$300-Million Dispute Threatens Pact on School Funds

The $18.4-billion education financing package that apparently was agreed to several days ago by both houses of the Legislature and Gov. Pete Wilson was encountering new trouble Sunday.

Officials of the California Teachers Assn. and the Education Coalition said Wilson has changed his mind and now wants to make $300 million of the $822 million in additional spending a one-time item, for 1991-92 only, and not include it in the permanent funding base for public schools and community colleges.

A spokesman for the governor said Wilson made it clear all along that the allocation in question was non-renewable.

No matter who is at fault for the misunderstanding, said Alice Huffman, director of governmental relations for the teachers group, “If it’s one-time money, then it can’t be used to prevent layoffs” of non-teaching personnel. Many California school districts are planning such layoffs.

The teachers group had reached an agreement with the California School Employees Assn., which represents secretaries, janitors and other non-teaching workers, that the $300 million Wilson was offering would be used to prevent these layoffs.

If the money is to be available for one year only, it cannot be used for the ongoing obligation of paying salaries. Consequently, Huffman and others in the coalition of educational groups said, they will not support the tentative agreement that was reached with the governor and legislative leaders last week.

That, in turn, could threaten the agreement, since the education group, especially the 200,000-member teachers’ union, has substantial influence with Democrats in both the Assembly and the Senate.

“There seems to be some confusion on the governor’s part as to what constitutes an agreement,” Huffman said. “We’re hoping it can be cleared up.”

Bill Livingstone, Wilson’s press secretary, said the $300 million would be available only for one year because the money comes from exempting school districts from making payments to the state employees “gold-plated retirement plan” for a single year.

Livingstone said the governor never agreed to make the money available permanently.

Wilson originally proposed a $2.1-billion cut in school and community college financing for next year, along with suspension of Proposition 98, the 1988 voter-approved initiative that granted schools a set percentage of state General Fund revenues.

Lacking the votes to win the Proposition 98 suspension, Wilson dropped that demand several days ago and also said he would provide an additional $822 million to the schools and two-year colleges. Of this amount, $422 million would come from the General Fund and $100 million from eliminating a requirement that schools collect property taxes for the counties.

The other $300 million is the money in dispute.

The teachers group also is unhappy about Wilson’s proposal to freeze all salaries, for local government as well as state positions, in the event of a fiscal emergency.

Under the governor’s plan, which surfaced only two days ago, local school districts could grant pay raises to teachers and other employees but, if they did, their state appropriations would be reduced by an equivalent amount.

“Why should state workers take cuts in their salaries and then have that money go for raises in school districts at the local level? That isn’t fair,” said Livingstone.

The California Teachers Assn. also is opposed to changes in the makeup of the Public Employees Retirement System’s board of directors that would allow the governor to control a majority of the appointments.

“This is an attempt by the governor to gain control of a $63-billion pension fund,” association lobbyist Bill Collins said. “We’re opposed to that.”

If and when the education financing package does come together, a limited “school choice” plan evidently will be part of it.

The plan, introduced by Assemblyman Charles W. Quackenbush (R-Saratoga), and supported by the governor and members of both parties in both houses, would make it easier for students to transfer from one school district to another.

It covers public schools only and does not include any payments to students to make it easier for them to transfer.

This plan requires school districts with low test scores to hold public hearings and take other steps to make sure parents are aware of existing opportunities to transfer from one public school to another, either within the same district or between districts.