CALSSD Announces Advocacy Push on the 2026–27 May Revision and TK–12 Education Budget Priorities

Dear Governor Newsom, Senate pro Tem Limón, Speaker Rivas, Senator Laird, Assembly Member Gabriel, Senator Pérez, and Assembly Member Alvarez:

The May Revision reflects meaningful progress on issues important to suburban districts. At the same time, the continued proposal to withhold Proposition 98 funding, albeit at a lower level than proposed in January, remains a major point of opposition

The additional revenues recognized in the May Revision help address priorities of suburban districts, and our members are appreciative. As the Legislature and Administration deliberate budget provisions, a small number of refinements would substantially strengthen the final budget. There are also significant changes that CALSSD recommends.

A. Progress in the May Revision and Refinements for Final Budget

CALSSD appreciates the following improvements relative to the Governor’s January Budget and prior-year baselines. Where the May Revision proposals warrant clarification or refinement, we have noted those points alongside our support.

1. Special education. The $2.4 billion ongoing increase — including $1.8 billion in new base rate funding — equalizes the special education base rate statewide and raises it to $1,340 per ADA. This investment is one of the most consequential elements of the May Revision. In a recent feedback survey, district leaders identified this investment as meaningful and expected to reduce the amount of local general fund dollars that must be used to cover a portion of special education costs. For a number of respondents, the new base rate increase is estimated to cover a small portion (under 30%) of general fund encroachment for special education. These freed-up general fund dollars are expected to be redirected to student services, staff supports, and operational needs.
2. LCFF and the super COLA. The increase from a 2.41% statutory COLA to 2.87% brings the COLA close to the 3% rate which has been identified as a key metric. Paired with the $906.7 million discretionary investment that brings the effective COLA to 4.31%, this will begin to address the longstanding gap between statutory COLAs and the real cost of staffing, benefits, utilities, insurance, and facility maintenance. This is a meaningful step toward base grant adequacy. The proposed new mandated paid pregnancy disability leave that the enhanced COLA is intended to cover is discussed below.
3. Discretionary block grant. Nearly doubling the Student Support and Professional Development Discretionary Block Grant from $2.8 billion to $5.1 billion provides districts with critical flexibility to manage rising costs — particularly in declining-enrollment districts where fixed and rising costs collide with reduced ADA revenue. CALSSD strongly supports retaining the per-ADA allocation structure. The rising operational costs and fiscal liabilities that this funding is intended to address — health benefits, utilities, transportation, insurance, retirement contributions, and AB 218 exposure — do not fall on districts on a weighted basis; they are hitting all districts. A per-ADA distribution is therefore the most equitable way to support all students, including students in the LCFF unduplicated count and other underserved students, because it ensures every district receives the resources necessary to keep classrooms operating for every child it serves
4. Community schools. CALSSD supports the $1 billion ongoing investment; it is a significant shift from time-limited grants to sustained funding, allowing districts to build and maintain the staffing and partnerships the model requires. Ongoing funding is essential for sustainability and for building the capacity that allows the community schools approach to take root. To strengthen implementation, CALSSD offers two refinements:
   • Eligibility threshold. The proposed minimum of 65% of students in the LCFF unduplicated count will still leave out many school sites that serve high proportions of low-income students, English learners, foster youth, students experiencing homelessness, and students with disabilities but fall below the 65% floor. Vulnerable students are concentrated at many school sites that do not meet the eligibility threshold. CALSSD urges consideration of state funding that supports balance across school sites within a district rather than create pressure between designated and non-designated sites.
   • Evaluation authority. CALSSD proposes that the Legislature clarify authorization for districts to use community schools funding for local evaluation and continuous improvement efforts — so districts, county and regional technical assistance providers, and the Legislature can see what is working and direct ongoing dollars accordingly.
5. Educator workforce. CALSSD continues to support the Teacher and Counselor Residency Grant Program, the Golden State Teacher Grant Program, and the 21st Century California School Leadership Academy, which together reflect sustained attention to the educator pipeline. We appreciate that the May Revision maintains the $250 million one-time Proposition 98 General Fund investment for the Teacher and Counselor Residency Grant Program and adds $30 million one-time Proposition 98 General Fund for a new statewide teacher residency technical assistance center. Residencies have shown strong promise in attracting new educators and in improved preparation, and districts value continued investment and capacity support.

