Newsom Reaches Deal with CTA on Prop 98 Funding

Gov. Gavin Newsom has resolved a dispute with the California Teachers Association (CTA) over Prop 98 funding, avoiding what could have become a nasty legal fight and moving budget negotiations one step closer to finality. 

Under the agreement — summarized here by EdSource’s John Fensterwald — the state will suspend Proposition 98 and defer funding over a three-year budget period. The CTA and other K-12 education groups will get nearly all the funds they were demanding, amounting to an additional $5.5 billion, albeit with delays. 

The settlement calls for three years of deferrals, ranging from $1.3 billion to $2.6 billion, from 2023-24 through 2025-26. The last deferral, for $2.4 billion, would make up about 2% of funding to community colleges and school districts. Together, the three deferrals should have no appreciable impact on school and community college budgets but will require $2.4 billion in future school funding to pay off. They will involve an accounting shift from June, the last month of one fiscal year, to July, the first month of the next.

Newsom’s previous plan would have reduced the amount of guaranteed school funding by nearly $12 billion over two years through an accounting maneuver that critics said was unconstitutional. 

“This agreement is a smart and balanced policy solution that incorporates feedback from California’s educators,” Newsom said in a statement. “Working together, we are protecting California’s students, families, and educators and putting the state on a fiscally sound and sustainable path.”

CTA President David Goldberg said the agreement “ensures that students, educators and families aren’t impacted by cuts to the classroom this year while protecting future year education funding.”

Read more at EdSource and Politico