We relayed recently that the Orange County Board of Supervisors basically told the state to drop dead when it came to grabbing $48 million from the County's coffers as a way to balance the state budget. Supervisors decided to fight back over the funds rather than let the state’s plans create layoffs and major cutbacks, so the county announced its plans to hold onto $73.5 million in local property taxes that are supposed to go toward public schools (the county contends the state will be required to backfill the reduction in local revenue due to a mandate). Supervisor John Moorlach stuck to his guns in a post on his blog about the county’s decision and wrote the following:
“The taxpayers of the OC are due the entire $73.5 million. We must keep our $49.5 million and we rightfully deserve the additional $24 million. The schools must be backfilled by the State. The State has to figure out how to come up with the $73.5 million. Had the Legislature and the Governor simply left the OC alone, it would have been $24 million ahead. Now we have to wait and see how Sacramento responds to our having informed them that we are following the law.”
The so-called "response" that OC is getting could be better characterized as backlash. So what about that claim that funding for schools will be guaranteed anyways? Here’s what H.D. Palmer, deputy director of the state Department of Finance, had to say about it, according to the Voice of OC:
“While the redirection of property tax revenue available from K-12 school districts in Orange County would be automatically backfilled with state general fund, the loss of property tax revenue available to community college districts would not. General apportionment funding for K-12 schools is continuously appropriated, and the state general fund makes up the difference between the amount of property tax revenue received by a school district and the ‘revenue limit’ it is entitled to by state statute. However, the state general-fund portion of community college revenue limits is appropriated each year in the budget act. Orange County's decision to redirect property taxes from schools will result in a funding reduction to community colleges unless the Legislature acts to backfill the money.”
The state has already announced that it is considering its legal options in light of Orange County’s decision. So it would appear a legal challenge is likely since the state argues the move is illegal. But the county has countered that it has accounted for legal issues by verifying the options with a private law firm in addition to the legal research that was conducted by county counsel.
But William M. Habermehl, superintendent of the Orange County Department of Education, is certainly not pleased by the county’s decision either. Habermehl fears the state will not make up the difference and commented, “I find it very disconcerting and almost a slap in the face. How can we assume the State of California with the financial difficulties it has will have the money to pay?” More on the response of school officials can be found at the OC Register.