B. Key Considerations for the Final Budget

As the Legislature crafts a final budget, CALSSD urges attention to the following:

1. Reject the use of the settle-up methodology to defer Proposition 98 obligations and close the $3.9 billion settle-up in 2026–27. CALSSD continues to oppose the withholding of Proposition 98 funding, now proposed at $3.9 billion, and the use of the settle-up methodology to postpone or avoid providing Proposition 98 dollars to schools and students. These are constitutionally guaranteed dollars that have been identified for students currently in classrooms. Deferring $3.9 billion into 2027 — a year already projected to face significant fiscal pressure — undermines district planning, compounds the structural problem rather than resolving it, and risks normalizing the use of settle-up as a budget-balancing tool at students’ expense. CALSSD urges the Legislature to close the remaining $3.9 billion gap in the 2026–27 budget and to reject the use of the settle-up methodology to delay or reduce the State’s Proposition 98 obligations going forward.
2. Provide dedicated funding for the new pregnancy disability leave mandate and address implementation gaps The May Revision creates a new mandate requiring up to 14 weeks of paid= pregnancy disability leave for all TK–12 LEA employees beginning in 2026–27. The Administration maintains that the 1.4% gap between the statutory COLA (2.87%) and the effective COLA (4.31%) is sufficient to absorb this mandate alongside other rising operating costs. CALSSD is concerned that the 1.4% discretionary increment will not fully cover the mandate’s cost — particularly when districts are also absorbing rising health benefit, utility, transportation, and insurance costs. To implement this 4 mandate without forcing districts to redirect resources from students, CALSSD urges the Legislature to:
   • Establish a separate, dedicated funding source. Rather than rely on the discretionary portion of the LCFF COLA to absorb a new statutory obligation, the Legislature should evaluate the true cost of the mandate independently and establish an ongoing funding source that reflects actual implementation costs. This protects the LCFF discretionary increment for its intended purpose: addressing rising operating costs that are already straining district budgets and supporting core programs.
   • Ensure funding reaches every LEA, including those outside the standard LCFF framework. The current proposal would require LEAs that do not receive the full LCFF COLA — including community-funded (basic aid) districts and Necessary Small School districts — to provide the same paid leave benefit without the funding intended to support it. Small districts and county offices of education would likely not receive sufficient funding through their LCFF formula allocation to cover the costs. We urge the final budget to include a funding structure that covers the actual cost of the mandate, regardless of how the local educational agency is funded under LCFF.
   • Address the anticipated increase in substitute teacher demand. Districts will need to fill classroom assignments for the full duration of any pregnancy disability leave taken. CALSSD urges policy changes that provide authority to districts to meet the anticipated increase in substitute teacher demand, including reviewing existing substitute teacher assignment limits to ensure they accommodate leaves of up to 14 consecutive weeks. Maintaining instructional continuity for students depends on it.
3. AB 218: provide a durable solution beyond COLA. The improved LCFF COLA provides near-term breathing room, but COLA is not a sustainable response to AB 218 exposure. These claims arise from conduct that occurred decades ago — before today’s students, staff, and leaders were in the system — and the multi-year fiscal exposure is significant. CALSSD urges the Legislature to advance reforms that strengthen prevention and student safety, support survivors, and explore establishment of a victim compensation fund so districts can meet obligations rooted in past conduct without compromising their ability to serve students currently in classrooms.
4. Expanded Learning Opportunities Program (ELOP): consistent rate, real flexibility. The ELOP proposal in the May Revision is unchanged from the Governor’s January Budget. Suburban districts continue to support the Administration’s proposal for a consistent Tier 2 per-pupil rate and continue to advocate for additional flexibility in program implementation. Suburban districts vary significantly in staffing, facilities, transportation capacity, and community partner availability. A one-size implementation model strains districts that face different operating realities. A consistent rate paired with greater local flexibility allows districts to plan, retain staff, sustain partnerships, and provide reliable programming.
5. California State Preschool Program: apply the full statutory COLA. Many suburban districts operate the California State Preschool Program (CSPP), which plays a critical role in early learning, school readiness, and access to high-quality care for working families. CALSSD urges the Legislature to apply the full 2.87% statutory COLA to CSPP so funding keeps pace with rising operational costs and programs can sustain access, quality, and stability for young children and their families.
6. Transitional kindergarten: address facilities and implementation. The May Revision does not address the facility and implementation costs associated with universal TK expansion. CALSSD districts have embraced universal TK, but expansion continues to create facility and staffing pressures — particularly where classrooms designed for older students require modification for four-year-olds and where districts are operating at the edge of early-grade capacity. CALSSD urges the Legislature to address these facility and implementation needs in the final budget alongside continued operational funding.

CALSSD appreciates the opportunity to comment on the May Revision. As the budget moves toward final adoption, we welcome the opportunity to provide additional information about how these proposals affect suburban districts across California.

Please contact us at andrea@ballfrostgroup.com and deborah@bautistazavalagr.com with questions or to discuss the positions outlined here.

Sincerely,

Deborah Bautista Zavala
Legislative Advocate
California Association of Suburban School Districts