Keep Schools Solvent With a Tax on Oil Drilling?

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School Crosswalk

Flickr: Kt Ann

Almost 15 percent of California school districts are in critical financial jeopardy, California's state schools superintendent Tom Torlakson announced this week. That's 143 districts that may not be able to pay their bills in the coming months. The school funding crisis has led to swelling classrooms, shorter school years, program cuts,  and layoffs of teachers, librarians and counselors. And California lags behind the nation in per pupil spending.

How did we get into this mess? The lack of cash is partly due to the recession, of course. But as The California Report's Ana Tintocalis reports Wednesday, the problem is built into the structure we use to fund schools. And it has led to a push for new taxes for education, including a long-sought tax on oil drilled up in California.

(Timeline produced by Adam Susaneck, KQED.)

For the past thirty years, school districts have received the bulk of their funding from state coffers, rather than local property taxes. Schools are guaranteed roughly 40 percent of the state's general fund revenue. But the state money comes largely from income tax, which is much more volatile. So as the economy goes up and down, so does education funding.

Statewide, education suffered roughly $18 billion in cuts over the past three belt-tightening years. And the legislature has deferred paying schools several billion dollars it owes under Proposition 98's minimum funding guarantee. While Gov. Jerry Brown left school funding mostly intact in his 2011-12 budget proposal, it could get slashed further if new revenue isn't forthcoming

That all makes it tough for school districts to plan. And it has prompted education advocates to propose a laundry list of new tax ideas. A number of school districts have managed to pass parcel taxes. A Democratic state senator suggests making it easier for school districts to raise local taxes. The state teacher's association wants higher taxes on the highest incomes. And a community college professor is gathering signatures for an oil severance tax.

It's not clear which of these strategies might make education funding less volatile. But any of them could bring in more cash.

Of course many Californians think they're already taxed plenty. Republican State Senator Bob Huff, who chairs the senate budget committee, says taxes are not the answer. Schools have plenty of money, he told Tintocalis; they just need to spend it more wisely. 

Oil extraction tax proposals have surfaced numerous times over the past couple of decades. California is the only state that doesn't tax oil companies for taking this natural resource out of the ground. In this interactive timeline, we examine the Quixotic history of efforts to pass an oil severance tax. None have succeeded so far. Will this year's plan fare better?

In 2008 Gov. Arnold Schwarzenegger said we should use an oil severance tax to balance the budget. In 2006, environmentalists wanted the money to go to green energy research. A 1991 plan would have substituted it for an unpopular "snack tax." And way back in 1980, Gov. Jerry Brown was pushing an oil tax to fund public transit.

This year Cypress College political science professor Peter Mathews has launched a petition drive to get a 15 percent oil severance tax on the ballot. The proceeds could pump $3 billion a year into California's public schools and colleges. Mathews shoe-string operation doesn't have big backers so far to underwrite the effort to gather more than 500,000 signatures by the end of September. But Californians may be sufficiently alarmed about the school funding crisis this year to boost the measure's chances.

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Comments (4)

  1. ellen says:

    Can anyone tell me how to donate funds to help get the initiative for an oil drilling tax for education on the ballot?

  2. mlaiuppa says:

    It’s obvious Bob Huff has never attended a school board budget meeting or he wouldn’t be perpetuating the lie that schools have plenty of money. They don’t. They haven’t had “plenty of money” for decades. Because his party has been starving public education funding in order to “prove” it’s failing so they can privatize it.

    • Tyche Hendricks says:

      Attend a school board budget meeting… now there’s a great way to plug in to your government!