The principal dispute is over education's share of the state's $31.3 billion General Fund for fiscal year 1987-88. Following is a look at Gov. George Deukmejian's budget positions on education and responses from state schools chief Bill Honig.

Deukmejian: Education is receiving $17.2 billion--or 55%--of the General Fund, more than it ever received during the administrations of his two predecessors, Edmund G. Brown Jr. and Ronald Reagan.

Honig: The 55% figure is misleading, because Deukmejian, in drafting the new budget, put $477 million that had always been part of the General Fund in a separate fund for health programs he wants to transfer to counties. The General Fund pie is therefore smaller; by the standard of previous years, education's share actually is 53.7%.

Deukmejian: Next year's budget provides a $621 million or 4% increase for public school spending from the current year.

Honig: The $621 million figure is equally misleading. Only $125 million is actually new money from state tax revenues. The rest is accounted for as follows:

- $281.4 million from improved collections of local property taxes.

- $98.4 million from state lottery revenues.

- $685,000 in federal aid.

- $90 million represents a restoration of money that Deukmejian cut from the schools budget by executive action in December.

- $25 million amounts to a bookkeeping transfer.


Deukmejian: State spending for education has increased dramatically since the Deukmejian administration's first year. Competing pressures on the state budget caused by such things as soaring prison populations and the rising costs of providing health care to the needy under the $5-billion Medi-Cal program make large increases in education impossible this year. A tax increase is out of the question, and a $1-billion budget reserve is essential for potential emergencies.

Honig: California public schools have started back from the decline that occurred in the 1970s, but there is still a long way to go. It will take $2 billion more a year to restore California public schools to the national standing they enjoyed during the 1960s. The additional money for public schools should be taken from the governor's proposed $1-billion budget reserve. If all else fails, the state should raise taxes.

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