Amended in Senate June 13, 2013

California Legislature—2013–14 Regular Session

Assembly Bill No. 97

Introduced by Committee on Budget (Blumenfield (Chair), Bloom, Bonilla, Chesbro, Daly, Dickinson, Gordon, Jones-Sawyer, Mitchell, Mullin, Muratsuchi, Nazarian, Rendon, Stone, and Ting)

January 10, 2013

An act begin delete relating to the Budget Act of 2013 end delete begin insert to amend Sections 1622, 14002, 14501, 17582, 33127, 35035, 35735.1, 37700, 37710.3, 37710.5, 41020, 41303, 41544, 42127, 42238.15, 42280, 42281, 42282, 42283, 42284, 42285, 42285.5, 42286, 42287, 42289, 42289.1, 42289.2, 42289.3, 42289.4, 42289.5, 42800, 46200, 46201, 46201.2, 46202, 47604.32, 47604.33, 47604.5, 47605, 47605.6, 47613, 47631, 47632, 47635, 47636, 47660, 47663, 48310, 48359.5, 49085, 49536, 52052, 52052.1, 52052.5, 52055.750, 56365, 56366.1, 56836.21, and 56836.24 of, to amend and repeal Sections 42238, 42238.1, 42238.2, and 42238.5 of, to add Sections 35736.5, 42238.01, 42238.02, 42238.025, 42238.03, 42238.04, 42238.05, 42238.051, 42238.052, 42238.053, 42238.06, 42238.07, 46207, 46208, 47606.5, and 47607.3 to, end insert begin insert to add Article 4.5 (commencing with Section 52060) to Chapter 6.1 of Part 28 of Division 4 of Title 2 of, to add Chapter 12.5 (commencing with Section 2574) to Part 2 of Division 1 of Title 1 of, to repeal Sections 14002.3, 17583, 17584, 17584.1, 17584.2, 17585, 17587, 35735.2, 42282.1, 42283.1, 42283.2, 42285.1, 42285.4, 42605, 42606, 46201.3, 46204, 47612.7, 47632.5, 47664, 52051, and 52052.2 of, and to repeal Article 3 (commencing with Section 52053), Article 3.5 (commencing with Section 52055.600), and Article 4 (commencing with Section 52056) of Chapter 6.1 of Part 28 of Division 4 of Title 2 of, the Education Code, to amend Sections 7906 and 50286 of the Government Code, to amend Sections 33492.78, 33607.5, and 33684 of the Health and Safety Code, and to amend Sections 95 and 196.4 of the Revenue and Taxation Code, relating to school finance, and making an appropriation therefor, to take effect immediately, bill related to the budget end insert .

LEGISLATIVE COUNSEL’S DIGEST

AB 97, as amended, Committee on Budget. begin delete Budget Act of 2013. end delete begin insert School finance. end insert

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(1) Existing law establishes the public school system in this state, and, among other things, provides for the establishment of county superintendents of schools, school districts, and charter schools throughout the state. Existing law provides for the provision of instruction at the public elementary and secondary schools maintained by these local educational agencies. Existing law establishes a public school financing system that requires funding for county superintendents of schools and school districts to be calculated pursuant to a revenue limit, as specified, and requires funding for charter schools to be calculated pursuant to a general-purpose entitlement, except as provided, and requires the revenue limit and general-purpose entitlement to be composed of, among other things, state aid and certain local revenues. Existing law also establishes various categorical education programs under which funding is provided for specific educational purposes, including, among many other programs, programs for home-to-school transportation, adult education, teacher training, and class size reduction.

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This bill would revise and recast the provisions related to the public financing system by requiring state funding for county superintendents of schools and school districts, and charter schools that previously received a general-purpose entitlement, to be calculated pursuant to a local control funding formula, as specified. The bill would authorize local educational agencies to expend, for any local educational purpose, the funds previously required to be spent for specified categorical education programs, including, among others, programs for teacher training and class size reduction.

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This bill would also change the funding calculations for necessary small schools and make other changes related to shifting financial responsibilities and school accountability, and would make other changes to the law relating to elementary and secondary education.

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(2) Existing law requires a county board of education, a governing board of a school district, and a governing body of a charter school, to annually adopt a budget, as specified.

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This bill would require a county board of education and a governing board of a school district to annually adopt or revise a local control and accountability plan that aligns with the annual budget and contains certain elements and that, among other things, was developed in consultation with teachers, principals, administrators, other school personnel, parents, and pupils. The bill would require a charter for a charter school to include many of the local control and accountability plan elements and would require the charter school to annually update its plan related to those elements. By requiring county boards of education and school districts to annually adopt or revise a local control and accountability plan and provide additional services, the bill would impose a state-mandated local program.

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(3) This bill would appropriate $2,099,161,000 with $2,000,000 being apportioned to the Governor’s Office of Planning and Research for purposes of developing regulations, templates, and evaluation rubrics, as specified, and the remaining funds being apportioned to the Superintendent of Public Instruction for purposes of allocating those funds to county superintendents of schools, school districts, and charter schools pursuant to the local control funding formula.

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(4) This bill would make conforming changes, correct cross-references, and make other nonsubstantive changes.

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(5) The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.

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This bill would provide that, if the Commission on State Mandates determines that the bill contains costs mandated by the state, reimbursement for those costs shall be made pursuant to these statutory provisions.

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(6) Funds appropriated by this bill would be applied toward the minimum funding requirements for school districts and community college districts imposed by Section 8 of Article XVI of the California Constitution.

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(7) This bill would declare that it is to take effect immediately as a bill providing for appropriations related to the Budget Bill.

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This bill would express the intent of the Legislature to enact statutory changes relating to the Budget Act of 2013.

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Vote: majority. Appropriation:  begin delete no end delete begin insert yes end insert . Fiscal committee:  begin delete no end delete begin insert yes end insert . State-mandated local program:  begin delete no end delete begin insert yes end insert .

The people of the State of California do enact as follows:

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begin insert SECTION end insert begin insert 1. end insert   

end insert

begin insert Section 1622 of the end insert begin insert Education Code end insert begin insert is amended
to read: end insert

1622.  

(a) On or before July 1 of each fiscal year, the county
board of education shall adopt an annual budget for the budget
year and shall file begin delete that end delete begin insert the end insert budget with the Superintendent begin delete of Public
Instruction end delete , the county board of supervisors, and the county auditor.
The budget, and supporting data, shall be maintained and made
available for public review. The budget shall indicate the date,
time, and location at which the county board of education held the
public hearing required under Section 1620. begin insert For the 2014-15 fiscal
year and each fiscal year thereafter, the county board of education
shall not adopt a budget before the county board of education
adopts a local control and accountability plan or approves an
update to an existing local control and accountability plan if an
existing local control and accountability plan or update to a local
control and accountability plan is not effective during the budget
year. The county board of education shall not adopt a budget that
does not include the expenditures identified in the local control
and accountability plan and any annual update to the local control
and accountability plan that will be effective in the subsequent
fiscal year. end insert

(b)  begin insert (1) end insert begin insert   end insert The Superintendent begin delete of Public Instruction end delete shall examine
the budget to determine begin delete whether end delete begin insert if end insert it begin delete (1) end delete begin insert (A) end insert complies with the
standards and criteria adopted by the begin delete State Board of Education end delete
begin insert state board end insert pursuant to Section 33127 for application to final local
educational agency budgets, begin delete (2) end delete begin insert (B) end insert allows the county office of
education to meet its financial obligations during the fiscal year,
and begin delete (3) end delete begin insert (C) end insert is consistent with a financial plan that will enable the
county office of education to satisfy its multiyear financial
commitments. In addition, the Superintendent shall identify any
technical corrections to the budget that must be made. On or before
August 15, the Superintendent begin delete of Public Instruction end delete shall approve
or disapprove the budget and, in the event of a disapproval, transmit
to the county office of education in writing his or her
recommendations regarding revision of the budget and the reasons
for those recommendations. begin delete For end delete

begin insert (2) end insert begin insert   end insert begin insert For end insert the 2011-12 fiscal year, notwithstanding any of the
standards and criteria adopted by the state board pursuant to Section
33127, the Superintendent, as a condition on approval of a county
office of education budget, shall not require a county office of
education to project a lower level of revenue per unit of average
daily attendance than it received in the 2010-11 fiscal year nor
require the county superintendent to certify in writing whether or
not the county office of education is able to meet its financial
obligations for the two subsequent fiscal years.

begin insert

(3) For the 2014-15 fiscal year and each fiscal year thereafter,
the Superintendent shall disapprove a budget if any of the following
occur:

end insert begin insert

(A) The Superintendent has not approved a local control and
accountability plan or an annual update to the local control and
accountability plan filed by a county superintendent of schools
pursuant to Section 52067.

end insert begin insert

(B) The Superintendent determines that the budget does not
include the expenditures necessary to implement the local control
and accountability plan or an annual update to the local control
and accountability plan that is effective for that budget year.

end insert

(c) On or before September 8, the county board of education
shall revise the county office of education budget to reflect changes
in projected income or expenditures subsequent to July 1, and to
include any response to the recommendations of the Superintendent
begin delete of Public Instruction end delete , shall adopt the revised budget, and shall file
the revised budget with the Superintendent begin delete of Public Instruction end delete ,
the county board of supervisors, and the county auditor. begin delete Prior to end delete
begin insert Before end insert revising the budget, the county board of education shall
hold a public hearing regarding the proposed revisions, which shall
be made available for public inspection not less than three working
days begin delete prior to end delete begin insert before end insert the hearing. The agenda for that hearing shall
be posted at least 72 hours begin delete prior to end delete begin insert before end insert the public hearing and
shall include the location where the budget will be available for
public inspection. The revised budget, and supporting data, shall
be maintained and made available for public review.

(d) The Superintendent begin delete of Public Instruction end delete shall examine the
revised budget to determine begin delete whether end delete begin insert if end insert it complies with the
standards and criteria adopted by the begin delete State Board of Education end delete
begin insert state board end insert pursuant to Section 33127 for application to final local
educational agency budgets and, no later than October 8, shall
approve or disapprove the revised budget. begin insert For the 2014-15 fiscal
year and each fiscal year thereafter, the Superintendent shall
disapprove a revised budget if the Superintendent determines that
the revised budget does not include the expenditures necessary to
implement the local control and accountability or an annual update
to the local control and accountability plan approved by the
Superintendent pursuant to Section 52067. end insert If the Superintendent
begin delete of Public Instruction end delete disapproves the budget, he or she shall call
for the formation of a budget review committee pursuant to Section
1623. For the 2011-12 fiscal year, notwithstanding any of the
standards and criteria adopted by the state board pursuant to Section
33127, the Superintendent, as a condition on approval of a county
office of education budget, shall not require a county office of
education to project a lower level of revenue per unit of average
daily attendance than it received in the 2010-11 fiscal year nor
require the county superintendent to certify in writing whether or
not the county office of education is able to meet its financial
obligations for the two subsequent fiscal years.

(e) Notwithstanding any other provision of this section, the
budget review for a county office of education shall be governed
by paragraphs (1), (2), and (3) of this subdivision, rather than by
subdivisions (c) and (d), if the county board of education so elects,
and notifies the Superintendent begin delete of Public Instruction end delete in writing of
that decision, no later than October 31 of the immediately
preceding calendar year.

(1) In the event of the disapproval of the budget of a county
office of education pursuant to subdivision (b), on or before
September 8, the county superintendent of schools and the county
board of education shall review the recommendations of the
Superintendent begin delete of Public Instruction end delete at a regularly scheduled
meeting of the county board of education and respond to those
recommendations. That response shall include the proposed actions
to be taken, if any, as a result of those recommendations.

(2) No later than October 8, after receiving the response required
under paragraph (1), the Superintendent begin delete of Public Instruction end delete shall
review that response and either approve or disapprove the budget
of the county office of education. begin insert For the 2014-15 fiscal year and
each fiscal year thereafter, the Superintendent shall disapprove a
budget if the Superintendent determines that the budget adopted
by the county board of education does not include the expenditures
necessary to implement the local control and accountability plan
or an annual update to the local control and accountability plan
approved by the Superintendent pursuant to Section 52067. end insert If the
Superintendent begin delete of Public Instruction end delete disapproves the budget, he
or she shall call for the formation of a budget review committee
pursuant to Section 1623.

(3) Not later than 45 days after the Governor signs the annual
Budget Act, the county office of education shall make available
for public review any revisions in revenues and expenditures that
it has made to its budget to reflect the funding made available by
that Budget Act.

begin insert

begin insert SEC. 2. end insert   

end insert

begin insert Chapter 12.5 (commencing with Section 2574) is added
to Part 2 of Division 1 of Title 1 of the end insert begin insert Education Code end insert begin insert , to read: end insert

begin insert

 

Chapter   begin insert 12.5. end insert County Local Control Funding Formula

 

begin insert 2574. end insert   

For the 2013-14 fiscal year and for each fiscal year
thereafter, the Superintendent annually shall calculate a county
local control funding formula for each county superintendent of
schools as follows:

(a) Compute a county office of education operations grant equal
to the sum of each of the following amounts:

(1) Six hundred fifty-five thousand nine hundred twenty dollars
($655,920).

(2) One hundred nine thousand three hundred twenty dollars
($109,320) multiplied by the number of school districts for which
the county superintendent of schools has jurisdiction pursuant to
Section 1253.

(3) (A) Seventy dollars ($70) multiplied by the number of units
of countywide average daily attendance, up to a maximum of
30,000 units. For purposes of this section, countywide average
daily attendance means the aggregate number of annual units of
average daily attendance within the county attributable to all
school districts for which the county superintendent of schools has
jurisdiction pursuant to Section 1253, charter schools physically
located within the county, and the schools operated by the county
superintendent of schools.

(B) Sixty dollars ($60) multiplied by the number of units of
countywide average daily attendance for the portion of countywide
average daily attendance, if any, above 30,000 units, up to a
maximum of 60,000 units.

(C) Fifty dollars ($50) multiplied by the number of units of
countywide average daily attendance for the portion of countywide
average daily attendance, if any, above 60,000, up to a maximum
of 140,000 units.

(D) Forty dollars ($40) multiplied by the number of units of
countywide average daily attendance for the portion of countywide
average daily attendance, if any, above 140,000 units.

(4) For the 2014-15 fiscal year and each fiscal year thereafter,
adjust each of the amounts provided in the prior year pursuant to
paragraphs (1), (2), and (3) by 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 reported by the Department of
Finance.

(b) Determine the enrollment percentage of unduplicated pupils
pursuant to the following:

(1) (A) For the 2013-14 fiscal year, divide the enrollment of
unduplicated pupils in all schools operated by a county
superintendent of schools in the 2013-14 fiscal year by the total
enrollment in those schools in the 2013-14 fiscal year.

(B) For the 2014-15 fiscal year, divide the sum of the enrollment
of unduplicated pupils in all schools operated by a county
superintendent of schools in the 2013-14 and 2014-15 fiscal years
by the sum of the total enrollment in those schools in the 2013-14
and 2014-15 fiscal years.

(C) For the 2015-16 fiscal year and each fiscal year thereafter,
divide the sum of the enrollment of unduplicated pupils in all
schools operated by a county superintendent of schools in the
current fiscal year and the two prior fiscal years by the sum of the
total enrollment in those schools in the current fiscal year and the
two prior fiscal years.

(D) For purposes of determining the enrollment percentage of
unduplicated pupils pursuant to this subdivision, enrollment in
schools or classes established pursuant to Article 2.5 (commencing
with Section 48645) of Chapter 4 of Part 27 of Division 4 of Title
2 and the enrollment of pupils other than the pupils identified in
clauses (i) to (iii), inclusive, of subparagraph (A) of paragraph
(4) of subdivision (c), shall be excluded from the calculation of
the enrollment percentage of unduplicated pupils.

(2) For purposes of this section, an “unduplicated pupil” is a
pupil who is classified as an English learner, eligible to receive a
free or reduced-price meal, or a foster youth. For purposes of this
section, the definitions in Section 42238.01 of an English learner,
a pupil eligible to receive a free or reduced-price meal, and foster
youth shall apply. A pupil shall be counted only once for purposes
of this section if any of the following apply:

(A) The pupil is classified as an English learner and is eligible
for a free or reduced-price meal.

(B) The pupil is classified as an English learner and is a foster
youth.

(C) The pupil is eligible for a free or reduced-price meal and
is classified as a foster youth.

(D) The pupil is classified as an English learner, is eligible for
a free or reduced-price meal, and is a foster youth.

(3) (A) Commencing with the 2013-14 fiscal year, a county
superintendent of schools annually shall report the enrollment of
unduplicated pupils, pupils classified as English learners, pupils
eligible for free and reduced-price meals, and foster youth in
schools operated by the county superintendent of schools to the
Superintendent using the California Longitudinal Pupil
Achievement Data System.

(B) The Superintendent shall make the calculations pursuant
to this section using the data submitted through the California
Longitudinal Pupil Achievement Data System.

(C) The Controller shall include instructions, as appropriate,
in the audit guide required by subdivision (a) of Section 14502.1
for determining if the data reported by a county superintendent of
schools using the California Longitudinal Pupil Achievement Data
System is consistent with pupil data records maintained by the
county office of education.

(c) Compute an alternative education grant equal to the sum of
the following:

(1) (A) For the 2013-14 fiscal year, a base grant equal to the
2012-13 per pupil undeficited statewide average juvenile court
school base revenue limit calculated pursuant to Article 3
(commencing with Section 2550), as that article read on January
1, 2013.

(B) Commencing with the 2013-14 fiscal year, the per pupil
base grant shall be adjusted by 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 reported by the Department of
Finance.

(2) A supplemental grant equal to 35 percent of the base grant
described in paragraph (1) multiplied by the enrollment percentage
calculated in subdivision (b). The supplemental grant shall be
expended in accordance with the regulations adopted pursuant to
Section 42238.07.

(3) (A) A concentration grant equal to 35 percent of the base
grant described in paragraph (1) multiplied by the greater of either
of the following:

(i) The enrollment percentage calculated in subdivision (b) less
50 percent.

(ii) Zero.

(B) The concentration grant shall be expended in accordance
with the regulations adopted pursuant to Section 42238.07.

(4) (A) Multiply the sum of paragraphs (1), (2), and (3) by the
total number of units of average daily attendance for pupils
attending schools operated by a county office of education,
excluding units of average daily attendance for pupils attending
schools or classes established pursuant to Article 2.5 (commencing
with Section 48645) of Chapter 4 of Part 27 of Division 4 of Title
2, who are any of the following:

(i) Probation-referred pursuant to Sections 300, 601, 602, and
654 of the Welfare and Institutions Code.

(ii) On probation or parole and not in attendance in a school.

(iii) Expelled for any of the reasons specified in subdivision (a)
or (c) of Section 48915.

(B) Multiply the number of units of average daily attendance
for pupils attending schools or classes established pursuant to
Article 2.5 (commencing with Section 48645) of Chapter 4 of Part
27 of Division 4 of Title 2 by the sum of the base grant calculated
in paragraph (1), a supplemental grant equal to 35 percent of the
base grant pursuant to paragraph (1), and a concentration grant
equal to 17.5 percent of the base grant pursuant to paragraph (1).
Funds provided for the supplemental and concentration grants
pursuant to this calculation shall be expended in accordance with
the regulations adopted pursuant to Section 42238.07.

(C) Add the amounts calculated in subparagraphs (A) and (B).

(d) Add the amount calculated in subdivision (a) to the amount
calculated in subparagraph (C) of paragraph (4) of subdivision
(c).

(e) Add all of the following to the amount calculated in
subdivision (d):

(1) The amount of funding a county superintendent of schools
received for the 2012-13 fiscal year from funds allocated pursuant
to the Targeted Instructional Improvement Block Grant program,
as set forth in Article 6 (commencing with Section 41540) of
Chapter 3.2 of Part 24 of Division 3 of Title 2, as that article read
on January 1, 2013.

(2) (A) The amount of funding a county superintendent of
schools received for the 2012-13 fiscal year from funds allocated
pursuant to the Home to School Transportation program, as set
forth in Article 2 (commencing with Section 39820) of Chapter 1
of Part 23.5 of Division 3 of Title 2, and Article 10 (commencing
with Section 41850) of Chapter 5 of Part 24 of Division 3 of Title
2, as those articles read on January 1, 2013.

(B) On or before March 1, 2014, the Legislative Analyst’s Office
shall submit recommendations to the fiscal committees of both
houses of the Legislature regarding revisions to the methods of
funding pupil transportation that address historical funding
inequities across county offices of education and school districts
and improve incentives for local educational agencies to provide
efficient and effective pupil transportation services.

(f) The funds apportioned pursuant to this section and Section
2575 shall be available to implement the activities required
pursuant to Article 4.5 (commencing with Section 52060) of
Chapter 6.1 of Part 28 of Division 4 of Title 2.

begin insert 2575. end insert   

(a) Commencing with the 2013-14 budget year and for
each fiscal year thereafter, the Superintendent shall calculate a
base entitlement for the transition to the county local control
funding formula for each county office of education based on the
sum of the amounts computed pursuant to paragraphs (1) to (3),
inclusive:

(1) Revenue limits in the 2012-13 fiscal year pursuant to Article
3 (commencing with Section 2550) of Chapter 12, as that article
read on January 1, 2013, adjusted only for changes in average
daily attendance claimed by the county superintendent of schools
for pupils identified in clauses (i), (ii), and (iii) of subparagraph
(A) of paragraph (4) of subdivision (c) of Section 2574 and for
pupils attending juvenile court schools. All other average daily
attendance claimed by the county superintendent of schools and
any other average daily attendance used for purposes of
calculating revenue limits pursuant to Article 3 (commencing with
Section 2550) of Chapter 12, as that article read on January 1,
2013, shall be considered final for purposes of this section as of
the annual apportionment for the 2012-13 fiscal year, as calculated
for purposes of the certification required on or before February
20, 2014, pursuant to Section 41332.

(2) The sum of both of the following:

(A) The amount of funding received from appropriations
contained in Section 2.00 of the Budget Act of 2012, as adjusted
by Section 12.42, in the following items: 6110-104-0001,
6110-105-0001, 6110-107-0001, 6110-108-0001, 6110-111-0001,
6110-124-0001, 6110-128-0001, 6110-137-0001, 6110-144-0001,
6110-156-0001, 6110-181-0001, 6110-188-0001, 6110-189-0001,
6110-190-0001, 6110-193-0001, 6110-195-0001, 6110-198-0001,
6110-204-0001, 6110-208-0001, 6110-209-0001, 6110-211-0001,
6110-212-0001, 6110-227-0001, 6110-228-0001, 6110-232-0001,
6110-234-0001, 6110-240-0001, 6110-242-0001, 6110-243-0001,
6110-244-0001, 6110-245-0001, 6110-246-0001, 6110-247-0001,
6110-248-0001, 6110-260-0001, 6110-265-0001, 6110-266-0001,
6110-267-0001, 6110-268-0001, and 6360-101-0001, 2012-13
fiscal year funding for the Class Size Reduction Program pursuant
to Chapter 6.10 (commencing with Section 52120) of Part 28 of
Division 4 of Title 2, as it read on January 1, 2013, and 2012-13
fiscal year funding for pupils enrolled in community day schools
who are mandatorily expelled pursuant to subdivision (c) of Section
48915.

(B) The amount of local revenues used to support a regional
occupational center or program established and maintained by a
county superintendent of schools pursuant to Section 52301.

(3) For the 2014-15 fiscal year and for each fiscal year
thereafter, the sum of the amounts apportioned to the county office
of education pursuant to subdivision (f) in all prior years.

(b) The Superintendent shall annually compute a county local
control funding formula transition adjustment for each county
superintendent of schools as follows:

(1) Subtract the amount computed pursuant to subdivision (a)
from the amount computed pursuant to subdivision (e) of Section
2574. A difference of less than zero shall be deemed to be zero.

(2) Divide the difference for each county superintendent of
schools calculated pursuant to paragraph (1) by the total sum of
the differences for all county superintendents of schools calculated
pursuant to paragraph (1).

(3) Multiply the proportion calculated for each county office of
education pursuant to paragraph (2) by the amount of funding
specifically appropriated for purposes of subdivision (f). The
amount calculated shall not exceed the difference for the county
superintendent of schools calculated pursuant to paragraph (1).

(c) The Superintendent shall subtract from the amount calculated
pursuant to subdivision (a) the sum of each of the following:

(1) Local property tax revenues received pursuant to Section
2573 in the then current fiscal year.

(2) Any amounts that the county superintendent of schools was
required to maintain as restricted and not available for expenditure
in the 1978-79 fiscal year as specified in the second paragraph
of subdivision (c) of Section 6 of Chapter 292 of the Statutes of
1978, as amended by Chapter 51 of the Statutes of 1979.

(3) The amount received pursuant to subparagraph (C) of
paragraph (3) of subdivision (a) of Section 33607.5 of the Health
and Safety Code that is considered property taxes pursuant to that
section.

(4) The amount, if any, received pursuant to Sections 34177,
34179.5, 34179.6, and 34188 of the Health and Safety Code.

(5) The amount, if any, received pursuant to subparagraph (B)
of paragraph (3) of subdivision (e) of Section 36 of Article XIII of
the California Constitution.

(d) The Superintendent shall subtract from the amount computed
pursuant to subdivision (e) of Section 2574 the sum of the amounts
computed pursuant to paragraphs (1) to (5), inclusive, of
subdivision (c).

(e) The Superintendent shall annually apportion to each county
superintendent of schools the amount calculated pursuant to
subdivision (c) unless the amount computed pursuant to subdivision
(c) is negative. If the amount computed is negative, except as
provided in subdivision (f), an amount of property tax of the county
superintendent of schools equal to the negative amount shall be
deemed restricted and not available for expenditure during the
fiscal year. In the following fiscal year, that amount, excluding
any amount of funds used for purposes of subdivision (f), shall be
considered restricted local property tax revenue for purposes of
subdivision (a) of Section 2578. State aid shall not be apportioned
to the county superintendent of schools pursuant to this subdivision
if the amount computed pursuant to subdivision (c) is negative.

(f) (1) The Superintendent shall apportion, from an
appropriation specifically made for this purpose, the amount
computed pursuant to subdivision (b), or, if the amount computed
pursuant to subdivision (c) is negative, the sum of the amounts
computed pursuant to subdivisions (b) and (c) if the sum if greater
than zero.

(2) The Superintendent shall apportion any portion of the
appropriation made for purposes of paragraph (1) that is not
apportioned pursuant to paragraph (1) pursuant to the following
calculation:

(A) Add the amount calculated pursuant to subdivision (b) to
the amount computed pursuant to subdivision (a) for a county
superintendent of schools.

(B) Subtract the amount computed pursuant to subparagraph
(A) from the amount computed pursuant to subdivision (e) of
Section 2574 for the county superintendent of schools.

(C) Divide the difference for the county superintendent of
schools computed pursuant to subparagraph (B) by the sum of the
differences for all county superintendents of schools computed
pursuant to subparagraph (B).

(D) Multiply the proportion computed pursuant to subparagraph
(B) by the unapportioned balance in the appropriation.

(E) Apportion to each county superintendent of schools the
amount calculated pursuant to subparagraph (D), or if subdivision
(c) is negative, apportion the sums of subdivisions (b) and (c) and
subparagraph (D) if the sum is greater than zero.

(F) The Superintendent shall repeat the computation made
pursuant to this paragraph, accounting for any additional amounts
apportioned after each computation, until the appropriation made
for purposes of paragraph (1) is fully apportioned.

(G) The total amount apportioned pursuant to this subdivision
to a county superintendent of schools shall not exceed the
difference for the county superintendent of schools calculated
pursuant to paragraph (1) of subdivision (b).

