June 30 was the legal deadline for a signed budget for California. The fact that a budget has not been enacted is having a substantially negative effect on the state's financial management. As explained on the State Controller's website, certain payments, such as those for K-12 schools' categorical programs, and $523 million for community colleges, cannot be made. In contrast, the state constitution requires the payment of revenue limit funding for K-12 school districts regardless of state budget action. 

According to California Watch, "California remains the only state without a passed budget this year, 28 days into the new fiscal calendar, and the clock keeps running. Of the $19 billion-budget shortfall, the governor and the Legislature have reached agreement on trimming about $11 billion of the shortfall, leaving a $7 billion problem." See News & Resources  for more articles about the impact of the budget stalemate on California's schools.

Here are some resources to help you understand and explain the state's current budget situation and this year's budget debates:

Analysis:

From School Services of California

• June Revenues Essentially on Target ~ July 16, 2010  
• Budget Conference Committee Begins Work—Pressure Is On to Suspend Proposition 98 ~ June 4, 2010  
• Congress Cuts Federal Aid, Leaving May Revision Short $1.9 Billion ~ June 3, 2010
• Details of May Revision Child Care Reductions ~ May 26, 2010
• May Revision Shows No Gain But No New Pain for Education ~ May 14, 2010 

From Strategic Education Services

• May Revision to the Governor's 2010-2011 Budget ~ May 14, 2010

From Legislative Analyst's Office

• Overview of the Economy, Revenues, and Spending ~ June 4, 2010
• The 2010-11 Budget: Overview of the May Revision ~ May 18, 2010
• Webcast: Overview of the 2010-11 May Revision  ~ May 18, 2010  

Analyses of governor's original proposal

• Governor’s Proposals for the 2010-11 State Budget and K-12 Education ~ January 9, 2010
  School Services of California provides a detailed analysis of the Governor's budget proposal for education that puts it in the context of California's overall budget. And, though the governor proclaimed in his State-of-the-State address that education funding would be protected, SSC shows that the budget proposal actually contains reductions for K–12 schools.

• Governor's Budget Proposal for 2010-11 ~ January 8, 2010   Strategic Education Services' memo on the governor’s budget proposal for 2010–11 gives an overview of the proposed budget and describes his proposals for K–12 education, community colleges, and child care programs.
  • More policy analyses from Strategic Education Services
    
• The 2010-11 Budget: Proposition 98 and K-12 Education  ~ February 25, 2010  The independent Legislative Analyst's Office presents its assessment of the governor’s budget proposal and presents an alternative budget plan
  • See video of the budget update presented by Legislative Analyst Mac Taylor at EdSource's March 19th Forum.

What's Next:

• The Legislature now must finalize its budget bills. The constitutional deadline for the Legislature to pass a budget was June 15, though this deadline is rarely met.

More Information and Context:

• For the latest news, policy documents, and analyses on school finance, please see our News & Resources section.
• For information about the funding of K-14 education in the current year, including our 2009-10 school finance updates, please see 2009-10 Funding.
• Need help explaining California's school finance system? Our Budget Basics page lists tools you can use.