California’s next governor faces hard education funding choices as budgets tighten
education funding – California’s next governor will inherit a tougher budget reality for schools: declining enrollment, rising special education costs, and pressure to boost base funding and COLA—while still deciding which programs to scale or scale back.
California’s education leaders are heading into a political transition with a practical warning: the money story is changing.
The fall election will determine both the next governor and the next state superintendent of public instruction after Gov.. Gavin Newsom and State Superintendent Tony Thurmond complete their terms.. Whatever new agenda emerges. districts across California are bracing for a period of tighter state budgets—one that is likely to bring sharper tradeoffs in staffing. programming. and day-to-day operations.
A key part of that shift could be Newsom’s proposal to restructure the California Department of Education’s operations by placing it under a new education commissioner appointed by the next governor.. In the current setup, the state superintendent holds substantial influence over the department’s bureaucracy.. Under the proposed model. the elected superintendent would remain the public advocate for education. while day-to-day management would move out of the superintendent’s direct control—an administrative change that could shape how quickly policy gets translated into practice.
Newsom’s tenure has been defined by large. multi-year state investments in TK-12: expanding transitional kindergarten for 4-year-olds. extending the school day. and building new pathways through apprenticeships and community schools that connect families to services.. But districts now say that the era of “more programs” has also come with a heavier compliance load—more reporting requirements and regulatory demands—at the same time that costs for wages. services. and transportation continue to rise.
Those frustrations are no longer confined to policy circles.. In school board rooms and negotiations. educators and administrators have been pointing to a growing mismatch: districts are being asked to implement ambitious initiatives while wrestling with funding pressures they say are already straining their ability to maintain what exists.. David Roth. superintendent of Buckeye Union School District. described the problem bluntly: adding new programs. he argued. would worsen labor tension over pay raises that districts cannot fund and could limit their capacity to sustain current offerings.
Roth’s argument has taken institutional form through the Raise the Base Coalition. which is pushing for base funding to become the top priority for the Legislature and next governor.. The coalition is made up of dozens of districts—largely suburban—many of which report receiving less supplemental and concentration funding because of student demographics.. Their claim is not that equity is broken. but that even districts receiving relatively more still struggle to keep up with rising costs.. To them, “base” funding is the difference between staying operational and falling behind.
This debate sits inside a broader fiscal arithmetic that is hard to ignore: enrollment continues to decline.. California’s Department of Finance projects statewide enrollment drops accelerating over the coming decade. with an additional 10% reduction by 2033-34. taking total enrollment to about 5.2 million students.. Because many district budgets depend on average daily attendance over time. the decline will tighten resources—even though transitional kindergarten has helped stabilize attendance during earlier phases of expansion.. As TK phases in fully. districts anticipate that the “attendance cushion” will be less effective. and the financial impacts will land more directly.
Special education is adding another layer of pressure.. The proportion of students with disabilities has risen in recent years even as overall enrollment has declined. meaning districts are carrying a growing service load with limited room to absorb unexpected costs.. Newsom has proposed a $500 million increase to equalize special education funding among districts. but district leaders say the overall direction has still left local budgets exposed.. A growing share of special education costs is falling on districts. and some smaller districts report reaching financial warning levels after costly cases arrive.
Cost-of-living adjustments are also at the heart of the dispute.. Losing even a few percentage points of attendance translates into larger losses than the COLAs projected for upcoming years. especially when health insurance costs and the need to retain teachers keep climbing.. District leaders describe the timing as a critical flaw: funding changes tied to attendance and statewide formulas do not move as quickly as expenses do.
The combination of declining enrollment and Proposition 98’s guarantee has produced an additional financial effect often framed as a “declining enrollment dividend.” Proposition 98 requires funding for TK-12 and community colleges based on a set share of state revenue. but districts can end up receiving less collectively when enrollment falls.. The difference can become discretionary room for the Legislature and governor—potentially a major budget battleground in the next few years.
How that “dividend” gets used could determine whether the next governor’s education priorities look like expansions or stabilization.. Options discussed by districts and policy advocates include shifting from attendance-based funding to annual enrollment. adding a regional cost factor to the Local Control Funding Formula. increasing the state’s share of special education expenses. making a 4% annual COLA permanent. and building professional development funding into the base system—particularly support tied to early literacy and the state’s new mathematics framework.
Money won’t be the only issue.. Even if funding rises or falls. the next governor will still confront structural decisions that shape how schools are held accountable and supported.. Newsom’s plan to restructure the California Department of Education would be only the first step in untangling the current accountability system. and it could affect how education improvement efforts are administered statewide.. There is also a pending legal conflict over how facility repair funds are distributed. which could force the next administration to decide whether to settle or defend an approach that critics argue favors wealthier districts.
Beyond finance and governance. California’s education policy debates are moving into new territory. especially around artificial intelligence and high school redesign.. Districts are already trying to understand how AI will be used in classrooms and what “AI literacy” should mean for students.. At the same time. engagement remains a concern: only a little over half of California students report feeling connected to high school.. The Legislature has funded pilot redesign efforts aimed at improving relationships and purpose through new instructional models—such as team teaching. small-group learning. and scheduling changes intended to make it easier for students to pursue apprenticeships alongside coursework.
Finally, districts and school boards are pressing for a more direct focus on closing persistent achievement gaps.. Advocacy groups representing school boards are seeking accountability for whether state agencies provide the metrics used to track progress. and they’re warning against new initiatives that could divert time and resources.. In the background of all of these debates is a central tension: districts say they want solutions that stabilize their operations now. not only strategies that may take effect after years of implementation.
For the next governor, the challenge will be political as much as budgetary.. Voters may want momentum. but districts are asking for predictability—base funding strength. a realistic COLA. and funding formulas aligned with how enrollment and costs actually behave.. In California education right now. that question—what gets prioritized when the state’s budget room tightens—may matter as much as any campaign promise.
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