(g) (1) For a county superintendent of schools for whom, in the
2013-14 fiscal year, the amount computed pursuant to subdivision
(c) is less than the amount computed pursuant to subdivision (d),
in the first fiscal year following the fiscal year in which the sum
of the apportionments pursuant to subdivisions (e) and (f) is equal
to the amount calculated pursuant to subdivision (d) of this section,
the Superintendent shall apportion to the county superintendent
of schools the amount computed in subdivision (d) in that fiscal
year and each fiscal year thereafter instead of the amounts
computed pursuant to subdivisions (e) and (f).

(2) For a county superintendent of schools for whom, in the
2013-14 fiscal year, the amount computed pursuant to subdivision
(c) is greater than the amount computed pursuant to subdivision
(d), in the first fiscal year in which the amount computed pursuant
to subdivision (c) would be less than the amount computed pursuant
to subdivision (d), the Superintendent shall apportion to the county
superintendent of schools the amount computed in subdivision (d)
in that fiscal year and each fiscal year thereafter instead of the
amounts computed pursuant to subdivisions (e) and (f).

(3) In each fiscal year, the Superintendent shall determine the
percentage of county superintendents of schools that are
apportioned funding that is less than the amount computed
pursuant to subdivision (d), as of the second principal
apportionment of the fiscal year. If the percentage is less than 10
percent, the Superintendent shall apportion to those county
superintendents of schools funding equal to the amount computed
in subdivision (d) in that fiscal year and for each fiscal year
thereafter instead of the amounts calculated pursuant to
subdivisions (e) and (f).

(4) Commencing with the first fiscal year after the
apportionments in paragraph (3) are made, the adjustments in
paragraph (4) of subdivision (a) of Section 2574 and subparagraph
(B) of paragraph (1) of subdivision (c) of Section 2574 shall be
made only if an appropriation for those purposes is included in
the annual Budget Act.

(5) If the calculation pursuant to subdivision (d) is negative and
the Superintendent apportions to a county superintendent of schools
the amount computed pursuant to subdivision (d) pursuant to
paragraph (1), (2), or (3), an amount of property tax of the county
superintendent of schools equal to the negative amount shall be
deemed restricted and not available for expenditure during that
fiscal year. In the following fiscal year the restricted amount shall
be considered restricted local property tax revenue for purposes
of subdivision (a) of Section 2578.

(h) Commencing with the 2013-14 fiscal year, the
Superintendent shall apportion to a county superintendent of
schools an amount of state aid, including any amount apportioned
pursuant to subdivisions (f) and (g), that is no less than the amount
calculated in subparagraph (A) of paragraph (2) of subdivision
(a).

(i) For the 2013-14 and 2014-15 fiscal years only, a county
superintendent of schools who, in the 2012-13 fiscal year, from
any of the funding sources identified in paragraph (1) or (2) of
subdivision (a), received funds on behalf of, or provided funds to,
a regional occupational center or program joint powers agency
established in accordance with Article 1 (commencing with Section
6500) of Chapter 5 of Division 7 of Title 1 of the Government Code
for purposes of providing instruction to pupils enrolled in grades
9 to 12, inclusive, shall not redirect that funding for another
purpose unless otherwise authorized in law or pursuant to an
agreement between the regional occupational center or program
joint powers agency and the contracting county superintendent of
schools.

(j) For the 2013-14 and 2014-15 fiscal years only, a county
superintendent of schools who, in the 2012-13 fiscal year, from
any of the funding sources identified in paragraph (1) or (2) of
subdivision (a), received funds on behalf of, or provided funds to,
a home-to-school transportation joint powers agency established
in accordance with Article 1 (commencing with Section 6500) of
Chapter 5 of Division 7 of Title 1 of the Government Code for
purposes of providing pupil transportation shall not redirect that
funding for another purpose unless otherwise authorized in law
or pursuant to an agreement between the home-to-school
transportation joint powers agency and the contracting county
superintendent of schools.

(k) (1) In addition to subdivision (j), of the funds a county
superintendent of schools receives for home-to-school
transportation programs pursuant to Article 2 (commencing with
Section 39820) of Chapter 1 of Part 23.5 of Division 3 of Title 2,
and Article 10 (commencing with Section 41850) of Chapter 5 of
Part 24 of Division 3 of Title 2, the county superintendent of
schools shall expend no less for those program than the amount
of funds the county superintendent of schools expended for
home-to-school transportation in the 2012-13 fiscal year.

(2) For the 2013-14 and 2014-15 fiscal years only, of the funds
a county superintendent of schools receives for purposes of
regional occupational centers or programs, or adult education,
the county superintendent of schools shall expend no less for each
of those programs than the amount of funds the county
superintendent of schools expended for purposes of regional
occupational centers or programs, or adult education, respectively,
in the 2012-13 fiscal year.

begin insert 2576. end insert   

(a) If a county superintendent of schools enrolls in a
school operated by the county superintendent of schools a pupil
not funded pursuant to clause (i), (ii), or (iii) of subparagraph (A)
of paragraph (4) of subdivision (c) of Section 2574, any attendance
generated by that pupil shall be credited to the school district of
residence. Enrollment of these pupils shall be transferred to the
school district of residence for purposes of calculating the
percentage of unduplicated pupils pursuant to Section 42238.02.

(b) For purposes of this section, the school district of residence
for a homeless child, as defined in Section 1981.2, enrolled in a
school operated by a county superintendent of schools shall be
deemed to be the school district that last provided educational
services to that child or, if it is not possible to determine that school
district, the largest school district in the county.

begin insert 2577. end insert   

Notwithstanding any other law, revenue limit funding
for county superintendents of schools for the 2012-13 fiscal year
and prior fiscal years shall continue to be adjusted pursuant to
Article 3 (commencing with Section 2550) of Chapter 12, as that
section read on January 1, 2013.

begin insert 2578. end insert   

(a) Every fiscal year the Superintendent shall determine
the amount of funds that will be restricted for each county
superintendent of schools pursuant to subdivisions (e) and (g) of
Section 2575, as of June 30 of the prior fiscal year.

(b) The auditor-controller of each county shall distribute the
amounts determined in subdivision (a) to the Supplemental Revenue
Augmentation Fund created within the county pursuant to Section
100.06 of the Revenue and Taxation Code. The amount of funds
required to be transferred by this subdivision shall be transferred
annually in two equal shares with the first share transferred on
or before January 15 of each year and the second share transferred
after January 15 and on or before May 1 of each year.

(c) The funds transferred to the Supplemental Revenue
Augmentation Fund for purposes of this section shall be transferred
by the county office of education to the auditor-controller of the
county and shall be exclusively used to offset state costs of
providing trial court services and costs, until the funds are
exhausted.

begin insert 2579. end insert   

Commencing on July 1, 2013, all of the following shall
apply:

(a) All references to Section 2558 shall instead refer to Section
2575.

(b) Unless the context otherwise requires, all references to the
revenue limit of a county office of education or county
superintendent of schools shall instead refer to the county local
control funding formula.

end insert

begin insert

begin insert SEC. 3. end insert   

end insert

begin insert Section 14002 of the end insert begin insert Education Code end insert begin insert is amended to
read: end insert

begin delete

14002.  

(a) The Controller shall during each fiscal year
commencing with the 1980-81 fiscal year, transfer from the
General Fund of the state to that portion of the State School Fund
restricted for elementary and high school purposes, hereinafter
called Section A of the State School Fund such sums, in addition
to the sums accruing from other sources, as shall provide in Section
A of the State School Fund for apportionment during the fiscal
year a total amount per pupil in average daily attendance during
the preceding fiscal year credited to all elementary, high, and
unified school districts and to all county superintendents of schools
in the state, as certified by the Superintendent of Public Instruction,
of one hundred eighty dollars ($180).

(b) The Controller shall also transfer, as needed during each
fiscal year commencing with the 1980-81 fiscal year, such
additional amounts from the General Fund to Section A of the
State School Fund as are certified from time to time by the
Superintendent of Public Instruction to be necessary to meet actual
computed apportionments from Section A of the State School Fund
for the purposes set forth in Section 41301; provided that the total
of such additional amounts transferred in a fiscal year shall not
exceed, except pursuant to subdivision (c) of this section, one
thousand two hundred sixty-eight dollars ($1,268) for the 1980-81
fiscal year and fiscal years thereafter, per pupil in average daily
attendance during the preceding fiscal year credited to all
elementary, high, and unified school districts and to all county
superintendents of schools in the state, as certified by the
Superintendent of Public Instruction.

(c) In addition to the amounts authorized to be transferred to
Section A of the State School Fund under subdivisions (a) and (b),
the Controller shall transfer from the General Fund to Section A
of the State School Fund during the fiscal year, upon certification
of the Superintendent of Public Instruction, if necessary to meet
actual computed apportionments for the fiscal year for the purposes
set forth in Sections 41300 and 41301, an amount not to exceed
the lesser of: (1) 1 percent of the total apportionment from Section
A of the State School Fund in the preceding fiscal year for the
purposes set forth in Sections 41300 and 41301, or (2) the net
amount, if any, by which the total amounts authorized to be
transferred from the General Fund to Section A of the State School
Fund under subdivisions (a) and (b) in prior fiscal years have
exceeded the total amounts actually apportioned in prior fiscal
years for the purposes set forth in Sections 41300 and 41301.

(d) The Controller shall also transfer to Section A of the State
School Fund any additional amounts appropriated thereto by the
Legislature in augmentation of any of the amounts for any of the
purposes set forth in Sections 41300 and 41301 and such additional
amounts shall be allowed and apportioned by the Superintendent
of Public Instruction and warrants therefor drawn by the Controller
in the manner provided in Sections 41050, 46304, and 84503 and
in this article, Article 2 (commencing with Section 14040), Article
3 (commencing with Section 41330) of Chapter 3, and Article 1
(commencing with Section 41600) of Chapter 4 of Part 24.

(e) The amounts transferred under subdivisions (a) and (b) of
this section shall be cumulatively increased by the following
amounts:

(1) In the 1981-82 fiscal year, by 7 percent.

(2) In the 1982-83 fiscal year and each fiscal year thereafter,
by 6 percent.

(f) This section shall become operative on July 1, 2002.

end delete

begin insert

begin insert 14002. end insert   

end insert begin insert

Notwithstanding any other law, upon certification of
the Superintendent, the Controller shall transfer from the General
Fund to Section A of the State School Fund during each fiscal year
the amount of moneys required to meet the amounts apportioned
pursuant to subdivisions (e) and (g) of Section 2575, and Sections
2577, 42238.02, as implemented by Section 42238.03, and
42238.04 for each fiscal year. If all school districts and charter
schools are funded pursuant to the provisions of Section 42238.02
and all county superintendents of schools are funded at or above
the calculation made pursuant to subdivision (d) of Section 2575,
appropriations for local control funding formula cost-of-living
adjustments pursuant to Section 2574 and paragraph (2) of
subdivision (d) of Section 42238.02 shall be subject to an
appropriation in the annual Budget Act.

end insert

begin insert

begin insert SEC. 4. end insert   

end insert

begin insert Section 14002.3 of the end insert begin insert Education Code end insert begin insert is repealed. end insert

begin delete

14002.3.  

Notwithstanding any other law, for purposes of
Sections 14002, 14004, and 41301, for the 2000-01 fiscal year
and each fiscal year thereafter, the Superintendent of Public
Instruction shall certify to the Controller amounts that do not
exceed the amounts needed to fund the revenue limits of school
districts, as determined pursuant to Section 42238, the revenue
limits of county superintendents of schools, as determined pursuant
to Section 2558, warrants issued pursuant to Section 41329.57,
and the revenue limit portion of charter school operational funding,
as determined pursuant to Section 47633.

end delete

begin insert

begin insert SEC. 5. end insert   

end insert

begin insert Section 14501 of the end insert begin insert Education Code end insert begin insert is amended to
read: end insert

14501.  

(a) As used in this chapter, “financial and compliance
audit” shall be consistent with the definition provided in the
“Standards for Audits of Governmental Organizations, Programs,
Activities, and Functions” promulgated by the Comptroller General
of the United States. Financial and compliance audits conducted
under this chapter shall fulfill federal single audit requirements.

(b) As used in this chapter, “compliance audit” means an audit
that ascertains and verifies whether or not funds provided through
apportionment, contract, or grant, either federal or state, have been
properly disbursed and expended as required by law or regulation
or both and includes the verification of each of the following:

begin insert

(1) Expenditure of funds in accordance with the local control
and accountability plan adopted pursuant to Article 4.5
(commencing with Section 52060) of Chapter 6.1 of Part 28 of
Division 4 of Title 2.

end insert begin delete

(1)

end delete

begin insert (2) end insert  The reporting requirements for the sufficiency of textbooks
or instructional materials, or both, as defined in Section 60119.

begin delete

(2)

end delete

begin insert (3) end insert  Teacher misassignments pursuant to Section 44258.9.

begin delete

(3)

end delete

begin insert (4) end insert  The accuracy of information reported on the School
Accountability Report Card required by Section 33126. The
requirements set forth in paragraphs begin delete (1) and end delete (2) begin insert and (3) end insert and this
paragraph shall be added to the audit guide requirements pursuant
to subdivision (b) of Section 14502.1.

begin insert

begin insert SEC. 6. end insert   

end insert

begin insert Section 17582 of the end insert begin insert Education Code end insert begin insert is amended to
read: end insert

17582.  

(a) The governing board of begin delete each end delete begin insert a end insert school district may
establish a restricted fund to be known as the “district deferred
maintenance fund” for the begin delete purpose end delete begin insert purposes end insert of major repair or
replacement of plumbing, heating, air conditioning, electrical,
roofing, and floor systems, the exterior and interior painting of
school buildings, the inspection, sampling, and analysis of building
materials to determine the presence of asbestos-containing
materials, the encapsulation or removal of asbestos-containing
materials, the inspection, identification, sampling, and analysis of
building materials to determine the presence of lead-containing
materials, the control, management, and removal of lead-containing
materials, and any other items of maintenance approved by the
State Allocation Board. Funds deposited in the district deferred
maintenance fund may be received from any source begin delete whatsoever, end delete
and shall be accounted for separately from all other funds and
accounts and retained in the district deferred maintenance fund for
purposes of this section. The term “school building” as used in
this article includes a facility that a county office of education is
authorized to use pursuant to Article 3 (commencing with Section
17280) of Chapter 3.

(b) Funds deposited in the district deferred maintenance fund
shall only be expended for maintenance purposes as provided
pursuant to subdivision (a).

(c) The governing board of each school district shall have
complete control over the funds and earnings of funds once
deposited in the district deferred maintenance begin delete fund, provided that
no funds deposited in the district deferred maintenance fund
pursuant to subdivision (a) or (b) of Section 17584 may be
expended by the governing board for any purpose except those
specified in subdivision (a) of this section end delete begin insert fund end insert .

begin insert

begin insert SEC. 7. end insert   

end insert

begin insert Section 17583 of the end insert begin insert Education Code end insert begin insert is repealed. end insert

begin delete

17583.  

Notwithstanding Section 17582, whenever the state
funds provided pursuant to Sections 17584 and 17585 are
insufficient to fully match the local funds deposited in the deferred
maintenance fund, the governing board of each school district may
transfer the excess local funds deposited in that fund to any other
expenditure classifications in other funds of the district. A
resolution providing for the transfer shall be approved by a
two-thirds vote of the governing board members and filed with
the county superintendent of schools and the county auditor.

end delete

begin insert

begin insert SEC. 8. end insert   

end insert

begin insert Section 17584 of the end insert begin insert Education Code end insert begin insert is repealed. end insert

begin delete

17584.  

(a) Each fiscal year, the State Allocation Board shall
apportion, from the State School Deferred Maintenance Fund, to
school districts an amount equal to one dollar ($1) for each one
dollar ($1) of local funds up to a maximum of1⁄2 percent of the
district’s second prior fiscal year revenue limit average daily
attendance multiplied by the average, per unit of second prior fiscal
year average daily attendance, of the total expenditures and ending
fund balances of the total general funds and adult education funds
for districts of similar size and type, as defined in subdivision (b)
of Section 42238.4, for the second prior fiscal year, exclusive of
any amounts expended for capital outlay, debt service, or revenues
that are passed through to other local education agencies, to the
extent of funds available.

(b) In order to be eligible to receive state aid pursuant to
subdivision (a), no district shall be required to budget from local
district funds an amount greater than 1⁄2 percent of the district’s
second prior fiscal year revenue limit average daily attendance,
multiplied by the average, per unit of second prior fiscal year
average daily attendance, of the total expenditures and ending fund
balances of the total general funds and adult education funds for
districts of similar size and type, as defined in subdivision (b) of
Section 42238.4 for the second prior fiscal year, exclusive of any
amounts expended for capital outlay, debt service, or revenues that
are passed through to other local educational agencies.

end delete

begin insert

begin insert SEC. 9. end insert   

end insert

begin insert Section 17584.1 of the end insert begin insert Education Code end insert begin insert , as amended
by Section 18 of Chapter 7 of the Statutes of 2011, is repealed. end insert

begin delete

17584.1.  

(a) The governing board of a school district shall
discuss proposals and plans for expenditure of funds for the
deferred maintenance of school district facilities at a regularly
scheduled public hearing.

(b) The purposes of this section are to inform the public
regarding the local decisionmaking process relating to the deferred
maintenance of school facilities and to provide a foundation for
local accountability in that regard.

(c) This section shall become inoperative on July 1, 2015, and,
as of January 1, 2016, is repealed, unless a later enacted statute,
that becomes operative on or before January 1, 2016, deletes or
extends the dates on which it becomes inoperative and is repealed.

end delete

begin insert

begin insert SEC. 10. end insert   

end insert

begin insert Section 17584.1 of the end insert begin insert Education Code end insert begin insert , as amended
by Section 19 of Chapter 7 of the Statutes of 2011, is repealed. end insert

begin delete

17584.1.  

(a) The governing board of a school district shall
discuss proposals and plans for expenditure of funds for the
deferred maintenance of school district facilities at a regularly
scheduled public hearing.

(b) In any fiscal year that the school district does not set aside
0.5 percent of its current-year revenue limit average daily
attendance for deferred maintenance, the governing board of a
school district shall submit a report to the Legislature by March 1
of that year, with copies to the Superintendent, the state board, the
Department of Finance, and the State Allocation Board.

(c) The report required pursuant to subdivision (b) shall include
all of the following:

(1) A schedule of the complete school facilities deferred
maintenance needs of the school district for the current fiscal year,
including a schedule of costs per schoolsite and total costs.

(2) A detailed description of the school district’s spending
priorities for the current fiscal year and an explanation of why
those priorities, or any other considerations, have prevented the
school district from setting aside sufficient local funds so as to
permit it to fully fund its deferred maintenance program and, if
eligible, to participate in the state deferred maintenance funding
program as set forth in Section 17584.

(3) An explanation of the manner in which the governing board
of a school district plans to meet its current-year facilities deferred
maintenance needs without setting aside the funds set forth in
Section 17584.

(d) Copies of the report shall be made available at each
schoolsite within the school district, and shall be provided to the
public upon request.

(e) The purposes of this section are to inform the public
regarding the local decisionmaking process relating to the deferred
maintenance of school facilities and to provide a foundation for
local accountability in that regard.

(f) This section shall become operative on July 1, 2015.

end delete

begin insert

begin insert SEC. 11. end insert   

end insert

begin insert Section 17584.2 of the end insert begin insert Education Code end insert begin insert is repealed. end insert

begin delete

17584.2.  

At the public hearing required pursuant to Section
17584.1, the governing board of the school district shall also
address the use of deferred maintenance funds for the inspection,
identification, sampling, and analysis of building materials to
determine the presence of lead-containing materials and the control,
management, and removal of lead-containing materials.

end delete

begin insert

begin insert SEC. 12. end insert   

end insert

begin insert Section 17585 of the end insert begin insert Education Code end insert begin insert is repealed. end insert

begin delete

17585.  

(a) School districts may submit applications to the
State Allocation Board for deferred maintenance funding in
addition to the amounts specified in Section 17584. In order to be
eligible for an additional apportionment, a school district shall do
all of the following:

(1) Certify that if an additional apportionment is provided, the
district will have matched the additional apportionment amount
with an equal amount of district funds that have not been previously
used as a match for state aid.

(2) Certify an additional claim of not greater than one-half of
1 percent of the district’s current-year revenue limit average daily
attendance, multiplied by the average, per unit of average daily
attendance, of the total general funds and adult education funds
budgeted by districts of similar size and type, as defined in Section
42238.4 for the prior fiscal year, excluding any amounts budgeted
for capital outlay or debt service, but including adult education
funds.

(3) Certify that any additional funds will be used to meet
deferred maintenance identified in the district’s five-year deferred
maintenance plan.

(b) The State Allocation Board shall establish rules and
regulations regarding the formulas used to apportion additional
funds pursuant to this section.

(c) It is the intent of the Legislature that state funds for deferred
maintenance be drawn first from excess bond repayments by school
districts, revenues pursuant to subdivision (f) of Section 6217 of
the Public Resources Code, and proceeds from existing general
obligation bonds.

end delete

begin insert

begin insert SEC. 13. end insert   

end insert

begin insert Section 17587 of the end insert begin insert Education Code end insert begin insert is repealed. end insert

begin delete

17587.  

(a) Notwithstanding the limitations of Section 17584,
the State Allocation Board may each year reserve an amount not
to exceed 10 percent of the funds transferred from any source to
the State School Deferred Maintenance Fund for apportionments
to school districts, in instances of extreme hardship. The
apportionment shall be in addition to the apportionments made
pursuant to Section 17584. Not less than one-half of all funds made
available by this section shall be apportioned to school districts
that had an average daily attendance, excluding summer session
attendance, of less than 2,501 during the prior fiscal year.

An extreme hardship shall exist in a school district if the State
Allocation Board determines the existence of all of the following:

(1) That the district has deposited in its deferred maintenance
fund an amount equal to at least 0.5 percent of the total general
funds and adult education funds budgeted by the district for the
fiscal year, exclusive of any amounts budgeted for capital outlay
or debt service.

(2) That the district has a critical project on its five-year plan
which, if not completed in one year, could result in serious damage
to the remainder of the facility or would result in a serious hazard
to the health and safety of the pupils attending the facility.

(3) That the total funds deposited by the district and the state
pursuant to Section 17584 are insufficient to complete the project.

(b) If a determination is made that a hardship exists pursuant to
subdivision (a), the State Allocation Board may increase the
apportionment to a school district by the amount it determines
necessary to complete the critical project.

(c) Notwithstanding subdivision (a), in any fiscal year in which
the State Allocation Board has apportioned all funding from the
State School Deferred Maintenance Fund for which school districts
have qualified under Section 17584, the board may apportion any
amount remaining in that fund for the purposes of this section.

(d) This section shall become operative on July 1, 2015.

end delete

begin insert

begin insert SEC. 14. end insert   

end insert

begin insert Section 33127 of the end insert begin insert Education Code end insert begin insert is amended to
read: end insert

33127.  

(a) The Superintendent begin delete of Public Instruction end delete , the
Controller, and the Director of begin delete the Department of end delete Finance shall
develop, on or before March 1, 1989, standards and criteria to be
reviewed and adopted by the begin delete State Board of Education, end delete begin insert state board, end insert
and to be used by local educational agencies in the development
of annual budgets and the management of subsequent expenditures
from that budget. During the development of the standards and
criteria, the Superintendent begin delete of Public Instruction end delete shall convene a
committee composed of representatives from school districts,
county offices of education, state agencies, the Legislature, and
appropriate labor and professional organizations. The committee
may review and comment on the proposal standards and criteria
begin delete prior to end delete begin insert before end insert their adoption. In addition, the standards and criteria
shall be used to monitor the fiscal stability of local educational
agencies as provided for in Sections 1240.1, 1240.2, 1621, 1623,
33131, 42127, and 42127.1.

(b) The Superintendent begin delete of Public Instruction end delete , the Controller,
and the Director of begin delete the Department of end delete Finance shall update the
standards and criteria developed pursuant to subdivision (a) on or
before September 1, 2005. The updated standards and criteria shall
be reviewed and adopted pursuant to the procedure established by
subdivision (a) and are applicable to local educational agency
budgets commencing with the 2006-07 fiscal year and each fiscal
year thereafter.

begin insert

(c) The Superintendent, the Controller, and the Director of
Finance shall update the standards and criteria developed pursuant
to subdivision (a) on or before January 1, 2014, to address the
requirements of Article 4.5 (commencing with Section 52060) of
Chapter 6.1 of Part 28. The updated standards and criteria shall
be reviewed and adopted pursuant to the procedure established
by subdivision (a) and are applicable to local educational agency
budgets commencing with the 2014-15 fiscal year and each fiscal
year thereafter.

end insert begin delete

(c)

end delete

begin insert (d) end insert  After begin delete September 1, 2005, end delete begin insert January 1, 2014, end insert to the extent
necessary, any revisions or updates to the standards and criteria
shall be developed by the Superintendent begin delete of Public Instruction end delete ,
the Controller, and the Director of begin delete the Department of end delete Finance
pursuant the begin delete procedures end delete begin insert procedure end insert established by subdivision (a).
The revisions or updates shall specify the fiscal year in which the
revisions or updates are applicable.

begin insert

begin insert SEC. 15. end insert   

end insert

begin insert Section 35035 of the end insert begin insert Education Code end insert begin insert is amended to
read: end insert

35035.  

The superintendent of each school district shall, in
addition to other powers and duties granted to or imposed upon
him or her:

(a) Be the chief executive officer of the governing board of the
begin insert school end insert district.

(b) Except in a begin insert school end insert district where the governing board has
appointed or designated an employee other than the superintendent,
or a deputy, or assistant superintendent, to prepare and submit a
budget, prepare and submit to the governing board of the begin insert school end insert
district, at the time it may direct, the budget of the begin insert school end insert district
for the next ensuing school year, and revise and take other action
in connection with the budget as the begin insert governing end insert board begin insert of the school
district end insert may desire.

begin insert

(c) Be responsible for the preparation and submission to the
governing board of the school district, at the time the governing
board may direct, the local control and accountability plan of the
school district for the subsequent school year, and revise and take
other action in connection with the local control and accountability
plan as the governing board of the school district may desire.

end insert begin insert

(d) Except in a school district where the governing board has
appointed or designated an employee other than the
superintendent, or a deputy, or assistant superintendent, ensure
that the local control and accountability plan is implemented.

end insert begin delete

(c)

end delete

begin insert (e) end insert  Subject to the approval of the governing board begin insert of the school
district end insert , assign all employees of begin insert school end insert the district employed in
positions requiring certification qualifications, to the positions in
which they are to serve. This power to assign includes the power
to transfer a teacher from one school to another school at which
the teacher is certificated to serve within the begin insert school end insert district when
the superintendent concludes that the transfer is in the best interest
of the begin insert school end insert district.

begin delete

(d)

end delete

begin insert (f) end insert  Upon adoption, by the begin insert school end insert district board, of a begin insert school end insert
district policy concerning transfers of teachers from one school to
another school within the begin insert school end insert district, have authority to transfer
teachers consistent with that policy.

begin delete

(e)

end delete

begin insert (g) end insert  Determine that each employee of the begin insert school end insert district in a
position requiring certification qualifications has a valid certificated
document registered as required by law authorizing him or her to
serve in the position to which he or she is assigned.

begin delete

(f)

end delete

begin insert (h) end insert  Enter into contracts for and on behalf of the begin insert school end insert district
pursuant to Section 17604.

begin delete

(g)

end delete

begin insert (i) end insert  Submit financial and budgetary reports to the governing
board begin insert of the school district end insert as required by Section 42130.

begin insert

begin insert SEC. 16. end insert   

end insert

begin insert Section 35735.1 of the end insert begin insert Education Code end insert begin insert is amended
to read: end insert

35735.1.  

