Gov. Schwarzenegger reaches nearly $3 billion deal with teachers |

Gov. Schwarzenegger reaches nearly $3 billion deal with teachers

SACRAMENTO, Calif. – Gov. Arnold Schwarzenegger on Wednesday announced a plan to repay billions of dollars to public schools, a proposal that could end a lawsuit by the state’s largest teachers union.School officials claimed they agreed to accept $2 billion in cuts to help the newly elected governor balance the 2004-05 state budget. In return, they said, the governor promised schools would get more money if state revenues increased more than expected.The lawsuit said schools were shorted an additional $3.1 billion over two years. Schwarzenegger had denied there was a promise to share the excess revenue with schools.Under the deal – reached as the governor finalized revisions to his proposed 2006-07 budget – the state would repay $2.9 billion over seven years. He also will direct another $2.8 billion from an unexpected tax windfall this spring to education.Administration officials, who would speak only on the condition of anonymity, said they expected the deal would settle the potentially costly lawsuit by education groups and could be partly funded with a creative budget maneuver involving tobacco funds.Perhaps more importantly for Schwarzenegger, however, it may quiet one of the governor’s most vociferous political enemies – the California Teachers Association – in a tough election year. The group spent $50 million in last year’s special election to defeat the governor’s initiatives.Teachers union President Barbara Kerr proclaimed victory.”This is something really good for our kids. It will allow us to reduce class sizes, pay for more school counselors and provide more teacher training,” Kerr said.State Superintendent of Public Instruction Jack O’Connell, who frequently criticized Schwarzenegger for failing to live up to the deal, commended the governor Wednesday.”I was critical of the governor and I also said I would thank him when he lives up to his commitment to the students of California, so today I am publicly thanking the governor.”However, budget watchdogs said the deal could exacerbate future deficits.—Associated Press writers Juliet Williams and Samantha Young in Sacramento contributed to this report.

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