BILL NUMBER: SB 6 CHAPTERED 10/13/01 CHAPTER 794 FILED WITH SECRETARY OF STATE OCTOBER 13, 2001 APPROVED BY GOVERNOR OCTOBER 12, 2001 PASSED THE SENATE SEPTEMBER 13, 2001 PASSED THE ASSEMBLY SEPTEMBER 10, 2001 AMENDED IN ASSEMBLY SEPTEMBER 6, 2001 AMENDED IN SENATE JUNE 4, 2001 AMENDED IN SENATE MAY 3, 2001 AMENDED IN SENATE MARCH 27, 2001 INTRODUCED BY Senator O'Connell (Coauthor: Senator Costa) (Coauthors: Assembly Members Chan and Thomson) DECEMBER 4, 2000 An act to amend Section 42238.12 of the Education Code, relating to school finance, and declaring the urgency thereof, to take effect immediately. LEGISLATIVE COUNSEL'S DIGEST SB 6, O'Connell. School finance. Existing law requires the county superintendent of schools to adjust the total revenue limit for each school district in the jurisdiction of the county superintendent of schools by the amount of increased or decreased employer contributions to the Public Employees' Retirement System (PERS), and sets forth a method for calculating that amount for the 1995-96 fiscal year and each fiscal year thereafter. Existing law, the Budget Act of 2001, appropriated $35,000,000 for the purpose of limiting the PERS offset to K-12 revenue limit apportionments. This bill would provide that the amount appropriated in the Budget Act of 2001 is for the purpose of limiting reductions to revenue limits, as described. The bill would also set forth parameters for apportionment reductions in the 2002-03 fiscal year. The bill would declare that it would take effect immediately as an urgency statute. THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS: SECTION 1. Section 42238.12 of the Education Code is amended to read: 42238.12. (a) For the 1995-96 fiscal year and each fiscal year thereafter, the county superintendent of schools shall adjust the total revenue limit for each school district in the jurisdiction of the county superintendent of schools by the amount of increased or decreased employer contributions to the Public Employees' Retirement System resulting from the enactment of Chapter 330 of the Statutes of 1982, adjusted for any changes in those contributions resulting from subsequent changes in employer contribution rates, excluding rate changes due to the direct transfer of the state-mandated portion of the employer contributions to the Public Employees' Retirement System, through the current fiscal year. The adjustment shall be calculated for each school district, as follows: (1) (A) Determine the amount of employer contributions that would have been made in the current fiscal year if the applicable Public Employees' Retirement System employer contribution rate in effect immediately prior to the enactment of Chapter 330 of the Statutes of 1982 were in effect during the current fiscal year. (B) For the purposes of this calculation, no school district shall have a contribution rate higher than 13.020 percent. (2) Determine the actual amount of employer contributions made to the Public Employees' Retirement System in the current fiscal year. (3) If the amount determined in paragraph (1) for a school district is greater than the amount determined in paragraph (2), the total revenue limit computed for that school district shall be decreased by the amount of the difference between those paragraphs ; or, if the amount determined in paragraph (1) for a school district is less than the amount determined in paragraph (2), the total revenue limit for that school district shall be increased by the amount of the difference between those paragraphs. (4) For the purpose of this section, employer contributions to the Public Employees' Retirement System for any of the following positions shall be excluded from the calculation specified above: (A) Positions or portions of positions supported by federal funds that are subject to supplanting restrictions. (B) Positions supported by funds received pursuant to Section 42243.6. (C) Positions supported, to the extent of employers contributions not exceeding twenty-five thousand dollars ($25,000) by any single educational agency, from a non-General Fund revenue source determined to be properly excludable from this section by the Superintendent of Public Instruction with the approval of the Director of Finance. (5) For accounting purposes, any reduction to district revenue limits made by this provision may be reflected as an expenditure from appropriate sources of revenue as directed by the Superintendent of Public Instruction. (6) The amount of the increase or decrease to the revenue limits of school districts computed pursuant to paragraph (3) for the 1995-96 fiscal year or any fiscal year thereafter shall not be adjusted by the deficit factor applied to the revenue limit of each school district pursuant to Section 42238.145. (b) Funding appropriated by Provision 35 of Item 6110-485 of Section 2.00 of the Budget Act of 2001 is for the purpose of limiting the reductions to revenue limits calculated pursuant to this section and to Section 2558 for the 2001-02 fiscal year. Funding from this appropriation shall be allocated in the following manner: (1) Each school district and county office of education subject to a reduced apportionment pursuant to this section or to Section 2558 shall receive a share of the amount described in paragraph (3) that is proportionate to the reduction in their apportionment pursuant to this section or to Section 2558 for the 2001-02 fiscal year as compared to the statewide total reduction that would occur absent this paragraph. (2) For the 2001-02 fiscal year, in lieu of the alternative calculation authorized by paragraph (1), San Francisco Unified School District shall receive an amount equal to five dollars and 57 cents ($5.57) multiplied by its second principal apportionment average daily attendance for the 2001-02 fiscal year. (3) Notwithstanding any other provision of law, total allocations pursuant to this subdivision shall not exceed thirty-five million dollars ($35,000,000). (c) For the 2002-03 fiscal year and each fiscal year thereafter, apportionment reductions pursuant to this section and to Section 2558 shall be limited as follows: (1) Each school district and county office of education subject to a reduced apportionment pursuant to this section or to Section 2558 shall receive a share of the amount described in paragraph (3) that is proportionate to the reduction in their apportionment pursuant to this section or to Section 2558 for the 2002-03 fiscal year as compared to the statewide total reduction as would occur absent this paragraph. (2) For the 2002-03 fiscal year and each fiscal year thereafter, in lieu of the alternative calculation authorized by paragraph (1), the San Francisco Unified School District shall receive funding equal to the amount of funding per unit of average daily attendance specified in paragraph (2) of subdivision (b) as increased annually by cost-of-living adjustments specified in Section 42238.1, multiplied by its second principal apportionment average daily attendance for that fiscal year. (3) Notwithstanding any other provision of law, total limitations pursuant to this subdivision shall not annually exceed the amount described in paragraph (3) of subdivision (b) as annually increased by the cost-of-living adjustments specified in Section 42238.1, multiplied by the annual statewide percentage growth in total average daily attendance, measured at the second principal apportionment. SEC. 2. This act is an urgency statute necessary for the immediate preservation of the public peace, health, or safety within the meaning of Article IV of the Constitution and shall go into immediate effect. The facts constituting the necessity are: In order to implement the Budget Act of 2001 with respect to the public schools, it is necessary that this act take effect immediately.