(a) The begin delete base revenue limit end delete begin insert local control funding
formula allocation end insert per unit of average daily attendance for newly
organized school districts shall be equal to the total of the amount
of begin delete blended revenue limit end delete begin insert the local control funding formula
allocation pursuant to Section 42238.02, as implemented by Section
42238.03, end insert per unit of average daily attendance of the affected
school districts computed pursuant to begin delete paragraph (1), the amount
based on salaries and benefits of classified employees computed
pursuant to paragraph (2), the amount based on salaries and benefits
of certificated employees calculated pursuant to paragraph (3),
and the amount of the inflation adjustment calculated pursuant to
paragraph (4) end delete begin insert the computations set forth below end insert . The following
computations shall be made to determine the begin delete base revenue limit end delete
begin insert local control funding formula allocation pursuant to Section
42238.02, as implemented by Section 42238.03, end insert per unit of average
daily attendance for the newly organized school districts:

begin delete

(1) Perform the following computation to arrive at the blended
revenue limit:

end delete begin delete

(A)

end delete

begin insert (1) end insert  Based on the current information available for each affected
school district for the second principal apportionment period for
the fiscal begin delete year, two years prior to end delete begin insert year before end insert the fiscal year in
which the reorganization is to become effective, multiply the begin delete base
revenue limit end delete begin insert end insert begin insert local control funding formula allocation pursuant
to Section 42238.02, as implemented by Section 42238.03, end insert per unit
of average daily attendance for that school district by the number
of units of average daily attendance for that school district that the
county superintendent of schools determines will be included in
the proposed school district.

begin delete

(B)

end delete

begin insert (2) end insert  Add the amounts calculated pursuant to begin delete subparagraph (A) end delete begin insert end insert
begin insert paragraph (1) and divide that sum by the number of units of end insert begin insert end insert
begin insert average daily attendance in the newly organized school districts end insert .

begin delete

(2) For each affected school district in the newly organized
school districts, the following computation shall be made to
determine the amount to be included in the base revenue limit per
unit of average daily attendance for the newly organized school
districts that is based on the salaries and benefits of full-time
equivalent classified employees:

end delete begin delete

(A) For each of those school districts, make the following
computation to arrive at the highest average amount expended for
salaries and benefits for classified full-time employees by the
districts:

end delete begin delete

(i) Add the amount of all salaries and benefits for classified
employees of the district, including both part-time and full-time
employees.

end delete begin delete

(ii) Divide the amount computed in clause (i) by the total number
of full-time equivalent classified employees in the district.

end delete begin delete

(B) Among those school districts that will make up 25 percent
or more of the average daily attendance of the resulting newly
organized school district, compare the amounts determined for
each of those school districts pursuant to subparagraph (A) and
identify the highest average amount expended for salaries and
benefits for classified employees.

end delete begin delete

(C) For each of the school districts with salaries and benefits
that are below the highest average amount identified in
subparagraph (B) and that are included, in whole or in part, in the
newly organized district, subtract the amount determined for the
district pursuant to subparagraph (A) from the amount identified
pursuant to subparagraph (B).

end delete begin delete

(D) For each of those school districts, multiply the amount
determined for the district pursuant to subparagraph (C) by the
number of full-time equivalent classified employees employed by
the district, and then multiply by the percentage of the district’s
average daily attendance to be included in the new district.

end delete begin delete

(E) Add the amounts computed for each school district pursuant
to subparagraph (D).

end delete begin delete

(3) For each affected school district in the newly organized
school districts, the following computation shall be made to
determine the amount to be included in the base revenue limit per
unit of average daily attendance for the newly organized school
districts that is based on the salaries and benefits of full-time
equivalent certificated employees:

end delete begin delete

(A) For each of those school districts, make the following
computation to determine the highest average amount expended
for salaries and benefits for certificated full-time employees:

end delete begin delete

(i) Add the amount of all salaries and benefits for certificated
employees, including both part-time and full-time employees.

end delete begin delete

(ii) Divide the amount determined in clause (i) by the total
number of full-time equivalent certificated employees in the
district.

end delete begin delete

(B) Among those school districts that will make up 25 percent
or more of the average daily attendance of the resulting newly
organized school district, compare the amounts determined for
each school district pursuant to subparagraph (A) and identify the
highest average amount expended for salaries and benefits for
certificated employees.

end delete begin delete

(C) For each of the school districts with salaries and benefits
that are below the highest average amount identified in
subparagraph (B) and that are included, in whole or in part, in the
newly organized school district, subtract the amount determined
for the district pursuant to subparagraph (A) from the amount
identified pursuant to subparagraph (B).

end delete begin delete

(D) For each of those school districts, multiply the amount
determined for the district pursuant to subparagraph (C) by the
number of full-time equivalent certificated employees of the school
district, and then multiply by the percentage of the district’s
average daily attendance to be included in the new district.

end delete begin delete

(E) Add the amount calculated for each school district identified
pursuant to subparagraph (D).

end delete begin delete

(4) The base revenue limit per unit of average daily attendance
shall be adjusted for inflation as follows:

end delete begin delete

(A) Add the amounts determined pursuant to subparagraph (B)
of paragraph (1), subparagraph (E) of paragraph (2), and
subparagraph (E) of paragraph (3), and divide that sum by the
number of units of average daily attendance in the newly organized
school districts. The amount determined pursuant to this
subparagraph shall not exceed 110 percent of the blended revenue
limit per unit of average daily attendance calculated pursuant to
paragraph (1).

end delete begin delete

(B) (i) Increase the amount determined pursuant to
subparagraph (A) by the amount of the inflation adjustment
calculated and used for apportionment purposes pursuant to Section
42238.1 for the fiscal year immediately preceding the year in which
the reorganization becomes effective.

end delete begin delete

(ii) With respect to a school district that unifies effective July
1, 1997, and that has an average daily attendance in the 1996-97
fiscal year of more than 1,500 units, increase the amount
determined pursuant to subparagraph (A) by an amount calculated
as follows:

end delete begin delete

(I) For each component district of the newly unified district,
multiply the amount of revenue limit equalization aid per unit of
average daily attendance determined pursuant to Sections 42238.41,
42238.42, and 42238.43, or any other sections of law, for the
1996-97 fiscal year by the 1996-97 second principal apportionment
units of average daily attendance determined pursuant to Section
42238.5 for that component district.

end delete begin delete

(II) Add the results for all component districts, and divide this
amount by the sum of the 1996-97 second principal apportionment
units of average daily attendance determined pursuant to Section
42238.5 for all component districts.

end delete begin delete

(C) Increase the amount determined pursuant to subparagraph
(B) by the amount of the inflation adjustment calculated and used
for apportionment purposes pursuant to Section 42238.1 for the
fiscal year in which the reorganization becomes effective for all
purposes.

end delete begin delete

(D) Increase the amount determined pursuant to subparagraph
(C) by any other adjustments to the base revenue limit per unit of
average daily attendance that the newly organized school districts
would have been eligible to receive had they been reorganized in
the fiscal year two years prior to the year in which the
reorganization becomes effective for all purposes.

end delete

(b) The amount determined pursuant to begin delete subparagraph (D) of
paragraph (4) of end delete subdivision (a) shall be the begin delete base revenue limit end delete
begin insert local control funding formula allocation pursuant to Section
42238.02, as implemented by Section 42238.03, end insert per unit of average
daily attendance for the newly organized school districts.

(c) The begin delete base revenue limit per unit of end delete average daily attendance
begin delete for the end delete begin insert of a end insert newly organized school district begin delete shall not be greater
than the amount set forth in the proposal for reorganization that is
approved by the state board. The Superintendent may make
adjustments to base revenue limit apportionments to a newly
organized school district, if necessary to cause those
apportionments to be consistent with this section. end delete begin insert , for purposes of
Sections 42238.02 and 42238.03, shall be the average daily
attendance that is attributable to the area reorganized for the fiscal
year before the fiscal year in which the new school district becomes
effective for all purposes. end insert

begin delete

(d) If the territorial jurisdiction of any school district was revised
pursuant to a unification, consolidation, or other reorganization,
occurring on or before July 1, 1989, that resulted in a school district
having a larger territorial jurisdiction than the original school
district prior to the reorganization, and a reorganization of school
districts occurs on or after the effective date of the act that added
this subdivision that results in a school district having a territorial
jurisdiction that is substantially the same, as determined by the
state board, as the territorial jurisdiction of that original school
district prior to the most recent reorganization occurring on or
before July 1, 1989, the revenue limit of the school district resulting
from the subsequent reorganization shall be the same,
notwithstanding subdivision (b), as the revenue limit that was
determined for the original school district prior to the most recent
reorganization occurring on or before July 1, 1989.

end delete begin delete

(e) The average daily attendance of a newly organized school
district, for purposes of subdivision (d) of Section 42238, shall be
the average daily attendance that is attributable to the area
reorganized for the fiscal year two years prior to the fiscal year in
which the new district becomes effective for all purposes.

end delete begin delete

(f) For purposes of computing average daily attendance pursuant
to subdivision (d) of Section 42238 for each school district that
exists prior to the reorganization and whose average daily
attendance is directly affected by the reorganization, the following
calculation shall apply for the fiscal year two years prior to the
fiscal year in which the newly reorganized school district becomes
effective:

end delete begin delete

(1) Divide the 1982-83 fiscal year average daily attendance,
computed pursuant to subdivision (d) of Section 42238, by the
total average daily attendance of the district pursuant to Section
42238.5.

end delete begin delete

(2) Multiply the percentage computed pursuant to paragraph
(1) by the total average daily attendance of the district calculated
pursuant to Section 42238.5, excluding the average daily attendance
of pupils attributable to the area reorganized.

end delete begin delete

(g) This section shall not apply to any reorganization proposal
approved by the state board prior to January 1, 1995.

end delete begin insert

(d) Notwithstanding this section, commencing with the 2013-14
fiscal year, a newly reorganized school district shall receive
state-aid funding pursuant to paragraph (3) of subdivision (b) of
Section 42238.03 or the total combined per pupil funding amount
received by each school district pursuant to paragraphs (1) and
(2) of subdivision (a) of Section 42238.03 for the fiscal year before
the fiscal year in which the new school district becomes effective
for all purposes, whichever is greater.

end insert begin delete

(h)

end delete

begin insert (e) end insert  Notwithstanding any other begin delete provision of end delete law, this section
shall not be subject to waiver by the state board pursuant to Section
33050 or by the Superintendent.

begin insert

(f) Upon a determination that all school districts or charter
schools equal or exceed the local control funding formula target
computed pursuant to Section 42238.02 as determined by the
calculation of a zero difference pursuant to paragraph (1) of
subdivision (b) of Section 42238.03, for all school districts and
charter schools, this section shall not apply and the newly
reorganized school district shall receive an allocation equal to
the amount calculated under Section 42238.02 in that fiscal year
and future fiscal years.

end insert

begin insert

begin insert SEC. 17. end insert   

end insert

begin insert Section 35735.2 of the end insert begin insert Education Code end insert begin insert is repealed. end insert

begin delete

35735.2.  

(a) If a newly organized school district is unable to
provide the school facilities necessary to provide instructional
services by employees of the district to all of the pupils who are
residents of that district during the fiscal year in which the
reorganization becomes effective for all purposes, the base revenue
limit per unit of average daily attendance of the newly organized
district shall be the blended revenue limit arrived at pursuant to
paragraph (1) of subdivision (a) of Section 35735.1 as adjusted by
the calculations made pursuant to subparagraphs (B), (C), and (D)
of paragraph (4) of subdivision (a) of Section 35735.1 and
subdivision (b) of Section 35735.1. As the newly organized school
district obtains the school facilities necessary to provide
instructional services by employees of the district to all or a portion
of those pupils, the following adjustment shall be made to the base
revenue limit per unit of average daily attendance of the district
each fiscal year subsequent to the fiscal year in which the
reorganization becomes effective until the fiscal year in which the
district provides the facilities necessary to provide those services
for all of those pupils:

(1) Determine the total number of pupils who are residents of
the district to whom the district was unable to provide school
facilities necessary to provide that instruction during the fiscal
year in which the reorganization becomes effective for all purposes.

(2) Determine the total number of pupils identified in paragraph
(1) that will attend school in school facilities located in, and receive
instructional services provided by employees of, that district in
the current fiscal year.

(3) Divide the number determined pursuant to paragraph (2) by
the number determined pursuant to paragraph (1) to determine the
percentage of pupils identified in paragraph (1) who will attend
school in school facilities located in, and receive instructional
services provided by employees of, that district in the current fiscal
year.

(4) Multiply the numbers determined pursuant to paragraphs
(2) and (3) of subdivision (a) of Section 35735.1 by the percentage
determined pursuant to paragraph (3) for that fiscal year, and total
the amounts. Divide that sum by the number of units of average
daily attendance residing in the proposed district in the current
fiscal year.

(5) Increase the base revenue limit calculated pursuant to
subdivision (a) of this section for the school district by the amount
arrived at pursuant to paragraph (4) as adjusted by the calculations
pursuant to subparagraphs (B), (C), and (D) of paragraph (4) of
subdivision (a) of Section 35735.1. In no event shall the amount
determined pursuant to this paragraph exceed that amount that
would otherwise be calculated pursuant to subdivision (a) of
Section 35735.1.

(b) For the purposes of making the adjustments described in
subdivision (a), the annual audit of the school district required
pursuant to Section 41020 shall include an audit of the average
daily attendance of pupils by grade level and the numbers of
certificated and classified employees on which the adjustments to
the base revenue limit of the district were made pursuant to
paragraphs (1), (2), and (3) of subdivision (a) of Section 35735.1.
Until the newly organized school district provides the school
facilities necessary to provide instructional services by employees
of the district to pupils who are residents of the district in the
manner and in the timeframes set forth in the proposal to reorganize
that was approved by the State Board of Education, the county
superintendent of schools shall, for each fiscal year, inform the
Superintendent of Public Instruction of the extent to which the
district is providing those facilities to those pupils. The county
superintendent of schools may charge the school district for the
cost of preparation of the report. Based on that information, the
superintendent shall make base revenue limit apportionments to
the school district in a manner consistent with subdivision (a).

(c) If the newly organized school district is unable to provide
the school facilities necessary to provide instructional services by
employees of the district to all of the pupils who are residents of
the district five years from the date on which the reorganization
becomes effective for all purposes, the State Department of
Education shall recommend to the State Board of Education
whether or not the district should be lapsed pursuant to Article 5
(commencing with Section 35780). The State Department of
Education shall make that recommendation for each fiscal year
until either the school district provides the school facilities
necessary to provide instructional services by employees of the
district to all of the pupils who are residents of the district or the
district is lapsed. Upon recommendation by the State Department
of Education, the State Board of Education may direct the county
committee on school district organization to lapse the school
district according to the procedures set forth in Article 5
(commencing with Section 35780).

(d) This section shall not apply to any reorganization proposal
approved by the State Board of Education prior to January 1, 1995.

end delete

begin insert

begin insert SEC. 18. end insert   

end insert

begin insert Section 35736.5 is added to the end insert begin insert Education Code end insert begin insert , to
read: end insert

begin insert

begin insert 35736.5. end insert   

Sections 35735 to 35736, inclusive, shall only apply
to actions to reorganize school districts initiated on or after July
1, 2013, for which the order to reorganize, pursuant to Section
35765, is appropriately filed after December 1, 2013, pursuant to
Section 54902 of the Government Code. Actions to reorganize
school districts initiated before July 1, 2013, for which the order
to reorganize is appropriately filed on or before December 1, 2013,
shall be implemented pursuant to Sections 35735 to 35736,
inclusive, as those sections read on January 1, 2013.

end insert

begin insert

begin insert SEC. 19. end insert   

end insert

begin insert Section 37700 of the end insert begin insert Education Code end insert begin insert is amended to
read: end insert

37700.  

(a) Notwithstanding any other law, the Pacific Unified
School District, the Leggett Valley Unified School District, and
the Reeds Creek Elementary School District may operate one or
more schools in their respective districts on a four-day school
week, if the district complies with the instructional time
requirements specified in Section 37701 and the other requirements
of this chapter.

(b) If a school district operates one or more schools on a
four-day week pursuant to this section and the program for the
school year provides less than the 180 days of instruction required
under Section 46200, begin insert as it read on January 1, 2013, end insert the
Superintendent begin delete of Public Instruction end delete shall reduce the begin delete base revenue
limit end delete begin insert local control funding formula allocation pursuant to Section
42238.02, as implemented pursuant to Section 42238.03, end insert per unit
of average daily attendance for that fiscal year by the amount the
school district would have received for the increase received
pursuant to subdivision (a) of Section 46200, begin insert as it read on January
1, 2013, end insert as adjusted in fiscal years subsequent to the 1984-85 fiscal
year. If a school district operates one or more schools on a four-day
school week pursuant to this section and the program provides less
than the minimum instructional minutes required under Section
46201, begin insert as it read on January 1, 2013, end insert the Superintendent begin delete of Public
Instruction end delete shall reduce the begin delete base revenue limit end delete begin insert local control funding
formula allocation pursuant to Section 42238.02, as implemented
pursuant to Section 42238.03, end insert per unit of average daily attendance
for that fiscal year in which the reduction occurs by the amount
the school district would have received for the increase in the
1987-88 fiscal year base revenue limit per unit of average daily
attendance pursuant to paragraph (6) of subdivision (b) of Section
42238, begin insert as it read on January 1, 2013, end insert as adjusted begin delete in end delete begin insert from end insert the
1987-88 fiscal year begin delete and fiscal years thereafter end delete begin insert to the 2012-13
fiscal year, inclusive, and, commencing with the 2013-14 fiscal
year, pursuant to the local control funding formula allocation
pursuant to Section 42238.02, as implemented pursuant to Section
42238.03, per unit of average daily attendance end insert .

(c) A school district with an exclusive bargaining representative
may operate a school on a four-day school week pursuant to this
section only if the begin insert school end insert district and the representative of each
bargaining unit of begin insert school end insert district employees mutually agree to that
operation in a memorandum of understanding.

begin insert

(d) Notwithstanding this section, upon a determination that a
school district identified in subdivision (a) equals or exceeds its
local control funding formula target computed pursuant to Section
42238.02 as determined by the calculation of a zero difference
pursuant to paragraph (1) of subdivision (b) of Section 42238.03,
the school district, as a condition of apportionment pursuant to
Section 42238.02, as implemented pursuant to Section 42238.03,
shall offer 180 days or more of instruction per school year, and
meet the minimum minute requirements pursuant to paragraph
(1) of subdivision (a) of Section 46207.

end insert

begin insert

begin insert SEC. 20. end insert   

end insert

begin insert Section 37710.3 of the end insert begin insert Education Code end insert begin insert is amended
to read: end insert

37710.3.  

(a) Beginning in the 2010-11 fiscal year, the Alpaugh
Unified School District may operate one or more schools in the
school district on a four-day school week if the district complies
with the instructional time requirements in Section 37701 and the
other requirements of this chapter. The state board may waive
five-consecutive-day operating requirements for any of the
following programs that operate on a four-day school week
pursuant to this section, provided that the district meets the
minimum time requirement for each program:

(1) Preschools.

(2) Before and after school programs.

(3) Independent study programs.

(4) Child nutrition and food service programs.

(5) Community day schools.

(6) Regional occupational centers or programs.

(7) Continuation high schools.

(b) If the school district operates one or more schools on a
four-day school week pursuant to this section, and the program
for the school year provides fewer than the 180 days of instruction
required under Section 46200, begin insert as it read on January 1, 2013, end insert the
Superintendent shall reduce the begin delete base revenue limit end delete begin insert local control
funding formula allocation pursuant to Section 42238.02, as
implemented pursuant to Section 42238.03, end insert per unit of average
daily attendance for that fiscal year by the amount the school
district would have received for the increase received pursuant to
subdivision (a) of Section 46200, begin insert as it read on January 1, 2013, end insert
as adjusted in fiscal years subsequent to the 1984-85 fiscal year.
If the school district operates one or more schools on a four-day
school week pursuant to this section, and the program provides
fewer than the minimum instructional minutes required under
Section 46201, begin insert as it read on January 1, 2013, end insert the Superintendent
shall reduce the begin delete base revenue limit end delete begin insert local control funding formula
allocation pursuant to Section 42238.02, as implemented pursuant
to Section 42238.03, end insert per unit of average daily attendance for that
fiscal year in which the reduction occurs by the amount the school
district would have received for the increase in the base revenue
limit per unit of average daily attendance pursuant to subdivision
(a) of Section 46201, begin insert as it read on January 1, 2013, end insert as adjusted
begin delete in end delete begin insert from end insert the 1987-88 fiscal year begin delete and fiscal years thereafter end delete begin insert to the
2012-13 fiscal end insert begin insert year, inclusive, and, commencing with the 2013-14
fiscal year, pursuant to the local control funding formula allocation
pursuant to Section 42238.02, as implemented pursuant to Section
42238.03, per unit of average daily attendance end insert .

(c) Notwithstanding Section 37710, if a small school having
between 11 and 99 valid Standardized Testing and Reporting
Program test scores operating on a four-day school week fails to
achieve its Academic Performance Index growth target pursuant
to Section 52052 for two consecutive years, the authority of that
school to operate on a four-day school week shall be permanently
revoked commencing with the school year following the second
consecutive year the school failed to achieve its Academic
Performance Index growth rate.

(d) If the school district operates one or more schools on a
four-day school week pursuant to this section, the school district
shall submit a report to the department, the Senate Committee on
Education, and the Assembly Committee on Education on or before
January 15, 2015. The report shall include, but not necessarily be
limited to, information on all of the following:

(1) Programs the district offered on the fifth schoolday and their
participation rates.

(2) Whether the four-day school week schedule resulted in any
fiscal savings.

(3) Impact on overall attendance of the schools operating a
four-day school week.

(4) Programs for which the state board waived minimum time
and five-consecutive-day requirements and the operational and
educational effects of the programs if they operated at less time
than required.

(5) The impact of the four-day school week on crime statistics,
especially on the day on which school would otherwise be in
session.

(6) Information on the Academic Performance Index, pursuant
to Section 52052, for every year a school in the district operated
on a four-day school week. The information shall include, but not
necessarily be limited to, the base and growth Academic
Performance Index of each school that operated on a four-day
school week and whether that school met the Academic
Performance growth targets.

begin insert

(e) Notwithstanding this section, upon a determination that the
school district identified in subdivision (a) equals or exceeds its
local control funding formula target computed pursuant to Section
42238.02 as determined by the calculation of a zero difference
pursuant to paragraph (1) of subdivision (b) of Section 42238.03,
the school district, as a condition of apportionment pursuant to
Section 42238.02, as implemented pursuant to Section 42238.03,
shall offer 180 days or more of instruction per school year, and
meet the minimum minute requirements pursuant to paragraph
(1) of subdivision (a) of Section 46207.

end insert begin delete

(e)

end delete

begin insert (f) end insert  This section shall remain in effect only until January 1, 2016,
and as of that date is repealed, unless a later enacted statute, that
is enacted before January 1, 2016, deletes or extends that date.

begin insert

begin insert SEC. 21. end insert   

end insert

begin insert Section 37710.5 of the end insert begin insert Education Code end insert begin insert is amended
to read: end insert

37710.5.  

(a) Beginning in the 2009-10 fiscal year, the Potter
Valley Community Unified School District may operate one or
more schools in the school district on a four-day school week if
the begin insert school end insert district complies with the instructional time requirements
specified in Section 37701 and the other requirements of this
chapter. The begin delete State Board of Education end delete begin insert state board end insert may waive
five-consecutive-day operating requirements for any of the
following programs that operate on a four-day week pursuant to
this section, provided that the begin insert school end insert district meets the minimum
time requirement for each program:

(1) Preschools.

(2) Before and after school programs.

(3) Independent study programs.

(4) Child nutrition and food service programs.

(5) Community day schools.

(6) Regional occupational centers or programs.

(7) Continuation high schools.

(b) If the school district operates one or more schools on a
four-day week pursuant to this section, and the program for the
school year provides fewer than the 180 days of instruction required
under Section 46200, begin insert as it read on January 1, 2013, end insert the
Superintendent shall reduce the begin delete base revenue limit end delete begin insert local control
funding formula allocation pursuant to Section 42238.02, as
implemented pursuant to Section 42238.03, end insert per unit of average
daily attendance for that fiscal year by the amount the school
district would have received for the increase received pursuant to
subdivision (a) of Section 46200, begin insert as it read on January 1, 2013, end insert
as adjusted in fiscal years subsequent to the 1984-85 fiscal year.
If the school district operates one or more schools on a four-day
school week pursuant to this section, and the program provides
fewer than the minimum instructional minutes required under
Section 46201, begin insert as it read on January 1, 2013, end insert the Superintendent
shall reduce the begin delete base revenue limit end delete begin insert local control funding formula
allocation pursuant to Section 42238.02, as implemented pursuant
to Section 42238.03, end insert per unit of average daily attendance for that
fiscal year in which the reduction occurs by the amount the school
district would have received for the increase in the base revenue
limit per unit of average daily attendance pursuant to subdivision
(a) of Section 46201, begin insert as it read on January 1, 2013, end insert as adjusted
begin delete in end delete begin insert from end insert the 1987-88 fiscal year begin delete and fiscal years thereafter end delete begin insert to the
2012-13 fiscal end insert begin insert year, inclusive, and, commencing with the 2013-14
fiscal year, pursuant to Section 42238.02, as implemented pursuant
to Section 42238.03, per unit of average daily attendance end insert .

(c) If the school district operates one or more schools on a
four-day school week pursuant to this section, the school district
shall submit a report to the department, the Senate Committee on
Education and the Assembly Committee on Education on January
15, 2014. The report shall include, but not necessarily be limited
to, information on the following:

(1) Programs the district offered on the fifth day and their
participation rates.

(2) Whether the four-day school week schedule resulted in any
fiscal savings.

(3) Impact on overall attendance of the schools operating a
four-day school week.

(4) Programs for which the Superintendent waived minimum
time and five-consecutive-day requirements and the operational
and educational effect of the programs if they operated at less time
than required.

begin insert

(d) Notwithstanding this section, upon a determination that the
school district identified in subdivision (a) equals or exceeds its
local control funding formula target computed pursuant to Section
42238.02 as determined by the calculation of a zero difference
pursuant to paragraph (1) of subdivision (b) of Section 42238.03,
the school district, as a condition of apportionment pursuant to
Section 42238.02, as implemented pursuant to Section 42238.03,
shall offer 180 days or more of instruction per school year, and
meet the minimum minute requirements pursuant to paragraph
(1) of subdivision (a) of Section 46207.

end insert begin delete

(d)

end delete

begin insert (e) end insert  This section shall remain in effect only until January 1, 2015,
and as of that date is repealed, unless a later enacted statute, that
is enacted before January 1, 2015, deletes or extends that date.

begin insert

begin insert SEC. 22. end insert   

end insert

begin insert Section 41020 of the end insert begin insert Education Code end insert begin insert is amended to
read: end insert

41020.  

(a) It is the intent of the Legislature to encourage sound
fiscal management practices among local educational agencies for
the most efficient and effective use of public funds for the
education of children in California by strengthening fiscal
accountability at the begin insert school end insert district, county, and state levels.

(b) (1) Not later than the first day of May of each fiscal year,
each county superintendent of schools shall provide for an audit
of all funds under his or her jurisdiction and control and the
governing board of each local educational agency shall either
provide for an audit of the books and accounts of the local
educational agency, including an audit of income and expenditures
by source of funds, or make arrangements with the county
superintendent of schools having jurisdiction over the local
educational agency to provide for that auditing.

