CCC NEWS

• Sacramento rally against higher education budget cuts, April 21
• Testimony by Friedlander and Smith at Assembly Select Committee
• Faculty and College Excellence Act (FACE)
• "New push for full-time faculty jobs," Inside Higher Ed
• GASB 45, Health Care, and Public Schools and Colleges (PDF)
• CC Part-timer Retirement Primer (PDF)
• The CCC Perspective (official publication of the CCC)
• AFT Higher Education Website
• Community College Links
• Community College Key Documents

Property tax backfill, AB2277

UPDATE: May 1, 2008
Assemblyman Mike Eng ably, and with feeling, presented AB 2277-the backfill bill-to the Assembly Appropriations Committee on April 30. Carl Friedlander testified on behalf of CFT and was joined by other supporters of the bill. The bill moved to the Assembly Appropriations Suspense file, where it will remain until after the May Revision. This period will be one of intense lobbying both in and out of the capitol with the goal of moving the bill off the suspense
file. Bills that clear this file move to the Assembly floor for action. Bills that remain, unless a rule waiver is granted, die.

Next Steps:

Sacramento
The various community college advocates will be lobbying each member of the
Assembly Appropriations Committee, speaking to staff, giving specific
information about the need, etc. We'll also be making appointments with Assembly
Leadership.

Outside the Capitol:
Many Assembly members will be holding town hall meetings about the budget,
for example, Sandre Swanson and others in Oakland this Saturday, and Karen Bass
in Los Angeles this Saturday. Find a representative from your local to attend
and raise the issue of the backfill.

Make your individual Assembly member aware of the effort. Attempt to have a
dialog about the need and make an assessment as to whether your member will
vote for AB 2277, and, if s/he supports it, ask if s/he will sign on as a
co-author. If the member agrees, contact Andrew Medina in Assemblyman Eng's office
who can follow up.

The various Sacramento-based advocates will be checking in regularly with
Andrew, who will be able to report on our progress.
—Judy Michaels, CFT Legislative Director

Background: We need a permanent solution to a persistent problem
Property tax backfill addressed by AB 2277

by Dean Murakami

Many of us have become complacent about education funding because we are protected by Proposition 98.  But, suddenly we are in a budget deficit quagmire, facing possible suspension of Proposition 98, and a severe funding shortage to education.  How did this happen? 

One of the main contributing factors has been that much of the Proposition 98 budget is based on the Department of Finance’s (DOF) prediction of property tax revenues for the coming year.  When the DOF overestimates property tax revenues for the coming year the State finds that there is not enough money to support the education budget it passed the previous year. Therefore, the legislature and governor have to find other funds, make cuts, or think about (God forbid!) raising revenues. 

K-12 has legal provisions in which the legislature must automatically make up the property tax shortfall in its budget from the General Fund.  This is called the “property tax backfill.”  The community college system is not protected from mistakes made by the DOF.  Each time there is a property tax shortfall the community colleges have to lobby for legislation to backfill the deficit. 

This year it will take massive advocacy pressure to get the legislature to pass and the governor to sign a property tax backfill bill.  There are two reasons for this.  First, we have a serious budget deficit.   Second, the DOF made a Titanic-sized overestimate of property tax revenues for this year.  From the table below (State Chancellor’s Office) you can see the huge deficit so far for this year relative to previous years.  The accumulated shortage in property taxes is not done, property tax revenues continually come up short.  As we move through the rest of this fiscal year, the tax shortfall may get worse [It already has, from $80 million at the time this article was written, to April 21, when the new projection became $109 million—Ed.].

How did the DOF overestimate property tax revenue by so much?  Could it have been the housing crisis, declining economy, or an overoptimistic prediction in order to technically balance the budget and not deal with the harsh realities of structural flaws in the state tax and budget system? 

No matter.  When you ask most legislators about a community college property tax backfill for this year there is only silence.  Our praises go to Assembly member Mike Eng who has taken the community college property tax backfill legislation (AB 2277) for this year to the Assembly Higher Ed Committee.  With support from the faculty unions and many other stakeholder groups AB 2277 passed the committee.  Now AB 2277 is in the Assembly Appropriations Committee and we need everyone’s help to get it through the next stage. 

Consequences

What are the consequences if AB 2277 fails to get through Appropriations and there is no property backfill for this year?  If the state does not provide a general fund backfill, the property tax shortfall represents an additional late-year cut to instructional and student services in the current year.  This is especially difficult when we are so close to the end of the fiscal year. Appropriate planning and budgeting by community college districts cannot be accommodated without seriously reducing classes, student services, and/or reducing the numbers of part-time faculty and classified staff.  We need to pass AB 2277 so that our community college students have the opportunity to be successful.  We must make every effort not to let them down.  However, this budget situation also underscores the fact that community colleges need a permanent property tax backfill. 

We need to send our state legislators a high volume of mail, faxes, emails, phone calls, and visits so AB 2277 can have a chance to pass out of Appropriations or for the issue to be resolved in some other way.  Write a letter in support of AB 2277 to Mark Leno, Chair of the Appropriations Committee, and to and your local legislators today!   Then let’s work on getting community colleges a permanent property tax provision.