Door Open for Compromise

Perata flunks teachers union loyalty test

Senate chief raises old allies' hackles with funding remark

Phillip Matier, Andrew Ross, San Francisco Chronicle, March 2, 2005

State Senate President Pro Tem Don Perata just got a taste of what it means to break ranks with his friends in the powerful teachers lobby.

In a move clearly intended as a warning shot, the usually Democratic- friendly California Teachers Association dive-bombed 50,000 mailers into Perata's district with the headline: "Senator Don Perata wants to cut funding for local schools.''

The Oakland Democrat's sin: Saying it may be time to overhaul Proposition 98, the voter-approved initiative that guarantees that a big cut of the state budget goes to schools.

"In siding with Governor (Arnold) Schwarzenegger,'' the mailer said, "Don Perata is breaking his promise to support funding for local public schools.''

The mailer also urged voters to phone the senator's district office and demand that he "defend -- not destroy'' the guaranteed money flow.

Just in case anyone missed the mailer, the 335,000-member union also took out ads in 18 community newspapers in the East Bay and planted a number of giant yard signs.

The roots of this little uproar go back to a comment Perata made a few weeks back, comparing Prop. 98 to a runaway escalator -- one that guarantees money for public schools and community colleges while leaving next to nothing for health care for the poor and the like.

"It is an escalator without pause,'' Perata told the Los Angeles Daily News. "Some people say you need more revenues, but I'm operating in a world of reality.''

Teachers union leaders say they felt blindsided that Perata -- himself a former high school teacher -- didn't talk to them first.

"It wasn't so much that he said it, as who he said it to -- to the governor and to reporters,'' union President Barbara Kerr said. "He forgot to say it to us so we could talk about it.''

Perata said he could understand why the union was upset, but insisted the anger was misdirected.

"They cut a deal with the governor over funding last year and he didn't abide by it,'' Perata said. "But there's no sense in mugging your allies to get back at the governor.''

He said his comments simply constituted an opening line, not his final word. As for the attack, he said, "It's pretty clear that in coming after a Senate leader, they felt they could send a message to everyone else that, 'If they're willing to throw him overboard, what chance do I have?' ''

But if the intent was to scare his fellow legislators, Perata said, he thinks the tactic will backfire.

"People don't cower in that situation,'' he said. "They get angry.''

If school funding system is wrong, what's right?

By Peter Schrag, Sccramento Bee Columnist, March 16, 2005

They're Sacramento's newest odd couple: Arnold Schwarzenegger's finance director Tom Campbell and Senate President Pro Tem Don Perata, one a Republican, the other a Democrat. Both want to stop the automatic escalator in Proposition 98, California's convoluted school finance formula. And they're at least half right.

California badly underfunds its schools. But Proposition 98, designed to ratchet up that funding, has functioned more as a straitjacket and ceiling than a floor.

Proposition 98 more or less guarantees that funding in any given year must be based on the prior year's appropriation, plus increases in enrollment, cost of living and personal income.

But since additional funding approved by the governor and Legislature in any given year automatically goes into the base for the following year, governors have been chary about voluntarily adding still more funding. To do so would increase the base and thus reduce their budgetary options in the future.

The big exception was Gray Davis, who put additional money into the schools in boom times, thus raising the base and contributing to the deficits of the bust years that followed.

But Proposition 98 has unintended consequences for liberals as well. Under it, 53 cents of every new dollar from any increased revenues today would go to schools, leaving 47 cents for everything else. It thus dampens the incentive for groups squeezed by its funding formula - the universities, law enforcement and health and welfare groups particularly - to support revenue increases.

It's here that Campbell and Perata find common ground. Neither likes being locked in this way.

Nonetheless, Proposition 98, narrowly passed by voters in 1988, has a good reason for being. Given the restrictive tax and spending limitations put in place in the late 1970s, state spending for K-14 education became a sort of sinking fund whenever money got tight.

In 1987, Gov. George Deukmejian, saying he had no choice under the voter-enacted spending limits on the books at the time, refunded more than $1 billion to the taxpayers, most of which would otherwise have gone to the schools.

School groups, who had already gathered signatures, then pushed what became Proposition 98. Never again, they believed, would they get stiffed the same way. Yet because of its ceiling effect, school spending, rather than keeping pace with the rest of the nation, continued to drift lower.

The trouble with doing away with the Proposition 98 escalator, both as politics and as policy, is that the state has no other gauge of any kind to determine what it should be spending on its schools, much less how to spend it.

In state after state, courts have ordered "costing-out" studies to get at least a rough idea of what it takes to provide an adequate education to different kinds of students. In many, among them New York and New Jersey, which already spend far more per pupil than California, they've also ordered major increases in school funding.

But California has no such data. We don't know how much we should spend on schools, don't know how or where to spend it, or how much of existing spending is just faddish waste.

Schwarzenegger effectively killed the state's Quality Education Commission, which might have developed such information. Campbell says that a new gubernatorial advisory commission on education, headed by Ted Mitchell, the president of Occidental College, will take on that task.

But there's no assurance of that, much less assurance that a panel that reports only to a governor more concerned with low taxes than quality education will have the credibility it needs to have any real impact.

The best chance of that happening now is the strong possibility that three major foundations, Hewlett, Irvine and Gates, will fund a private study to develop reliable adequacy data for California schools.

Perata and Assembly Speaker Fabian Núñez have formally asked for such a project.

