Some of California’s record $308 billion budget spending appears to be an attempt to slow the number of people fleeing the state. At the height of the COVID-19 pandemic, California experienced the highest net influx of residents in the nation, losing 300,000 residents between April 1, 2020 and July 1, 2021. Florida and Texas together have gained more than 625,000 residents during this period. , according to census data. Meanwhile, the latest census metrics show Los Angeles, San Francisco and San Jose lost more than 120,000 residents combined in 2021, joining New York and Chicago as the top five cities that lost residents.
“In the face of new challenges and uncertainties, we are providing more than $17 billion in assistance to help families make ends meet and doubling our investments to continue building the California dream on a strong fiscal foundation,” the governor said. Gavin Newsom of the state spending plan he signed in June.
Stimulus checks marketed as “inflation relief” are the largest item in this $17 billion portion of the budget. The payments will go to single adults earning up to $250,000 a year and couples earning up to $500,000, costing taxpayers $9.5 billion. Another spending item that receives far less attention, but with an almost identical price tag, is a $9 billion increase in base student funding for California’s public school funding formula, which determines the amount of money that school districts receive each year.
For various reasons during the pandemic, student enrollment in public schools across the state fell 2.6% in the 2020-21 school year and 1.8% in the current school year. 2021-22. Declines in major metro school districts have been more acute, according to data from Burbio, a school data site. In Southern California, the Los Angeles Unified School District was not alone in losing large numbers of students. The San Diego Unified School District and Long Beach Unified each lost more than 3% of their student population last year. Orange Unified School District and Capistrano Unified fared better, losing less than 1% of their students. Overall, school districts located in cities and suburbs lost 2.5% and 1.6% of their students, respectively, last year.
Even though there are fewer children in public schools, state education spending continues to rise. But higher education spending does not lead to higher student test scores. Despite the 36% increase in education spending since 2002, California students produced only small increases in math and reading test scores from 2019.
CalMatters reports, “Since California students began taking the new standardized exam – known as ‘Smarter Balanced’ – statewide reading and math scores have increased on average by about 1 percentage point each year for the past five years.”
However, many education researchers worry that school closures and other learning disruptions during the pandemic have likely erased all the progress students have made over the past decade. California’s current combination of a declining population and rising education spending is a recipe for fiscal challenges in years to come. As a potential recession looms and inflation continues to rise, heads of state and school districts should plan their budgets accordingly, not go on a spending spree.
The state budget relies heavily on personal income tax, which, although more stable than many other sources of revenue, can make state revenues volatile and contribute to large surpluses and deficits. During the 2008-2009 recession, for example, a decline in revenue from income and corporate taxes, coupled with years of rampant spending, contributed to shrinking the state education budget. nearly 14%.
Resizing California’s education budget now, when the state has a surplus, certainly runs counter to political pressures to perpetually increase spending. But California cannot continue to increase education spending while losing students and failing to produce meaningful achievement gains. To avoid sudden and drastic budget cuts when the next financial crisis inevitably hits state and public schools, students and taxpayers would be best served by strategically resizing schools and the education system now.
Jordan Campbell is an Education Policy and Quantitative Analyst at the Reason Foundation.