Last week, California's chief budget analyst released a new set of figures showing a projected state budget deficit that significantly eclipsed the figure mentioned only days earlier.  According to Mac Taylor, the Golden State now faces a $25.4 billion deficit.  An online copy of "The 2011-2012 Budget: California's Fiscal Outlook," including a nine-minute executive summary video presented by Mr. Taylor, can be found here.

The Legislative Analyst Office (LAO) report predicts that the state will finish the current year with a $6.1 billion deficit, and places the gap between spending and revenue at $19.3 billion for the coming fiscal year.  Combining those two figures, Governor-Elect Jerry Brown and the incoming legislature will need to address a $25.4 billion "problem" as they attempt to fashion a budget for FY 2011-2012.  The LAO report has prompted Governor Arnold Schwarzenegger to declare a state of fiscal emergency, and to convene an emergency legislative session to address the budget deficit.

A number of factors accounted for the difference between in magnitude between prior and current fiscal forecasts.  It has long been the wont of elected officials to employ "best case" projections, and to make a variety of highly optimistic financial assumptions when preparing a budget.  (Such a practice is only underscored in an election year.)  After a budget deal has been struck and the elections have been concluded, the LAO discloses the stark realities.  For example, the current report predicts that the actual amount of federal funding California can count on receiving during the current fiscal year will fall $3.5 billion short of the budgeted figure.  Whereas the current budget indicates approximately $1 billion in savings realized from expenditures on the state's correctional system, the new LAO report has discounted that figure by $900 million.

Mr. Taylor warned that the new legislature is likely to find itself in the grips of some formidable constraints, among which education funding figures prominently.  When faced with sizeable budget deficits in years past, the state often "borrowed" Proposition 98 funds to offset the shortfall.  This year, however, there is no "Prop. 98 money" to "borrow," and the state's public schools face the unhappy prospect of significant budget cuts, to boot.  Modifications to the state's second largest cost center (following education), MediCal, are limited by the federal regulations.  And the situation doesn't get any better over the intermediate term.  The LAO report projects annual budget deficits on the order of $20 billion through 2015-2016. 

While the LAO report doesn't offer specific recommendations to the Governor and legislators, Mr. Taylor opined that "everything needs to be put on the table if we're going to have a realistic chance of closing this [deficit] in a realistic way."  "Everything" includes "significant baseline expenditure reductions to programs, revenue increases, realignment of programs, [and] restructuring of programs."
 
Mr. Taylor regards the magnitude of the state's fiscal challenges as too formidable to be brought back into balance in any single year's budget.  The LAO report, therefore, proposes a multi-year approach that would provide a balanced budget in each of the coming four years, but would at the same time eliminate the currently anticipated $20 billion annual shortfall, over the course of the same time frame.  Doing so will, in Mr. Taylor's words, necessitate "sizeable temporary reductions" in expenditures in each of the four years. 

The Los Angeles Times reports the story, here.  The San Jose Mercury News reports, here.  Dan Walters offers an op-ed piece titled, "Jerry Brown's frugal instincts will come in handy," here.

                                     

For the second time in the span of a month, a nationally renowned public school superintendent has resigned.  In mid-October, Washington, DC Schools Chancellor Michelle Rhee announced her imminent departure in the wake of the failed re-election bid of the man who hired her, Mayor Adrian Fenty.  Last week, New York City Schools Chancellor Joel Klein resigned his office, reportedly, to accept an executive position at News Corp.  Mr. Klein, who served as chancellor of the nation's largest public school system for eight years, and who was one of a handful of candidates rumored to have been under consideration for U.S. Secretary of Education following President Obama's 2008 election, will be succeeded by Cathleen Black, herself a media executive.

During his term of office, Mr. Klein exposed the notorious "rubber rooms," in which teachers on administrative leave received full salary and benefits, oftentimes for years, while they spent their time reading, sleeping, and playing cards.  He succeeded in ending the so-called "forced transfer" policy, in which more-veteran teachers who were transfered from one school to another could "bump" less experienced but more desirable counterparts, against the wishes of the receiving school's administration.  Mr. Klein also closed a number of low-performing schools, and supported lifting the state's charter school cap.  Test scores have improved under Mr. Klein's tenure, and the high school graduation rate has increased 20 percent over the course of the last four years.
 
The New York City public school district educates some 1.1 million students and employs 135,000 people.  The incoming chancellor and her leadership team will administer a $23 billion budget.

The Economist comments on the transition, here, and a New York Times editorial addressing Mr. Klein's accomplishments can be read, here.  Finally, NYU Professor Diane Ravitch weighs in with an alternative view coupled with an instructive dose of historical context, here.

More or Less

In this week's Education Intelligence Agency Communique, Mike Antonucci places an array of current California Department of Education data in context.  California law requires that public school teachers be notified prior to March 15, should the possibility exist that they will not be rehired for the coming school year.  Last year, while 26,000 such notifications were issued, "only" 7,221 teachers and 2,464 education support staff actually ended up losing their jobs. 

The Thomas B. Fordham Institute's Mike Petrilli offers a series of sensible suggestions for the long-overdue reauthorization of the federal Elementary and Secondary Education Act.  The Flypaper, and Gadfly contributor, himself a former U.S. Department of Education staff member, opines that, "the next ESEA should be reform-minded yet realistic about Washington's capacity to change schools."  He calls upon lawmakers to "abandon federal oversight of accountability," while simultaneously providing states with greater flexibility and requiring transparency of school results.  While the flexibility he endorses appears to apply to formula grant programs such as Title I, Mr. Petrilli also leaves room for competitive grants.  Bottom line: his prescriptions call for the elimination of the most onerous components of NCLB while advancing a smorgasbord of ideas that are likely to appeal to various tastes.

The American Enterprise Institute's always-thoughtful Rick Hess has produced a formidable think-piece appearing as the "Commentary" article in the November 10, 2010 edition of Education Week.  The column is titled "The Same Thing Over and Over."   By no dint of coincidence, Dr. Hess recently authored a book of the same name, accompanied by the subtitle: "How School Reformers Get Stuck in Yesterday's Ideas."

In his EdWeek article, Dr. Hess makes the point that participants in education policy discussions are prone to commit the error of allowing "...the shape of today's public schools and school districts to define the mission of public schooling."  When structure becomes confounded with purpose, he argues, "...attempts to rethink governance, teacher evaluation, or incentives become 'attacks' on public schooling."  The upshot is that our attention becomes absorbed by the potential impact of various ideas upon power, politics, and finances, rather than "...whether we're doing a better job of educating all children in ways that ensure they master essential knowledge and skills, develop their gifts, and are prepared for the duties of citizenship."  As a consequence, we remain largely committed to the same assumptions and basic structures that have defined our public education system for decades, if not centuries...and then find ourselves wondering why a succession of faddish tweaks fail to deliver significant and lasting improvement.
 
Eight years earlier, in an equally poignant article reflective of the consistency of his thinking, Dr. Hess wrote:  "...debates over educational choice and privatization tend to devolve into arguments about whether various proposals are consistent with the 'public schooling,' instead of focusing on the questions of what our children require and how we can best meet their needs."  That article, titled, "Making Sense of the 'Public' in Public Education, can be found, here.

The next edition of the CAPSO Midweek E-Mailer will be published Wednesday, December 1, 2010.  CAPSO wishes our readers, their families, friends, and colleagues a very happy Thanksgiving!