Aren't All Political Factions Supporting Prop 2?

"Leave it to the governor and state legislators to take a good idea and screw it up. That's what happened with the plan for a rainy day fund on the November ballot."  So begins the San Jose Mercury's endorsement of Proposition 2.  "The only reason California needs a rainy day fund is that state lawmakers don't responsibly budget on their own. They should butt out of local schools' budgeting. It's insane to couple a requirement for fiscal prudence on the state level with a prohibition against it for school districts."


Politicians and others see themselves as winners from Prop 2 -- proud proponents of fiscal responsibility.  Many civic groups that have long agitated for an effective rainy day fund thought they'd finally got it. 

Then the other shoe fell.

When we ask groups that have endorsed Prop 2 about the reserves dump and about interactions with Prop 98, we either get silence or the assurance that the governor will do "something" next year about the reserves fund.  What he will do -- having shoved it into budget too late for any analysis or discussion this year -- they don't seem to know.  And none of them seems to have done any numerical modeling themselves.  They've taken into account different "points of view." 

We, meanwhile, have gone to the trouble of running the numbers.  And we've tried to model alternative economic scenarios -- including improved fiscal revenues on the one hand and another bump in the road on the other -- and factoring in the idea that the governor will actually try to fund LCFF (which the LAO's analysis does not assume, leaving LCFF $6 billion short in 2020).  We can come up with rosy scenarios in which the gentle slosh of funds from year to year doesn't hurt schools.  But equally easily, we can foresee a good 2015-16 year eliminating the past Prop 98 maintenance factor and depositing a bit in the PSSSA.  Schools would then be forced to pay down their local reserves to under $3 billion ... and wham! ... we're hit by another financial shock with only a few billion in the state BSA, even less in the PSSSA, and $5 billion less in our school reserves.  Who pays?  Kids.  California.

Meanwhile, not a single shadowy special interest has shown up offering to fund our opposition.  Odd, eh? 

To find those groups actively supporting Proposition 2, click here and Google "vote yes on prop 2". 

Then, please, ask supporters the questions we've asked:

  • How do you feel about forcing schools to dump $5 Billion of Local Reserves -- and why isn't that a stumbling block for you?
  • Doesn't Prop 2 mean that any replacement of Prop 30 funds is likely to go into the rainy day fund, rather than directly to schools?  (Since only the existing Prop 98 maintenance factor is protected and could be eliminated by one good capital gains year -- like this one?)
    • Prop 30 funds currently represent 12% of total school district revenues -- and 20% of all state funding of local school districts.

Let us know what answers you get!

And, if they don't satisfy you, please join us in voting NO on Prop 2. 


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