Budget Information and Bargaining Trends

January 30, 2026

Presented By:

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William “Bill” Diedrich – Partner

Cerritos • Fresno • Irvine • Riverside • Pleasanton • Sacramento • San Diego

Agenda

• Budget Numbers and Their Impact on Negotiations
• Current Bargaining Trends

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Statutory/Funded Cola

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_{1. In addition to statutory COLA, Assembly Bill 181 (Chapter 52, Statutes of 2022) authorized LCFF base grant adjustments effective fiscal year 2022–23.}

_{2. Assembly Bill 130 (Chapter 44, Statutes of 2021) authorized a compounded COLA comprised of statutory COLA adjustments attributed to fiscal year 2020–21 (2.31%) and fiscal year 2021–22 (1.70%), and an additional 1% increase in LCFF base grant for an effective increase of 5.07% from 2019–20 to 2021–22 funding levels.}

_{3. The 2020–21 May Revision proposed a 10 percent reduction to certain components of the LCFF formula that are also subject to COLA. The 2020–21 Budget Act did not contain the 10 percent reduction.}

_{4. The 2018–19 Budget Act authorized a higher COLA, known as "Super COLA”, for school districts and charter schools.}

How COLA is Calculated (EC 42238.1)

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(b) For the 1999-2000 fiscal year and each fiscal year thereafter, the Superintendent shall compute an inflation adjustment equal to the product of paragraphs (1) and (2):

(1) Compute the sum of the following:

(A) The statewide average base revenue limit per unit of average daily attendance for the prior fiscal year for school districts of similar type.

(B) The amount, if any, per unit of average daily attendance received by the school district pursuant to Article 8 (commencing with Section 46200) of Chapter 2 of Part 26 for the prior fiscal year.

(2) The percentage change in the annual average value of the Implicit Price Deflator for State and Local Government Purchases of Goods and Services for the United States, as published by the United States Department of Commerce for the 12-month period ending in the third quarter of the prior fiscal year. This percentage change shall be determined using the latest data available as of May 10 of the preceding fiscal year compared with the annual average value of the same deflator for the 12-month period ending in the third quarter of the second preceding fiscal year, using the latest data available as of May 10 of the preceding fiscal year, as report by the Department of Finance.

Implicit Price Deflator

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• The Implicit Price Deflator for State and Local Government Purchases of Goods and Services in the United States is an inflation measure used in national accounts to track changes over time in the prices that state and local governments pay for goods and services they purchase (e.g., operational inputs, equipment, services). It’s conceptually similar to other implicit price deflators: it’s the ratio of current-dollar spending to real (inflation-adjusted) spending for that category.
• This is NOT the same as the consumer price index!

Impact on Negotiations

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• COLA is not keeping up with the cost of benefits.
• COLA is not keeping up with inflation.
• Many District offers are similar—close to COLA
• Impact of Declining Enrollment vs. Growth Districts
• Harder to “catch up”
• Lower COLA juxtaposed against a higher/growing ending fund balance

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_{BARGAINING TRENDS}

We Can’t Wait!

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_{Coordinated Bargaining Campaign Involving 77,000 Educators in 32 California School Districts Serving 1 Million Students.}

What is it?

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• _{Saying “we can’t wait” for Washington to get its act together and unwilling to wait any longer for the schools students deserve, 32 local educator unions across California are joining together to coordinate their contract bargaining on common issues.}
• _{Selected associations will approach their local school districts with the shared priorities of the campaign.}

• _{Common topics: improved class sizes, more resources for students, better wages and benefits.}

Impetus

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_{A report, The State of California’s Public Schools, conducted by GBAO Strategies for the California Teachers Association and released last month, found that four out of 10 educators surveyed are thinking about leaving the profession because they’re not getting the support they need in school and can’t make ends meet at home.}

• _{84 percent of the teachers surveyed cannot afford to live near their schools.}
• _{81 percent say their salaries are not keeping up with rising costs for groceries, childcare and other necessary expenses.}
• _{80 percent have concerns that they would not be able to cover an unexpected cost.}
• _{69 percent cite high, out-of-pocket, and often inadequate healthcare costs eating into their paychecks.}

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My District is listed, what can I expect?

• Common proposals, especially on safety, class size, wages, and special education.
• Hard bargaining.
• Lack of movement at the table.
• Urgency to go to impasse.

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My District is not listed, what can I expect?

• Potential use of common proposals.
• Hard bargaining, but slow movement.
• Slower bargaining progress.
• Less of an urgency to go to impasse.

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What do we do?

• Continue bargaining using the same methodology you have used in the past.
• Make connections with the local units.
• Ask questions. In particular, ask for the “why.”
• Don’t rush to impasse!

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Other Trends

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• Salary driven
• Incremental movement
• Slower process
• Willingness to sign a 2-year deal
• Emphasis on Special Education
• Class Size
• Caseloads
• Workspaces

• Emphasis on time in the classroom/on site
• A.I.
• Safety
• Indifferent to layoffs�

Other Trends

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• Pushing for benefits over salary
• One year deal
• Moving more quickly
• More restrictive layoff language
• More “nickel and dime” items
• E.g. Boot allowance

• Heavy emphasis on reclassification
• Heavy emphasis on complaints
• Less restrictive leave language
• Using grievances/ULPs to drive language concessions�

Addressing Trends

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• Budget Transparency
• Consider a multi-year deal
• Borrow from 2026-2027 for 2025-2026
• Close the contract
• One time money?
• Use data where possible
• Consider team composition
• Develop a bargaining communication strategy
• Be flexible

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For questions or comments, please contact:

Thank You