Credit: Michael Gordon / Shutterstock.com
Credit: Michael Gordon / Shutterstock.comThe California School Boards Association and its partners last week took the next step toward putting a $15 billion tax initiative for K-12 schools and community colleges on the ballot, setting up the possibility that two competing tax measures will go before voters in November 2020.
Neither measure’s backers favor that prospect, but neither side is showing any sign of backing down. Both sides see next year’s presidential election, with a large turnout expected in a Democratic state, as an opportunity for higher taxes. The behind-the-scenes maneuvering over the next several months, with what some hope will be mediation by Gov. Gavin Newsom, will determine what will go before voters.
The school boards association, together with the Association of California School Administrators and the Community College League of California, filed papers last week with the California Attorney General for its initiative and expects to begin gathering signatures in a few weeks. Called Full and Fair Funding, the initiative would increase taxes on individuals and corporations earning more than $1 million. It would produce enough money for K-12 and community colleges to raise California’s per-student funding to the national average, according to the sponsors. Its calculations are based on a state ranking system that incorporates California’s high living costs.
The sponsors moved ahead without the support of an organization critical to the initiative’s success: the 310,000-member California Teachers Association, although they did announce a consolation prize. Joe Nunez, the longtime CTA executive director who was ousted from his job earlier this year, and former CTA Associate Executive Director Scott Day, who directed the union’s political campaigns, have agreed to come work for Full and Fair Funding.
Nunez and Day could face a big problem, however, in trying to make inroads with their former employer. The CTA is already a major donor for the other tax proposal, whose backers have been organizing for more than a year and have locked in key supporters.
The Schools and Communities First initiative would be the first serious ballot challenge in 40 years to Proposition 13. The “split-roll” measure would leave Prop. 13’s limits on tax increases for homeowners intact while changing the rules for business and commercial properties. Those properties would be revaluated every three years, raising their assessed value more rapidly, thus producing more tax revenue.
Roughly 40 percent of the projected $11 billion annual tax revenue would go to schools and community colleges, with the rest divided among counties and cities. While the estimated $4.5 billion for K-14 would be less than a third of what the Full and Fair Funding would provide schools, the support for the split-roll tax is broad and deep, with endorsements from dozens of housing, social justice and community groups, public employee unions and local government officials. Besides the CTA, the California State PTA, the California Federation of Teachers, United Teachers Los Angeles and some school district boards also have joined the coalition.
“We think we have a stronger measure because we developed a whole community approach to funding,” said Helen Hutchison, acting director of the California League of Women Voters and a member of the executive committee of the Schools and Communities First coalition. While schools would be the biggest beneficiary, they will not thrive without more funding for housing, health care and jobs, she said. “The teachers I have talked to acknowledge that.”
Last week, in announcing the appointment of Nunez’s successor, the CTA gave no hint of its view of the Full and Fair Funding plan. But in a statement, Joe Boyd, the new executive director, reaffirmed unwavering support for the split-roll tax.
“California educators are engaged and ready to lead the way in closing corporate tax loopholes and funding public schools with our Schools and Communities First initiative. I’m excited to lead that charge,” said Boyd, who previously served as executive director of the smaller of the state’s two teachers unions, the California Federation of Teachers.
Troy Flint, senior communications director for the school boards association, said that the decision to move ahead “was not based on the condition of CTA support” but he was circumspect about what happens next. “Our hope is all education advocates would support Full and Fair Funding; there are 6.2 million reasons to do so,” he said referring to the number of public school students in the state. “However, there is significant interest in this measure from a variety of education advocates, not just the usual suspects.”
The CTA’s State Council, its governing body with nearly 800 delegates, meets this weekend, but the Full and Fair initiative may not come up, said spokeswoman Claudia Briggs. The final agenda won’t be set until close to the meeting, although CTA would not take a position on an initiative unless it qualified for the ballot, she said.
Will the past be prologue?
In November 2012, state voters also faced two tax initiatives on the ballot and passed one: Proposition 30, a temporary tax to raise about $6 billion annually for the General Fund by increasing income taxes on high earners and increasing the sales tax. With Brown threatening a massive cut in K-12 funding if it failed, voters passed Prop. 30 by 55 to 45 percent. The other initiative, Proposition 38, a $10 billion personal tax increase that would have funded early childhood education and K-12, lost badly with 29 percent voting for it. Los Angeles philanthropist Molly Munger underwrote Prop. 38.
Most observers agree that running two tax initiatives on the same ballot is a bad idea — particularly in this case, since the business community is vowing a vigorous campaign against the split-roll measure, if not both initiatives.
“It’s quite possible neither might pass if both are on the same ballot,” said Kevin Gordon, president of Capitol Advisors Group, an education consulting firm. “It’s always easier to vote no, particularly if voters find multiple tax proposals confusing.”
