Honig, Other School Advocates Threaten to Defeat Gas Tax Plan

SACRAMENTO — Throwing down a gauntlet, state Schools Supt. Bill Honig, teachers’ union leaders, PTA officials and school administrators threatened Tuesday to defeat a proposed gasoline tax increase if they do not get a fair shake in budget negotiations.

“These measures are not going to pass unless we decide to vote for them,” Honig said. He referred to a 10-year $18.5-billion transportation improvement program built around a proposed 9-cent-a-gallon increase in the gasoline tax as well as proposed constitutional amendments to substantially repeal the state spending limit and funding guarantees for public schools.

Honig and other school interests said at a Capitol press conference that they had been excluded from negotiations that will decide how billions of dollars in state revenue will be distributed for education and other government programs.

At the heart of the debate is the issue of how to rewrite Proposition 98, the landmark school funding measure approved by voters in November. Republican Gov. George Deukmejian and legislators of both parties would like to revise the measure so more of the state’s surplus revenue can be channeled into health, welfare and other state programs.

Deukmejian and leaders in the Assembly and Senate plan to go to voters next June with one or possibly two ballot measures that would pave the way for the gasoline tax increase.

At the same time, they also would present voters with a constitutional amendment that would recast Proposition 98 and ease a limit on state spending approved by voters in 1979.

Proposition 98 guarantees public schools and community colleges 40% of state revenues and provides them with increases each year that are tied to the rate of inflation and growth in school enrollment. It also gives schools first call on any budget surpluses, up to 4% of their prior year’s budget.

The problem, as Deukmejian and others see it, is that they project that because of escalators built into the Proposition 98 funding, schools will get 46% or 47% of state revenues within 10 years, not just the 40% voters were told the measure would provide.

Any proposed changes in Proposition 98 or the voter-imposed spending limit would have to be approved by voters, because both are now part of the state Constitution.

Honig and the various education interests raised $7.5 million to pass Proposition 98 and said they are prepared to spend a like amount next spring to defeat Deukmejian-backed measures if too much money is taken away from schools.

Concessions Alleged

The school interests say they recognize the broad budget problems created by Proposition 98 and are willing to support amendments. But they say they have already made numerous concessions and are unwilling to go much farther.

“We conceded, we compromised,” said Del Weber, vice president of the 200,000-member California Teachers Assn. “Now they want more. They want us to give up the basic guarantees granted by the voters so they can increase taxes to support highways. We cannot do that. We will oppose anything on the June, 1990, statewide ballot that permits a gas tax increase if it accompanies changes that hurt kids.”

What school interests have agreed to so far is a redistribution of surplus revenues that would take their share of a $2.5 billion tax windfall down from $1.9 billion to about $1 billion, plus support for legislation that will temporarily lift the spending limit and help the Legislature balance its proposed $50-billion state budget.

Joining Honig and Weber at the press conference were officials of the Assn. of California School Administrators, the state PTA and the California Federation of Teachers.

Their comments came as Deukmejian and legislative leaders held their ninth meeting in recent weeks to try to reach agreement on measures to be presented to voters next June.

Under current law, the governor and Legislature can spend only about 10% of the $2.5 billion in new revenues resulting from unexpectedly high income tax payments. Under Proposition 98, public schools and community colleges would get $1.9 billion of the $2.5-billion windfall if the governor and legislators cannot find a way around the spending limit restrictions.

Legislation is pending before the Assembly and Senate that would temporarily lift spending limit restrictions, but Deukmejian and Senate Republicans say they will not support a temporary solution unless they can reach agreement with Democrats on a package of constitutional amendments that will substantially repeal portions of the spending limit and Proposition 98.

The ambitious 10-year transportation improvement program is caught up in the problem because unless the spending limit is changed the state will not be legally able to spend the money raised through the proposed gasoline tax increase.

The clock is running on these negotiations because the 1988-89 fiscal year ends at midnight Friday. Unless there is agreement on lifting the spending limit by then, the state will finish the fiscal year with a surplus of $1.1 billion. Proposition 98 requires that the state automatically hand over $600 million of that to schools and return the rest to taxpayers in the form of rebates or tax cuts.

Despite the pressing deadline and the complex array of issues facing them, Senate Republican leader Ken Maddy of Fresno, one of the participants, said, “I still think it will be resolved. There is just too much at stake.”