for Community Colleges)
* Settle Up Funding of $300 million
* One time funding totaling $240 million
* Funding for the Quality Education Investment Act totaling $420 million.
* Funding for 2.21% enrollment growth ($126 million) for Community Colleges
* Guaranteed payback of the Maintenance Factor totaling $9.5 billion. This is money owed to schools to be repaid in future years when the economy improves.
* $1.3 billion in federal jobs funds, which can be used over the next two years to buy back furlough days, stop layoffs, bring back laid off employees or otherwise save education jobs.

This level of funding could not have been achieved unless CSEA members took the lead in lobbying legislators to keep their education budget promise.

Stopping Layoffs, Furloughs and Cuts
CSEA chapters should bargain for rehiring of classified employees, elimination of furloughs and restoration of jobs and programs. Virtually every school district based their budgets on the Governor’s May revise budget. However, since the budget agreement includes $3.1 billion more than the May revise budget, plus $1.3 billion in federal jobs funds, there should be ample funds available to restore jobs and cuts.

Pension Benefits Cut for New Employees

During the budget fight, Governor Schwarzenegger conditioned the budget on rolling back retirement benefits for new classified employees. He insisted that new classified employees be moved into a two-tier retirement formula at 2% at age 60, instead of 2% at age 55 and have final retirement compensation based on the highest consecutive 36 months, instead of the highest consecutive 12 months.

CSEA lobbied hard against this proposal and Senate President Pro Tem Steinberg engaged in a late night negotiation with Governor Schwarzenegger to remove this two-tier benefit from the budget agreement. We want to thank Senator Steinberg for stepping up on this issue and stopping the two-tier retirement. Senator Steinberg and Speaker Perez did an exceptional job negotiating this budget under difficult economic and political circumstances.

Our friends in the legislature stood strong with us and CSEA members did a fantastic job lobbying, organizing and fighting for a fair budget for classified employees and students. You can be proud of the result and the fact that we have finally stopped the cuts and begun reinvesting in our public schools. Thank you for all your efforts and hard work.
Next Steps

We expect the Governor will review, blue pencil and sign the budget over the next few days. We want to caution that the information reported here may change based on further analysis of the budget bills and the Governor’s actions. We will send out additional reports on the budget as any new or significant information becomes available.

If you wish to comment or would like additional information, please contact: Dave Low, Director, Governmental Relations; Jai Sookprasert, Assistant Director, Governmental Relations; Dolores Duran-Flores, Legislative Advocate; Steve Henderson, Legislative Advocate; Joshua Golka, Legislative Advocate, 1127 11th Street, Suite. 346, Sacramento, California 95814. Toll Free: (800) 867-2026.