Flint acknowledged that internal polling showed that support for both tax initiatives would decline if they were on the same ballot, although he wouldn’t say by how much. But he said that, depending on the wording, more than 60 percent of those polled said they would favor Full and Fair Funding. And there is room to grow support, he said, since more than half of respondents incorrectly believe that California is already among the highest funded states.
Two polls this year, by the Public Policy Institute of California and the nonprofit PACE and USC, found support for a split-roll initiative in the mid-50-percent range — not a comfortable margin heading into an election. Schools and Communities First is counting on a massive door-to-door voter education drive to win.
Last year, Schools and Communities First qualified its initiative for the ballot, but recently revised the wording, putting it back to square one. It and Full and Fair Funding must collect about a million signatures to qualify — an effort that may cost each about $5 million and take months.
With both sides poised to spend a lot of money, now is the time to turn to Newsom to cut a deal for a single initiative, Gordon said. “Instead of the parties duking it out, what might Newsom back and then help raise money to pass it?” he asked.
It would take a two-thirds majority in the Legislature to place an alternative tax proposal on the November ballot. Ted Lempert, president of the children’s research and advocacy organization Children Now, said he hoped that would happen. “Clearly, two measures are not helpful. This is an opportunity for the governor and the Legislature to put a unified measure on the ballot.” And, he added, to include money specifically for early childhood education as well.
Newsom’s office did not respond to a request for comment.
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Cathy Campbell 4 years ago4 years ago
I do not understand why an either/or paradigm is already in place in this discussion. These two measures combined would go a long way toward closing the $25 billion funding gap outlined in the most recent “Getting Down to Facts” report. California voters have consistently shown strong support for school funding. We need both of these measures to begin to adequately serve our students, close our equity gaps and fund public education on par with higher achieving states.
Stan Sexton 4 years ago4 years ago
CTA and CALSTRS need too address the obscene pensions many of the top school district employees receive. Also the cost of educating illegal aliens. "For the Children" only goes so far, as one failed initiative in LA proves. CALSTRS and CALPERS employees live in a bubble of unreality, not realizing the economic genocide you are committing on the private sector middle-class. We toil without the automatic paychecks and tax-free pension contributions. No … Read More
CTA and CALSTRS need too address the obscene pensions many of the top school district employees receive. Also the cost of educating illegal aliens. “For the Children” only goes so far, as one failed initiative in LA proves. CALSTRS and CALPERS employees live in a bubble of unreality, not realizing the economic genocide you are committing on the private sector middle-class. We toil without the automatic paychecks and tax-free pension contributions. No unicorns, rainbows and mermaids for us everyday.
Gregory Lin Lipford 4 years ago4 years ago
Another article that demonstrates we sorely need a news source not committed to promoting causes of the public education lobby. Nothing here challenged the logic, numbers or even the dishonest semantics related to these bills, but rather presents them as an unquestioned public good. Any tax story should mention the current level of funding, which generally exceeds $400,000 per classroom. Most people cannot imagine what happens to that money, or how that cannot be sufficient.
Replies
Todd Maddison 4 years ago4 years ago
I agree that stories like this should do a better job of disclosing the relevant facts. I've been active in contract negotiations in my district, have heard many a parent go to the podium at board meetings to make impassioned speeches on behalf of poor underpaid education employees, "fairness", "respect", etc.. If you ask those parents "how much do you think they make?" the answer you get is often something like "$40K, and that's too little!". … Read More
I agree that stories like this should do a better job of disclosing the relevant facts.
I’ve been active in contract negotiations in my district, have heard many a parent go to the podium at board meetings to make impassioned speeches on behalf of poor underpaid education employees, “fairness”, “respect”, etc..
If you ask those parents “how much do you think they make?” the answer you get is often something like “$40K, and that’s too little!”. When you let them know the average is more like $80K, and with benefits over $100K/year, all of a sudden the attitude changes a bit…
Regrettably those people are not generally going to take it on themselves to educate themselves on the actual data before expressing their opinion. That would be nice, but a bit much to ask for people who spend their time working, and listen to “the news”, which never brings up the actual numbers.
On EdSource’s behalf, I’ve got to say they’re much better at being fair and balanced than that other “Ed” newsletter (the one that makes you pay), but it would certainly be good to see an article like this include at least a paragraph outlining how CA education funding has grown at multiple times the rate of inflation since we passed Prop 30 but yet that is not enough – and give some numbers on the growth of pay and pensions since that’s the key driver of that …
With that, if people still feel that education is underfunded, more power to them, but at least they’d have an educated opinion rather than a random one based on emotional response ….
