Teachers Support Gov.’s Plan to Cut Schools by $2 Billion

With the support of California’s largest teacher’s union, Gov. Arnold Schwarzenegger is expected to propose cutting at least $2 billion in education spending when he presents his first state budget Friday.

After closed-door negotiations with the governor’s staff, leaders of the California Teacher’s Assn. agreed to back an assortment of temporary education cuts -- the details of which remain sketchy -- in return for Schwarzenegger’s pledge not to tinker with Proposition 98, according to officials close to the talks. Proposition 98 is a constitutional amendment guaranteeing that K-12 schools and community colleges annually receive an increasing stream of money from the state’s general fund.

The union support could take significant political pressure off Schwarzenegger, who promised during his election campaign not to cut education in the course of resolving the state’s $14-billion budget deficit.

Budget analysts were anticipating that the governor would do battle with the education community over his insistence on closing the deficit without any new taxes. But educators said privately Monday that with schools accounting for about 40% of the budget, $2 billion in temporary cuts seem manageable. They had been bracing for much worse, alarmed by recent comments from the governor that a suspension of Proposition 98 might be necessary to rein in what he characterizes as out-of-control spending.

Officials said they are still discussing where exactly the cuts will be made, but all the money would be restored next year -- whether the state economy improves or not. For that reason, the cuts may help Schwarzenegger balance next year’s budget, but would do nothing to help solve the state’s long-term structural imbalance between spending and revenues.

Under review, among other things, is more than $900 million in cost-of-living increases that the state will owe schools next year. It is discretionary money that schools are free to use however they please. Also on the table are several hundred million dollars to pay for new state mandates -- such as an updated school bus safety program. The administration could defer the mandates and, along with them, the money schools need to accommodate them.

For the governor, the agreement also demonstrates his continuing success in striking out on his own to broker sensitive political deals, as he did last month when he reached agreement with the Legislature’s Democratic majority over a plan to borrow $15 billion to cover this year’s deficit. That borrowing plan will go before voters in March.

“It’s a smart move on the governor’s part,” said Senate Appropriations Committee Chairwoman Dede Alpert (D-San Diego). “It takes the issue that could have been most troublesome to him out of play.”

Republican political consultant Dan Schnur agreed. “This is probably the best possible way for a new governor to start his term in office,” Schnur said. “Any interest group that faces a potential cut can make enough noise to cause a governor some problems. But the teachers could have made his life absolutely miserable.”

However, the agreement does threaten to fracture an uneasy coalition of major education groups that only a few weeks ago had resolved to stand together in budget negotiations. Representatives from some of those groups expressed frustration that they were left out of the talks, but would not comment publicly.

Community colleges were particularly anxious. They are preparing for the governor to propose hiking fees from $18 per credit to $26, which would raise more than $90 million in new revenue.

Administration officials have also signaled to the colleges that they are considering eliminating fee waivers for disadvantaged students, in the hope of saving an additional $150 million or so.

An administration spokesman declined Monday to discuss any details of the deal, saying only that schools will get at least as much money next year as they received this year.

“The governor made clear he was not going to cut K-12 spending, and the budget he will submit to the Legislature will reflect that commitment,” said Department of Finance spokesman H.D. Palmer.

The administration prefers to not define the reduction in education spending as a “cut” because schools would get at least as much as they got this year. The cuts would instead come from payment increases guaranteed to accommodate enrollment growth, inflation and the cost of meeting new mandates required by the state.

Instead of getting a $3.5-billion increase owed them this year as a result of Proposition 98 and other laws, schools would get $1.5 billion or less.

Schwarzenegger’s budget Friday will also be in a different form than in years past. Governors have traditionally been forced to have their entire budget put together by Christmas so it can get to the printer in time to be ready for the Jan. 10 deadline.

But the administration is not going to be printing hundreds of volumes of the budget. It will instead distribute the plan on computer CD-ROMs, a move that could prove controversial. Finance Director Donna Arduin made a similar move while budget director in Florida. Democrats there complained her “e-budget” was stylish and user friendly, but short on substance and difficult for them to analyze effectively.

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Times staff writers Duke Helfand and Jeffrey L. Rabin contributed to this report.