(2) A contract to perform the audit of a local educational agency
that has a disapproved budget or has received a negative
certification on any budget or interim financial report during the
current fiscal year or either of the two preceding fiscal years, or
for which the county superintendent of schools has otherwise
determined that a lack of going concern exists, is not valid unless
approved by the responsible county superintendent of schools and
the governing board.

(3) If the governing board of a local educational agency has not
provided for an audit of the books and accounts of the local
educational agency by April 1, the county superintendent of schools
having jurisdiction over the local educational agency shall provide
for the audit of each local educational agency.

(4) An audit conducted pursuant to this section shall comply
fully with the Government Auditing Standards issued by the
Comptroller General of the United States.

(5) For purposes of this section, “local educational agency” does
not include community colleges.

(c) Each audit conducted in accordance with this section shall
include all funds of the local educational agency, including the
student body and cafeteria funds and accounts and any other funds
under the control or jurisdiction of the local educational agency.
Each audit shall also include an audit of pupil attendance
procedures. begin insert end insert begin insert Each end insert begin insert audit shall include a determination of whether
funds were expended pursuant to a local control and accountability
plan or an approved annual update to a local control and
accountability plan pursuant to Article 4.5 (commencing with
Section 52060) of Chapter 6.1 of Part 28 of Division 4. end insert

(d) All audit reports for each fiscal year shall be developed and
reported using a format established by the Controller after
consultation with the Superintendent and the Director of Finance.

(e) (1) The cost of the audits provided for by the county
superintendent of schools shall be paid from the county school
service fund and the county superintendent of schools shall transfer
the pro rata share of the cost chargeable to each begin insert school end insert district
from begin insert school end insert district funds.

(2) The cost of the audit provided for by a governing board begin insert of
a local educational agency end insert shall be paid from local educational
agency funds. The audit of the funds under the jurisdiction and
control of the county superintendent of schools shall be paid from
the county school service fund.

(f) (1) The audits shall be made by a certified public accountant
or a public accountant, licensed by the California Board of
Accountancy, and selected by the local educational agency, as
applicable, from a directory of certified public accountants and
public accountants deemed by the Controller as qualified to conduct
audits of local educational agencies, which shall be published by
the Controller not later than December 31 of each year.

(2) Commencing with the 2003-04 fiscal year and except as
provided in subdivision (d) of Section 41320.1, it is unlawful for
a public accounting firm to provide audit services to a local
educational agency if the lead audit partner, or coordinating audit
partner, having primary responsibility for the audit, or the audit
partner responsible for reviewing the audit, has performed audit
services for that local educational agency in each of the six previous
fiscal years. The Education Audits Appeal Panel may waive this
requirement if the panel finds that no otherwise eligible auditor is
available to perform the audit.

(3) It is the intent of the Legislature that, notwithstanding
paragraph (2), the rotation within public accounting firms conform
to provisions of the federal Sarbanes-Oxley Act of 2002 begin delete (P.L. end delete
begin insert (Public Law end insert 107-204; 15 U.S.C. Sec. 7201 et seq.), and upon
release of the report required by the act of the Comptroller General
of the United States addressing the mandatory rotation of registered
public accounting firms, the Legislature intends to reconsider the
provisions of paragraph (2). In determining which certified public
accountants and public accountants shall be included in the
directory, the Controller shall use the following criteria:

(A) The certified public accountants or public accountants shall
be in good standing as certified by the Board of Accountancy.

(B) The certified public accountants or public accountants, as
a result of a quality control review conducted by the Controller
pursuant to Section 14504.2, shall not have been found to have
conducted an audit in a manner constituting noncompliance with
subdivision (a) of Section 14503.

(g) (1) The auditor’s report shall include each of the following:

(A) A statement that the audit was conducted pursuant to
standards and procedures developed in accordance with Chapter
3 (commencing with Section 14500) of Part 9 of Division 1 of
Title 1.

(B) A summary of audit exceptions and management
improvement recommendations.

(C) Each audit of a local educational agency shall include an
evaluation by the auditor on whether there is substantial doubt
about the ability of the local educational agency to continue as a
going concern for a reasonable period of time. This evaluation
shall be based on the Statement begin delete of end delete begin insert on end insert Auditing Standards (SAS)
No. 59, as issued by the AICPA regarding disclosure requirements
relating to the ability of the entity to continue as a going concern.

(2) To the extent possible, a description of correction or plan
of correction shall be incorporated in the audit report, describing
the specific actions that are planned to be taken, or that have been
taken, to correct the problem identified by the auditor. The
descriptions of specific actions to be taken or that have been taken
shall not solely consist of general comments such as “will
implement,” “accepted the recommendation,” or “will discuss at
a later date.”

(h) Not later than December 15, a report of each local
educational agency audit for the preceding fiscal year shall be filed
with the county superintendent of schools of the county in which
the local educational agency is located, the department, and the
Controller. The Superintendent shall make any adjustments
necessary in future apportionments of all state funds, to correct
any audit exceptions revealed by those audit reports.

(i) (1) Commencing with the 2002-03 audit of local educational
agencies pursuant to this section and subdivision (d) of Section
41320.1, each county superintendent of schools shall be responsible
for reviewing the audit exceptions contained in an audit of a local
educational agency under his or her jurisdiction related to
attendance, inventory of equipment, internal control, and any
miscellaneous items, and determining whether the exceptions have
been either corrected or an acceptable plan of correction has been
developed.

(2) Commencing with the 2004-05 audit of local educational
agencies pursuant to this section and subdivision (d) of Section
41320.1, each county superintendent of schools shall include in
the review of audit exceptions performed pursuant to this
subdivision those audit exceptions related to use of instructional
materials program funds, teacher misassignments pursuant to
Section 44258.9, information reported on the school accountability
report card required pursuant to Section 33126 and shall determine
whether the exceptions are either corrected or an acceptable plan
of correction has been developed.

(j) Upon submission of the final audit report to the governing
board of each local educational agency and subsequent receipt of
the audit by the county superintendent of schools having
jurisdiction over the local educational agency, the county office
of education shall do all of the following:

(1) Review audit exceptions related to attendance, inventory of
equipment, internal control, and other miscellaneous exceptions.
Attendance exceptions or issues shall include, but not be limited
to, those related to begin delete revenue limits, adult education, end delete begin insert end insert begin insert local control
funding formula allocations pursuant to Section 42238.02, as
implemented by Section 42238.03, end insert and independent study.

(2) If a description of the correction or plan of correction has
not been provided as part of the audit required by this section, then
the county superintendent of schools shall notify the local
educational agency and request the governing board of the local
educational agency to provide to the county superintendent of
schools a description of the corrections or plan of correction by
March 15.

(3) Review the description of correction or plan of correction
and determine its adequacy. If the description of the correction or
plan of correction is not adequate, the county superintendent of
schools shall require the local educational agency to resubmit that
portion of its response that is inadequate.

(k) Each county superintendent of schools shall certify to the
Superintendent and the Controller, not later than May 15, that his
or her staff has reviewed all audits of local educational agencies
under his or her jurisdiction for the prior fiscal year, that all
exceptions that the county superintendent was required to review
were reviewed, and that all of those exceptions, except as otherwise
noted in the certification, have been corrected by the local
educational agency or that an acceptable plan of correction has
been submitted to the county superintendent of schools. In addition,
the county superintendent shall identify, by local educational
agency, any attendance-related audit exception or exceptions
involving state funds, and require the local educational agency to
which the audit exceptions were directed to submit appropriate
reporting forms for processing by the Superintendent.

(l) In the audit of a local educational agency for a subsequent
year, the auditor shall review the correction or plan or plans of
correction submitted by the local educational agency to determine
if the exceptions have been resolved. If not, the auditor shall
immediately notify the appropriate county office of education and
the department and restate the exception in the audit report. After
receiving that notification, the department shall either consult with
the local educational agency to resolve the exception or require
the county superintendent of schools to follow up with the local
educational agency.

(m) (1) The Superintendent shall be responsible for ensuring
that local educational agencies have either corrected or developed
plans of correction for any one or more of the following:

(A) All federal and state compliance audit exceptions identified
in the audit.

(B) Any exceptions that the county superintendent certifies as
of May 15 have not been corrected.

(C) Any repeat audit exceptions that are not assigned to a county
superintendent to correct.

(2) In addition, the Superintendent shall be responsible for
ensuring that county superintendents of schools and each county
board of education that serves as the governing board of a local
educational agency either correct all audit exceptions identified in
the audits of county superintendents of schools and of the local
educational agencies for which the county boards of education
serve as the governing boards or develop acceptable plans of
correction for those exceptions.

(3) The Superintendent shall report annually to the Controller
on his or her actions to ensure that school districts, county
superintendents of schools, and each county board of education
that serves as the governing board of a school district have either
corrected or developed plans of correction for any of the exceptions
noted pursuant to paragraph (1).

(n) To facilitate correction of the exceptions identified by the
audits issued pursuant to this section, commencing with 2002-03
audits pursuant to this section, the Controller shall require auditors
to categorize audit exceptions in each audit report in a manner that
will make it clear to both the county superintendent of schools and
the Superintendent which exceptions they are responsible for
ensuring the correction of by a local educational agency. In
addition, the Controller annually shall select a sampling of county
superintendents of schools and perform a followup of the audit
resolution process of those county superintendents of schools and
report the results of that followup to the Superintendent and the
county superintendents of schools that were reviewed.

(o) County superintendents of schools shall adjust subsequent
local property tax requirements to correct audit exceptions relating
to local educational agency tax rates and tax revenues.

(p) If a governing board or county superintendent of schools
fails or is unable to make satisfactory arrangements for the audit
pursuant to this section, the Controller shall make arrangements
for the audit and the cost of the audit shall be paid from local
educational agency funds or the county school service fund, as the
case may be.

(q) Audits of regional occupational centers and programs are
subject to the provisions of this section.

(r) This section does not authorize examination of, or reports
on, the curriculum used or provided for in any local educational
agency.

(s) Notwithstanding any other provision of law, a nonauditing,
management, or other consulting service to be provided to a local
educational agency by a certified public accounting firm while the
certified public accounting firm is performing an audit of the
agency pursuant to this section must be in accord with Government
Accounting Standards, Amendment No. 3, as published by the
United States General Accounting Office.

begin insert

begin insert SEC. 23. end insert   

end insert

begin insert Section 41303 of the end insert begin insert Education Code end insert begin insert is amended to
read: end insert

41303.  

The Superintendent begin delete of Public Instruction end delete shall report
to the Controller, on or before the 20th day of October of each
year, the total average daily attendance during the preceding fiscal
year credited to all kindergarten, begin insert including average daily
attendance for transitional kindergarten, end insert elementary, high school,
and adult schools in the state and to county school tuition funds.

begin insert

begin insert SEC. 24. end insert   

end insert

begin insert Section 41544 of the end insert begin insert Education Code end insert begin insert is amended to
read: end insert

41544.  

(a) For a basic aid begin insert school end insert district that was entitled to
reimbursement pursuant to Section 42247.4, as that section read
on January 1, 2001, and that received an apportionment pursuant
to subdivision (h) of Section 42247.4, as that section read on
January 1, 2001, because a court order directs pupils to transfer to
that begin insert school end insert district as part of the court-ordered voluntary pupil
transfer program, the Superintendent, begin delete commencing with end delete begin insert from end insert the
2001-02 fiscal year begin insert to the 2012-13 fiscal year, inclusive end insert , shall
calculate an apportionment of state funds for that basic aid begin insert school end insert
district that provides 70 percent of the school district revenue limit
calculated pursuant to Section 42238 begin insert , as that section read on
January 1, 2013, end insert that would have been apportioned to the school
district from which the pupils were transferred for the average
daily attendance of any pupils credited under that court order who
did not attend the basic aid school district before the 1995-96 fiscal
year.

begin insert

(b) (1) For a basic aid school district that was entitled to
reimbursement pursuant to Section 42247.4, as that section read
on January 1, 2001, and that received an apportionment pursuant
to subdivision (h) of Section 42247.4, as that section read on
January 1, 2001, because a court order directs pupils to transfer
to that school district as part of the court-ordered voluntary pupil
transfer program, the Superintendent, commencing with the
2013-14 fiscal year, shall calculate an apportionment of state
funds for that basic aid school district that provides 70 percent of
the school district local control funding formula base grant
calculated pursuant to subdivision (d) of Section 42238.02, as
implemented by Section 42238.03, that would have been
apportioned to the school district from which the pupils were
transferred for the average daily attendance of any pupils credited
under that court order who did not attend the basic aid school
district before the 1995-96 fiscal year.

end insert begin insert

(2) Notwithstanding paragraph (1), until the Superintendent
determines that the school district from which the pupil or pupils
were transferred is funded pursuant to Section 42238.02 in the
prior fiscal year, the Superintendent shall apportion, for average
daily attendance credited pursuant to paragraph (1), 70 percent
of the sum of the entitlements for the school district from which
the pupil or pupils were transferred for the specified fiscal year
as computed pursuant to paragraphs (1) to (4), inclusive, of
subdivision (a), and paragraph (3) of subdivision (b), of Section
42238.03, divided by the average daily attendance of that school
district for that fiscal year and then multiplied by the ratio of local
control formula base grant funding computed pursuant to
subdivision (d) of Section 42238.02 to the local control funding
formula amount for that fiscal year computed pursuant to Section
42238.02.

end insert begin delete

(b)

end delete

begin insert (c) end insert  For purposes of begin insert subdivision (b) of end insert this section, “basic aid
begin insert school end insert district” means a school district that does not receive from
the state, for any fiscal year in which this section is applied, an
apportionment of state funds pursuant to subdivision begin delete (h) end delete begin insert (o) end insert of
Section begin delete 42238 end delete begin insert 42238.02 end insert .

begin insert

begin insert SEC. 25. end insert   

end insert

begin insert Section 42127 of the end insert begin insert Education Code end insert begin insert is amended to
read: end insert

42127.  

(a) On or before July 1 of each year, the governing
board of each school district shall accomplish the following:

(1) Hold a public hearing on the budget to be adopted for the
subsequent fiscal year. The budget to be adopted shall be prepared
in accordance with Section 42126. The agenda for that hearing
shall be posted at least 72 hours before the public hearing and shall
include the location where the budget will be available for public
inspection.

(A) For the 2011-12 fiscal year, notwithstanding any of the
standards and criteria adopted by the state board pursuant to Section
33127, each school district budget shall project the same level of
revenue per unit of average daily attendance as it received in the
2010-11 fiscal year and shall maintain staffing and program levels
commensurate with that level.

(B) For the 2011-12 fiscal year, the school district shall not be
required to demonstrate that it is able to meet its financial
obligations for the two subsequent fiscal years.

(2) Adopt a budget. Not later than five days after that adoption
or by July 1, whichever occurs first, the governing board of the
school district shall file that budget with the county superintendent
of schools. begin delete That end delete begin insert The end insert budget and supporting data shall be
maintained and made available for public review. If the governing
board of the school district does not want all or a portion of the
property tax requirement levied for the purpose of making
payments for the interest and redemption charges on indebtedness
as described in paragraph (1) or (2) of subdivision (b) of Section
1 of Article XIII A of the California Constitution, the budget shall
include a statement of the amount or portion for which a levy shall
not be made. begin insert end insert begin insert For the 2014-15 fiscal year and each fiscal year
thereafter, the governing board of the school district shall not
adopt a budget before the governing board of the school district
adopts a local control and accountability plan, if an existing local
control and accountability plan or annual update to a local control
and accountability plan is not effective for the budget year. The end insert
begin insert governing board of a school district shall not adopt a budget that
does not include the expenditures necessary to implement the local
control and accountability plan or the annual update to a local
control and accountability plan that is effective during the
subsequent fiscal year. end insert

(b) The county superintendent of schools may accept changes
in any statement included in the budget, pursuant to subdivision
(a), of the amount or portion for which a property tax levy shall
not be made. The county superintendent of schools or the county
auditor shall compute the actual amounts to be levied on the
property tax rolls of the school district for purposes that exceed
apportionments to the school district pursuant to Chapter 6
(commencing with Section 95) of Part 0.5 of Division 1 of the
Revenue and Taxation Code. Each school district shall provide all
data needed by the county superintendent of schools or the county
auditor to compute the amounts. On or before August 15, the
county superintendent of schools shall transmit the amounts
computed to the county auditor who shall compute the tax rates
necessary to produce the amounts. On or before September 1, the
county auditor shall submit the rate computed to the board of
supervisors for adoption.

(c) The county superintendent of schools shall do all of the
following:

(1) Examine the adopted budget to determine whether it
complies with the standards and criteria adopted by the state board
pursuant to Section 33127 for application to final local educational
agency budgets. The county superintendent of schools shall
identify, if necessary, technical corrections that are required to be
made to bring the budget into compliance with those standards
and criteria.

(2) Determine whether the adopted budget will allow the school
district to meet its financial obligations during the fiscal year and
is consistent with a financial plan that will enable the school district
to satisfy its multiyear financial commitments. In addition to his
or her own analysis of the budget of each school district, the county
superintendent of schools shall review and consider studies, reports,
evaluations, or audits of the school district that were commissioned
by the school district, the county superintendent of schools, the
Superintendent, and state control agencies and that contain
evidence that the school district is showing fiscal distress under
the standards and criteria adopted in Section 33127 or that contain
a finding by an external reviewer that more than three of the 15
most common predictors of a school district needing intervention,
as determined by the County Office Fiscal Crisis and Management
Assistance Team, are present. The county superintendent of schools
shall either conditionally approve or disapprove a budget that does
not provide adequate assurance that the school district will meet
its current and future obligations and resolve any problems
identified in studies, reports, evaluations, or audits described in
this paragraph.

begin insert

(3) Determine whether the adopted budget includes the
expenditures necessary to implement the local control and
accountability plan or annual update to the local control and
accountability plan approved by the county superintendent of
schools.

end insert

(d) On or before August 15, the county superintendent of schools
shall approve, conditionally approve, or disapprove the adopted
budget for each school district. begin insert For the 2014-15 fiscal year and
each fiscal year thereafter, the end insert begin insert county superintendent of schools
shall disapprove a budget if the county superintendent of schools
determines that the budget does not include the expenditures
necessary to implement a local control and accountability plan or
an annual update to the local control and accountability plan
approved by the county superintendent of schools. end insert If a school
district does not submit a budget to the county superintendent of
schools, the county superintendent of schools shall develop, at
school district expense, a budget for that school district by
September 15 and transmit that budget to the governing board of
the school district. The budget prepared by the county
superintendent of schools shall be deemed adopted, unless the
county superintendent of schools approves any modifications made
by the governing board of the school district. The approved budget
shall be used as a guide for the school district’s priorities. The
Superintendent shall review and certify the budget approved by
the county. If, pursuant to the review conducted pursuant to
subdivision (c), the county superintendent of schools determines
that the adopted budget for a school district does not satisfy
paragraph (1) or (2) of that subdivision, he or she shall
conditionally approve or disapprove the budget and, not later than
August 15, transmit to the governing board of the school district,
in writing, his or her recommendations regarding revision of the
budget and the reasons for those recommendations, including, but
not limited to, the amounts of any budget adjustments needed
before he or she can approve that budget. The county
superintendent of schools may assign a fiscal adviser to assist the
school district to develop a budget in compliance with those
revisions. In addition, the county superintendent of schools may
appoint a committee to examine and comment on the
superintendent’s review and recommendations, subject to the
requirement that the committee report its findings to the county
superintendent of schools no later than August 20. For the 2011-12
fiscal year, notwithstanding any of the standards and criteria
adopted by the state board pursuant to Section 33127, the county
superintendent of schools, as a condition on approval of a school
district budget, shall not require a school district to project a lower
level of revenue per unit of average daily attendance than it
received in the 2010-11 fiscal year nor require the school district
to demonstrate that it is able to meet its financial obligations for
the two subsequent fiscal years.

(e) On or before September 8, the governing board of the school
district shall revise the adopted budget to reflect changes in
projected income or expenditures subsequent to July 1, and to
include any response to the recommendations of the county
superintendent of schools, shall adopt the revised budget, and shall
file the revised budget with the county superintendent of schools.
Before revising the budget, the governing board of the school
district shall hold a public hearing regarding the proposed revisions,
to be conducted in accordance with Section 42103. In addition, if
the adopted budget is disapproved pursuant to subdivision (d), the
governing board of the school district and the county
superintendent of schools shall review the disapproval and the
recommendations of the county superintendent of schools regarding
revision of the budget at the public hearing. The revised budget
and supporting data shall be maintained and made available for
public review.

(1) For the 2011-12 fiscal year, notwithstanding any of the
standards and criteria adopted by the state board pursuant to Section
33127, each school district budget shall project the same level of
revenue per unit of average daily attendance as it received in the
2010-11 fiscal year and shall maintain staffing and program levels
commensurate with that level.

(2) For the 2011-12 fiscal year, the school district shall not be
required to demonstrate that it is able to meet its financial
obligations for the two subsequent fiscal years.

(f) On or before September 22, the county superintendent of
schools shall provide a list to the Superintendent identifying all
school districts for which budgets may be disapproved.

(g) The county superintendent of schools shall examine the
revised budget to determine whether it (1) complies with the
standards and criteria adopted by the state board pursuant to Section
33127 for application to final local educational agency budgets,
(2) allows the school district to meet its financial obligations during
the fiscal year, (3) satisfies all conditions established by the county
superintendent of schools in the case of a conditionally approved
budget, and (4) is consistent with a financial plan that will enable
the school district to satisfy its multiyear financial commitments,
and, not later than October 8, shall approve or disapprove the
revised budget. If the county superintendent of schools disapproves
the budget, he or she shall call for the formation of a budget review
committee pursuant to Section 42127.1, unless the governing board
of the school district and the county superintendent of schools
agree to waive the requirement that a budget review committee be
formed and the department approves the waiver after determining
that a budget review committee is not necessary. Upon the grant
of a waiver, the county superintendent of schools immediately has
the authority and responsibility provided in Section 42127.3. Upon
approving a waiver of the budget review committee, the department
shall ensure that a balanced budget is adopted for the school district
by November 30. If no budget is adopted by November 30, the
Superintendent may adopt a budget for the school district. The
Superintendent shall report to the Legislature and the Director of
Finance by December 10 if any school district, including a school
district that has received a waiver of the budget review committee
process, does not have an adopted budget by November 30. This
report shall include the reasons why a budget has not been adopted
by the deadline, the steps being taken to finalize budget adoption,
the date the adopted budget is anticipated, and whether the
Superintendent has or will exercise his or her authority to adopt a
budget for the school district. For the 2011-12 fiscal year,
notwithstanding any of the standards and criteria adopted by the
state board pursuant to Section 33127, the county superintendent
of schools, as a condition on approval of a school district budget,
shall not require a school district to project a lower level of revenue
per unit of average daily attendance than it received in the 2010-11
fiscal year nor require the school district to demonstrate that it is
able to meet its financial obligations for the two subsequent fiscal
years.

(h) Not later than October 8, the county superintendent of
schools shall submit a report to the Superintendent identifying all
school districts for which budgets have been disapproved or budget
review committees waived. The report shall include a copy of the
written response transmitted to each of those school districts
pursuant to subdivision (d).

(i) Notwithstanding any other provision of this section, the
budget review for a school district shall be governed by paragraphs
(1), (2), and (3), rather than by subdivisions (e) and (g), if the
governing board of the school district so elects and notifies the
county superintendent of schools in writing of that decision, not
later than October 31 of the immediately preceding calendar year.
On or before July 1, the governing board of a school district for
which the budget review is governed by this subdivision, rather
than by subdivisions (e) and (g), shall conduct a public hearing
regarding its proposed budget in accordance with Section 42103.

(1) If the adopted budget of a school district is disapproved
pursuant to subdivision (d), on or before September 8, the
governing board of the school district, in conjunction with the
county superintendent of schools, shall review the superintendent’s
recommendations at a regular meeting of the governing board of
the school district and respond to those recommendations. The
response shall include any revisions to the adopted budget and
other proposed actions to be taken, if any, as a result of those
recommendations.

(2) On or before September 22, the county superintendent of
schools shall provide a list to the Superintendent identifying all
school districts for which a budget may be tentatively disapproved.

(3) Not later than October 8, after receiving the response
required under paragraph (1), the county superintendent of schools
shall review that response and either approve or disapprove the
budget. If the county superintendent of schools disapproves the
budget, he or she shall call for the formation of a budget review
committee pursuant to Section 42127.1, unless the governing board
of the school district and the county superintendent of schools
agree to waive the requirement that a budget review committee be
formed and the department approves the waiver after determining
that a budget review committee is not necessary. Upon the grant
of a waiver, the county superintendent has the authority and
responsibility provided to a budget review committee in Section
42127.3. Upon approving a waiver of the budget review committee,
the department shall ensure that a balanced budget is adopted for
the school district by November 30. The Superintendent shall
report to the Legislature and the Director of Finance by December
10 if any school district, including a school district that has received
a waiver of the budget review committee process, does not have
an adopted budget by November 30. This report shall include the
reasons why a budget has not been adopted by the deadline, the
steps being taken to finalize budget adoption, and the date the
adopted budget is anticipated. For the 2011-12 fiscal year,
notwithstanding any of the standards and criteria adopted by the
state board pursuant to Section 33127, the county superintendent
of schools, as a condition on approval of a school district budget,
shall not require a school district to project a lower level of revenue
per unit of average daily attendance than it received in the 2010-11
fiscal year nor require the school district to demonstrate that it is
able to meet its financial obligations for the two subsequent fiscal
years.

(4) Not later than 45 days after the Governor signs the annual
Budget Act, the school district shall make available for public
review any revisions in revenues and expenditures that it has made
to its budget to reflect the funding made available by that Budget
Act.

(j) Any school district for which the county board of education
serves as the governing board of the school district is not subject
to subdivisions (c) to (h), inclusive, but is governed instead by the
budget procedures set forth in Section 1622.

begin insert

begin insert SEC. 26. end insert   

end insert

begin insert Section 42238 of the end insert begin insert Education Code end insert begin insert is amended to
read: end insert

42238.  

(a) For the 1984-85 fiscal year and each fiscal year
thereafter, the county superintendent of schools shall determine a
revenue limit for each school district in the county pursuant to this
section.

(b) The base revenue limit for a fiscal year shall be determined
by adding to the base revenue limit for the prior fiscal year the
following amounts:

(1) The inflation adjustment specified in Section 42238.1.

(2) For the 1995-96 fiscal year, the equalization adjustment
specified in Section 42238.4.

(3) For the 1996-97 fiscal year, the equalization adjustments
specified in Sections 42238.41, 42238.42, and 42238.43.

(4) For the 1985-86 fiscal year, the amount per unit of average
daily attendance received in the 1984-85 fiscal year pursuant to
Section 42238.7.

(5) For the 1985-86, 1986-87, and 1987-88 fiscal years, the
amount per unit of average daily attendance received in the prior
fiscal year pursuant to Section 42238.8.

(6) For the 2004-05 fiscal year, the equalization adjustment
specified in Section 42238.44.

(7) For the 2006-07 fiscal year, the equalization adjustment
specified in Section 42238.48.

(8) For the 2011-12 fiscal year, the equalization adjustment
specified in Section 42238.49.

(c) (1) (A) For the 2010-11 fiscal year, the Superintendent
shall compute an add-on for each school district by adding the
inflation adjustment specified in Section 42238.1 to the adjustment
specified in Section 42238.485.

