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Teacher pay one option for Gov.’s funding increase proposal

William Ferchland

It has one of those sleep-inducing budget names – Cost of Living Adjustment – but is highly important to California education funding.

COLA, as it is typically referred to, is set at 5.18 percent in Gov. Arnold Schwarzenegger’s budget proposal. It is the adjustment proposed for public school districts and community colleges to adjust for inflation.

When the COLA is improved, the amount of money gets tacked onto the funding school districts receive for each student occupying a desk.

Teamed with Proposition 98 funds, the two provide the bulk of K-14 education funding in California.

For growing school districts the extra money allows them to do things such as enhance or introduce programs. For declining school districts COLA helps soften the blow of financial cuts.

“The COLA will certainly help us,” said Guy Lease, president of Lake Tahoe Community College which has seen its share of decreasing student numbers.

When the COLA rate is approved at the state level it becomes retroactive to July 1, typically the beginning of the fiscal year.

This fiscal year the COLA was set at 4.23 percent, meaning an extra $211 was tacked onto the per-student funding, or Average Daily Attendance, for Lake Tahoe Unified School District, said Superintendent James Tarwater.

When thousands of students are in a school district, the extra money could turn into a sizable amount. It is up to a school district on how the money will be spent – whether it will go to costs such as fuel, be used to lessen a financial shortfall, or be given to employees in the form of a raise.

Mike Patterson, the political action arm of the South Tahoe Educators Association, said raises are a negotiated item, therefore a big COLA doesn’t equal a big pay increase for employees.

In addition, if a district is struggling with declining enrollment and the financial cuts that follow, Patterson said a COLA is more useful in fighting deficits, and thus avoiding teacher layoffs, than pay hikes.

“It’s in everybody’s interest that the school district is financially solvent,” Patterson said.

Tarwater said he would like to see employees receive raises. When he arrived at the school district before the start of this school year one of his first actions was to provide a 0.7 percent pay increase to employees.

“When everyone is working that hard they deserve it. … It’s been a long, long haul,” he said.

But for school districts to have options on how to spend the extra money, COLA must be financially backed by the state. For the 2003-04 fiscal year, Gov. Gray Davis announced a COLA of 1.86 percent but it wasn’t funded and cuts eventually came down to school districts, said Francie Heim, deputy superintendent at El Dorado County Office of Education.

The level COLA is set is based on the Implicit Price Deflator for Government Goods and Services published by the Department of Agriculture. The publication analyzes the prices for various goods. Hurricane Katrina was one phenomenon that created price fluctuations.

With Schwarzenegger proposing the COLA at a relative-high 5.18 percent, Heim remarked: “On the scale that’s a nice number.”


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