Several schools across the state of California continue to shut their doors due to the threat of the coronavirus pandemic, but institutions are at risk of another problem; a lack of long-term funding.
The ballot measure that did not get the majority vote, Proposition 15, would have provided educational institutions with billions of dollars worth of funding. The support would allow public schools and community colleges across the state to continue operating.
Analysts estimated a revenue of about $8 billion to $12.5 billion per year would be possible by reassessing tax payments of commercial businesses that have holdings worth over $3 million. About 40% of the revenue would go to schools.
However, the change would only take effect starting on the fiscal year 2022-23 and would not include certain properties with occupants that have 50% or more small businesses. They would only be taxes based on the market value on the fiscal year 2025-26.
The superintendent of the Oakland Unified School District, Kyla Johnson-Trammell, said that California had had a history of being the state with the lowest education funds per student in the country. The state ranks in the bottom 20% in education dollars when compared to other states despite being the fifth-largest economy worldwide.
Johnson-Trammell said the OUSD would be glad to receive any additional funding after facing several years of budget constraints. The superintendent requested that the government provide more funding to their students and facilities for future endeavors.
Despite the expected increase in school funding this year, the coronavirus pandemic forced the state legislature to defer $11 billion in state funding for schools, hoping for more federal assistance to push through. While state funding has steadily grown over the years, costs such as employee pension contributions and other costs have risen as well.
Need for school funding
The spokeswoman for the San Francisco Unified School District, Laura Dudnick, said Proposition 15 would have provided a massive amount of funding to educational establishments in the region. She said the financial assistance would have helped several schools and public services in California amid the effects of the pandemic.
Dudnick said that the COVID-19 virus brought millions of new costs for the district and noted that officials should prioritize public school funding.
However, opposition to Proposition 15 said that the legislation, if passed, would have slowly crippled small businesses during a time when the economy was in shambles. The president and CEO of the California Business Properties Association, Rex Hime, said the defeat of the proposition was not only good for small businesses but for the state as a whole.
Hime said citizens now realized the importance of Proposition 13 in helping the state move forward in reviving its economy. He added people now had the time to focus on what really mattered: how to survive the pandemic, instead of paying with money they did not have.
Previously, California Governor Gavin Newsom said Proposition 15 was a positive reform to the state tax policy. However, he did not express his support for the legislation during the campaign, which might have ultimately spelled its defeat, the San Francisco Gate reported.
The defeated proposition would have rehauled Proposition 13, which was passed in 1978. The old legislation capped property taxes at 1% of the purchase price. It also limited assessed values to a maximum of 2% every year until the successful sale of the property.
People who supported Proposition 15 said establishments such as Disneyland were prime examples of improperly taxed commercial properties. The famous theme park pays property taxes based on what the land in owns was worth in 1975 and is relatively a small price to pay in recent years.