2018 State Budget Update

Two Words: McCleary and Supplemental

It’s important to put this year’s budget proposals in context.

First, it’s a supplemental budget year. What’s that? Every odd year the Governor and state lawmakers put together a two-year budget agreement. In the even years say like 2018 for instance, they typically make small changes.  This is called the supplemental budget. So they might add some small amount of funding if there was a bad fire season or respond to a lawsuit or fill some holes or have some more money because of increased revenue to do something with. In short, a supplemental budget session is usually is focused only on modest changes. It also is super quick—lawmakers are supposed to be finished up by March 8th.  This makes large and new investments and policy changes tough. 

Second, you might recall that the Supreme Court told lawmakers and the Governor this summer that they have been too slow in funding K-12, that the state should be fully funding teacher salaries, and that the state should stop relying on local levies to fill the gaps. Lawmakers and the Governor previously agreed to fund teacher salaries by the fall of 2019. The Supreme Court said sorry that’s too late. It needs to be done by the fall of 2018. So before you read on you should understand these two fundamental storylines.

Early Learning Sees Only Minor Budget Gains

The House and Senate introduced their budget proposals this week and it was mostly underwhelming for early learning.  Both budgets provided a small increase to expand home visiting for an additional 275 children, maintain the ECLIPSE Program for children with mental health issues, and make some technical changes to the homeless child care program. Funding to increase childcare rates or to reverse the previous cut to Early Achievers was not included in the budget proposals.

K-12 Education: Different Amounts and Different Approaches

This was not a typical supplemental budget because of the Supreme Court decision and the fact that the state found itself flush with cash. As a result House and Senate leaders included significant increases to K-12, mental health, and higher education funding. The biggest hurdle to a final deal, however, before the session finishes in a few weeks is how they will resolve their differences on K-12 funding. 

The Senate budget proposal attempts to meet the Supreme Court mandate that the state fully take over funding teacher salaries and do so this year. They allocate an additional $1 billion for K-12 and teachers would begin seeing salary bumps in the fall of 2018, instead of the fall of 2019, as was previously scheduled.  The House budget proposal on the other hand would spend about $500 million in new dollars and focus on special education services, family engagement coordinators, guidance counselors, and other intervention services. The House budget writers say they believe the K-12 dollars can be better spent on at risk children, instead of moving up the timeline to fund teacher salaries. Both the House and Senate proposals would lower the property tax based on the increase in unexpected revenue with the House also calling for a capital gains tax. It will be interesting to see what compromise develops, but right now the House and Senate are funding K-12 at different rates and using the funds for different priorities.

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