John Fensterwald 4 years ago4 years ago
Todd: Fair enough criticism. We should and will provide context for proposed tax increases. Here are a few comments. You started your calculations on increases in 2012-13, the low point in per student spending following the Great Recession. Had you started in 2006 and adjusted for inflation, you would have seen that state spending on K-12 reached pre-recession levels in 2016-17 (that's for base-level spending). According to the Legislative Analyst's Office (see graph), the state … Read More
Todd: Fair enough criticism. We should and will provide context for proposed tax increases.
Here are a few comments. You started your calculations on increases in 2012-13, the low point in per student spending following the Great Recession. Had you started in 2006 and adjusted for inflation, you would have seen that state spending on K-12 reached pre-recession levels in 2016-17 (that’s for base-level spending). According to the Legislative Analyst’s Office (see graph), the state is now at an all-time high in spending but only by $500 per child, adjusted for inflation; the previous high was in 2000-2001. We are now $1,200 above the pre-recession level of 2006-07. No matter how you measure, recognizing regional costs (Education Week) or unadjusted (NEA), the state is either in the bottom third or bottom half of states in spending — and with a significanly higher than average proportion of low-income children. As a percentage of taxable resources spent on K-12 education, California lags the nation: 3.2 percent compared with 3.7 percent (again, adjusted for regional costs).
I would be very wary of using Oceanside or any single district to generalize on state spending increases and teacher salary increases.
Todd Maddison 4 years ago4 years ago
Thanks, and appreciate the feedback - and points. Yes, choosing to start my examination with 2012 is a bit of cherry picking, but that isn't chosen at random - I pick it because it's the year we approved Prop 30. With that, you're right - starting at the prior peak in spending does show different results, and they aren't so egregious looking as when one starts with 2012, however in this case my point is that the … Read More
Thanks, and appreciate the feedback – and points.
Yes, choosing to start my examination with 2012 is a bit of cherry picking, but that isn’t chosen at random – I pick it because it’s the year we approved Prop 30.
With that, you’re right – starting at the prior peak in spending does show different results, and they aren’t so egregious looking as when one starts with 2012, however in this case my point is that the last time we approved a tax increase “for education”, the education industry generally chose to use that money to pay itself, not to fund the types of things most people were likely thinking of when they voted “yes” (things that were part of the campaign – like lower class sizes, more support staff, better arts and STEM, etc, etc…)
Regarding the use of a single district I can tell you that I’ve tried longitudinal analysis with the entire TransCal database for CA K-12 and that’s almost impossible because the reporting entities do not provide a unique identifier for employees, and often the format is different from year to year – for example, using middle initials one year and not the next.
My district, however, has been consistent for this period so it can be done. I’ve also done that for at least 20-30 other districts in CA and the results are absolutely consistent – I have not found a single district that has not increased pay at rates that are at least 4-5%/year, and usually 5-7% is the more normal range.
With that it’s certainly possible that I’ve managed to pick outliers, but unlikely… If anyone feels a particular district has not done that, give me that district and I’ll see if the analysis is possible with their data, I have a template that makes it somewhat easy.
Related to that, if one “what-if’s” those districts, in every single case if one projects where they would be if they kept their raises to the same as the average for their county that results in millions more to spend on programs and services for the kids, and likely would mean none of them would be in any kind of financial distress – even with the increase in pension contribution levels.
Dan Plonsey 4 years ago4 years ago
Your numbers are wrong. The average increase from 13-14 to 17-18 across CA was 3.1%. (Source: http://www.ed-data.org/ ) In my district, Berkeley, our salaries have increased by only 2 percent/year, which is below COLA. Meanwhile, California GDP has increased by 16 percent in constant dollars over that period. California can easily afford to pay teachers substantially better (we’re now approximately median income), And can support students better too, as it seems we both would like.
Todd Maddison 4 years ago4 years ago
Ideally neither of the measures would make it to the ballot, but the next best thing would be to have both qualify - increasing the odds of failure for both. In 2012 we were asked (in Prop 30) to raise taxes on ourselves to improve education. In 2016 we were asked to extend those taxes (in prop 55.) Since 2012, overall state spending per ADA has risen tremendously. According to the California Department of Education … Read More
Ideally neither of the measures would make it to the ballot, but the next best thing would be to have both qualify – increasing the odds of failure for both.
In 2012 we were asked (in Prop 30) to raise taxes on ourselves to improve education. In 2016 we were asked to extend those taxes (in prop 55.)
Since 2012, overall state spending per ADA has risen tremendously. According to the California Department of Education (CDE), per ADA spending has risen from $8,382 in 2012 to $12,068 in 2018.