(B) For the 2011-12 fiscal year and each fiscal year thereafter,
the Superintendent shall compute an add-on for each school district
by adding the inflation adjustment specified in Section 42238.1 to
the amount computed pursuant to this paragraph for the prior fiscal
year.

(2) Commencing with the 2010-11 fiscal year, the
Superintendent shall compute an add-on for each school district
by dividing each school district’s fiscal year average daily
attendance computed pursuant to Section 42238.5 by the total
adjustments in funding for each district made for the 2007-08
fiscal year pursuant to Section 42238.22 as it read on January 1,
2009.

(d) The sum of the base revenue limit computed pursuant to
subdivision (b) and the add-on computed pursuant to subdivision
(c) shall be multiplied by the district average daily attendance
computed pursuant to Section 42238.5.

(e) For districts electing to compute units of average daily
attendance pursuant to paragraph (2) of subdivision (a) of Section
42238.5, the amount computed pursuant to Article 4 (commencing
with Section 42280) shall be added to the amount computed in
subdivision (c) or (d), as appropriate.

(f) For the 1984-85 fiscal year only, the county superintendent
shall reduce the total revenue limit computed in this section by the
amount of the decreased employer contributions to the Public
Employees’ Retirement System resulting from enactment of
Chapter 330 of the Statutes of 1982, offset by any increase in those
contributions, as of the 1983-84 fiscal year, resulting from
subsequent changes in employer contribution rates.

(g) The reduction required by subdivision (f) shall be calculated
as follows:

(1) Determine the amount of employer contributions that would
have been made in the 1983-84 fiscal year if the applicable Public
Employees’ Retirement System employer contribution rate in effect
immediately before the enactment of Chapter 330 of the Statutes
of 1982 was in effect during the 1983-84 fiscal year.

(2) Subtract from the amount determined in paragraph (1) the
greater of subparagraph (A) or (B):

(A) The amount of employer contributions that would have been
made in the 1983-84 fiscal year if the applicable Public
Employees’ Retirement System employer contribution rate in effect
immediately after the enactment of Chapter 330 of the Statutes of
1982 was in effect during the 1983-84 fiscal year.

(B) The actual amount of employer contributions made to the
Public Employees’ Retirement System in the 1983-84 fiscal year.

(3) For purposes of this subdivision, employer contributions to
the Public Employees’ Retirement System for either of the
following shall be excluded from the calculation specified above:

(A) Positions supported totally by federal funds that were subject
to supplanting restrictions.

(B) Positions supported, to the extent of employer contributions
not exceeding twenty-five thousand dollars ($25,000) by a single
educational agency, from a revenue source determined on the basis
of equity to be properly excludable from the provisions of this
subdivision by the Superintendent with the approval of the Director
of Finance.

(4) For accounting purposes, the reduction made by this
subdivision may be reflected as an expenditure from appropriate
sources of revenue as directed by the Superintendent.

(h) The Superintendent shall apportion to each school district
the amount determined in this section less the sum of:

(1) The district’s property tax revenue received pursuant to
Chapter 3.5 (commencing with Section 75) and Chapter 6
(commencing with Section 95) of Part 0.5 of Division 1 of the
Revenue and Taxation Code.

(2) The amount, if any, received pursuant to Part 18.5
(commencing with Section 38101) of Division 2 of the Revenue
and Taxation Code.

(3) The amount, if any, received pursuant to Chapter 3
(commencing with Section 16140) of Part 1 of Division 4 of Title
2 of the Government Code.

(4) Prior years’ taxes and taxes on the unsecured roll.

(5) Fifty percent of the amount received pursuant to Section
41603.

(6) (A) The amount, if any, received pursuant to the Community
Redevelopment Law (Part 1 (commencing with Section 33000)
of Division 24 of the Health and Safety Code), except for any
amount received pursuant to Section 33401 or 33676 of the Health
and Safety Code that is used for land acquisition, facility
construction, reconstruction, or remodeling, or deferred
maintenance, except for any amount received pursuant to Section
33492.15 of, paragraph (4) of subdivision (a) of Section 33607.5
of, or Section 33607.7 of, the Health and Safety Code that is
allocated exclusively for educational facilities.

(B) The amount, if any, received pursuant to Sections 34177,
34179.5, 34179.6, and 34188 of the Health and Safety Code.

(C) The amount, if any, received pursuant to subparagraph (B)
of paragraph (3) of subdivision (e) of Section 36 of Article XIII
of the California Constitution.

(7) For a unified school district, other than a unified school
district that has converted all of its schools to charter status
pursuant to Section 47606, the amount of statewide average
general-purpose funding per unit of average daily attendance
received by school districts for each of four grade level ranges, as
computed by the department pursuant to Section 47633, multiplied
by the average daily attendance, in corresponding grade level
ranges, of any pupils who attend charter schools funded pursuant
to Chapter 6 (commencing with Section 47630) of Part 26.8 of
Division 4 for which the school district is the sponsoring local
educational agency, as defined in Section 47632, and who reside
in and would otherwise have been eligible to attend a noncharter
school of the school district.

(i) A transfer of pupils of grades 7 and 8 between an elementary
school district and a high school district shall not result in the
receiving school district receiving a revenue limit apportionment
for those pupils that exceeds 105 percent of the statewide average
revenue limit for the type and size of the receiving school district.

begin insert

(j) Commencing with the 2013-14 fiscal year, this section shall
be used only for purposes of allocating revenues received pursuant
to subparagraph (B) of paragraph (3) of subdivision (e) of Section
36 of Article XIII of the California Constitution.

end insert begin insert

(k) This section shall become inoperative on July 1, 2021, and,
as of January 1, 2022, is repealed, unless a later enacted statute,
that becomes operative on or before January 1, 2022, deletes or
extends the dates on which it becomes inoperative and is repealed.

end insert

begin insert

begin insert SEC. 27. end insert   

end insert

begin insert Section 42238.01 is added to the end insert begin insert Education Code end insert begin insert , to
read: end insert

begin insert

begin insert 42238.01. end insert   

For purposes of Section 42238.02, the following
definitions shall apply:

(a) “Eligible for free or reduced-price meal” means determined
to meet federal eligibility criteria for free or reduced-price meals
as specified in Section 49531, as that section read on January 1,
2013, except in regard to meals in family day care homes.

(b) “Foster youth” means a foster child, as described in
subdivision (a) of Section 48853.5, or a nonminor under the
transition jurisdiction of the juvenile court, as described in Section
450 of the Welfare and Institutions Code, who satisfies all of the
following criteria:

(1) He or she has attained 18 years of age while under an order
of foster care placement by the juvenile court, and is not more
than 19 years of age on or after January 1, 2012, not more than
20 years of age on or after January 1, 2013, and not more than
21 years of age, on or after January 1, 2014, and as described in
Section 10103.5 of the Welfare and Institutions Code.

(2) He or she is in foster care under the placement and care
responsibility of the county welfare department, county probation
department, Indian tribe, consortium of tribes, or tribal
organization that entered into an agreement pursuant to Section
10553.1 of the Welfare and Institutions Code.

(3) He or she is participating in a transitional independent
living case plan pursuant to Section 475(8) of the federal Social
Security Act (42 U.S.C. Sec. 675(8)), as contained in the federal
Fostering Connections to Success and Increasing Adoptions Act
of 2008 (Public Law 110-351), as described in Section 11403 of
the Welfare and Institutions Code.

(c) “Pupils of limited English proficiency” means pupils who
do not have the clearly developed English language skills of
comprehension, speaking, reading, and writing necessary to receive
instruction only in English at a level substantially equivalent to
pupils of the same age or grade whose primary language is
English. “English learner” shall have the same meaning as is
provided for in subdivision (a) of Section 306 and as “pupils of
limited English proficiency.”

end insert

begin insert

begin insert SEC. 28. end insert   

end insert

begin insert Section 42238.02 is added to the end insert begin insert Education Code end insert begin insert , to
read: end insert

begin insert

begin insert 42238.02. end insert   

(a) The amount computed pursuant to this section
shall be known as the school district and charter school local
control funding formula.

(b) (1) For purposes of this section “unduplicated pupil” means
a pupil enrolled in a school district or a charter school who is
either classified as an English learner, eligible to receive a free
or reduced-price meal, or is a foster youth. A pupil shall be counted
only once for purposes of this section if any of the following apply:

(A) The pupil is classified as an English learner and is eligible
for a free or reduced-price meal.

(B) The pupil is classified as an English learner and is a foster
youth.

(C) The pupil is eligible for a free or reduced-price meal and
is classified as a foster youth.

(D) The pupil is classified as an English learner, is eligible for
a free or reduced-price meal, and is a foster youth.

(2) Commencing with the 2013-14 fiscal year, a school district
or charter school shall annually report its enrolled free and
reduced-price meal eligibility, foster youth, and English learner
pupil-level records to the Superintendent using the California
Longitudinal Pupil Achievement Data System.

(3) (A) Commencing with the 2013-14 fiscal year, a county
office of education shall review and validate reported English
learner, foster youth, and free or reduced-price meal eligible pupil
data for school districts and charter schools under its jurisdiction
to ensure the data is reported accurately. The Superintendent shall
provide each county office of education with appropriate access
to school district and charter school data reports in the California
Longitudinal Pupil Achievement Data System for purposes of
ensuring data reporting accuracy.

(B) The Controller shall include the instructions necessary to
enforce paragraph (2) in the audit guide required by Section
14502.1. The instructions shall include, but are not necessarily
limited to, procedures for determining if the English learner, foster
youth, and free or reduced-price meal eligible pupil counts are
consistent with the school district’s or charter school’s English
learner, foster youth, and free or reduced-price meal eligible pupil
records.

(4) The Superintendent shall make the calculations pursuant to
this section using the data submitted by local educational agencies,
including charter schools, through the California Longitudinal
Pupil Achievement Data System. The Superintendent shall
authorize school districts and charter schools to review and revise,
as necessary, their submitted data on English learner, foster youth,
and free or reduced-price meal eligible pupil counts to ensure the
accuracy of data reflected in the California Longitudinal Pupil
Achievement Data System.

(5) The Superintendent shall annually compute the percentage
of unduplicated pupils for each school district and charter school
by dividing the enrollment of unduplicated pupils in a school
district or charter school by the total enrollment in that school
district or charter school pursuant to all of the following:

(A) For the 2013-14 fiscal year, divide the sum of unduplicated
pupils for the 2013-14 fiscal year by the sum of the total pupil
enrollment for the 2013-14 fiscal year.

(B) For the 2014-15 fiscal year, divide the sum of unduplicated
pupils for the 2013-14 and 2014-15 fiscal years by the sum of the
total pupil enrollment for the 2013-14 and 2014-15 fiscal years.

(C) For the 2015-16 fiscal year and each fiscal year thereafter,
divide the sum of unduplicated pupils for the current fiscal year
and the two prior fiscal years by the sum of the total pupil
enrollment for the current fiscal year and the two prior fiscal years.

(c) Commencing with the 2013-14 fiscal year and each fiscal
year thereafter, the Superintendent shall annually calculate a local
control funding formula grant for each school district and charter
school in the state pursuant to this section.

(d) The Superintendent shall compute a grade span adjusted
base grant equal to the total of the following amounts:

(1) For the 2013-14 fiscal year, a base grant of:

(A) Six thousand eight hundred forty-five dollars ($6,845) for
average daily attendance in kindergarten and grades 1 to 3,
inclusive.

(B) Six thousand nine hundred forty-seven dollars ($6,947) for
average daily attendance in grades 4 to 6, inclusive.

(C) Seven thousand one hundred fifty-four dollars ($7,154) for
average daily attendance in grades 7 and 8.

(D) Eight thousand two hundred eighty-nine dollars ($8,289)
for average daily attendance in grades 9 to 12, inclusive.

(2) In each year the grade span adjusted base grants in
paragraph (1) shall be adjusted by 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 reported by the Department of
Finance.

(3) (A) The Superintendent shall compute an additional
adjustment to the kindergarten and grades 1 to 3, inclusive, base
grant as adjusted for inflation pursuant to paragraph (2) equal to
10.4 percent. The additional grant shall be calculated by
multiplying the kindergarten and grades 1 to 3, inclusive, base
grant as adjusted by paragraph (2) by 10.4 percent.

(B) Until paragraph (4) of subdivision (b) of Section 42238.03
is effective, as a condition of the receipt of funds in this paragraph,
a school district shall make progress toward maintaining an
average class enrollment of not more than 24 pupils for each
schoolsite in kindergarten and grades 1 to 3, inclusive, unless a
collectively bargained alternative annual average class enrollment
for each schoolsite in those grades is agreed to by the school
district, pursuant to the following calculation:

(i) Determine a school district’s average class enrollment for
each schoolsite for kindergarten and grades 1 to 3, inclusive, in
the prior year. For the 2013-14 fiscal year, this amount shall be
the average class enrollment for each schoolsite for kindergarten
and grades 1 to 3, inclusive, in the 2012-13 fiscal year.

(ii) Determine a school district’s percentage of total need
pursuant to paragraph (2) of subdivision (b) of Section 42238.03.

(iii) Determine the percentage of the need calculated in clause
(ii) that is met by funding provided to the school district pursuant
to paragraph (3) of subdivision (b) of Section 42238.03.

(iv) Determine the difference between the amount computed
pursuant to clause (i) and an average class enrollment of not more
than 24 pupils.

(v) Calculate a current year average class enrollment adjustment
for each schoolsite for kindergarten and grades 1 to 3, inclusive,
equal to the adjustment calculated in clause (iv) multiplied by the
percentage determined pursuant to clause (iii).

(C) School districts that have an average class enrollment for
each schoolsite for kindergarten and grades 1 to 3, inclusive, of
24 pupils or less for each schoolsite in the 2012-13 fiscal year,
shall be exempt from the requirements of subparagraph (B) so
long as the school district continues to maintain an average class
enrollment for each schoolsite for kindergarten and grades 1 to
3, inclusive, of not more than 24 pupils, unless a collectively
bargained alternative ratio is agreed to by the school district.

(D) Upon full implementation of the local control funding
formula, as a condition of the receipt of funds in this paragraph,
all school districts shall maintain an average class enrollment for
each schoolsite for kindergarten and grades 1 to 3, inclusive, of
not more than 24 pupils for each schoolsite in kindergarten and
grades 1 to 3, inclusive, unless a collectively bargained alternative
ratio is agreed to by the school district.

(E) The average class enrollment requirement for each
schoolsite for kindergarten and grades 1 to 3, inclusive, established
pursuant to this paragraph shall not be subject to waiver by the
state board pursuant to Section 33050 or by the Superintendent.

(F) The Controller shall include the instructions necessary to
enforce this paragraph in the audit guide required by Section
14502.1. The instructions shall include, but are not necessarily
limited to, procedures for determining if the average class
enrollment for each schoolsite for kindergarten and grades 1 to
3, inclusive, exceeds 24, or an alternative average class enrollment
for each schoolsite pursuant to a collectively bargained alternative
ratio. The procedures for determining average class enrollment
for each schoolsite shall include criteria for employing sampling.

(4) (A) The Superintendent shall compute an additional
adjustment to the base grant for grades 9 to 12, inclusive, as
adjusted for inflation pursuant to paragraph (2), equal to 2.6
percent. The additional grant shall be calculated by multiplying
the base grant for grades 9 to 12, inclusive, as adjusted by
paragraph (2), by 2.6 percent.

(B) A school district or charter school shall expend funds
appropriated pursuant to this paragraph on pupils enrolled in
grades 9 to 12, inclusive, for any purposes or programs that
support a school district or charter school in achieving its goals
for college and career readiness as described in a school district’s
local control and accountability plan pursuant to subparagraph
(C) of paragraph (4) of subdivision (d) of Section 52060, or a
charter school’s plan pursuant to Section 47605, 47605.6, or
47606.5, as applicable.

(C) As a condition of the receipt of funds pursuant to this
paragraph, a school district or charter school shall report such
pupil-level college and career readiness information as may be
approved by the state board to implement subparagraph (ii) of
subparagraph (F) of paragraph (4) of subdivision (a) of Section
52052.

(D) Funds apportioned pursuant to this paragraph are
specifically intended to fund, and shall be first used to offset, the
costs of any new programs or higher levels of service required by
this paragraph.

(e) The Superintendent shall compute a supplemental grant
add-on equal to 20 percent of the base grants as specified in
subparagraphs (A) to (D), inclusive, of paragraph (1) of
subdivision (d), as adjusted by paragraphs (2) to (4), inclusive, of
subdivision (d), for each school district’s or charter school’s
percentage of unduplicated pupils calculated pursuant to
paragraph (5) of subdivision (b). The supplemental grant shall be
calculated by multiplying the base grants as specified in
subparagraphs (A) to (D), inclusive, of paragraph (1), as adjusted
by paragraphs (2) to (4), inclusive, of subdivision (d), by 20 percent
and by the percentage of unduplicated pupils calculated pursuant
to paragraph (5) of subdivision (b) in that school district or charter
school. The supplemental grant shall be expended in accordance
with the regulations adopted pursuant to Section 42238.07.

(f) The Superintendent shall compute a concentration grant
add-on equal to 50 percent of the base grants as specified in
subparagraphs (A) to (D), inclusive, of paragraph (1) of
subdivision (d), as adjusted by paragraphs (2) to (4), inclusive, of
subdivision (d), for each school district’s or charter school’s
percentage of unduplicated pupils calculated pursuant to
paragraph (5) of subdivision (b) in excess of 55 percent of the
school district’s or charter school’s total enrollment. The
concentration grant shall be calculated by multiplying the base
grant as specified in subparagraphs (A) to (D), inclusive, of
paragraph (1) of subdivision (d), as adjusted by paragraphs (2)
to (4), inclusive, of subdivision (d), by 50 percent and by the
percentage of unduplicated pupils calculated pursuant to
paragraph (5) of subdivision (b) in excess of 55 percent of the total
enrollment in that school district or charter school. For a charter
school physically located in only one school district, the percentage
of unduplicated pupils calculated pursuant to paragraph (5) of
subdivision (b) in excess of 55 percent used to calculate
concentration grants shall not exceed the percentage of
unduplicated pupils calculated pursuant to paragraph (5) of
subdivision (b) in excess of 55 percent of the school district in
which the charter school is physically located. For a charter school
physically located in more than one school district, the charter
school’s percentage of unduplicated pupils calculated pursuant
to paragraph (5) of subdivision (b) in excess of 55 percent used
to calculate concentration grants shall not exceed that of the school
district with the highest percentage of unduplicated pupils
calculated pursuant to paragraph (5) of subdivision (b) in excess
of 55 percent of the school districts in which the charter school
has a school facility. The concentration grant shall be expended
in accordance with the regulations adopted pursuant to Section
42238.07.

(g) The Superintendent shall compute an add-on to the total
sum of a school district’s or charter school’s base, supplemental,
and concentration grants equal to the amount of funding a school
district or charter school received from funds allocated pursuant
to the Targeted Instructional Improvement Block Grant program,
as set forth in Article 6 (commencing with Section 41540) of
Chapter 3.2, for the 2012-13 fiscal year, as that article read on
January 1, 2013. A school district or charter school shall not
receive a total funding amount from this add-on greater than the
total amount of funding received by the school district or charter
school from that program in the 2012-13 fiscal year. The amount
computed pursuant to this subdivision shall reflect the reduction
specified in paragraph (2) of subdivision (a) of Section 42238.03.

(h) The Superintendent shall compute an add-on to the total
sum of a school district’s or charter school’s base, supplemental,
and concentration grants equal to the amount of funding a school
district or charter school received from funds allocated pursuant
to the Home-to-School Transportation program, as set forth in
former Article 2 (commencing with Section 39820) of Chapter 1
of Part 23.5, former Article 10 (commencing with Section 41850)
of Chapter 5, and the Small School District Transportation
program, as set forth in former Article 4.5 (commencing with
Section 42290), for the 2012-13 fiscal year. A school district or
charter school shall not receive a total funding amount from this
add-on greater than the total amount received by the school district
or charter school for that program in the 2012-13 fiscal year. The
amount computed pursuant to this subdivision shall reflect the
reduction specified in paragraph (2) of subdivision (a) of Section
42238.03.

(i) (1) The sum of the local control funding formula rates
computed pursuant to subdivisions (c) to (f), inclusive, shall be
multiplied by:

(A) For school districts, the average daily attendance of the
school district in the corresponding grade level ranges computed
pursuant to Section 42238.05.

(B) For charter schools, the total current year average daily
attendance in the corresponding grade level ranges.

(2) (A) The amount computed pursuant to Article 4
(commencing with Section 42280) shall be added to the amount
computed pursuant to paragraphs (1) to (4), inclusive, of
subdivision (d), as multiplied by subparagraph (A) or (B) of
paragraph (1), as appropriate.

(B) The amount added pursuant to this paragraph shall not
change the calculation of a school district’s or charter school’s
supplemental grant or concentration grant.

(j) The Superintendent shall adjust the sum of each school
district’s or charter school’s amount determined in subdivisions
(g) to (i), inclusive, pursuant to the calculation specified in Section
42238.03, less the sum of the following:

(1) (A) For school districts, the property tax revenue received
pursuant to Chapter 3.5 (commencing with Section 75) and Chapter
6 (commencing with Section 95) of Part 0.5 of Division 1 of the
Revenue and Taxation Code.

(B) For charter schools, the in-lieu property tax amount
provided to a charter school pursuant to Section 47635.

(2) The amount, if any, received pursuant to Part 18.5
(commencing with Section 38101) of Division 2 of the Revenue
and Taxation Code.

(3) The amount, if any, received pursuant to Chapter 3
(commencing with Section 16140) of Part 1 of Division 4 of Title
2 of the Government Code.

(4) Prior years’ taxes and taxes on the unsecured roll.

(5) Fifty percent of the amount received pursuant to Section
41603.

(6) The amount, if any, received pursuant to the Community
Redevelopment Law (Part 1 (commencing with Section 33000) of
Division 24 of the Health and Safety Code), less any amount
received pursuant to Section 33401 or 33676 of the Health and
Safety Code that is used for land acquisition, facility construction,
reconstruction, or remodeling, or deferred maintenance and that
is not an amount received pursuant to Section 33492.15, or
paragraph (4) of subdivision (a) of Section 33607.5, or Section
33607.7 of the Health and Safety Code that is allocated exclusively
for educational facilities.

(7) The amount, if any, received pursuant to Sections 34183
and 34188 of the Health and Safety Code.

(8) Revenue received pursuant to subparagraph (B) of
paragraph (3) of subdivision (e) of Section 36 of Article XIII of
the California Constitution.

(k) A school district shall annually transfer to each of its charter
schools funding in lieu of property taxes pursuant to Section 47635.

(l) (1) Nothing in this section shall be interpreted to authorize
a school district that receives funding on behalf of a charter school
pursuant to Section 47651 to redirect this funding for another
purpose unless otherwise authorized in law pursuant to paragraph
(2) or pursuant to an agreement between a charter school and its
chartering authority.

(2) A school district that receives funding on behalf of a locally
funded charter school pursuant to paragraph (2) of subdivision
(b) of Section 42605, Section 42606, and subdivision (b) of Section
47634 in the 2012-13 fiscal year may annually redirect for another
purpose a percentage of the amount of the funding received on
behalf of that charter school. The percentage of funding that may
be redirected shall be determined pursuant to the following
computation:

(A) (i) Determine the sum of the need fulfilled for that charter
school pursuant to paragraph (3) of subdivision (b) of Section
42238.03 in the then current fiscal year for the charter school.

(ii) Determine the sum of the need fulfilled in every fiscal year
before the then current fiscal year pursuant to paragraph (3) of
subdivision (b) of Section 42238.03 adjusted for changes in average
daily attendance pursuant to paragraph (3) of subdivision (a) of
Section 42238.03 for the charter school.

(iii) Subtract the amount computed pursuant to paragraphs (1)
to (3), inclusive, of subdivision (a) of Section 42238.03 from the
amount computed for that charter school under the local control
funding formula entitlement computed pursuant to subdivision (i)
of Section 42238.02.

(iv) Compute a percentage by dividing the sum of the amounts
computed to clauses (i) and (ii) by the amount computed pursuant
to clause (iii).

(B) Multiply the percentage computed pursuant to subparagraph
(A) by the amount of funding the school district received on behalf
of the charter school pursuant to paragraph (2) of subdivision (b)
of Section 42605, Section 42606, and subdivision (b) of Section
47634 for the 2012-13 fiscal year.

(C) The maximum amount that may be redirected shall be the
lesser of the amount of funding the school district received on
behalf of the charter school pursuant to paragraph (2) of
subdivision (b) of Section 42605, Section 42606, and subdivision
(b) of Section 47634 for the 2012-13 fiscal year or the amount
computed pursuant to subparagraph (B).

(3) Commencing with the 2013-14 fiscal year, a school district
operating one or more affiliated charter schools shall provide
each affiliated charter school schoolsite with no less than the
amount of funding the schoolsite received pursuant to the charter
school block grant in the 2012-13 fiscal year.

(m) Any calculations in law that are used for purposes of
determining if a local educational agency is an excess tax school
entity or basic aid school district, including, but not limited to,
this section and Sections 42238.03, 41544, 47660, 47632, 47663,
48310, and 48359.5, and Section 95 of the Revenue and Taxation
Code, shall be made exclusive of the revenue received pursuant
to subparagraph (B) of paragraph (3) of subdivision (e) of Section
36 of Article XIII of the California Constitution.

(n) A school district that does not receive an apportionment of
state funds pursuant to this section as implemented pursuant to
Section 42238.03, excluding funds apportioned pursuant to the
requirements of subdivision (d) of Section 42238.03 shall be
considered a “basic aid school district” or an “excess tax entity.”

(o) The funds apportioned pursuant to this section and Section
42238.03 shall be available to implement the activities required
pursuant to Article 4.5 (commencing with Section 52060) of
Chapter 6.1 of Part 28 of Division 4 of Title 2.

end insert

begin insert

begin insert SEC. 29. end insert   

end insert

begin insert Section 42238.025 is added to the end insert begin insert Education Code end insert begin insert ,
to read: end insert

begin insert

begin insert 42238.025. end insert   

(a) In the 2013-14 fiscal year, the Superintendent
shall compute an economic recovery target rate for each school
district and charter school equal to the sum of the following:

(1) (A) For each school district, the school district’s revenue
limit in the 2012-13 fiscal year as computed pursuant to this
article, as this article read on January 1, 2013, divided by the
2012-13 fiscal year average daily attendance of the school district
computed pursuant to Section 42238.05.

(B) For each charter school, the charter school’s general
purpose funding as computed pursuant to Article 2 (commencing
with Section 47633) of Chapter 6 of Part 26.8 of Division 4, as
that article read on January 1, 2013, and the in-lieu property tax
amount provided to the charter school pursuant to Section 47635,
as that section read on January 1, 2013, divided by the 2012-13
fiscal year average daily attendance of the school district computed
pursuant to Section 42238.05.

(C) The amounts determined pursuant to subparagraphs (A)
and (B) of this paragraph shall not reflect the deficit factor
adjustments set forth in Section 42238.146 as that section read on
January 1, 2013.

(D) The amounts determined pursuant to this subdivision shall
be adjusted for the cost of living for the 2013-14 fiscal year
pursuant to paragraph (2) of subdivision (d) of Section 42238.02
and an annual average cost-of-living adjustment of 1.94 percent
for the 2014-15 fiscal year to the 2020-21 fiscal year, inclusive.

