California’s largest educators union has initiated legal action against state leadership, alleging that billions of dollars rightfully allocated for public education have been systematically withheld over the past two fiscal cycles. The legal challenge contends that state officials breached longstanding constitutional mandates designed to guarantee baseline resources for classrooms across the state.
The lawsuit was formally lodged in Sacramento County Superior Court by the California Teachers Association. While the complaint formally identifies state Finance Director Joe Stephenshaw alongside several unnamed officials as respondents, the legal action directly challenges the fiscal maneuvers overseen by Gov. Gavin Newsom and state lawmakers amid broader state budget shortfalls.
According to court filings submitted by the union, state leadership intentionally underfunded the public education system by $1.9 billion during the 2024-25 fiscal year. The complaint further alleges that the state withheld an even larger sum of $3.9 billion in the subsequent 2025-26 budget period.
Although state officials eventually repaid the $1.9 billion reduction from the 2024-25 budget a year later, union leaders emphasized that no such repayment plan or formal commitment has been established for the $3.9 billion shortfall in 2025-26. That missing allocation comes out of a total education budget of $119.9 billion.
The union stressed that these fiscal deficits have created tangible hardships across school districts, calculating that the unpaid $3.9 billion corresponds to an estimated loss of $638 for every public school student enrolled in California.
Beyond per-pupil funding reductions, the union linked the state's budget withholdings to significant workforce reductions throughout local school districts. The legal filing highlights that nearly 1,000 educational personnel have faced layoffs over the course of the past year as districts struggled to balance their local finances.
The California Teachers Association represents roughly 310,000 members across the state, encompassing a wide array of public school professionals, including classroom instructors, school counselors, librarians, and various support personnel.
David Goldberg, president of the California Teachers Association, issued a statement sharply criticizing state leaders for balancing budget difficulties on the backs of school workers during an otherwise strong economic climate. Goldberg noted that public school careers were disrupted and local communities destabilized despite broader statewide economic strength.
In his remarks, Goldberg stated that the union is actively demanding the full restoration of the withheld education funds. He underscored that recovering these resources is vital to shielding students, staff, and local communities from experiencing another cycle of severe budget cuts and teacher layoffs.
The legal core of the union's case rests on Proposition 98, a landmark constitutional amendment approved by 51% of California voters in November 1988. The measure established strict constitutional guarantees requiring a specific percentage of the state’s overall budget to be dedicated exclusively to K-12 public schools and community colleges.
Under the framework of Proposition 98, the California Legislature is granted the authority to temporarily suspend minimum funding obligations for a single year through a two-thirds supermajority vote. However, the constitutional provision explicitly requires the state to fully repay any withheld funds in subsequent fiscal periods.
The teachers union argues that state officials bypassed these constitutional protections by failing to provide any schedule or guarantee for replenishing the 2025-26 funds. Benjamin Gevercer, a Sacramento-based attorney representing the union, wrote in the complaint that it remains highly doubtful whether the state will ever repay the $3.9 billion owed to local schools.
Through this lawsuit, the union is seeking a binding judicial order declaring that the state’s funding maneuvers violate Proposition 98. The legal action requests the court to compel the state to provide full, constitutionally required funding for public schools in both current and future budget cycles.
Alongside the litigation, Goldberg highlighted the importance of Proposition 3, an upcoming November ballot initiative aimed at securing long-term education revenues. The measure seeks to permanently extend tax increases on high-income earners that were previously approved by California voters in 2012 and 2016.
Those high-income tax provisions are currently slated to expire in 2031. If approved by voters, Proposition 3 would protect nearly $15 billion in annual state revenue earmarked directly for public elementary, secondary, and community college education.
Following the filing of the lawsuit, the office of Gov. Gavin Newsom did not immediately provide a public response to requests for comment. Meanwhile, the office representing State Superintendent of Public Instruction Tony Thurmond declined to comment on the pending litigation.
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