Announcements

San Luis Obispo Fire Fighter's Association

The San Luis Obispo city firefighters are fighting to keep binding arbitration in their contract. The City of San Luis Obispo will be discussing this issue and the possibility of a special election to eliminate binding arbitration at their Tuesday, March 3, 2009 meeting. The firefighters are holding a large rally at the meeting and would like us to join them. The meeting begins at 7:00 p.m. Come out in support of fellow unionists!

In support of the San Luis Obispo Firefighters, CCFT has drafted a support letter. To offer our support, please send a copy of this letter to the following:

Attached is a letter of support for San Luis Obispo Firefighters Local 3523.  If you support The SLO Firefighters, please send a copy of the letter to the addresses below.

Support Letter - MS Word Format | Support Letter - PDF Format

Erik Baskin - President
San Luis Obispo City Firefighters Local 3523
2160 Santa Barbara Ave.
San Luis Obispo, CA 93401

Ken Hampian
CAO, City of San Luis Obispo
990 Palm St.
San Luis Obispo, CA  93401

Mayor Dave Romero/ Council Member Andrew Carter
990 Palm St.
San Luis Obispo, CA 93401

The CA Nurses Association

The California Nurses Association, which has members at all the local hospitals, is supporting HR 676, John Conyers’ single payer health insurance plan, and encourage everyone to help get this legislation passed. Find out more at http://singlepayernow.net/

The Employee Free Choice Act

The Employee Free Choice Act needs support. This legislation will prohibit employers and their agents from unfair tactics used to discourage, even prevent, employees from joining unions. Find out more at http://freechoiceact.org/

Dear Colleagues:

Both the State Assembly and the State Senate have adjourned for the evening, bringing to an end a marathon weekend of budget debate and deliberation. Both houses are scheduled to reconvene tomorrow (11 am for the Senate, 12 pm for the Assembly).

The package at the center of the weekend's action, the product of Big Five negotiations, covers both the current year (2008-09) and the budget year (2009-10). As anticipated, the package contains significant budget cuts and new taxes impacting every sector of the budget and giving every constituency something to hate.

Highlights of the budget package are provided below.

• $41 Billion in budget solutions (2008-09 and 2009-10, combined):
• $15.1 billion in expenditure reductions, including:
• $13.3 billion in cuts; and
• $1.8 billion in other reductions (delays, fund shifts)
• $14.4 billion in temporary tax increases
• $11.4 billion in borrowing
• $1.3 billion reserve

Proposition 98 Cuts and Deferrals:

• Lowers Proposition 98 spending for the colleges and K-12 schools to $50.7 billion in the current year (2008-09), a reduction of $7.4 billion from 2008-09 Budget Act levels.
• The current year-reduction is accomplished by $5 billion in funding swaps and deferrals and $2.4 billion in program cuts.
• After accounting for deferrals and funding swaps, the budget package provides about $700 million less in Proposition 98 funding in the budget year (2009-10) than provided for 2008-09.

California Community Colleges, current year (2008-09):

• $39.8 million cut to eliminate the 0.68 COLA
• $3.6 million reduction to capture unspent prior-year funds
• $3 million cut to mandate payments
• $340 million in apportionment funding deferred from January, February, March, and April to be repaid in July (this replaces the existing $245 million deferral that was added to the community college budget in 2008-09). This new deferral is likely to be a permanent feature of our budget.
• Delay repayment of existing $200 million June-to-July deferral, now to be repaid in October. This change is assumed to be permanent.

California Community Colleges, budget year (2009-10):

• No COLA
• $185.4 million augmentation to fund 3 percent enrollment growth
• The budget does not include categorical flexibility provisions for the college
• The budget does not include student fee increases
• The budget does not include other policy changes that have been discussed in recent weeks (property tax shortfall protection, lowering funding rates for certain courses, etc.) Such policy proposals will be heard in policy committees or budget hearings during the Spring.
• The budget maintains funding for the Cal Grant program. The proposal to eliminate new Competitive Cal Grants was rejected.

