CSBA, ACSA set to file suit over sales tax diversion to counties

The California School Boards Association and the Association of California School Administrators are set to announce today the filing of a lawsuit aimed at restoring more than $2 billion in Proposition 98 funding they believe should have been included in the current state budget.

Bob Wells, executive director of ACSA, said the issue stems from the diversion of about $5 billion sales tax from the state's general fund to local government to help pay for the realignment of public safety programs to counties.

Wells said that the details of the suit will be made available Wednesday at a press conference in Sacramento, but at least two school districts - Los Angeles and Turlock will be joining in the complaint.

The June budget agreement has been the object of some criticism by school management groups from the beginning on a number of levels - but there has been specific concern about the implications of the tax diversion to the landmark school fund measure adopted by voters in 1988.

While a real decline in sales tax money going into the general fund would reduce the Proposition 98 guarantee - it has been argued that the June budget agreement calls for a deliberate diversion of sales taxes, which is not something contemplated by the constitutional guarantee and thus could create a dangerous precedent.

In an effort to appease school groups, legislative leaders and Gov. Jerry Brown agreed to place a tax measure on the November 2012 ballot to backfill K-14 schools for the loss of funds - estimated to be about $2.1 billion.

The budget act provides that if voters reject the measure or if the election is never held - the state would be required to determine how much it would have owed schools under the Proposition 98 guarantee for 2011-12 had the shift never occurred.