SILICON VALLEY MERCURY NEWS. MAY 15, 2013. Warning Democratic legislators that he will not sign a budget that ramps up spending, Gov. Jerry Brown on Tuesday framed a much less upbeat vision about the California economy than just four months ago.
Brown's revised budget proposes spending $1.3 billion less than his January blueprint, which he had touted as the first deficit-free budget in years and a harbinger of good things to come. But the governor said federal "sequestration" cuts, falling wages and higher Social Security payroll taxes now pose major obstacles to the state's economic recovery.
"It's a call for prudence, not exuberance," Brown said of his $96.4 billion budget at a Capitol news conference.
Still, the funding picture for schools has turned from bleak to bright, with cash pouring in from new taxes from November's Proposition 30 and a one-time surge of $4.6 billion in tax collections from mostly wealthy individuals who cashed in on investments before this year's federal tax hikes took effect. Much of that -- $2.9 billion -- will go back to schools in the current fiscal year as repayment of money that the state did not pay out during the recession.
Brown also built in about $1 billion to help school districts implement the state's new "common core" curriculum standards, which will require that all testing be done on computers.
Outside of adding accountability measures to ensure money is spent on students, Brown refused to budge from his school funding formula reform, which would divert about $2 billion to schools with high numbers of poor and disadvantaged students. He signaled he is poised for a fight with many of his fellow Democrats who want to spread the money more evenly to all schools.
"I think it's fair. I think it's just," Brown said. "I think it's got great moral force. ... I think most Democrats -- in our heart of hearts -- want to help those whom life has not given the same opportunities to enjoy."
All K-12 schools would get more funding than they received in 2011-12, but those with higher concentrations of low-income students, English language learners and foster youth would get more. Those school districts in which more than half of students are disadvantaged would receive additional "concentration grants," which Brown said would amount to only 4 cents for every dollar being spent on education.
Senate Democrats recently unveiled their own school funding formula, which would eliminate concentration grants and spread the money around to all districts. The governor argues that his fellow Democrats' plan would dilute the impact the money would have on disadvantaged students.
Senate President Pro Tem Darrell Steinberg, D-Sacramento, who has led opposition to Brown's plan, said Tuesday that Brown's concentration grants "treat thousands of disadvantaged students unequally" because funding would be less for disadvantaged students in wealthier districts.
While the specter of more dollars from Sacramento elates local educators, uncertainty about whether the Legislature will adopt the governor's plan is throwing a wrench into sticky contract talks between unions and some school districts, said Superintendent Dennis Byas of the San Lorenzo Unified School District.
Because his district includes a high percentage of English learners and low-income students, Byas said San Lorenzo would get a lot more money if the Legislature adopts Brown's plan. "It gives us the opportunity to really support our teachers," Byas said.
Even though his suburban district doesn't stand to gain greatly by the governor's revamped school funding formula, Superintendent Mark Barmore of the Moreland School District in San Jose was happy after taking a preliminary glance at the revised budget.
"I very much believe in what the governor is attempting to do," he said. "I'm also very happy that there will be more money for all schools."
Brown calls for spending more on the state's colleges and universities each year through 2016-17 -- and for a four-year tuition freeze at CSU and UC. But the plan the governor unveiled Tuesday backs away from the more sweeping changes he had proposed for California's three public college systems.
Among the higher education reforms he scrapped or postponed: capping the number of units students can take while receiving state tuition subsidies; shifting adult education programs from K-12 districts to community colleges; and funding community colleges based on how many students complete a term, rather than by a count taken a few weeks into the semester.
Some Democratic legislators were frustrated that Brown did little to shore up the social services safety net, which has been shredded by recent cuts. Brown did add $48 million to the state's welfare agency, CalWORKs, for job training.
"A certain amount of caution is good when we don't know for certain where the economy will be next year," said Assemblywoman Nora Campos, D-San Jose, a member of the budget committee. "But at the same time, we need to remember that nearly 2 million Californians are out of work. ... There's no way to get to sustained revenue growth unless we get people back to work."
Criticism also came from judicial advocates, who were disappointed that Brown offered no increase in their budget, and from environmentalists, who slammed him for shifting, as a one-year loan, $500 million from the state's new cap-and-trade program to the general fund. The money, environmentalists said, is supposed to be used to reduce greenhouse gas emissions and pollution in low-income neighborhoods.
"This shift in funds is extraordinarily disappointing," said Sierra Club California Director Kathryn Phillips. "The governor is using bizarre accounting to balance the budget and making future generations pay the price with climate disruption."
Brown anticipated howls from all corners.
"Everybody wants to see more spending," he said. "That's what this place is, a big spending machine. You need something? Go over there and see if you can get it. Well, I am the backstop at the end, and I'm going to keep this budget balanced as long as I'm here."
At the most basic level, Brown is grappling with the same problem that has dogged California for more than a decade, said Larry Gerston, a San Jose State political science professor.
"People realize things need to be done, but there just isn't enough money to do what must be done," he said. "So they try to apply Band-Aids to cancer."
Staff writers Howard Mintz, Mike Rosenberg, Sharon Noguchi, Karen de Sá and Sandy Kleffman contributed to this report.