The Current Situation
- Significant additional funding for schools and community colleges as a result of higher revenues from Proposition 30 and continued improvement in the economy, including $4.75 billion in additional funding for the so-called Local Control Funding Formula (LCFF), which provides a substantial amount of funding for K-12 schools based on how many low-income, non-English speaking, and foster children each district has.
- An increase in funding for the University of California and the California State University, with the expectation that there will not be increases in tuition this year.
- A multi-year plan to eliminate most of the so-called “wall of debt” -- budgetary obligations totaling around $30 billion incurred in recent years.
- Among the debts the budget pays off are $1.6 billion in Economic Recovery Bonds the state used to finance the deficit in 2004 and $5.2 billion in deferred payments to school districts and community colleges. If revenues are higher during the fiscal year than projected in the budget, up to nearly an additional $1 billion would be paid off, thereby eliminating these deferrals.
- The budget also spends $1.2 billion on one-time deferred maintenance projects and spends $250 million on high speed rail as part of a plan as to how to spend a total of $832 million in cap and trade auction revenues.
- The budget also puts in place a plan to begin to address the roughly $80 billion unfunded liability in the State Teachers' Retirement System fund.