Governor’s proposed budget could force cuts to Vallejo, Benicia school districts

VALLEJO – Gov. Gavin Newsom’s proposed budget could withhold millions from Vallejo City Unified District and Benicia Unified School District next school year, forcing cuts and layoffs.

The budget would withhold $5.6 billion in payments to public schools statewide starting in June. While some or all of this funding could be restored next year, there is no guarantee that would happen. The total amounts to roughly $900 per student based on school districts’ average daily attendance, the model through which California schools receive state funding.

It’s unclear exactly what next school year's attendance numbers will be for both districts, but Vallejo’s average daily attendance was roughly 8,300 last year, so Newsom’s plan would withhold roughly $7.5 million from Vallejo schools, or slightly less if attendance dips. Benicia’s average daily attendance last year was roughly 4,100, meaning the plan would withhold over $3.5 million.

Officials in both Vallejo and Benicia’s districts told the Vallejo Sun that the governor’s proposal has posed challenges.

Vallejo Assistant Superintendent of Business Operations Rubén Fernández said in an email that Newsom’s plan leads the district “into a defensive financial posture and complicates our ability to sustain ongoing programs.”

Both Vallejo and Benicia’s school districts have approved cuts to address projected budget deficits. Vallejo’s school board voted to close three schools next school year and approved cutting over 200 full time positions, though Fernández said that the proposed changes to the state budget did not factor into that decision.

Benicia cut roughly $1.7 million from its budget following Newsom’s proposal, which included reducing hours for 14 workers and laying off two workers. 

Benicia Superintendent Chris Calabrese said in an interview that the proposal is “not fair to students, families and educators.”

“I think it’s unfortunate that we have to go through this turmoil when this could be solved,” Calabrese said. “I think there are other ways to solve these issues.”

The state legislature could reject or amend Newsom’s proposal before it’s passed in June, but Calabrese said that even if that happens, it’ll be too late. California law requires districts to notify public school employees that they could be laid off next school year by March 15, and give final notice by May 15, Calabrese said the district has already made cuts because it has to plan on the budget passing.

“The impact is what we’ve already done,” Calabrese said, “because we have to make any layoffs by March 15 while the state makes its adjustments in June.”

Erik Saucedo, an expert with the California Budget & Policy Center who focuses his research on education funding, told the Vallejo Sun that Newsom’s plan doesn’t propose cutting educational funding but withholds an increase in funding that would occur in June, and revisit it next year when revenue figures are clearer. California state revenue is in part based on tax revenue from stock market gains, Saucedo said, and “there’s concern that the recent growth in these gains are not going to sustain over time.”

Education funding in California is guided by Proposition 98, a 1988 ballot measure that mandates at least 40% of the general fund goes to public schools serving transitional kindergarten through 12th grade along with community colleges. Historically, the state has based its minimum educational funding on projected revenue figures that determine how much it can spend. 

That doesn’t always happen though. Sometimes the state will pay less than what the projections say the 40% benchmark would be, wait for the final revenue figures a year later, and pay the difference then. Saucedo said they do this out of concern that the projected revenues might not sustain.

The last time the state paid less than the full 40% was last year, when it allocated $1.9 billion less. Newsom has proposed paying schools back that $1.9 billion as a settle-up this June. But he also proposed again budgeting less than the projected minimum, this time by $5.6 billion.

“They’re saying let’s fund this at a lower level at the moment,” Saucedo said. “And next year we’ll provide the difference to the school districts.”

Newsom’s press office did not answer questions from the Vallejo Sun.

The California Teachers Association, the state-wide teachers’ union, opposes Newsom’s plan. A post on its website says that school administrators have “weaponized” the proposal by issuing nearly 2,500 preliminary layoff notices. 

“Prop 98 isn’t a piggy bank you get to borrow from,” said CTA President David Goldberg. “It’s the law that entitles our students to the funding they need to learn.”

In March, officials with the San Francisco, West Contra Costa, Oakland, and seven other Bay Area school districts signed a letter to lawmakers who chair the budget and education committees. The letter urged the legislature to reject Newsom’s proposal. 

“Our districts seek to attract and retain high quality educators to serve our students, but with insufficient state funding it is a struggle to provide salaries that make living within our districts practical,” the letter reads. “We urge the Legislature to ensure that Prop 98 funding remains fully intact for all districts.”

Benicia school district officials haven’t signed the letter. Calabrese said that he wanted to discuss the matter with the school board before signing but that he “made our local legislators aware of my concerns.”

Vallejo school officials also haven’t signed the letter, but Fernández said that the district “stands united with the broader statewide education community,” and that district leaders have been “communicating with our education partners to ensure our local communities and representatives understand the severe impact this will have on our classrooms.”

Earlier this month, Vallejo Superintendent Rubén Aurelio along with leaders from seven other California school districts sent a letter to Newsom and legislators who chair budget committees requesting that $500 million of the funds the governor has proposed withholding be used as a one-time payment for “embedded behavioral supports in preschool through 3rd grade” in order to mitigate “increasing behavioral challenges” since the onset of the COVID-19 pandemic.

California’s Legislative Analyst’s Office, a nonpartisan government agency that provides fiscal and policy advice to the legislature, also disagrees with Newsom’s plan. 

In a report on the governor’s proposed budget, the office acknowledged concerns that the state could fall short of its revenue projections, but suggested accounting for this by placing the funds into a reserve called the Public School System Stabilization Account. According to the report, Newsom’s current plan to use the $5.6 billion to fund other non-school related programs in the current budget cycle only “shifts costs to the future.” 

Senate Democrats also proposed a different plan in a report released last week. It states that California’s recent state tax receipts show higher than anticipated revenue fueled by strong stock market gains from artificial intelligence businesses. Senate Democrats now say the state can afford to set $5.9 billion into the reserve while also investing an additional $5.7 billion into educational programs for next school year.

Even with the short term gains, the Democrats’ report projects long-term economic challenges in California, including a $20 billion deficit by 2027-28. Some experts and think tanks have recently pointed out the fragile nature of the recent AI boom, and also project that California could face fiscal difficulties long-term. 

Saucedo said that California will likely also face short term challenges no matter what path it takes in regards to education funding. Withholding education funds contributes to fiscal difficulties in schools, but also would allow the state to support other budget priorities, like health and human services, which have taken a hit under the Trump Administration.

“The important thing to understand is that there are tradeoffs to all the potential alternatives,” Saucedo said. “If the withholding is reversed it could mean cuts to childcare and food assistance. There’s a deeper issue of California needing more money.”