by Mark McDermott
Like every public school district in California, the Manhattan Beach Unified School District this month is faced with a daunting task. The district must by law file its budget without a clear idea of what funding, and cuts, will emerge from the state’s budget process.
This is often the case, but more so this year, both due to the extended tax filing deadline in California and because Governor Gavin Newsom’s proposed budget has been almost universally received as overly optimistic in its revenue assumptions.
MBUSD deputy superintendent Dawnalyn Murakawa-Leopard told the Board of Education at its last meeting in May that the discrepancy between the Governor’s budget and the Legislative Analysts Office is $11 billion in revenue projections.
“[The LAO] say that they think there’s an $11 billion problem in what the Governor has presented, and that there’s a less than a one in six chance that the state can afford what the Governor is proposing in his budget,” Murakawa-Leopard told the board at its May 29 meeting. “What we’re hearing is that $42 billion of revenue from [fiscal year] 22-23 has not yet been received, and that is largely due to the fact that taxes aren’t due until October. So it’s what school services and other organizations are referring to as a blind spot — $42 billion may come in or may not come in and we won’t truly know that until the fall. So there’s a lot of uncertainty.”
Legislators and the Governor appear to agree on a few key points regarding education funding, perhaps most significantly that an 8.1 percent cost of living [COLA] increase will be attached to school funding.
“The main headline that I think is important is that all three — the Governor and both houses — are proposing to fully fund the statutory COLA, which is good news for us. That is ongoing revenue.”
If implemented, the 8.1 percent COLA increase would be the largest in four decades.
“That’s a number I never expected to see,” Newsom said at a January press conference announcing the proposed budget. “I am very proud that we were able to prioritize this COLA…It goes deep to our values. It’s an expression of our commitment to equity. Last year it was 6.5 percent.”
But the Governor’s budget also proposed a few takeaways, including an unusual cut that targets money that has already been allocated and spent. Newsom has proposed taking back money from two one-time block grants included in the 2022-23 budget: $2.5 billion from a $7.9 billion learning recovery block grant and $1.8 billion — about half — of the Arts, Music, and Instructional Materials Block Grant, which districts can use for other purposes.
“In January, he proposed to reduce the Arts, Music, and Instructional Materials discretionary block grant…Now he’s proposing to decrease it by more,” Marakawa-Leopard said. “In January, he said he was going to cut it by about a third. Now he’s suggesting cutting it by half. And in addition, he didn’t propose anything with the Learning Recovery Emergency block grant in January, but now is proposing to cut that by a third. The interesting thing about the Learning Recovery Emergency Block Grant is that that money has already come to us. So cutting it by a third means that the state is going to take that money back from us somehow, probably by reducing appropriations next year. So there’s been a lot of discussion about these block grant reductions, a lot of concern….because many districts are counting on that money for a variety of things. Some districts have paid for salaries out of these budgets and have committed those funds, and may have already expended those funds.”
Some of those funds may be replaced by Proposition 28, a ballot initiative that voters approved last year intended to better financially support arts education. Murakawa-Leopard said those funds are anticipated to arrive by next January but many details remain unclear, including the level of funding and how those funds can be spent. The state agency overseeing the funds, School Services of California, has urged districts to budget Prop. 28 funds with caution.
“We are looking at this advice but also looking at the needs of our community,” she said. “So we do anticipate that we will be proposing in our budget some expenditure of Proposition 28 funds in anticipation of receiving them, but we also hear this advice that we should proceed with caution.”
The board will conduct budget meetings on June 21 and June 22. Murakawa-Leopard said a full MBUSD budget proposal will be presented on June 21 that will include the block grant reductions, but that most likely budget revisions will be required after the dust settles on the state budget. She also pointed to an encouraging trend within MBUSD. Statewide, enrollment is trending downward with an overall 8 percent decline projected over the next decade. LA County is projecting a 17 percent decline. But MBUSD saw a modest enrollment increase this year that is expected to continue.
“Prior to the pandemic, we were hovering at about 6,500 students district-wide, and then through the pandemic we lost 300 students,” Murakawa-Leopard said. “And then, this year we’ve seen an increase…This is both students returning to our schools and a reflection of the expansion of transitional kindergarten that is impacting this. We’re hopeful that this trend will continue.”
State funding is tied to enrollment and Average Daily Attendance (ADA). Murakawa-Leopard emphasized that MBUSD needs to keep its daily attendance high. Pre-pandemic, she noted, MBUSD typically had 96 to 97 percent daily attendance, at least one percentage point higher than the state average. The first year after classroom teaching resumed, the state average dropped to around 91.25 percent and MBUSD’s to 95.69. But over the last year, the state rose to 91.92 while MBUSD dropped to 94.76.
“So I think an area that we may want to look at is attendance, and how we can encourage attendance among students while still of course helping students to know that they need to stay home when you are sick, and be healthy,” she said.
Board member Jen Fenton suggested the district be proactive in encouraging attendance.
“I’d love to consider ways to raise our Average Daily Attendance,” she said. “I remember several years ago, we did — was it a cartoon, or a video? — called ‘Butts in seats.’ Maybe it’s so much as blasting it out there again, so parents really understand the detriment of keeping their students home. It’s one thing if they’re sick. There’s all sorts of extenuating circumstances…I get that. But I don’t think we should just keep our kids out. I don’t think we should go on vacations. We really need to plan on having our kids in school, because it does make a difference in our budget.”
Not discussed at the budget meeting but looming in its details was the protracted labor negotiations with the Manhattan Beach Teachers Association (MBTA), whose contract expired more than a year ago. The district has made a “last best offer” of a one-year 6 percent COLA increase, while the teachers have held out for a multi-year contract beginning with an 8 percent increase. MBTA president Shawn Chen, in an interview, said that district negotiators have taken the unusual step — after 12 negotiation sessions — of waiting until the financial “actuals” are released on June 21 to discuss the previous year’s COLA for teachers. She said the district has been holding those funds while teachers continued to work without salary increases, which has led some teachers to accept jobs elsewhere.
The state COLA increase, Chen said, should largely be directed at salary increases. The district and MBTA have long operated under a shared assumption that at least 80 percent of COLA goes to salary increases, she said, yet teachers find themselves preparing for summer for the second year in a row with no salary increases.
“It’s always in the best interest of both students and the community for contracts to be settled expeditiously,” Chen said. “Dragging this out over 12 sessions and moving into summer without a settled contract doesn’t improve morale in the district.”
Murakawa-Leopard told the board that the district’s final budget will likely be subject to revision even after it is approved at next week’s meeting. “Sometime between June 15 And July 14, we should get some clarity on what the state budget is, we hope,” she said. “But we won’t truly know until October….Our budget approval date is June 22, probably before we have some clarity on the state budget. So that leads us to a 45-day budget revision once we find out how it all shakes out.” ER