So far, Perata's only reward for his apparent willingness to modify Proposition 98 has been the 50,000 hit pieces that the CTA, the California Teachers Association, sent to voters in his East Bay district declaring that "Perata wants to cut funding for local schools." Since he's the leader of the Senate's majority party, that probably wasn't the CTA's most astute political move at a moment like this. But what's even less astute are the continuing efforts by Assemblywoman Jackie Goldberg and other Democrats, Perata among them, to tinker with the state's academic accountability system.

Under current rules, beginning next year seniors who don't pass CAHSEE, the California High School Exit Exam, won't get their diplomas. Goldberg and the other legislative gremlins, arguing that school resources are inadequate, want to defer the effective date again.

Since adequacy funding arguments rest in large part on academic standards and accountability, the frailer those standards get, the weaker the case for more funding. Conversely, the weaker the funding and the greater the attacks on teachers, the more likely that academic standards will be undermined. Why can't they all get that?

Perata open to tax for schools

The Senate Democratic leader says the state should match U.S. average for education spending.

By Kevin Yamamura, Sacramento Bee, April 27, 2005

State Senate leader Don Perata asserted Tuesday that Senate Democrats will seek higher taxes if necessary to boost school spending to the national average, broaching a subject legislative leaders have largely avoided since Gov. Arnold Schwarzenegger took office.

With Schwarzenegger's revised budget plan due next month, Perata told reporters the state needs to spend $4 billion on education beyond the level the Republican governor proposed in January. To pay for that, Perata said, he would rather resort to tax increases than social-service spending cuts if no other funding options could be found.

"We have to raise taxes to pay for schools," said Perata, D-Oakland. "There, we've said it."

Perata's Assembly counterpart, Speaker Fabian Núñez, was not prepared to make a similar declaration, said Núñez spokesman Steve Maviglio. Núñez, D-Los Angeles, wants to pursue other options first, such as closing tax loopholes and using some of the $3 billion recovered through the state's tax amnesty program.

"We agree with (Perata) that education is a priority and we have to protect the integrity of Prop. 98," Maviglio said. "But this is a governor adamantly opposed to raising taxes, and now is the time to get together and craft a solution."

Perata suggested two methods of raising taxes - increasing rates on the highest income tax bracket or applying the sales tax to certain services. But he said he would pursue the tax route only if the governor cannot find other ways to bolster education funding in the revised budget he presents in May.

Tax increases in any form are a nonstarter for Schwarzenegger, said his press secretary, Margita Thompson.

"It's not a revenue problem - we have more revenues coming in than ever before," Thompson said. "It's unfortunate that the knee-jerk reaction for that constituency is to tax and spend. But we have to be responsible with that money and we have to be responsible for the kids."

Schwarzenegger has drawn criticism among educators for reneging on a budget promise from last year that would have given an additional $2 billion to schools in the upcoming fiscal year. A coalition of education representatives last year agreed to accept cuts and the suspension of the minimum schools funding guarantee under Proposition 98 to help Schwarzenegger balance the state's books. The governor promised he would restore the cuts if and when the economy perked up.

Although revenues were stronger than expected, Schwarzenegger reneged on the deal, citing the state's still-dire fiscal situation.

Education officials now say the economy has improved even more than the governor forecast when he proposed his early budget in January, and they estimate that schools would be owed $4 billion under the deal they made with Schwarzenegger - the same amount Perata emphasized Tuesday.

Thompson responded that the governor has proposed a school spending increase of $3 billion this year, which she said represents $362 more per student.

In advance of the governor's revised budget release, Perata was determined Tuesday to establish his negotiating platform on education funding.

"If you want to play it on the cheap, we'll play it on the cheap," Perata said. "By why in the world would the governor of the greatest state in the union want to stand up and say, 'We're interested in being mediocre'?"

Perata also railed against property-tax limits in 1978's Proposition 13 and the repeal of the state's vehicle license fee increase by Schwarzenegger, saying they contributed to education woes.

"If Proposition 13 was the first bell rung in education, then the returning of the car tax was the head shot," he said.

But Perata said he is not calling for a change in Proposition 13 or the license fee, because change to either is not politically viable.

Senate Republican leader Dick Ackerman of Irvine said solving the state's education problems is not as simple as looking at per-pupil spending.

Ackerman also challenged Perata's assertion that California is 43rd in the nation in per-pupil spending; instead, he said, Republican figures suggest that the state is in the top half.

Ackerman also said tax increases of any kind would earn the scorn of voters.

"I think some of the Democrats forget that one of the reasons Arnold was elected was because Democrats raised taxes by $4 billion through the car tax, and one of the first things Arnold did was rescind that tax," Ackerman said.

Perata himself was the subject of some criticism from educators because he said earlier this year that the Proposition 98 school-spending formula needs to be fixed.

He said Tuesday that he meant "there is something fundamentally wrong with a formula that defines what our commitment is going to be," and that he wants to go beyond the minimums stated in Proposition 98.

Perata and three Senate Democratic colleagues also promoted a series of education bills designed to give schools more local control. They include:

• Senate Constitutional Amendment 8 by Sen. Joe Simitian, D-Palo Alto, which would lower the threshold necessary for voters to approve parcel taxes from two-thirds to 55 percent
• Senate Bill 958 by Simitian, which would slow funding decreases for schools experiencing declining enrollment
• SB 1053 by Sen. Jack Scott, D-Altadena, a pilot project that would allow 10 school districts more control over their budgets