That’s a 43.97% increase, for an average of 6.26% per year. During a time when inflation has averaged 1.50% per year (per US CPI), and wage growth (according to Social Security records) has averaged 2.57%.
Meaning revenue in to the districts has exceed inflation by over 4 times and exceeded the wage growth – of taxpayers who are paying the bills – by over two times.
And, what have we gotten for it? Certainly no improvement in the quality of education, as measured by the CA school dashboard metrics, among other things.
And we see district after district is now in financial distress, many in danger of being taken over by the county or state.
Where did the money go?
That part is easy. We hear about the grown in pension costs pretty frequently these days, everyone reading this should be familiar with that. The money we voted to give “to improve education” is going instead to improve the retirement of teachers who are no longer teaching.
The money is also going to pad the salaries of existing education staff. I have not done an analysis of the state as a whole, but I have analyzed various districts around the state and see one common thread – raises to existing staff that mirrors the rise in revenue, raises that are often many times the rate of taxpayers in that district. Usually those raises are averaging pretty close to the same rate as the rise in revenue – usually 5 to 7% per year.
Which is easily 2, and often 3 times the rate of growth for “everyone else” in the state.
I have not analyzed the state as a whole – that’s difficult because the data available is not there to make that analysis very easily – but using the public pay data available on Transparent California, just as an example, in my home district, Oceanside Unified, since 2012 they have given themselves raises at a rate of 5.49% per year. San Diego county’s wage growth as a whole has averaged 1.97% in this time.
Administrators have a median pay of $114,979/year, not counting the cost of benefits (which we know adds almost 30% to this number.)
Teachers now have a median pay of $87,849/year. The county average for comparably educated residents (per the US Census Bureau) is $69,669/year, meaning the average teacher makes $18,180 (or 26.10%) more per year than they would with the same education elsewhere.
Since 2012, OUSD has gotten about $23M/year in extra funding (“EPA” funds, from Prop 30). They have now increased their pay and benefits expense to the point they are spending TWICE that on increased pay and benefits. Not only has every single dollar gone to paying themselves, but they’re farther in the hole beyond that.
And they’re not unique – every single district I’ve looked at has very similar numbers.
The data is clear. Unless you don’t believe the statistics from the US Bureau of Labor Statistics, the US Census Bureau, the Social Security Administration, and records obtained legally through the Public Records Act by Transparent California, it’s obvious that the last time around the education industry took the money we thought we were going to give them to decrease class sizes, improve facilities, buy technology, expand arts and sciences, provide more supplies, etc, etc – and used it to simply pay themselves more money.
So…. Why would anyone in their right mind think the answer is to give them more money – again?
What if we say “no” and demand that they use the money we’ve already given them properly first?
Maybe it’s time that we stopped feeding the spending in education that is not going to programs and services for the kids, and force that industry to face the reality that their customers – the parents and taxpayers of the state – expect them to stop spending every extra dollar we give them on themselves?
tom 4 years ago4 years ago
Only two tax measures? In Contra Costa County, depending on where you live, we could be voting for five. This includes a vote for a sales tax increase, a vote for a school bond sale (tax), and a school parcel tax all under consideration but not final yet. Hey I thought Cali had a budget surplus last year! What's wrong with this picture? Is there no end to profligate spending? … Read More
Only two tax measures? In Contra Costa County, depending on where you live, we could be voting for five. This includes a vote for a sales tax increase, a vote for a school bond sale (tax), and a school parcel tax all under consideration but not final yet. Hey I thought Cali had a budget surplus last year! What’s wrong with this picture? Is there no end to profligate spending? Live within your means and fix the unfunded pension obligations.
Rick Pratt 4 years ago4 years ago
Another nice article, John. As constitutional amendments, both measures require 997,139 valid signatures to qualify for the ballot. Which means something over 1 million need to be collected. That would stretch the resources of CSBA, ACSA, and the Community College League, who have neither the money nor the volunteer base of the coalition behind the Schools and Communities First initiative. Ironically, polling suggests that if only one measure makes it to the … Read More
Another nice article, John. As constitutional amendments, both measures require 997,139 valid signatures to qualify for the ballot. Which means something over 1 million need to be collected. That would stretch the resources of CSBA, ACSA, and the Community College League, who have neither the money nor the volunteer base of the coalition behind the Schools and Communities First initiative. Ironically, polling suggests that if only one measure makes it to the ballot, the Full and Fair Funding initiative stands the better chance of winning, while political reality suggests the other one stands a better chance of making it to the ballot.
This could be wild speculation, but CSBA’s main objective may be to get a seat at the table for negotiations with the governor, possibly along with other concessions, in exchange for dropping its initiative. Joe Nunez and Scott Day could be even more helpful with that than with running an election (which is saying a lot, because both have a lot of campaign experience and successes).