BILL ANALYSIS
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UNFINISHED BUSINESS
Bill No: SB 851
Author: Senate Budget and Fiscal Review Committee
Amended: 10/7/10
Vote: 27 Urgency
PRIOR VOTES NOT RELEVANT
ASSEMBLY FLOOR : Not available
SUBJECT : Budget Act of 2010 Proposition 98
SOURCE : Author
DIGEST : Assembly Amendments delete the Senate version of
the bill which expressed the intent of the Legislature to
enact statutory changes relating to the Budget Act of 2010,
and add the current content relating to Proposition 98.
This bill now suspends the state constitutional requirement
that the state spend a specific minimum amount for school
districts and community colleges in 2010-11.
ANALYSIS : This bill suspends the Proposition 98 minimum
funding guarantee for school districts and community
colleges in 2010-11. Specifically, this bill:
1.Makes finding and declarations that the Proposition 98
minimum required spending level for school districts and
community colleges in 2010-11, derived from the
application of the constitutional funding requirements
CONTINUED
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related to the minimum funding obligations for 2008-09
and certified per statute, including allocation of
maintenance factor in 2009-10 and 2010-11, exceeds the
state's available revenues for this purpose in 2010-11.
2,Invokes the provision of the California Constitution that
allows the Legislature to suspend the Proposition 98
minimum required spending level for school districts and
community colleges in 2010-11 as calculated by
subdivision (b) of Section 8 of Article XVI of the
California Constitution.
3.Specifies the amount of state support that will be
provided to school districts and community colleges in
2010-11 is $49.658 billion, which includes the amount of
the outstanding maintenance factor required to be
allocated in 2010-11. Provides that this level shall not
be decreased without subsequent invocation of the
provision of the California Constitution that allows the
Legislature to suspend the Proposition 98 minimum
guarantee.
4.States that the amount of maintenance factor created in
2010-11 shall be calculated pursuant to the Constitution
and shall be added to the adjusted maintenance factor
outstanding as of the end of 2009-10, less the amount of
maintenance factor allocated in the 2010-11 fiscal year.
5.Declares that this bill take effect immediately as an
urgency statute.
Background
Subdivision (b) of Section 8 of Article XVI of the
California Constitution requires the state to spend a
minimum amount of funding on school districts and community
colleges every fiscal year, based on specific calculations
built on a percentage of General Fund revenues or
prior-year education appropriations, enrollment, and
economic growth.
Subdivision (h) of Section 8 of Article XVI of the
California Constitution allows for the suspension of
subdivision (b) for one year by the enactment of an urgency
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statute separate from the budget bill.
When the state suspends the Proposition 98 minimum funding
guarantee, the Proposition 98 formula calls for the
creation of maintenance factor that reflects the difference
between the amount appropriated for school districts and
community colleges and the amount of the minimum guarantee.
The maintenance factor allows funding for school districts
and community colleges to eventually return to the level
that would have otherwise been required without suspension.
FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes
Local: No
CPM:cm 10/7/10 Senate Floor Analyses
SUPPORT/OPPOSITION: NONE RECEIVED
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