(2) (A) For each school district and charter school the sum of
the entitlements from items contained in Section 2.00 of the Budget
Act of 2012 for Items 6110-104-0001, 6110-105-0001,
6110-108-0001, 6110-111-0001, 6110-124-0001, 6110-128-0001,
6110-137-0001, 6110-144-0001, 6110-156-0001, 6110-181-0001,
6110-188-0001, 6110-189-0001, 6110-190-0001, 6110-193-0001,
6110-195-0001, 6110-198-0001, 6110-204-0001, 6110-208-0001,
6110-209-0001, 6110-211-0001, 6110-212-0001, 6110-227-0001,
6110-228-0001, 6110-232-0001, 6110-240-0001, 6110-242-0001,
6110-243-0001, 6110-244-0001, 6110-245-0001, 6110-246-0001,
6110-247-0001, 6110-248-0001, 6110-260-0001, 6110-265-0001,
6110-267-0001, 6110-268-0001, 6360-101-0001, 2012-13 fiscal
year funding for the Class Size Reduction Program pursuant to
Chapter 6.10 (commencing with Section 52120) of Part 28 of
Division 4, as it read on January 1, 2013, and 2012-13 fiscal year
funding for the community day school mandatorily expelled pupils
program pursuant to subdivision (c) of Section 48915, divided by
the 2012-13 fiscal year average daily attendance of the school
district computed pursuant to Section 42238.05.

(B) The amounts determined pursuant to this subdivision shall
not be adjusted for the reduction set forth in Section 12.42 of the
Budget Act of 2012.

(b) Of the amounts computed for school districts pursuant to
subdivision (a), the Superintendent shall determine the funding
rate per unit of average daily attendance above which fall not
more than 10 percent of the total number of school districts
statewide.

(c) The Superintendent shall compute a 2020-21 fiscal year
local control funding formula rate for each school district and
charter school equal to the amount computed pursuant to section
42238.02 for the 2013-14 fiscal year, adjusted for an annual
average cost-of-living adjustment of 1.94 percent for the 2014-15
fiscal year to the 2020-21 fiscal year, inclusive, divided by the
2012-13 fiscal year average daily attendance of the school district
or charter school computed pursuant to Section 42238.05.

(d) (1) For each school district and charter school that has a
funding rate per unit of average daily attendance computed
pursuant to subdivision (a) that is equal to, or below, the funding
rate per unit of average daily attendance determined pursuant to
subdivision (b), the Superintendent shall subtract the amount
computed pursuant to subdivision (c) from the amount computed
pursuant to subdivision (a). Each school district or charter school
for which this calculation yields an amount greater than zero shall
be eligible for an economic recovery target payment equal to the
amount of the difference. A school district or charter school that
has a funding rate per unit of average daily attendance calculated
pursuant to subdivision (a) that exceeds the rate calculated
pursuant to subdivision (b) shall not be eligible for an economic
recovery target payment.

(2) Each school district or charter school eligible for an
economic recovery target payment pursuant to paragraph (1) shall
receive the following apportionments:

(A) For the 2013-14 fiscal year, one-eighth of the amount
calculated pursuant to paragraph (1) multiplied by the 2012-13
fiscal year average daily attendance computed pursuant to Section
42238.05.

(B) For the 2014-15 fiscal year, two-eighths of the amount
calculated pursuant to paragraph (1) multiplied by the 2012-13
fiscal year average daily attendance computed pursuant to Section
42238.05.

(C) For the 2015-16 fiscal year, three-eighths of the amount
calculated pursuant to paragraph (1) multiplied by the 2012-13
fiscal year average daily attendance computed pursuant to Section
42238.05.

(D) For the 2016-17 fiscal year, four-eighths of the amount
calculated pursuant to paragraph (1) multiplied by the 2012-13
fiscal year average daily attendance computed pursuant to Section
42238.05.

(E) For the 2017-18 fiscal year, five-eighths of the amount
calculated pursuant to paragraph (1) multiplied by the 2012-13
fiscal year average daily attendance computed pursuant to Section
42238.05.

(F) For the 2018-19 fiscal year, six-eighths of the amount
calculated pursuant to paragraph (1) multiplied by the 2012-13
fiscal year average daily attendance computed pursuant to Section
42238.05.

(G) For the 2019-20 fiscal year, seven-eighths of the amount
calculated pursuant to paragraph (1) multiplied by the 2012-13
fiscal year average daily attendance computed pursuant to Section
42238.05.

(H) For the 2020-21 fiscal year and each fiscal year thereafter,
the amount calculated pursuant to paragraph (1) multiplied by
the 2012-13 fiscal year average daily attendance computed
pursuant to Section 42238.05.

(3) In each fiscal year until a determination has been made that
all school districts and charter schools equal or exceed the local
control funding formula target computed pursuant to Section
42238.02, as determined by the calculation of a zero difference
pursuant to paragraph (1) of subdivision (b) of Section 42238.03,
the economic recovery target payment apportioned to each eligible
school district or charter school pursuant to paragraph (2) shall
be added to the school district’s or charter school’s funding
amounts that are continuously appropriated pursuant to
subdivision (a) of Section 42238.03 and included in the amount
of funding that may be offset pursuant to subdivision (c) of Section
42238.03. The amount apportioned pursuant to paragraph (2)
shall not receive a cost-of-living adjustment.

(4) Commencing with the first fiscal year in which all school
districts and charter schools are apportioned funding pursuant to
Section 42238.02, the economic recovery target payment amount
calculated pursuant to paragraph (2) for the applicable fiscal year
shall be included as an add-on to the amounts computed pursuant
to subdivisions (c) to (i), inclusive, of Section 42238.02 and
included in the amount of funding that may be offset pursuant to
subdivision (j) of Section 42238.02. The amount included as an
add-on pursuant to this paragraph shall not receive a cost-of-living
adjustment.

end insert

begin insert

begin insert SEC. 30. end insert   

end insert

begin insert Section 42238.03 is added to the end insert begin insert Education Code end insert begin insert , to
read: end insert

begin insert

begin insert 42238.03. end insert   

(a) Commencing with the 2013-14 fiscal year and
each fiscal year thereafter, the Superintendent shall calculate a
base entitlement for the transition to the local control funding
formula for each school district and charter school equal to the
sum of the amounts computed pursuant to paragraphs (1) to (4),
inclusive. The amounts computed pursuant to paragraphs (1) to
(6), inclusive, shall be continuously appropriated pursuant to
Section 14002.

(1) The current fiscal year base entitlement funding level shall
be the sum of all of the following:

(A) For school districts, revenue limits in the 2012-13 fiscal
year as computed pursuant to Article 2 (commencing with Section
42238), as that article read on January 1, 2013, divided by the
2012-13 average daily attendance of the school district computed
pursuant to Section 42238.05. That quotient shall be multiplied
by the current fiscal year average daily attendance of the school
district computed pursuant Section 42238.05.

(B) (i) For charter schools, general purpose funding as
computed pursuant to Article 2 (commencing with Section 47633)
of Chapter 6, as that article read on January 1, 2013, and the
amount of in-lieu property tax provided to the charter school
pursuant to Section 47635, as that section read on June 30, 2013,
divided by the 2012-13 average daily attendance of the charter
school computed pursuant to Section 42238.05. That quotient shall
be multiplied by the current fiscal year average daily attendance
of the charter school computed pursuant to Section 42238.05.

(ii) The amount computed pursuant to clause (i) shall exclude
funds received by a charter school pursuant to Section 47634.1,
as that section read on January 1, 2013.

(C) The amount computed pursuant to subparagraphs (A) and
(B) shall exclude funds received pursuant to Section 47633, as
that section read on January 1, 2013.

(D) The amount computed pursuant to subparagraph (A) shall
exclude amounts computed pursuant to Article 4 (commencing
with Section 42280). Funding for qualifying necessary small high
school and necessary small elementary schools shall be adjusted
pursuant Article 4 (commencing with Section 42280) and Section
42238.146, as those provisions read on January 1, 2013.

(2) Entitlements from items contained in Section 2.00, as
adjusted pursuant to Section 12.42, of the Budget Act of 2012 for
Items 6110-104-0001, 6110-105-0001, 6110-108-0001,
6110-111-0001, 6110-124-0001, 6110-128-0001, 6110-137-0001,
6110-144-0001, 6110-156-0001, 6110-181-0001, 6110-188-0001,
6110-189-0001, 6110-190-0001, 6110-193-0001, 6110-195-0001,
6110-198-0001, 6110-204-0001, 6110-208-0001, 6110-209-0001,
6110-211-0001, 6110-212-0001, 6110-227-0001, 6110-228-0001,
6110-232-0001, 6110-240-0001, 6110-242-0001, 6110-243-0001,
6110-244-0001, 6110-245-0001, 6110-246-0001, 6110-247-0001,
6110-248-0001, 6110-260-0001, 6110-265-0001, 6110-267-0001,
6110-268-0001, 6360-101-0001, 2012-13 fiscal year funding for
the Class Size Reduction Program pursuant to Chapter 6.10
(commencing with Section 52120) of Part 28 of Division 4, as it
read on January 1, 2013, and 2012-13 fiscal year funding for
pupils enrolled in community day schools who are mandatorily
expelled pursuant to subdivision (c) of Section 48915. The
entitlement for basic aid school districts shall include the reduction
of 8.92 percent as applied pursuant to subparagraph (A) of
paragraph (1) of subdivision (a) of Section 3 of Chapter 2 of the
Statutes of 2012.

(3) The allocations pursuant to Sections 42606 and 47634.1,
as those sections read on January 1, 2013, divided by the 2012-13
average daily attendance of the charter school computed pursuant
to Section 42238.05. That quotient shall be multiplied by the
current fiscal year average daily attendance of the charter school
computed pursuant to Section 42238.05.

(4) The amount allocated to a school district or charter school
pursuant to paragraph (3) of subdivision (b) for the fiscal years
before the current fiscal year divided by the average daily
attendance of the school district or charter school for the fiscal
years before the current fiscal year computed pursuant to Section
42238.05. That quotient shall be multiplied by the current fiscal
year average daily attendance of the school district or charter
school computed pursuant to Section 42238.05.

(5) For the 2013-14 and 2014-15 fiscal years only, a school
district that, in the 2012-13 fiscal year, from any of the funding
sources identified in paragraph (1) or (2), received funds on behalf
of, or provided funds to, a regional occupational center or program
joint powers agency established in accordance with Article 1
(commencing with Section 6500) of Chapter 5 of Division 7 of
Title 1 of the Government Code for purposes of providing
instruction to secondary pupils shall not redirect that funding for
another purpose unless otherwise authorized in law or pursuant
to an agreement between the regional occupational center or
program joint powers agency and the contracting school district.

(6) (A) For the 2013-14 and 2014-15 fiscal years only, a school
district that, in the 2012-13 fiscal year, from any of the funding
sources identified in paragraph (1) or (2), received funds on behalf
of, or provided funds to, a home-to-school transportation joint
powers agency established in accordance with Article 1
(commencing with Section 6500) of Chapter 5 of Division 7 of
Title 1 of the Government Code for purposes of providing pupil
transportation shall not redirect that funding for another purpose
unless otherwise authorized in law or pursuant to an agreement
between the home-to-school transportation joint powers agency
and the contracting school district.

(B) In addition to subparagraph (A), of the funds a school
district receives for home-to-school transportation programs
pursuant to Article 2 (commencing with Section 39820) of Chapter
1 of Part 23.5, and Article 10 (commencing with Section 41850)
of Chapter 5, the school district shall expend no less than the
amount of funds the school district expended for home-to-school
transportation in the 2012-13 fiscal year.

(7) For the 2013-14 and 2014-15 fiscal years only, of the funds
a school district receives for purposes of regional occupational
centers or programs, or adult education, the school district shall
expend no less than the amount of funds the school district
expended for purposes of regional occupational centers or
programs, or adult education, respectively, in the 2012-13 fiscal
year.

(b) Compute an annual local control funding formula transition
adjustment for each school district and charter school as follows:

(1) Subtract the amount computed pursuant to paragraphs (1)
to (4), inclusive, of subdivision (a) from the amount computed for
each school district or charter school under the local control
funding formula entitlements computed pursuant to subdivision
(i) of Section 42238.02. School districts and charter schools with
a negative difference shall be deemed to have a zero difference.

(2) Each school district’s and charter school’s total need as
calculated pursuant to paragraph (1) shall be divided by the sum
of all school districts’ and charter schools’ total need to determine
the school district’s or charter school’s respective proportions of
total need.

(3) Each school district’s and charter school’s proportion of
total need shall be multiplied by any available appropriations
specifically made for purposes of this subdivision, and added to
the school district’s or charter school’s funding amounts as
calculated pursuant to subdivision (a).

(4) If the total amount of funds appropriated for purposes of
paragraph (3) pursuant to this subdivision are sufficient to fully
fund any positive amounts computed pursuant to paragraph (1),
the local control funding formula grant computed pursuant to
subdivision (c) of Section 42238.02 shall be adjusted to ensure
that any available appropriation authority is expended for purposes
of the local control funding formula.

(5) Commencing with the first fiscal year after either paragraph
(4) or paragraph (2) of subdivision (h) applies, the adjustments
in paragraph (2) of subdivision (d) of Section 42238.02 shall be
made only if an appropriation for those adjustments is included
in the annual Budget Act.

(c) The Superintendent shall subtract from the amounts
computed pursuant to subdivisions (a) and (b) the sum of the
following:

(1) (A) For school districts, the property tax revenue received
pursuant to Chapter 3.5 (commencing with Section 75) and Chapter
6 (commencing with Section 95) of Part 0.5 of Division 1 of the
Revenue and Taxation Code.

(B) For charter schools, the in-lieu property tax amount
provided to a charter school pursuant to Section 47635.

(2) The amount, if any, received pursuant to Part 18.5
(commencing with Section 38101) of Division 2 of the Revenue
and Taxation Code.

(3) The amount, if any, received pursuant to Chapter 3
(commencing with Section 16140) of Part 1 of Division 4 of Title
2 of the Government Code.

(4) Prior years’ taxes and taxes on the unsecured roll.

(5) Fifty percent of the amount received pursuant to Section
41603.

(6) The amount, if any, received pursuant to the Community
Redevelopment Law (Part 1 (commencing with Section 33000) of
Division 24 of the Health and Safety Code), less any amount
received pursuant to Section 33401 or 33676 of the Health and
Safety Code that is used for land acquisition, facility construction,
reconstruction, or remodeling, or deferred maintenance and that
is not an amount received pursuant to Section 33492.15, or
paragraph (4) of subdivision (a) of Section 33607.5, or Section
33607.7 of the Health and Safety Code that is allocated exclusively
for educational facilities.

(7) The amount, if any, received pursuant to Sections 34183
and 34188 of the Health and Safety Code.

(8) Revenue received pursuant to subparagraph (B) of
paragraph (3) of subdivision (e) of Section 36 of Article XIII of
the California Constitution.

(d) A school district or charter school that has a zero difference
pursuant to paragraph (1) of subdivision (b) in the prior fiscal
year shall receive an entitlement equal to the amount calculated
pursuant to Section 42238.02 in the current fiscal year and future
fiscal years.

(e) Notwithstanding the computations pursuant to subdivisions
(b) to (d), inclusive, and Section 42238.02, commencing with the
2013-14 fiscal year, a school district or charter school shall
receive state-aid funding of no less than the sum of the amounts
computed pursuant to paragraphs (1) to (3), inclusive.

(1) (A) For school districts, revenue limits in the 2012-13 fiscal
year as computed pursuant to Article 2 (commencing with Section
42238), as that article read on January 1, 2013, divided by the
2012-13 average daily attendance of the school district computed
pursuant to Section 42238.05. That quotient shall be multiplied
by the current fiscal year average daily attendance of the school
district computed pursuant Section 42238.05 and then offset for
local revenues pursuant to subdivision (c) for the current fiscal
year.

(B) (i) For charter schools, general purpose funding in the
2012-13 fiscal year as computed pursuant to Article 2
(commencing with Section 47633) of Chapter 6, as that article
read on January 1, 2013, and the amount of in-lieu property tax
provided to the charter school in the 2012-13 fiscal year pursuant
to Section 47635, as that section read on January 1, 2013, divided
by the 2012-13 average daily attendance of the charter school
computed pursuant to Section 42238.05. That quotient shall be
multiplied by the current fiscal year average daily attendance of
the charter school computed pursuant to Section 42238.05 and
then offset for local revenues pursuant to subdivision (c) for the
current fiscal year.

(ii) The amount computed pursuant to clause (i) shall exclude
funds received by a charter school pursuant to Section 47634.1,
as that section read on January 1, 2013.

(C) The amount computed pursuant to subparagraphs (A) and
(B) shall exclude funds received pursuant to Section 47633, as
that section read on January 1, 2013.

(D) The amount computed pursuant to subparagraph (A) shall
exclude amounts computed pursuant to Article 4 (commencing
with Section 42280). Funding for qualifying necessary small high
school and necessary small elementary schools shall be adjusted
pursuant Article 4 (commencing with Section 42280) and Section
42238.146, as those provisions read on January 1, 2013.

(E) The amount computed pursuant to subparagraphs (A) to
(C), inclusive, shall be reduced by the sum of the amount computed
pursuant to paragraphs (1) to (8), inclusive, of subdivision (c).

(2) (A) Entitlements from items contained in Section 2.00, as
adjusted pursuant to Section 12.42, of the Budget Act of 2012 for
Items 6110-104-0001, 6110-105-0001, 6110-108-0001,
6110-111-0001, 6110-124-0001, 6110-128-0001, 6110-137-0001,
6110-144-0001, 6110-156-0001, 6110-181-0001, 6110-188-0001,
6110-189-0001, 6110-190-0001, 6110-193-0001, 6110-195-0001,
6110-198-0001, 6110-204-0001, 6110-208-0001, 6110-209-0001,
6110-211-0001, 6110-212-0001, 6110-227-0001, 6110-228-0001,
6110-232-0001, 6110-240-0001, 6110-242-0001, 6110-243-0001,
6110-244-0001, 6110-245-0001, 6110-246-0001, 6110-247-0001,
6110-248-0001, 6110-260-0001, 6110-265-0001, 6110-267-0001,
6110-268-0001, 6360-101-0001, 2012-13 fiscal year funding for
the Class Size Reduction Program pursuant to Chapter 6.10
(commencing with Section 52120) of Part 28 of Division 4, as it
read on January 1, 2013, and 2012-13 fiscal year funding for
pupils enrolled in community day schools who are mandatorily
expelled pursuant to subdivision (c) of Section 48915.
Notwithstanding Section 39 of Chapter 38 of the Statutes of 2012,
the entitlement for basic aid school districts shall include the
reduction of 8.92 percent as applied pursuant to subparagraph
(A) of paragraph (1) of subdivision (a) of Section 3 of Chapter 2
of the Statutes of 2012.

(3) The allocations pursuant to Sections 42606 and 47634.1,
as those sections read on January 1, 2013, divided by the 2012-13
average daily attendance of the charter school. That quotient shall
be multiplied by the current fiscal year average daily attendance
of the charter school.

(f) (1) For purposes of this section, commencing with the
2013-14 fiscal year and until all school districts and charter
schools equal or exceed their local control funding formula target
computed pursuant to Section 42238.02 as determined by the
calculation of a zero difference pursuant to paragraph (1) of
subdivision (b), a newly operational charter school shall be
determined to have a prior year per average daily attendance
funding amount equal to the lesser of:

(A) The prior year funding amount per unit of average daily
attendance for the school district in which the charter school is
physically located. The Superintendent shall calculate the funding
amount per unit of average daily attendance for this purpose by
dividing the total local control funding formula entitlement received
by that school district in the prior year by prior year average daily
attendance of that school district. For purposes of this paragraph,
a charter school that is physically located in more than one school
district shall use the calculated local control funding entitlement
per unit of average daily attendance of the school district with the
highest prior year funding amount per unit of average daily
attendance.

(B) The charter school’s local control funding formula rate
computed pursuant to subdivisions (c) to (i), inclusive, of Section
42238.02.

(2) For charter schools funded pursuant to paragraph (1), the
charter school shall be eligible to receive growth funding pursuant
to subdivision (b) toward meeting the newly operational charter
school’s local control funding formula target.

(3) Upon a determination that all school districts and charter
schools equal or exceed the local control funding formula target
computed pursuant to Section 42238.02 as determined by the
calculation of a zero difference pursuant to paragraph (1) of
subdivision (b) for all school districts and charter schools, this
subdivision shall not apply and the charter school shall receive
an allocation equal to the amount calculated under Section
42238.02 in that fiscal year and future fiscal years.

(g) (1) In each fiscal year the Superintendent shall determine
the percentage of school districts that are apportioned funding
pursuant to this section that is less than the amount computed
pursuant to Section 42238.02 as of the second principal
apportionments of the fiscal year. If the percentage is less than 10
percent, the Superintendent shall apportion funding to the school
districts and charter schools equal to the amount computed
pursuant to Section 42238.02 in that fiscal year.

(2) For each fiscal year thereafter, the Superintendent shall
apportion funding to a school district and charter school equal to
the amount computed pursuant to Section 42238.02.

end insert

begin insert

begin insert SEC. 31. end insert   

end insert

begin insert Section 42238.04 is added to the end insert begin insert Education Code end insert begin insert , to
read: end insert

begin insert

begin insert 42238.04. end insert   

Notwithstanding any other law, revenue limit funding
for school districts and charter school block grant funding for
charter schools for the 2012-13 fiscal year and prior fiscal years
shall continue to be adjusted pursuant to Article 2 (commencing
with Section 42238), and Article 2 (commencing with Section
47633) of Chapter 6 of Part 26.8 of Division 4, as those articles
read on January 1, 2013.

end insert

begin insert

begin insert SEC. 32. end insert   

end insert

begin insert Section 42238.05 is added to the end insert begin insert Education Code end insert begin insert , to
read: end insert

begin insert

begin insert 42238.05. end insert   

(a) For purposes of Sections 42238.02 and
42238.03, the fiscal year average daily attendance shall be
computed pursuant to paragraph (1) or (2).

(1) The second principal apportionment regular average daily
attendance for either the current or prior fiscal year, whichever
is greater. However, prior fiscal year average daily attendance
shall be adjusted for any loss or gain of average daily attendance
due to a reorganization or transfer of territory.

(2) A school district that elects to receive funding pursuant to
Article 4 (commencing with Section 42280) shall compute its units
of average daily attendance for purposes of paragraphs (1), (3),
and (4), of subdivision (d) of Section 42238.02 by subtracting the
amount determined in subparagraph (B) from the amount
determined in subparagraph (A).

(A) The units of average daily attendance computed pursuant
to paragraph (1).

(B) The units of average daily attendance resulting from pupils
attending schools funded pursuant to Article 4 (commencing with
Section 42280).

(b) For purposes of this article, regular average daily
attendance shall be the base grant average daily attendance.

(c) For purposes of this section, the Superintendent shall
distribute total ungraded enrollment and average daily attendance
among kindergarten and each of grades 1 to 12, inclusive, in
proportion to the amounts of graded enrollment and average daily
attendance, respectively, in each of these grades.

(d) For purposes of this section, the Superintendent shall
distribute average daily attendance generated by the difference
between prior year average daily attendance and current year
average daily attendance, if positive, among kindergarten and
each of grades 1 to 12, inclusive, in proportion to the amounts of
graded average daily attendance, respectively, in each of these
grades.

(e) This section shall only apply to average daily attendance
generated by school districts and shall not apply to average daily
attendance generated by charter schools.

(f) A pupil shall not be counted more than once for purposes of
calculating average daily attendance pursuant to this section.

end insert

begin insert

begin insert SEC. 33. end insert   

end insert

begin insert Section 42238.051 is added to the end insert begin insert Education Code end insert begin insert ,
to read: end insert

begin insert

begin insert 42238.051. end insert   

(a) For purposes of paragraph (1) of subdivision
(a) of Section 42238.05, a sponsoring school district’s average
daily attendance shall be computed as follows:

(1) Compute the sponsoring school district’s regular average
daily attendance in the current year, excluding the attendance of
pupils in charter schools.

(2) (A) Compute the regular average daily attendance used to
calculate the second principal apportionment of the school district
for the prior year, excluding the attendance of pupils in charter
schools.

(B) Compute the attendance of pupils who attended one or more
noncharter schools of the school district between July 1, and the
last day of the second period, inclusive, in the prior year, and who
attended a charter school sponsored by the school district between
July 1, and the last day of the second period, inclusive, in the
current year. For purposes of this subparagraph, a pupil enrolled
in a grade at a charter school sponsored by the school district
shall not be counted if the school district does not offer classes for
pupils enrolled in that grade. The amount of the attendance counted
for any pupil for the purpose of this subparagraph may not be
greater than the attendance claimed for that pupil by the charter
school in the current year.

(C) Compute the attendance of pupils who attended a charter
school sponsored by the school district in the prior year and who
attended one or more noncharter schools of the school district in
the current year. The amount of the attendance counted for any
pupil for the purpose of this subparagraph may not be greater
than the attendance claimed for that pupil by the school district
in the current year.

(D) From the amount determined pursuant to subparagraph
(B), subtract the amount determined pursuant to subparagraph
(C). If the result is less than zero, the amount shall be deemed to
be zero.

(E) The prior year average daily attendance determined
pursuant to subparagraph (A) shall be reduced by the amount
determined pursuant to subparagraph (D).

(3) To the greater of the amounts computed pursuant to
paragraphs (1) and (2), add the regular average daily attendance
in the current year of all pupils attending charter schools
sponsored by the school district that are not funded through the
charter schools local control funding formula allocation pursuant
to Section 42238.02, as implemented by Section 42238.03.

(b) For purposes of this section, a “sponsoring school district”
shall mean a “sponsoring local educational agency,” as defined
in Section 47632, as that section read on January 1, 2013.

end insert

begin insert

begin insert SEC. 34. end insert   

end insert

begin insert Section 42238.052 is added to the end insert begin insert Education Code end insert begin insert ,
to read: end insert

begin insert

begin insert 42238.052. end insert   

(a) Notwithstanding any other law, the prior year
average daily attendance for a school district determined pursuant
to subdivision (a) of Section 42238.051 shall be increased by the
prior year second principal apportionment average daily
attendance of a school district only for a school that meets the
following description:

(1) The school was a district noncharter school in any year
before the prior year.

(2) The school was operated as a district-approved charter
school in the prior year.

(3) The school is again operated as a district noncharter school
in the current year.

(b) An adjustment to prior year average daily attendance
pursuant to this section may not be made for the attendance of
pupils who were not residents of the school district in the prior
year.

end insert

begin insert

begin insert SEC. 35. end insert   

end insert

begin insert Section 42238.053 is added to the end insert begin insert Education Code end insert begin insert ,
to read: end insert

begin insert

begin insert 42238.053. end insert   

(a) The fiscal year average daily attendance
computed under Section 42238.05 shall be increased, for each
school district that operates a school that meets the eligibility
requirements set forth in subdivision (b), by the number of days
of attendance of pupils enrolled in eligible schools in the school
district who are currently migratory children, as defined by Section
54441, and who are residing in state-operated migrant housing
projects between the second principal apportionment and the end
of the regular school year, divided by the number of days school
was actually taught in the regular day schools of the district,
excluding Saturdays and Sundays.

(b) For a school district to be eligible for purposes of this
section, the following conditions shall apply:

(1) One or more state-operated migrant housing projects are
located within the attendance area of the school.

(2) The maximum number of pupils enrolled in the school in the
relevant fiscal year who are currently migratory children, as
calculated under subdivision (a), constitutes not less than one-third
of the total pupil enrollment of the school.

