BILL ANALYSIS AB 1610 Page 1 CONCURRENCE IN SENATE AMENDMENTS AB 1610 (Budget Committee) As Amended October 7, 2010 2/3 vote. Urgency ----------------------------------------------------------------- |ASSEMBLY: | |(April 22, |SENATE: |28-6 |(October 7, | | | |2010) | | |2010) | ----------------------------------------------------------------- (vote not relevant) Original Committee Reference: BUDGET SUMMARY : Provides the necessary statutory changes in the area of education in order to enact modifications to fiscal year (FY) 2009-10 and 2010-11 Budget Acts. The Senate amendments delete the Assembly version of the bill, and instead: K-12 Provisions: 1)Provide a revenue limit deficit factor of 18.25% to reflect a $133.7 million deficit for county offices of education (COEs) and a revenue limit deficit factor of 17.963% to reflect a deficit of $6.9 billion for school districts. These statutory factors are created to establish state intent to repay the K-12 per-pupil reductions in the future, including foregone cost-of-living adjustments (COLA's). 2)Combine the English Language Assistance Program (ELAP) funding with Economic Impact Aid (EIA) funding and repeals the ELAP statute. Clarifies that local educational agencies (LEAs) may continue using this funding for English language professional development. 3)Increase the amount of school district revenue limit funding scored towards a June to July deferral from $1.1 billion to $1.6 billion. (This funding is already deferred in practice, just not currently scored so there is no impact to school districts with this adjustment). AB 1610 Page 2 4)Defer $420 million from K-12 principal apportionment payments made in April to July and $800 million from K-12 principal apportionments made in May to July. 5)Authorize up to $100 million in school apportionment funds currently scheduled to be deferred from June to July, to continue to be paid in June, for school districts and charter schools who can demonstrate that absent this relief, they will be unable to meet June payroll obligations. 6)Limit state mandate costs for the existing pupil promotion and retention mandate, worth an estimated $3.1 million annually, by relieving school districts from performing activities reimbursable under the mandate, through July 1, 2013. 7)Suspend the statutory division of Proposition 98 funding among K-12 educational agencies, community colleges, and other state agencies for 2010-11, instead referencing the funding split reflected in the 2010-11 Budget. 8)Provide $210 million towards the approximately $1.8 billion in "settle-up" payments owed to schools for FY 2009-10. (In total, the budget provides $300 million towards this settle-up obligation, the balance of $90 million is appropriated in the budget act for 2010-11 mandate costs). 9)Limit state costs for the High School Science Graduation mandate claim (about $2 billion in past costs and $200 million annually in ongoing costs) by directing LEAs to use state apportionment and flexible categorical funding to cover related costs. Requires districts to first fund teacher salary costs for courses required by the state when determining the proportion of their budgets statutorily required to be expended for the salaries of classroom teachers. 10)Provide supplemental categorical block grant funding for new charter schools established in 2008-09, 2009-10 or 2010-11 that were unable to access categorical funds due to AB 1610 Page 3 flexibility provisions enacted as a part of the 2008-09 Budget Act. 11)Delete a statutory requirement that school districts submit teachers' applications to participate in a National Board Certification incentive program to the state Department of Education for review and approval. These incentives are no longer funded, so there is no need for districts to forward applications. 12)Authorize the Department of Education to allocate facilities grant funding to eligible charter schools for current-year costs, to the extent that any funds remain after reimbursing past-year costs. 13)Limit state mandate costs for the existing truancy mandate, under which the state pays districts $17 each, or about $15.9 million annually, to send form letters to parents of truants, by amending the mandate to require schools to use the most cost-effective method possible for notification, which may include electronic mail or a telephone call. 14)Authorize county court schools to qualify for Economic Impact Aid funding, beginning in 2010-11, which should enable them to draw an estimated $2.7 million to serve poor students and English-learners. States legislative intent that average daily attendance records of county court schools be reviewed as part of those schools' routine audits. 15)Limit future state costs for a pending special education "behavioral intervention plan" mandate (created by the Department of Education regulations, with outstanding claims of over half a billion dollars) by conforming California's statutory requirements to those in federal law. 16)Suspend, through 2012-13, the following education mandates: Removal of Chemicals, Scoliosis Screening, Pupil Residency Verification and Appeals, Integrated Waste Management, Law Enforcement Jurisdiction Agreements, Physical Education AB 1610 Page 4 Reports and Health Benefits for Survivors of Peace Officers and Firefighters. 17)Capture $726 million in program savings in 2009-10 in order to achieve state budget solution. Of this amount, $340 million reflects budgeted savings for the K-3 Class Size Reduction program and $386 million reflects natural savings from more that seven other categorical programs. 18)Align the appropriation of federal 'stimulus' funds with the amounts actually available to the state (up to $3 million more than formerly expected). 19)Authorize the continuation of about $906 million in inter-year K-12 payment deferrals (from June to July of 2011). Inter-year deferrals have been a part of the budget since 2004-05. 20)Provide a statutory appropriation mechanism for the K-3 Class Size Reduction program for the 2010-11 FY only to ensure that the program is fully funded. 21)Establish a zero percent COLA for K-12 programs in 2010-11. The actual cola of -0.39% will not be imposed, but instead will be applied as an offset to the deficit factors established in this measure. 22)Request the Department of Finance to exercise its statutory authority to request the Commission on State Mandates to adopt a new test claim to supercede the existing test claim for the CCC Collective Bargaining mandate. 23)Require the State Controller to confirm by December 1, 2010, that school districts have ceased to file claims under the School Accountability Report Card mandate for activities no longer required by statute, and to file a request with the Commission on State Mandates to amend the parameters and guidelines for that mandate, if schools have not ceased to AB 1610 Page 5 file such claims. Higher Education: 24)Repeal legislative intent that no new General Fund augmentation be used for contributions to the UC Retirement Plan. 25)Shift $30 million in California Community Colleges Quality Education Investment Act (QEIA) from 2010-11 to ensure the state meets the 2009-10 State Fiscal Stabilization Fund maintenance of effort requirement for higher education. 26)Make technical corrections to the hardship waiver process for inter-year apportionment deferrals for community colleges in 2010-11. 27)Defer an additional $129 million of community college apportionment payments from January through June to July 2011 and defers $35 million from categorical programs and $25 million from Economic Development and Workforce Program for fiscal year 2010-11. 28)Suspend four community colleges mandates for during the remaining period of categorical program funding flexibility (through 2012-13). 29)Exclude the California Community Colleges' Career Technical Education program from categorical flexibility and provides $20 million in one-time funds. 30)State that the Trustees of the California State University shall not, and the Regents of the University of California are requested not to, allocate student-imposed athletics fees on purposes other than those voted on by the students. Child Care and Development: AB 1610 Page 6 31)Limit child care development contractors' reserves to five percent of reimbursable contract amounts. Previously, there had been no limit on the size of the reserve for child care development contractors. 32)Extend the City and County of San Francisco's child care subsidy pilot program until July 1, 2015. 33)Reduce the maximum reimbursement for license-exempt providers from 90 percent to 80 percent of the 85th percentile using the 2005 regional market rate survey. 34)Reduce the Alternative Payment agencies' administrative allotment from 19 percent of original contract amount to 17.5 percent. 35)Urgency Clause. Declare this bill take effect immediately as an urgency statute. AS PASSED BY THE ASSEMBLY , this bill was a vehicle for 2010 Budget legislation. Analysis Prepared by Misty Feusahrens and Sara Bachez / BUDGET / (916) 319-2099 FN: 0007235