Still the Education Governor?
He campaigned in 1998 under the banner of education reform. Education, he said upon taking office, was his first, second and third priority. Now, faced with recession and the prospect of a $12.4-billion state budget deficit over the next two years, Gov. Gray Davis has offered to cut some of his pet education initiatives to help close the gap. Does he still get to call himself the education governor?
In the short term--which is to say, the period before the filming of TV ads for next year’s gubernatorial election--that’s probably a question his political consultants will decide. Back in May, when the budget situation looked less severe and the crisis at hand was electric power, the governor’s pollster, Paul Maslin, said that “education is never again going to have the same salience” for California voters. So far, Maslin’s been right. A recent statewide poll by the Public Policy Institute of California shows that Californians rank the economy as their No.1 concern, followed by terrorism and security issues, the electricity crisis, and then education.
But if the budget cutting becomes visible in classrooms next year, education may move to center stage again. Indeed, Maslin now says it will come back as a critical issue for voters. His previous pronouncement notwithstanding, he says education is always No.1 or 2 in their minds.
All of which begs the real questions about the governor’s performance on education, regardless of what he decides to call himself in his reelection bid: Has he improved it, will the cuts he must now make harm it, and given the near incomprehensibility of the formula by which K-12 education is funded in this state, how on earth can an ordinary voter be able to figure that out?
As with all matters of fiscal consequence in California, the first step to figuring anything begins with Proposition 13. The 1978 property-tax initiative spawned a family of measures limiting spending and taxation, each one pinching just a little more on the discretion of the governor and the Legislature to make budgets. In 1988, the teachers’ unions fought back with Proposition 98, a minimum spending guarantee for K-12 education and the community colleges. It was amended in 1990 with Proposition 111 and then augmented with some wholesale tinkering by the Legislature.
Basically, Proposition 98 says education spending, currently about 35% of the budget, should grow in proportion to state tax revenues when the economy is doing well, and that it should keep pace with enrollment growth and inflation when the economy is growing at a slower rate. Describing it that way, however, is a little like saying fine French wine is fermented grape juice. It’s true, but it rather misses the point.
The point is the formula that determines what portion of the state’s general fund actually goes to education. Each year, a cottage industry of budget and education-policy specialists inside and outside state government coaxes the formula’s components into a computation upon which all other pieces of the state budget depend: the Proposition 98 minimum-funding guarantee. Picture here one of those marvelous Rube Goldberg machines of interlocking gears and pulleys that, say, toasts bread. At least with such a device, there is, in the end, toast. The problem with Proposition 98 is that its formula, particularly in times of economic boom or bust, can have perverse results because it computes backward and forward in time, simultaneously.
Nobody learned this more painfully than Pete Wilson in the early 1990s. During most of his two terms as governor, the effects of the long recession yielded school-funding levels that just kept pace with inflation and growth in school enrollment. At some points, state tax revenue fell so far below budget projections that the Proposition 98 minimum guarantee was too low to cover even that. Every time Wilson thought he had figured out a onetime solution to keep the schools afloat, the formula would automatically convert that crisis response into a permanent increase.
“There is not one word in Proposition 98 that does not have the potential to raise itself up unexpectedly and result in unanticipated consequences,” says Maureen DiMarco, who served as Wilson’s education secretary and watched Proposition 98 become a ceiling for education spending rather than the floor many educators had hoped it would be. “Only 12 people in the state even claim to understand the formula,” she says. “Eight are lying, two lost their sanity, and the other two always seem to disagree with each other about how it works.”
One of those two is veteran education lobbyist John Mockler, who is now executive director of the state Board of Education. Mockler is widely credited with drafting Proposition 98 and, drawing on his vast experience in budget battles, devising its most confusing and insidious budgetary effects. He jokes that he wrote it that way to get his kids through college. But then he gets serious.
“Everybody loves education except when there is a budget crisis, then they all want to whack it,” he says, offering no apologies for making the rest of the budget hostage to what amounts to a single interest group. “All governors hate fiscal restraints, as well they should,” Mockler continues. “I understand that, and in the abstract, I believe in the republic. In reality, though, I know that it takes a two-thirds vote in the Legislature to pass a tax increase and just a simple majority to pass a tax cut.” (So does every other interest group worth its salt, which is why law enforcement, public health and local government groups are plotting Proposition 98-like ballot measures for the November 2002 ballot that would protect their funding and/or earmark new sales taxes to pay for things like increased police overtime, trauma centers and emergency rooms, hazardous cleanup.)
In contrast to Wilson, Davis has had three fat years in which to fund education at levels above the Proposition 98 minimum. If that is the yardstick, he has boasting rights. In his first year as governor, education received nearly $1.8 billion above the minimum, the following year, about $414 million, and in the current budget year, about $3.5 billion even with the cuts he has proposed to the Legislature. When Davis took office, annual spending per K-12 student stood at roughly $5,700. It is now at $7,000. That lifts California from the near-bottom level of state rankings, although it still resides in the lower half.
There are criteria that have more to do with philosophy than money. Davis’ initiatives for teacher, parent and student “accountability” remain a work in progress. Critics, including plenty in his own party, say they were more show than substance, anyway. His much-touted high-school exit exam is being revised because students haven’t had a chance to study the material it covers and because the manner in which it was developed might not survive legal challenge.
Finally, there are the education-spending cuts that Davis proposed late last month, some $843 million from the current year’s budget. The governor wants the Legislature to approve them in a special budget session that would commence when lawmakers return to Sacramento in January. That approval is by no means a foregone conclusion. The Legislature has every incentive to wait until late spring, when it must begin acting upon next year’s budget, to see if better economic news or the opportunity to bargain as the budget deadline approaches produces a happier set of choices.
In the meantime, the cuts the governor has put on the table--taking back $250 million approved in July for schools to cover higher energy costs; cutting performance awards for teachers; delaying funding for poorly performing schools; taking back money designed to equalize funding for urban and rural schools and for expanding before- and after-school student programs--seem to be passing muster with important players in the education lobby. Davis was praised for making the cuts equitable and for sparing programs that directly affect curriculum. So far, so good. But Davis is now about to learn the lesson Wilson did: How to run the rest of state on the leftovers of Proposition 98’s guarantee to education. Remember, the funding formula works retrospectively and prospectively.
That means that having funded education above the minimum, even if the Legislature agrees to his proposed $843 million cut from the current-year budget, Davis will have to repay most of that money in next year’s budget. The amount he repays will, in turn, get built into the Proposition 98 base for the following budget year. And to add insult to injury, his obligation to repay is a direct consequence of the high funding levels he gave to education during his first three years as governor.
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Susan F. Rasky is senior lecturer in the Graduate School of Journalism at UC Berkeley.