(c) The Superintendent shall establish rules and regulations for
the implementation of this section.

end insert

begin insert

begin insert SEC. 36. end insert   

end insert

begin insert Section 42238.06 is added to the end insert begin insert Education Code end insert begin insert , to
read: end insert

begin insert

begin insert 42238.06. end insert   

Commencing on July 1, 2013, except for Sections
42238, 42238.1, 42238.2, and 42238.5, or where the context
requires otherwise, all of the following shall apply:

(a) References to “revenue limit” shall instead refer to the
“local control funding formula.”

(b) References to “the revenue limit calculated pursuant to
Section 42238” shall instead refer to “the local control funding
formula calculated pursuant to Section 42238.02, as implemented
by Section 42238.03.”

(c) References to “Section 42238” shall instead refer to “Section
42238.02, as implemented pursuant to Section 42238.03.”

(d) References to “Section 42238.1” shall instead refer to
“Section 42238.02.”

(e) References to “Section 42238.5” shall instead refer to
“Section 42238.05.”

(f) References to “general-purpose entitlement” shall instead
refer to “local control funding formula grant funding pursuant to
Section 42238.02, as implemented by Section 42238.03.”

end insert

begin insert

begin insert SEC. 37. end insert   

end insert

begin insert Section 42238.07 is added to the end insert begin insert Education Code end insert begin insert , to
read: end insert

begin insert

begin insert 42238.07. end insert   

(a) On or before January 31, 2014, the state board
shall adopt regulations that govern the expenditure of funds
apportioned on the basis of the number and concentration of
unduplicated pupils pursuant to Sections 2574, 2575, 42238.02,
and 42238.03. The regulations shall include, but are not limited
to, provisions that do all of the following:

(1) Require a school district, county office of education, or
charter school to increase or improve services for unduplicated
pupils in proportion to the increase in funds apportioned on the
basis of the number and concentration of unduplicated pupils in
the school district, county office of education, or charter school.

(2) Authorize a school district, county office of education, or
charter school to use funds apportioned on the basis of the number
of unduplicated pupils for schoolwide purposes, or, for school
districts, districtwide purposes, for county offices of education,
countywide purposes, or for charter schools, charterwide purposes,
in a manner that is no more restrictive than the restrictions
provided for in Title I of the federal No Child Left Behind Act of
2001 (20 U.S.C. Sec. 6301, et seq.).

(b) The state board may adopt emergency regulations for
purposes of this section.

end insert

begin insert

begin insert SEC. 38. end insert   

end insert

begin insert Section 42238.1 of the end insert begin insert Education Code end insert begin insert is amended
to read: end insert

42238.1.  

(a) For the 1986-87 fiscal year and each fiscal year
up to and including the 1998-99 fiscal year, the Superintendent
of Public Instruction 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 districts of similar
type.

(B) The amount, if any, per unit of average daily attendance
received by the 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 1 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 1 of the second preceding fiscal
year, as reported by the Department of Finance.

(b) For the 1999-2000 fiscal year and each fiscal year thereafter,
the Superintendent of Public Instruction 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 districts of similar
type.

(B) The amount, if any, per unit of average daily attendance
received by the 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.

(c) This section shall become operative July 1, 1986.

begin insert

(d) Commencing with the 2013-14 fiscal year, this section shall
be used only for purposes of allocating revenues received pursuant
to subparagraph (B) of paragraph (3) of subdivision (e) of Section
36 of Article XIII of the California Constitution.

end insert begin insert

(e) This section shall become inoperative on July 1, 2021, and,
as of January 1, 2022, is repealed, unless a later enacted statute,
that becomes operative on or before January 1, 2022, deletes or
extends the dates on which it becomes inoperative and is repealed.

end insert

begin insert

begin insert SEC. 39. end insert   

end insert

begin insert Section 42238.2 of the end insert begin insert Education Code end insert begin insert is amended
to read: end insert

42238.2.  

(a) (1) Notwithstanding Section 42238.5 or any other
provision of law, a school district that meets any of the following
conditions shall be entitled to an adjustment to its units of average
daily attendance pursuant to this section:

(A) The school district experiences a decline in the number of
units of average daily attendance in excess of 8 percent of its total
average daily attendance as a result of the closure of a facility
operated by a branch of the United States Armed Forces in the
school district’s boundaries.

(B) The school district experiences a decline in the number of
units of average daily attendance that is less than 8 percent but at
least 5 percent of its total average daily attendance as a result of
the closure of a facility operated by a branch of the United States
Armed Forces in that school district’s boundaries, upon a finding
by both the Superintendent of Public Instruction and the Director
of Finance that both of the following conditions exist:

(i) The school district demonstrates that at the end of a three-year
period the school district will experience a 10-percent reduction
in the amount of funding that the school district would otherwise
have received from state apportionments, funding received pursuant
to the California State Lottery Act of 1984 (Chapter 12.5
(commencing with Section 8880) of Division 1 of Title 2 of the
Government Code), and funding received pursuant to Title VIII
of Public Law 103-382, as a result of the loss of pupils related to
the closure of a facility operated by a branch of the United States
Armed Forces.

(ii) The fiscal crisis and management assistance team established
pursuant to Section 42127.8 has reviewed the school district’s
finances and has found that the school district has taken significant
steps to reduce expenditure.

(C) The school district experiences a decline in the number of
units of average daily attendance in excess of 5 percent of its total
average daily attendance and the Director of Finance determines
that the school district is likely, within eight years of that decline,
to maintain a number of units of average daily attendance that is
equivalent to the number of units of average daily attendance
maintained by the school district prior to the decline.
Notwithstanding subdivision (b), loan repayments shall commence
no later than the fourth year after the base year or at a later time,
as determined by the Director of Finance.

(2) For purposes of this section, the year preceding a decline
shall be the base year.

(b) In the second year after the base year, the district average
daily attendance pursuant to Section 42238.5 may, if the district
chooses, be increased by 75 percent of the difference between the
base year units of average daily attendance and the units of average
daily attendance in the first year of decline. In the third year after
the base year, the district average daily attendance pursuant to
Section 42238.5 may, if the district chooses, be increased by 50
percent of the difference between the base year units of average
daily attendance and the units of average daily attendance in the
first year of decline. The amount of money represented by these
increases shall be considered a loan to the school district. Loan
repayments shall commence no later than the fourth year after the
base year.

(c) (1) The Superintendent of Public Instruction, in consultation
with a school district subject to this section, shall determine a
schedule for repayment of the total amount loaned pursuant to this
section which may not exceed 10 years. Payments shall include
interest charged at a rate based on the most current investment rate
of the Pooled Money Investment Account in the General Fund as
of the date of the disbursement of funds to the school district.

(2) Upon written notification by the Superintendent of Public
Instruction that the school district has not made one or more of the
payments required by the schedule established pursuant to
paragraph (1), the Controller shall withhold from Section A of the
State School Fund the defaulted payment which shall not exceed
the amount of any apportionment entitlement of the district to
moneys in Section A of the State School Fund. In that regard, the
Controller shall withhold the amount of any payment made under
this subdivision, including reimbursement of the Controller’s
administrative costs as determined under a schedule approved by
the California Debt Advisory Commission, from subsequent
apportionments to the school district from Section A of the State
School Fund.

(3) Any apportionments made by the Controller pursuant to
paragraph (2) shall be deemed to be an allocation to the school
district for purposes of subdivision (b) of Section 8 of Article XVI
of the California Constitution, and for purposes of Chapter 2
(commencing with Section 41200) of Part 24.

(d) In no event shall the adjustment provided by this section
cause the apportionment to a school district to exceed the amount
that would otherwise be calculated for apportionment to the district
pursuant to Sections 42238 and 42238.1.

(e) This section does not apply to a school district that
experiences a decline in enrollment as a result of a school district
reorganization pursuant to Chapter 3 (commencing with Section
35500) of Part 21 or any other law.

begin insert

(f) Commencing with the 2013-14 fiscal year, this section shall
be used only for purposes of allocating revenues received pursuant
to subparagraph (B) of paragraph (3) of subdivision (e) of Section
36 of Article XIII of the California Constitution.

end insert begin insert

(g) This section shall become inoperative on July 1, 2021, and,
as of January 1, 2022, is repealed, unless a later enacted statute,
that becomes operative on or before January 1, 2022, deletes or
extends the dates on which it becomes inoperative and is repealed.

end insert

begin insert

begin insert SEC. 40. end insert   

end insert

begin insert Section 42238.5 of the end insert begin insert Education Code end insert begin insert is amended
to read: end insert

42238.5.  

(a) For purposes of Section 42238, the fiscal year
average daily attendance shall be computed pursuant to paragraph
(1) or (2).

(1) The second principal apportionment regular average daily
attendance for either the current or prior fiscal year, whichever is
greater. However, prior fiscal year average daily attendance shall
be adjusted for any loss or gain of average daily attendance due
to a reorganization or transfer of territory, or, commencing in the
1993-94 fiscal year, and each fiscal year thereafter, for any change
in average daily attendance for pupils who are concurrently enrolled
in adult programs and classes pursuant to Section 52616.17.

(2) Any school district that elects to receive funding pursuant
to Article 4 (commencing with Section 42280) shall compute its
units of average daily attendance for purposes of Section 42238
by subtracting the amount determined in subparagraph (B) from
the amount determined in subparagraph (A).

(A) The units of average daily attendance computed pursuant
to paragraph (1).

(B) The units of average daily attendance resulting from pupils
attending schools funded pursuant to Article 4 (commencing with
Section 42280).

(b) For purposes of this article, regular average daily attendance
shall be the base revenue limit average daily attendance, excluding
summer school average daily attendance.

(c) For purposes of this section, for the 1998-99 fiscal year
only, the prior year average daily attendance shall be the 1997-98
regular average daily attendance, excluding absences excused
pursuant to subdivision (b) of Section 46010, as that subdivision
read on July 1, 1996.

begin insert

(d) Commencing with the 2013-14 fiscal year, this section shall
be used only for purposes of allocating revenues received pursuant
to subparagraph (B) of paragraph (3) of subdivision (e) of Section
36 of Article XIII of the California Constitution.

end insert begin insert

(e) This section shall become inoperative on July 1, 2021, and,
as of January 1, 2022, is repealed, unless a later enacted statute,
that becomes operative on or before January 1, 2022, deletes or
extends the dates on which it becomes inoperative and is repealed.

end insert

begin insert

begin insert SEC. 41. end insert   

end insert

begin insert Section 42238.15 of the end insert begin insert Education Code end insert begin insert is amended
to read: end insert

42238.15.  

(a) Notwithstanding any other law, and in lieu of
any inflation or cost-of-living adjustment otherwise authorized for
any of the programs enumerated in subdivision (b), state funding
for the programs enumerated in subdivision (b) shall be increased
annually by the product of the following:

(1) The sum of 1.0 plus the percentage change determined under
begin insert paragraph (2) of end insert subdivision begin delete (b) end delete begin insert (d) end insert of Section begin delete 42238.1 end delete begin insert 42238.02 end insert .

(2) The sum of 1.0 plus the percentage of increase, from the
prior fiscal year to the current fiscal year, in each of the workload
factors described in subdivision (b).

(b) The programs for which annual state funding increases are
determined under this section, and the factors used to measure
workload for each of those programs, are as follows:

(1) Special education programs and services, as measured by
the regular second principal apportionment average daily
attendance for kindergarten and grades 1 to 12, inclusive.

(2) Child care and development programs, and preschool
programs, as measured by the state population of children up to
and including four years of age.

begin delete

(3) Instructional materials for kindergarten and grades 1 to 8,
inclusive, as measured by enrollment in kindergarten and grades
1 to 8, inclusive.

(4) Instructional materials for grades 9 to 12, inclusive, as
measured by enrollment in those grades.

(5) Regional occupational programs and centers, as measured
by enrollment in grades 11 and 12.

(6) School improvement programs in kindergarten and grades
1 to 6, inclusive, as measured by enrollment in kindergarten and
grades 1 to 6, inclusive.

(7) School improvement programs in grades 7 to 12, inclusive,
as measured by enrollment in those grades.

(8) Economic impact aid, as measured by the number of children
of ages 5 to 17 years, inclusive, from families that receive Aid to
Families with Dependent Children and the number of pupils of
limited English proficiency, as identified pursuant to Section
52163.

(9) Staff development programs, as measured by enrollment in
kindergarten and grades 1 to 12, inclusive.

(10) Gifted and talented education programs, as measured by
enrollment in kindergarten and grades 1 to 12, inclusive.

end delete

(c) Notwithstanding any other law, child care and development
programs shall not receive a cost-of-living adjustment in the
2012-13, 2013-14, and 2014-15 fiscal years.

begin insert

begin insert SEC. 42. end insert   

end insert

begin insert Section 42280 of the end insert begin insert Education Code end insert begin insert is amended to
read: end insert

42280.  

(a) For each school district that meets, in the current
or prior fiscal year, the conditions specified in Section 42281,
42282, or 42284 the begin delete county superintendent of schools end delete
begin insert Superintendent end insert shall compute, for each qualifying school in the
begin insert school end insert district, an amount pursuant to this article.

(b) For each school district that is a countywide unified school
district that had fewer than 2,501 units of average daily attendance
in the 1990-91 fiscal year, the begin delete county superintendent of schools end delete
begin insert Superintendent end insert shall compute an amount pursuant to this article
for those schools that meet the conditions specified in Sections
42283 and 42285 in the current or prior fiscal year. This
subdivision is only applicable to those schools funded pursuant to
this article in the 1990-91 fiscal year and, in subsequent years, if
the school district has no more than 3,000 units of average daily
attendance.

begin delete

(c) For the 1998-99 fiscal year, average daily attendance
reported pursuant to Section 41601 for the 1997-98 fiscal year,
exclusive of average daily attendance for absences excused
pursuant to subdivision (b) of Section 46010 as that subdivision
read on July 1, 1996, shall be used for the purpose of determining
whether school districts meet the conditions in Sections 42281,
42282, and 42284 for the prior fiscal year.

end delete

begin insert

begin insert SEC. 43. end insert   

end insert

begin insert Section 42281 of the end insert begin insert Education Code end insert begin insert is amended to
read: end insert

42281.  

begin delete (a) end delete begin delete   end delete Except as specified in paragraph (4), for each
elementary school district that maintains only one school with a
second principal apportionment average daily attendance of less
than begin delete 101, end delete begin insert 97, end insert the begin delete county superintendent end delete begin insert Superintendent end insert shall make
one of the following computations, whichever provides the lesser
amount:

begin delete

(1)

end delete

begin insert (a) end insert  For each small school that has an average daily attendance
during the fiscal year of less than begin delete 26, end delete begin insert 25, end insert exclusive of pupils
attending the 7th and 8th grades of a junior high school, and for
which school at least one teacher was hired full time, the begin delete county
superintendent end delete begin insert Superintendent end insert shall compute for the begin insert school end insert district
fifty-two thousand nine hundred twenty-five dollars ($52,925).

begin delete

(2)

end delete

begin insert (b) end insert  For each small school that has an average daily attendance
during the fiscal year of begin delete 26 end delete begin insert 25 end insert or more and less than begin delete 51, end delete begin insert 49, end insert
exclusive of pupils attending the 7th and 8th grades of a junior
high school, and for which school at least two teachers were hired
full time for more than one-half of the days schools were
maintained, the begin delete county superintendent end delete begin insert Superintendent end insert shall
compute for the begin insert school end insert district one hundred five thousand eight
hundred fifty dollars ($105,850).

begin delete

(3)

end delete

begin insert (c) end insert  For each small school that has an average daily attendance
during the fiscal year of begin delete 51 end delete begin insert 49 end insert or more but less than begin delete 76, end delete begin insert 73, end insert
exclusive of pupils attending the 7th and 8th grades of a junior
high school, and for which school three teachers were hired full
time for more than one-half of the days schools were maintained,
the begin delete county superintendent end delete begin insert Superintendent end insert shall compute for the
begin insert school end insert district one hundred fifty-eight thousand seven hundred
seventy-five dollars ($158,775).

begin delete

(4)

end delete

begin insert (d) end insert  For each small school that has an average daily attendance
during the fiscal year of begin delete 76 end delete begin insert 73 end insert or more and less than begin delete 101, end delete begin insert 97, end insert
exclusive of pupils attending the 7th and 8th grades of a junior
high school, and for which school four teachers were hired full
time for more than one-half of the days schools were maintained,
the begin delete county superintendent end delete begin insert Superintendent end insert shall compute for the
begin insert school end insert district two hundred eleven thousand seven hundred dollars
($211,700). A school district that qualifies under this subdivision
may use this funding calculation until the begin delete revenue limit end delete begin insert end insert begin insert local
control funding formula allocation pursuant to Section end insert begin insert 42238.02,
as implemented by Section 42238.03, end insert per unit of average daily
attendance multiplied by the average daily attendance produces
state aid equal to the small school funding formula.

begin delete

(b) For the 1998-99 fiscal year and each fiscal year thereafter,
the average daily attendance figure of 101 specified in subdivision
(a) and the ranges of average daily attendance specified in
paragraphs (1) to (4), inclusive, shall be reduced by the statewide
average rate of excused absence reported for elementary school
districts for the 1996-97 fiscal year pursuant to Section 42238.7,
with the resultant figures and ranges rounded to the nearest integer.

end delete

begin insert

begin insert SEC. 44. end insert   

end insert

begin insert Section 42282 of the end insert begin insert Education Code end insert begin insert is amended to
read: end insert

42282.  

For each district with fewer than 2,501 units of second
principal apportionment average daily attendance, on account of
each necessary small school, the begin delete county superintendent end delete
begin insert Superintendent end insert shall make the following computations:

(a) For each necessary small school which has an average daily
attendance during the fiscal year of less than begin delete 26, end delete begin insert 25, end insert exclusive of
pupils attending the 7th and 8th grades of a junior high school,
and for which school at least one teacher was hired full time, the
begin delete county superintendent end delete begin insert Superintendent end insert shall compute for the begin insert school end insert
district fifty-two thousand nine hundred twenty-five dollars
($52,925).

(b) For each necessary small school which has an average daily
attendance during the fiscal year of begin delete 26 end delete begin insert 25 end insert or more and less than
begin delete 51, end delete begin insert 49, end insert exclusive of pupils attending the 7th and 8th grades of a
junior high school, and for which school at least two teachers were
hired full time for more than one-half of the days schools were
maintained, the begin delete county superintendent end delete begin insert Superintendent end insert shall
compute for the begin insert school end insert district one hundred five thousand eight
hundred fifty dollars ($105,850).

(c) For each necessary small school which has an average daily
attendance during the fiscal year of begin delete 51 end delete begin insert 49 end insert or more, but less than
begin delete 76, end delete begin insert 73, end insert exclusive of pupils attending the 7th and 8th grades of a
junior high school, and for which school three teachers were hired
full time for more than one-half of the days schools were
maintained, the begin delete county superintendent end delete begin insert Superintendent end insert shall
compute for the begin insert school end insert district one hundred fifty-eight thousand
seven hundred seventy-five dollars ($158,775).

(d) For each necessary small school which has an average daily
attendance during the fiscal year of begin delete 76 end delete begin insert 73 end insert or more and less than
begin delete 101, end delete begin insert 97, end insert exclusive of pupils attending the 7th and 8th grades of a
junior high school, and for which school four teachers were hired
full time for more than one-half of the days schools were
maintained, the begin delete county superintendent end delete begin insert Superintendent end insert shall
compute for the begin insert school end insert district two hundred eleven thousand seven
hundred dollars ($211,700).

(e) A school district that qualifies under this section may use
this funding calculation until the begin delete revenue limit end delete begin insert local control funding
formula allocation pursuant to Section 42238.02, as implemented
by Section 42238.03, end insert per unit of average daily attendance
multiplied by the average daily attendance produces state aid equal
to the small school funding formula.

begin delete

(f) For the 1998-99 fiscal year and each fiscal year thereafter,
the ranges of average daily attendance specified in subdivisions
(a) to (d), inclusive, shall be reduced by the statewide average rate
of excused absences reported for elementary school districts for
the 1996-97 fiscal year pursuant to Section 42238.7, with the
resultant figures and ranges rounded to the nearest integer.

end delete

begin insert

begin insert SEC. 45. end insert   

end insert

begin insert Section 42282.1 of the end insert begin insert Education Code end insert begin insert is repealed. end insert

begin delete

42282.1.  

(a) Notwithstanding Section 42282, or any other
provision of law, each necessary small school in the Death Valley
Unified School District shall qualify for the apportionment
specified in subdivision (b) of Section 42282 if that school has an
average daily attendance of 21 or more and less than 51, exclusive
of pupils attending the 7th and 8th grades of a junior high school,
and for which school at least two teachers were hired full-time for
more than one-half of the days schools were maintained.

(b) It is the intent of the Legislature not to provide a special
allowance to the Death Valley Unified School District for one of
its schools by future legislation if the average daily attendance at
the school is 18 or less.

end delete

begin insert

begin insert SEC. 46. end insert   

end insert

begin insert Section 42283 of the end insert begin insert Education Code end insert begin insert is amended to
read: end insert

42283.  

(a) For begin delete the end delete purposes of begin delete Section end delete begin insert Sections 42281 and end insert
42282, a “necessary small school” is an elementary school with
an average daily attendance of less than begin delete 101, end delete begin insert 97, end insert exclusive of pupils
attending the seventh and eighth grades of a junior high school,
maintained by a school district begin delete which maintains two or more
schools and end delete to which school any of the following conditions apply:

(1) If as many as five pupils residing in the begin insert school end insert district and
attending kindergarten and grades 1 to 8, inclusive, exclusive of
pupils attending the seventh and eighth grades of a junior high
school in the elementary school with an average daily attendance
of less than begin delete 101 end delete begin insert 97 end insert would be required to travel more than 10 miles
one way from a point on a well-traveled road nearest their home
to the nearest other public elementary school.

(2) If as many as 15 pupils residing in the begin insert school end insert district and
attending kindergarten and grades 1 to 8, inclusive, exclusive of
pupils attending the seventh and eighth grades of a junior high
school in the elementary school with an average daily attendance
of less than begin delete 101 end delete begin insert 97 end insert would be required to travel more than five
miles one way from a point on a well-traveled road nearest their
home to the nearest other public elementary school.

(3) If topographical or other conditions exist in a begin insert school end insert district
which would impose unusual hardships if the number of miles
specified in paragraph (1) or (2) were required to be traveled, or
if during the fiscal year the roads which would be traveled have
been impassable for more than an average of two weeks per year
for the preceding five years, the governing board of the begin insert school end insert
district may, on or before April 1, request the Superintendent begin delete of
Public Instruction end delete , in writing, for an exemption from these
requirements or for a reduction in the miles required. The request
shall be accompanied by a statement of the conditions upon which
the request is based, giving the information in a form required by
the Superintendent begin delete of Public Instruction end delete . The Superintendent begin delete of
Public Instruction end delete shall cause an investigation to be made, and
shall either grant the request to the extent he or she deems
necessary, or deny the request.

begin delete

(b) For the 1998-99 fiscal year and each fiscal year thereafter,
a “necessary small school,” as defined in subdivision (a), shall be
an elementary school with an average daily attendance of less than
101 reduced by the statewide average rate of excused absence
reported for elementary school districts for the 1996-97 fiscal year
pursuant to Section 42238.7, rounded to the nearest integer.

end delete begin insert

(b) For purposes of this section, “other public elementary
school” is a public school, including a charter school, that serves
kindergarten or any of grades 1 to 8, inclusive, exclusive of grades
7 and 8 of a junior high school.

end insert

begin insert

begin insert SEC. 47. end insert   

end insert

begin insert Section 42283.1 of the end insert begin insert Education Code end insert begin insert is repealed. end insert

begin delete

42283.1.  

(a) Notwithstanding any provision of this article or
any other provision of law, Mt. Hamilton Elementary School and
Harney Elementary School each shall be deemed a necessary small
school, as defined in Section 42283. In lieu of the amount
calculated for necessary small schools, and in addition to the
amount per unit of average daily attendance received by the
districts, as calculated pursuant to Article 2 (commencing with
Section 42238), the Alum Rock Union Elementary School District
shall receive in each fiscal year, commencing with the 1993-94
fiscal year, a twenty thousand dollar ($20,000) apportionment for
Mt. Hamilton Elementary School and the Patterson Joint Unified
School District shall receive a twenty thousand dollar ($20,000)
apportionment for Harney Elementary School.

(b) If either Mt. Hamilton Elementary School or Harney
Elementary School exceeds 20 units of average daily attendance
in any fiscal year, then that school shall no longer be entitled to
receive the apportionments set forth in subdivision (a).

end delete

begin insert

begin insert SEC. 48. end insert   

end insert

begin insert Section 42283.2 of the end insert begin insert Education Code end insert begin insert is repealed. end insert

begin delete

42283.2.  

(a)  Notwithstanding any other provision of law, the
Rand Elementary School shall be deemed a necessary small school,
as defined in Section 42283. Notwithstanding any other provision
of law, the Sierra Sands Unified School District is eligible to
receive apportionments for the Rand Elementary School pursuant
to Section 42282.

(b) If the amount of average daily attendance of the Rand
Elementary School exceeds 100, then that school shall no longer
be entitled to receive apportionments as a necessary small school.

end delete

begin insert

begin insert SEC. 49. end insert   

end insert

begin insert Section 42284 of the end insert begin insert Education Code end insert begin insert is amended to
read: end insert

42284.  

(a) For each district with fewer than 2,501 units of
average daily attendance, on account of each necessary small high
school, the county superintendent of schools shall make one of the
following computations selected with regard only to the number
of certificated employees employed or average daily attendance,
whichever provides the lesser amount:

 

Average daily attendance	Minimum number of certificated employees	Amount to be computed
1- begin delete   end delete begin delete 20 end delete begin delete   end delete begin insert   end insert begin insert 19 end insert begin insert   end insert	less than 3	$42,980
		per teacher
1- begin delete   end delete begin delete 20 end delete begin delete   end delete begin insert   end insert begin insert 19 end insert begin insert   end insert	3	191,340
begin delete   end delete begin delete 21- end delete begin delete   end delete begin delete 40 end delete begin delete   end delete begin insert   end insert begin insert 20- end insert begin insert   end insert begin insert 38 end insert begin insert   end insert	4	234,320
begin delete   end delete begin delete 41- end delete begin delete   end delete begin delete 60 end delete begin delete   end delete begin insert   end insert begin insert 39- end insert begin insert   end insert begin insert 57 end insert begin insert   end insert	5	277,300
begin delete   end delete begin delete 61- end delete begin delete   end delete begin delete 75 end delete begin delete   end delete begin insert   end insert begin insert 58- end insert begin insert   end insert begin insert 71 end insert begin insert   end insert	6	320,280
begin delete   end delete begin delete 76- end delete begin delete   end delete begin delete 90 end delete begin delete   end delete begin insert   end insert begin insert 72- end insert begin insert   end insert begin insert 86 end insert begin insert   end insert	7	363,260
begin delete   end delete begin delete 91-105 end delete begin delete   end delete begin insert   end insert begin insert 87- end insert begin insert   end insert begin insert 100 end insert begin insert   end insert	8	406,240
begin delete 106-120 end delete begin delete   end delete begin insert 01-114 end insert begin insert   end insert	9	449,220
begin delete 121-135 end delete begin delete   end delete begin insert 115-129 end insert begin insert   end insert	10	492,200
begin delete 136-150 end delete begin delete   end delete begin insert 130-143 end insert begin insert   end insert	11	535,180
begin delete 151-180 end delete begin delete   end delete begin insert 44-171 end insert begin insert   end insert	12	578,160
begin delete 181-220 end delete begin delete   end delete begin insert 172-210 end insert begin insert   end insert	13	621,140
begin delete 221-260 end delete begin delete   end delete begin insert 211-248 end insert begin insert   end insert	14	664,120
begin delete 261-300 end delete begin delete   end delete begin insert 249-286 end insert begin insert   end insert	15	707,100

 

(b) For purposes of this section, a “certificated employee” means
an equivalent full-time position of an individual holding a
credential authorizing service and providing service in grades 9
to 12, inclusive, in any secondary school. Any fraction of an
equivalent full-time position remaining after all equivalent full-time
positions for certificated employees within the district have been
calculated shall be deemed to be a full-time position.