$14.4 billion in Tax Increases:

• Duration of taxes depends on passage of spending cap constitutional amendment.
• Sales tax:  Increased by 1 cent on the dollar, through 2011-12
• VLF:  Increased to 1%, through 2013-14 if cap passes (2011-12 if cap fails). Separate 0.15% VLF increase to pay for local law enforcement programs (saves General Fund $600 million)
• Personal Income Tax Surtax:  5% surtax (across-the-board) for four years if cap passes (2 years if cap fails); triggered down to 2.5%, if federal funds become available.
• Reduction in Dependent Credit Exemption (Personal Income Tax) for 4 years if cap passes (2 years if cap fails)
• Gasoline Excise Tax:  Increase by 12 cents per gallon for 4 years if cap passes (2 years if cap fails)

$11.4 billion in New Borrowing:

• $5 billion from lottery securitization (requires voter approval in special election in May or June).
• $5.9 billion from Revenue Anticipation Warrant sale.
• $400 million in loans and transfers from various special funds.

Spending Cap:

• Limits spending to rolling 10-year trend in revenues, amounts above the 10-year trend would go into the rainy day fund.
• Allows adjustment of the spending limit to accommodate new tax increases
• Money can be removed from the rainy day fund when revenues fall below amount needed to support a baseline budget
• Reduces the annual deposit from 3% to 1.5% (other 1.5% dedicated to education). 1.5% annual deposit ceases when fund is equal to 12.5% of revenues.
• Revenues above the trend line after the rainy day fund is full can be used for various one-time spending purposes, which can help balance the annual budget

Economic stimulus:

• Expanded Public Private Partnerships for transportation projects and corrections facilities
• Expanded use of design-build
• Meal break flexibility for employees
• CEQA exemptions for 8 specific projects
• Film/TV Production Tax Credit 
• Small Business Hiring Tax Credit

Constitutional Amendments:

The following elements of the budget package will be placed on the next state wide ballot:

• Spending Cap (see above)
• Proposition 98. Resolves technical issue over the treatment of the maintenance factor in the Proposition 98 calculation. Ensures that colleges and K-12 schools will receive an additional $9.3 billion in future years.
• Mental health funds (Proposition 63). Redirects a portion of these special funds to create General Fund savings.
• Early Childhood development funds (Proposition 10). Redirects a portion of these special funds to create General Fund savings.
  
  This budget package, while it leaves the community colleges with significant challenges to tackle in the current and budget years, is a good one under the circumstances. Given the state’s fiscal circumstances and the hard choices at hand, it is clear that the state leaders who negotiated this budget deal placed a very high priority on protecting the capacity of the community colleges to meet surging enrollment demand. The relatively modest cuts to the community colleges and the provision of $185 million in growth funds for the budget year are proof that state leaders value the indispensable role that the colleges are playing during these difficult times.
  
  In recent weeks and days, Chancellor Scott has been in frequent contact with legislative leaders and the Governor's Office pressing our case. I have been in daily contact with administration and legislative representatives to advocate for the community college budget. In these efforts, the System Office has been working closely with other community college advocates in order keep a unified front in the Capitol. We will continue this work through the critical days ahead.
  
  At the moment, the sticking point is the Senate where three Republican votes are needed for passage. Most observers anticipate that Republican Senator Cogdill would vote for the package as he was one of the Big 5 leaders who negotiated the deal. Rumor has it that Senator Ashburn, another Republican, would vote for the package given that it includes provisions related to home buyer credits that he supports. Republican Senators Cox and Maldonado are the most notable prospects being courted for the third vote.
  
  More updates will follow as the situation unfolds.
  
  Regards,
  
  Erik Skinner
  Vice Chancellor for Fiscal Policy
  Chancellor's Office
  California Community Colleges
  1102 Q Street, Sacramento, CA 95814-6511
  www.cccco.edu
  phone: 916-323-7007
  fax: 916-322-4783