Personal Tie Led Unlikely Allies to Education Deal

They seemed unlikely allies -- California’s new Republican governor and the chief political strategist for the state’s powerful, and generally Democratic, teachers union.

Yet in a series of meetings starting shortly after his Nov. 17 inauguration, Gov. Arnold Schwarzenegger and John Hein of the California Teachers Assn. struck a deal.

The plan, formally unveiled Thursday, gave the governor $2 billion toward reducing next year’s budget deficit and greatly undermined the leverage that Democratic legislative leaders have in opposing him.

For the union, the deal preserved a guarantee of money for schools that might otherwise have been at risk in this year’s budget battles.

The agreement served as another indication of Schwarzenegger’s inclination and ability to strike out on his own and negotiate with interest groups outside his Republican base.

It began with a telephone call.

The governor had worked together with Hein in 2002 when the CTA political director helped in the campaign for Proposition 49, the ballot measure that Schwarzenegger sponsored to increase funds for after-school programs. The two had remained friendly.

As the new governor began to grapple with the budget dilemma he had inherited, he reached out to Hein.

According to a knowledgeable education official, Schwarzenegger “called John and said, ‘I need $2 billion. Can you help me get it? What would that look like?’ ”

“The governor told us he was the one who called the CTA, because he has a relationship with John Hein,” the official said.

At the time, the union had reason to worry about Schwarzenegger.

When he became governor, Hein agreed to serve on a transition advisory team. But he resigned abruptly when the governor ignored the CTA’s recommendation that the position of education secretary be abolished.

Instead Schwarzenegger filled the job with a man whom CTA officials were known to dislike -- former Los Angeles Mayor Richard Riordan, who had fought with the Los Angeles teachers union over control of the Los Angeles Unified School District board.

That move could have permanently soured relations between the union and the governor.

Then, on Dec. 9, the governor alarmed leaders of education groups with a comment in a CNN interview. Schwarzenegger suggested that the state might need to suspend Proposition 98, the constitutional guarantee of a stable source of funds for schools and community colleges.

But despite those strains, Schwarzenegger maintained his relationship with Hein. And when the call came, Hein brought in John Mockler, an expert on school finances and a former state education secretary, to help craft a plan.

At a meeting Dec. 19 in the CTA’s Sacramento offices, Hein detailed the plan for leaders of other education groups, including the California School Boards Assn., which had also begun quietly working with Schwarzenegger’s staff.

Three days later, the group convened in the governor’s office at the Capitol. Several of Schwarzenegger’s top aides were present, including Legislative Secretary Richard Costigan and Deputy Chief of Staff Bonnie Reiss.

Among the education groups represented were the school boards group, the Assn. of California School Administrators, California Federation of Teachers and California Assn. of School Business Officials.

After a hearty welcome, Schwarzenegger turned the floor over to Hein, who outlined the deal. The proposal would give schools and community colleges $2 billion for cost-of-living increases and enrollment growth next year but would allow the state to defer another $2 billion owed to schools until revenues pick up.

In addition, Schwarzenegger agreed not to tap more than $800 million in additional school money owed as a result of the improving economy. And he pledged not to seek midyear budget cuts in education, as former Gov. Gray Davis had done in the last two years.

The educators came away impressed by the new governor. “He spoke with great confidence and knowledge about this topic and was well aware of the implications of wanting to make a deal with the education coalition before the budget was introduced,” said one education official. “It was a very smart play on his part. He buys support in the process.”

At the end, Schwarzenegger firmly warned everyone not to discuss the details outside the room.

For the governor, the deal provided a way to make good on a campaign pledge to protect school funds while still gaining $2 billion, about one-seventh of the deficit he needs to close in the budget for the year beginning July 1.

For their part, the CTA and the education groups were motivated by a fear that lawmakers, in trying to balance the budget, would eventually grab more than $4 billion in education money owed to schools next year.

To prevent that, the groups were prepared to abandon their traditional Democratic allies in the Legislature.

“You have two choices, in terms of negotiations,” said another person familiar with the discussions. “You either do it now or wait until the end. When you are representing the interests of such a huge part of the budget and you have an entree with the governor, why not take it?”

Legislative Democrats, meanwhile, were kept out of the loop. Some party leaders were aware that the CTA was negotiating with the administration, but they did not realize, until details were disclosed in a Times article Tuesday, that the two sides had forged such an extensive agreement.

Democrats had hoped to tap the education community’s support for a possible tax increase. But the agreement between the education groups and the governor could significantly undermine Democrats’ leverage.

“The new governor has demonstrated he is willing to pick up the phone and talk to people directly and he has also demonstrated he can be ... on a personal basis, both compelling and persuasive. That changes the rules of the game,” said Darry Sragow, a Democratic political consultant. That “is just not what we have seen in California.”

Some Democrats have already informed educators that they may not support the budget deal with Schwarzenegger, saying they cannot justify cuts to social programs that could result from the agreement.

“Are we at a place where it’s every man for himself and groups are willing to strike a deal to protect their own interests?” asked Assemblyman Joe Canciamilla (D-Pittsburg). “They need to understand our concerns may be different. For groups to begin trying to negotiate and cut separate side deals before the full impact of balancing the budget is known is a risky venture.”

Other Democrats accused Schwarzenegger of duping the public with proposed cuts that they say would effectively suspend Proposition 98 -- a move that would require a two-thirds vote in both houses of the Legislature.

“I want the public to have a transparent look at what’s going on,” said Assemblywoman Jackie Goldberg (D-Los Angeles), who heads the lower house’s Education Committee. “What is being advocated can only be characterized as suspending Prop. 98. Is that evil? Maybe not. What I do not like is the attempt by anybody to pretend that this is something other than that.”

Those familiar with the negotiations said the CTA and the other groups had “very reliable indications” that the Legislature itself would seek to suspend Proposition 98, a move that schools feared would cripple them.

And so they welcomed Schwarzenegger’s overture, seeing a chance to control the depth of budget cuts next year.

“Both sides were smart in trying to negotiate something early instead of waiting until June or July, when things get really bad,” said Senate budget committee Vice Chairman Dick Ackerman (R-Irvine). “All sides looked at the economic reality and tried to contribute to a solution.”