(c) A school district that qualifies under this section may use
the funding calculation as provided in this section until the begin delete revenue
limit end delete begin insert end insert begin insert local control funding formula allocation pursuant to Section
42238.02, as implemented by Section 42238.03, end insert per unit of average
daily attendance multiplied by the average daily attendance
produces state aid equal to the funding provided under this section.

begin delete

(d) For the 1998-99 fiscal year and each fiscal year thereafter,
the ranges of average daily attendance specified in the table in
subdivision (a) shall be reduced by the statewide average rate of
excused absence reported for high school districts for the 1996-97
fiscal year pursuant to Section 42238.7, with the resultant ranges
rounded to the nearest integer.

end delete

begin insert

begin insert SEC. 50. end insert   

end insert

begin insert Section 42285 of the end insert begin insert Education Code end insert begin insert is amended to
read: end insert

42285.  

(a) For the purposes of Section 42284, a necessary
small high school is a high school with an average daily attendance
of less than begin delete 301 end delete begin insert 287 end insert that comes within any of the following
conditions:

(1) The projection of its future enrollment on the basis of the
enrollment of the elementary schools in the district shows that
within eight years the enrollment in high school in grades 9 to 12,
inclusive, will exceed begin delete 300 end delete begin insert 286 end insert pupils.

(2) Any one of the following combinations of distance and units
of average daily attendance applies:

(A) The high school had an average daily attendance of less
than begin delete 100 end delete begin insert 96 end insert in grades 9 to 12, inclusive, during the preceding fiscal
year and is more than 15 miles by well-traveled road from the
nearest other public high school and either 90 percent of the pupils
would be required to travel 20 miles or 25 percent of the pupils
would be required to travel 30 miles one way from a point on a
well-traveled road nearest their homes to the nearest other public
high school.

(B) The high school had an average daily attendance of begin delete 100 end delete begin insert 96 end insert
or more and less than begin delete 150 end delete begin insert 144 end insert in grades 9 to 12, inclusive, during
the preceding fiscal year and is more than 10 miles by well-traveled
road from the nearest other public high school and either 90 percent
of the pupils would be required to travel 18 miles or 25 percent of
the pupils would be required to travel 25 miles one way from a
point on a well-traveled road nearest their homes to the nearest
other public high school.

(C) The high school had an average daily attendance of begin delete 150 end delete begin insert 144 end insert
or more and less than begin delete 200 end delete begin insert 192 end insert in grades 9 to 12, inclusive, during
the preceding fiscal year and is more than 71⁄2 miles by
well-traveled road from the nearest other public high school and
either 90 percent of the pupils would be required to travel 15 miles
or 25 percent of the pupils would be required to travel 20 miles
one way from a point on a well-traveled road nearest their homes
to the nearest other public high school.

(D) The high school had an average daily attendance of begin delete 200 end delete
begin insert 192 end insert or more and less than begin delete 301 end delete begin insert 287 end insert in grades 9 to 12, inclusive,
during the preceding fiscal year and is more than five miles by
well-traveled road from the nearest other public high school and
either 90 percent of the pupils would be required to travel 10 miles
or 25 percent of the pupils would be required to travel 15 miles to
the nearest other public high school.

(3) Topographical or other conditions exist in the begin insert school end insert district
which would impose unusual hardships on the pupils if the number
of miles specified above were required to be traveled. In these
cases, the Superintendent may, when requested, and after
investigation, grant exceptions from the distance requirements.

(4) The Superintendent has approved the recommendation of a
county committee on school district organization designating one
of two or more schools as necessary isolated schools in a situation
where the schools are operated by two or more begin insert school end insert districts and
the average daily attendance of each of the schools is less than begin delete 301 end delete
begin insert 287 end insert in grades 9 to 12, inclusive.

(b) For begin delete the end delete purposes of Section 42284, a necessary small high
school also includes begin delete any of the following: end delete begin insert end insert begin insert a high school maintained
by a school district for the exclusive purpose of educating juvenile
hall pupils or pupils with exceptional needs. end insert

begin delete

(1) The only high school maintained by a unified school district.

(2) A high school maintained by a school district for the
exclusive purpose of educating juvenile hall pupils or pupils with
exceptional needs.

(3) (A) The Sea View Elementary School in the Coachella
Valley Unified School District, as long as the amount of average
daily attendance of that school is 286 or less.

(B) The West Shores High School in the Coachella Valley
Unified School District, as long as the amount of average daily
attendance of that school is 286 or less.

end delete

(c) For begin delete the end delete purposes of Section 42284, a necessary small high
school does not include a continuation school.

begin delete

(d) For each fiscal year, the high school and junior high school
average daily attendance figures specified in subdivision (a) and
the ranges of average daily attendance specified in paragraph (2)
of subdivision (a) shall be reduced by the statewide average rate
of excused absence reported for high school districts for the
1996-97 fiscal year pursuant to Section 42238.7, with the resultant
figures and ranges rounded to the nearest integer.

end delete begin insert

(d) For purposes of this section, “other public high school” is
a public school, including a charter school, that serves any of
grades 9 to 12, inclusive, or grades 7 and 8 in a junior high school.

end insert

begin insert

begin insert SEC. 51. end insert   

end insert

begin insert Section 42285.1 of the end insert begin insert Education Code end insert begin insert is repealed. end insert

begin delete

42285.1.  

(a) For purposes of Section 42285, a necessary small
high school includes the Boys Republic High School maintained
by the Chino Unified School District in which the majority of the
pupils are placed by court order and the enrollment of the school
is less than 200 pupils. The total amount annually received by the
Chino Unified School District pursuant to this section for the
1988-89 fiscal year and each fiscal year thereafter shall not exceed
an amount equal to the sum of one hundred eighty thousand dollars
($180,000) plus the amount of revenue that the average daily
attendance in the Boys Republic High School would have generated
pursuant to Section 42238 and paragraph (1) of subdivision (a) of
Section 42238.5.

(b) The Chino Unified School District shall submit an annual
report to the State Department of Education regarding the necessary
small high school as defined in this section. The report shall
include, but not be limited to, the number of pupils attending the
school, the number of teachers teaching in the school, the number
of days that classes were held in the school, and the type of
program provided by the district.

(c) It is the intent of the Legislature that the Chino Unified
School District receive funding as provided by this section
commencing with the 1988-89 fiscal year and continuing in
subsequent fiscal years.

end delete

begin insert

begin insert SEC. 52. end insert   

end insert

begin insert Section 42285.4 of the end insert begin insert Education Code end insert begin insert is repealed. end insert

begin delete

42285.4.  

Notwithstanding any other provision of law, the River
Delta Unified School District is eligible to receive apportionments
pursuant to the schedule and criteria for small necessary high
schools set forth in Section 42284 if the school district has no more
than 3,000 units of average daily attendance.

end delete

begin insert

begin insert SEC. 53. end insert   

end insert

begin insert Section 42285.5 of the end insert begin insert Education Code end insert begin insert is amended
to read: end insert

42285.5.  

(a) For purposes of subdivision (a) of Section 42284
and Section 42285, a school district may include average daily
attendance in grades 7 and 8 and the instructors of grade 7 and 8
pupils in the calculation of average daily attendance and number
of certificated employees employed begin delete in the 2011-12 fiscal year if
the school district included average daily attendance in grades 7
and 8 and the instructors of grade 7 and 8 pupils in the calculation
of average daily attendance and certificated employees employed
in the 2010-11 fiscal year end delete .

(b) Notwithstanding Sections 42284 and 42285, for purposes
of this section, with respect to a school district eligible to utilize
subdivision (a), any references to grades 9 to 12, inclusive, in
Sections 42284 and 42285 shall be deemed instead to be references
to grades 7 to 12, inclusive.

begin insert

begin insert SEC. 54. end insert   

end insert

begin insert Section 42286 of the end insert begin insert Education Code end insert begin insert is amended to
read: end insert

42286.  

(a) Except as required under subdivision (b), if a high
school is determined to be a necessary small high school under
Section 42285, that status shall not be changed except as a review
of the determinative factors made every begin delete five end delete begin insert two end insert years following
the date of the determination indicates that the determination should
be changed.

(b) If a high school is determined to be a necessary small high
school under paragraph (3) of subdivision (b) of Section 42285,
that status shall not be changed except as a review of the
determinative factors made every two years following the date of
the determination indicates that the determination should be
changed.

(c)  begin delete Any end delete begin insert A end insert high school that has not been determined to be a
necessary small high school under Section 42285, may be
determined to be a necessary small high school at the beginning
of begin delete any end delete begin insert a end insert fiscal year if it meets the criteria specified in Section
42285.

begin insert

begin insert SEC. 55. end insert   

end insert

begin insert Section 42287 of the end insert begin insert Education Code end insert begin insert is amended to
read: end insert

42287.  

begin insert (a) end insert begin insert   end insert For the 1984-85 fiscal year begin delete and each fiscal year
thereafter, end delete begin insert to the 2012-13 fiscal year, inclusive, end insert the Superintendent
of Public Instruction shall increase the funding amounts specified
in Sections 42281, 42282, and 42284 by an amount proportionate
to the increase applied to the statewide average revenue limit for
unified school districts for the then current fiscal year.

begin insert

(b) Commencing with the 2013-14 fiscal year, the
Superintendent shall increase the funding amounts specified in
Sections 42281, 42282, and 42284, as previously increased
pursuant to subdivision (a) and Sections 42289 to 42289.5,
inclusive, by an amount proportionate to the increase in the
statewide average local control funding formula allocations
pursuant to Section 42238.02, as implemented by Section 42238.03,
for the then current fiscal year.

end insert

begin insert

begin insert SEC. 56. end insert   

end insert

begin insert Section 42289 of the end insert begin insert Education Code end insert begin insert is amended to
read: end insert

42289.  

Notwithstanding any other begin delete provision of end delete law, for each
fiscal begin delete year, prior to end delete begin insert year through the 2012-13 fiscal year, before end insert
calculating the increase in funding amount specified in Section
42287, the Superintendent begin delete of Public Instruction end delete shall increase the
funding amounts specified in Sections 42281, 42282, and 42284,
by the product of subdivisions (a) and (b):

(a) The amount per unit of average daily attendance received
by the begin insert school end insert district pursuant to Section 46201 in the prior fiscal
year.

(b) The average daily attendance for each necessary small school
and necessary small high school for which the begin insert school end insert district
received funding in the prior fiscal year pursuant to Section 42281,
42282, or 42284, as appropriate.

begin insert

begin insert SEC. 57. end insert   

end insert

begin insert Section 42289.1 of the end insert begin insert Education Code end insert begin insert is amended
to read: end insert

42289.1.  

(a) Notwithstanding any other begin delete provision of end delete law, for
the 1988-89 fiscal year begin delete and each fiscal year thereafter, end delete begin insert to the
2012-13 fiscal year, inclusive, end insert after calculating the increase in
funding amounts specified in Section 42287, the Superintendent
begin delete of Public Instruction end delete shall increase the funding amounts specified
in Sections 42281, 42282, and 42284, by the sum of paragraphs
(1) and (2):

(1) Compute the product of subparagraphs (A) and (B):

(A) The amount per unit of average daily attendance computed
pursuant to subdivision (g) of Section 42240.

(B) The average daily attendance for each necessary small
school and necessary small high school for which the district
receives funding in the current fiscal year pursuant to Section
42281, 42282, or 42284, as appropriate.

(2)  begin delete Commencing in end delete begin insert From end insert the 1990-91 fiscal year begin delete and each
fiscal year thereafter, end delete begin insert to the 2012-13 fiscal year, inclusive, end insert the
amount computed pursuant to paragraph (1) shall be increased by
the percentage cost-of-living increase given to school district
revenue limits for the then current fiscal year.

begin insert

begin insert SEC. 58. end insert   

end insert

begin insert Section 42289.2 of the end insert begin insert Education Code end insert begin insert is amended
to read: end insert

42289.2.  

(a) Notwithstanding any other begin delete provision of end delete law, for
the 1989-90 fiscal year begin delete and each fiscal year thereafter, end delete begin insert to the
2012-13 fiscal year, inclusive, end insert after calculating the increase in
funding amounts specified in Section 42287, the Superintendent
begin delete of Public Instruction end delete shall increase the funding amounts specified
in Sections 42281, 42282, and 42284, by the sum of paragraphs
(1) and (2):

(1) Compute the product of subparagraphs (A) and (B):

(A) The amount per unit of average daily attendance computed
pursuant to subdivision (e) of Section 54060.5.

(B) The average daily attendance for each necessary small
school and necessary small high school for which the begin insert school end insert district
receives funding in the current fiscal year pursuant to Section
42281, 42282, or 42284, as appropriate.

(2)  begin delete Commencing in end delete begin insert From end insert the 1990-91 fiscal year begin delete and each
fiscal year thereafter, end delete begin insert to the 2012-13 fiscal year, inclusive, end insert the
amount computed pursuant to paragraph (1) shall be increased by
the percentage cost-of-living increase given to school district
revenue limits for the then current fiscal year.

begin insert

begin insert SEC. 59. end insert   

end insert

begin insert Section 42289.3 of the end insert begin insert Education Code end insert begin insert is amended
to read: end insert

42289.3.  

(a) Notwithstanding any other begin delete provision of end delete law, for
the 1989-90 fiscal year begin delete and each fiscal year thereafter, end delete begin insert to the
2012-13 fiscal year, inclusive, end insert after calculating the increase in
funding amounts specified in Section 42287, the Superintendent
begin delete of Public Instruction end delete shall increase the funding amounts specified
in Sections 42281, 42282, and 42284, by the sum of paragraphs
(1) and (2):

(1) Compute the product of subparagraphs (A) and (B):

(A) The amount per unit of average daily attendance computed
pursuant to subdivision (e) of Section 54060.6.

(B) The average daily attendance for each necessary small
school and necessary small high school for which the begin insert school end insert district
receives funding in the current fiscal year pursuant to Section
42281, 42282, or 42284, as appropriate.

(2)  begin delete Commencing in end delete begin insert From end insert the 1990-91 fiscal year begin delete and each
fiscal year thereafter, end delete begin insert to the 2012-13 fiscal year, inclusive, end insert the
amount computed pursuant to paragraph (1) shall be increased by
the percentage cost-of-living increase given to school district
revenue limits for the then current fiscal year.

begin insert

begin insert SEC. 60. end insert   

end insert

begin insert Section 42289.4 of the end insert begin insert Education Code end insert begin insert is amended
to read: end insert

42289.4.  

(a) Notwithstanding any other begin delete provision of end delete law, for
the 1989-90 fiscal year begin delete and each fiscal year thereafter, end delete begin insert to the
2012-13 fiscal year, inclusive, end insert after calculating the increase in
funding amounts specified in Section 42287, the Superintendent
of Public Instruction shall increase the funding amounts specified
in Sections 42281, 42282, and 42284, by the sum of paragraphs
(1) and (2):

(1) Compute the product of subparagraphs (A) and (B):

(A) The amount per unit of average daily attendance computed
pursuant to subdivision (b) of Section 54060.7.

(B) The average daily attendance for each necessary small
school and necessary small high school for which the begin insert school end insert district
receives funding in the current fiscal year pursuant to Section
42281, 42282, or 42284, as appropriate.

(2)  begin delete Commencing in end delete begin insert From end insert the 1990-91 fiscal year begin delete and each
fiscal year thereafter, end delete begin insert to the 2012-13 fiscal year, inclusive, end insert the
amount computed pursuant to paragraph (1) shall be increased by
the percentage cost-of-living increase given to school district
revenue limits for the then current fiscal year.

begin insert

begin insert SEC. 61. end insert   

end insert

begin insert Section 42289.5 of the end insert begin insert Education Code end insert begin insert is amended
to read: end insert

42289.5.  

Notwithstanding any other begin delete provision of end delete law, the
increases determined pursuant to Sections 42289, 42289.1, 42289.3,
and 42289.4 shall be permanently increased for the 1998-99 fiscal
year by the quotient, for each begin insert school end insert district eligible for an increase,
of the amount determined pursuant to subparagraph (B) of
paragraph (3) of subdivision (a) of Section 42238.8 begin insert , as that section
read on January 1, 2013, end insert divided by the amount determined
pursuant to subparagraph (C) of paragraph (3) of subdivision (a)
of Section 42238.8 begin insert , as that section read on January 1, 2013 end insert .

begin insert

begin insert SEC. 62. end insert   

end insert

begin insert Section 42605 of the end insert begin insert Education Code end insert begin insert is repealed. end insert

begin delete

42605.  

(a) (1) Unless otherwise prohibited under federal law
or otherwise specified in subdivision (e), for the 2008-09 fiscal
year to the 2014-15 fiscal year, inclusive, recipients of funds from
the items listed in paragraph (2) may use funding received, pursuant
to subdivision (b), from any of these items listed in paragraph (2)
that are contained in Section 2.00 of the annual Budget Act, for
any educational purpose.

(2) Items 6110-104-0001, 6110-105-0001, 6110-108-0001,
6110-122-0001, 6110-124-0001, 6110-137-0001, 6110-144-0001,
6110-150-0001, 6110-151-0001, 6110-156-0001, 6110-181-0001,
6110-188-0001, 6110-189-0001, 6110-190-0001, 6110-193-0001,
6110-195-0001, 6110-198-0001, 6110-204-0001, 6110-208-0001,
6110-209-0001, 6110-211-0001, 6110-227-0001, 6110-228-0001,
6110-232-0001, 6110-240-0001, 6110-242-0001, 6110-243-0001,
6110-244-0001, 6110-245-0001, 6110-246-0001, 6110-247-0001,
6110-248-0001, 6110-260-0001, 6110-265-0001, 6110-266-0001,
6110-267-0001, 6110-268-0001, and 6360-101-0001 of Section
2.00.

(b) (1) For the 2009-10 fiscal year to the 2014-15 fiscal year,
inclusive, the Superintendent or other administering state agency,
as appropriate, shall apportion from the amounts provided in the
annual Budget Act for the items enumerated in paragraph (2) of
subdivision (a) an amount to recipients based on the same relative
proportion that the recipient received in the 2008-09 fiscal year
for the programs funded through the items enumerated in paragraph
(2) of subdivision (a).

(2) This section and Section 42 of Chapter 12 of the Third
Extraordinary Session of the Statutes of 2009 do not authorize a
school district that receives funding on behalf of a charter school
pursuant to Sections 47634.1 and 47651 to redirect this funding
for another purpose unless otherwise authorized in law or pursuant
to an agreement between a charter school and its chartering
authority. Notwithstanding paragraph (1), for the 2008-09 fiscal
year to the 2014-15 fiscal year, inclusive, a school district that
receives funding on behalf of a charter school pursuant to Sections
47634.1 and 47651 shall continue to distribute the funds to those
charter schools based on the relative proportion that the school
district distributed in the 2007-08 fiscal year, and shall adjust those
amounts to reflect changes in charter school attendance in the
district. The amounts allocated shall be adjusted for any greater
or lesser amount appropriated for the items enumerated in
paragraph (2) of subdivision (a). For a charter school that began
operation in the 2008-09 fiscal year, if a school district received
funding on behalf of that charter school pursuant to Sections
47634.1 and 47651, the school district shall continue to distribute
the funds to that charter school based on the relative proportion
that the school district distributed in the 2008-09 fiscal year and
shall adjust the amount of those funds to reflect changes in charter
school attendance in the district. The amounts allocated shall be
adjusted for any greater or lesser amount appropriated for the items
enumerated in paragraph (2) of subdivision (a).

(3) Notwithstanding paragraph (1), for the 2008-09 fiscal year
to the 2014-15 fiscal year, inclusive, the Superintendent shall
apportion from the amounts appropriated by Item 6110-211-0001
of Section 2.00 of the annual Budget Act an amount to a charter
school in accordance with the per-pupil methodology prescribed
in subdivision (c) of Section 47634.1.

(4) Notwithstanding paragraph (1), for the 2008-09 fiscal year
to the 2014-15 fiscal year, inclusive, the Superintendent shall
apportion from the amounts provided in the annual Budget Act an
amount to a school district, charter school, and county office of
education based on the same relative proportion that the local
educational agency received in the 2007-08 fiscal year for the
programs funded through the following items contained in Section
2.00 of the annual Budget Act: 6110-104-0001, 6110-105-0001,
6110-156-0001, 6110-190-0001, Schedule (3) of 6110-193-0001,
6110-198-0001, 6110-232-0001, and Schedule (2) of
6110-240-0001.

(5) For purposes of paragraph (4), if a direct-funded charter
school began operation in the 2008-09 fiscal year, the amount that
the charter school was entitled to receive from the items
enumerated in paragraph (4) for the 2008-09 fiscal year, as certified
by the Superintendent in March 2009, is deemed to have been
received in the 2007-08 fiscal year.

(c) (1) This section does not obligate the state to refund or repay
reductions made pursuant to this section. A decision by a school
district to reduce funding pursuant to this section for a
state-mandated local program shall constitute a waiver of the
subvention of funds that the school district is otherwise entitled to
pursuant to Section 6 of Article XIII B of the California
Constitution on the amount so reduced.

(2) (A) As a condition of receipt of funds, the governing board
of the school district or governing board of the county office of
education, as appropriate, at a regularly scheduled open public
hearing shall take testimony from the public, discuss, approve or
disapprove the proposed use of funding, and make explicit for each
of the budget items in paragraph (2) of subdivision (a) the purposes
for which the funds will be used.

(B) The regularly scheduled open public hearing held pursuant
to subparagraph (A) shall be held before and independent of a
meeting where the governing board of the school district or
governing board of the county office of education adopts a budget.
If the governing board intends to close a program funded by the
items listed in paragraph (2) of subdivision (a), the governing board
shall identify, in the notice of the agenda of the public hearing or
at another public hearing, the program or programs proposed to
be closed.

(3) Using the Standardized Account Code Structure reporting
process, a local educational agency shall report expenditures of
funds pursuant to the authority of this section by using the
appropriate function codes to indicate the activities for which these
funds are expended. The department shall collect and provide this
information to the Department of Finance and the appropriate
policy and budget committees of the Legislature by April 15, 2010,
and annually thereafter on April 15 until, and including, April 15,
2016.

(d) For the 2008-09 fiscal year to the 2014-15 fiscal year,
inclusive, local educational agencies that use the flexibility
provision of this section shall be deemed to be in compliance with
the program and funding requirements contained in statutory,
regulatory, and provisional language, associated with the items
enumerated in subdivision (a).

(e) Notwithstanding subdivision (d), the following requirements
shall continue to apply:

(1) For Item 6110-105-0001 of Section 2.00 of the annual
Budget Act, the amount authorized for flexibility shall exclude the
funding provided to fund remedial educational services pursuant
to Provision 4. For Item 6110-156-0001 of Section 2.00 of the
annual Budget Act, the amount authorized for flexibility shall
exclude the funding provided for instruction of CalWORKs-eligible
students pursuant to Schedules (2) and (3) and Provisions 2 and
4.

(2) (A) Any instructional materials purchased by a local
educational agency for kindergarten and grades 1 to 8, inclusive,
and for grades 9 to 12, inclusive, shall be aligned with the state
standards adopted pursuant to Section 60605 or 60605.8, and shall
also meet the reporting and sufficiency requirements contained in
Section 60119.

(B) For purposes of this section, “sufficiency” means that each
pupil has sufficient textbooks and instructional materials in the
four core areas as defined by Section 60119 and that all pupils
within the local educational agency who are enrolled in the same
course shall have identical textbooks and instructional materials,
as specified in Section 1240.3.

(3) For Item 6110-195-0001 of Section 2.00 of the annual
Budget Act, the item shall exclude moneys that are required to
fund awards for teachers that have previously met the requirements
necessary to obtain these awards, until the award is paid in full.

(4) For Item 6110-266-0001 of Section 2.00 of the annual
Budget Act, a county office of education shall conduct at least one
site visit to each of the required schoolsites pursuant to Section
1240 and shall fulfill all of the duties set forth in Sections 1240
and 44258.9.

(5) For Item 6110-198-0001 of Section 2.00 of the annual
Budget Act, a school district or county office of education that
operates the child care component of the Cal-SAFE program shall
comply with paragraphs (5) and (6) of subdivision (c) of Section
54746.

(f) This section does not invalidate any state law pertaining to
teacher credentialing requirements or the functions that require
credentials.

end delete

begin insert

begin insert SEC. 63. end insert   

end insert

begin insert Section 42606 of the end insert begin insert Education Code end insert begin insert is repealed. end insert

begin delete

42606.  

(a) To the extent funds are provided, for the 2010-11
to the 2014-15 fiscal years, inclusive, the Superintendent shall
allocate a supplemental categorical block grant to a charter school
that began operation during or after the 2008-09 fiscal year. These
supplemental categorical block grant funds may be used for any
educational purpose. Commencing in the 2011-12 fiscal year, a
locally or direct funded charter school that converted from a
preexisting school between the 2008-09 and 2014-15 fiscal years,
inclusive, is not eligible for funding specified in this section. A
charter school that receives funding pursuant to this subdivision
shall not receive additional funding for programs specified in
paragraph (2) of subdivision (a) of Section 42605, with the
exception of the program funded pursuant to Item 6110-211-0001
of Section 2.00 of the annual Budget Act.

(b) (1) For the 2010-11 fiscal year, the supplemental categorical
block grant shall equal one hundred twenty-seven dollars ($127)
per unit of charter school average daily attendance as determined
at the 2010-11 second principal apportionment for charter schools
commencing operations during or after the 2008-09 fiscal year.
A locally funded charter school that converted from a preexisting
school during or after the 2008-09 fiscal year is not eligible for
funding specified in this section.

(2) For the 2011-12 to the 2014-15 fiscal years, inclusive, the
supplemental categorical block grant shall equal one hundred
twenty-seven dollars ($127) per unit of charter school average
daily attendance as determined at the current year second principal
apportionment for charter schools commencing operations during
or after the 2008-09 fiscal year. In lieu of this supplemental grant,
a school district shall provide new conversion charter schools that
commenced operations within the district during or after the
2008-09 fiscal year, one hundred twenty-seven dollars ($127) per
unit of charter school average daily attendance as determined at
the current year second principal apportionment. This paragraph
does not preclude a school district and a new conversion charter
school from negotiating an alternative funding rate. Absent
agreement from both parties on an alternative rate, the school
district shall be obligated to provide funding at the one hundred
twenty-seven dollars ($127) per average daily attendance rate.

end delete

begin insert

begin insert SEC. 64. end insert   

end insert

begin insert Section 42800 of the end insert begin insert Education Code end insert begin insert is amended to
read: end insert

42800.  

(a) The governing board of begin delete any end delete begin insert a end insert school district may,
with the consent of the county superintendent of schools, establish
a revolving cash fund for the use of the chief accounting officer
of the begin insert school end insert district, by adopting a resolution setting forth the
necessity for the revolving cash fund, the officer for whom and
the purposes for which the revolving cash fund shall be available,
and the amount of the fund. The purposes for which the revolving
cash fund shall be available shall include the purposes specified
in Section 45167. Three certified copies of the resolution shall be
transmitted to the county superintendent of schools. If he approves
the establishment of the fund, the county superintendent shall
endorse his consent on the resolution and return one copy to the
governing body of the begin insert school end insert district, and transmit one copy to the
county auditor.

(b) The maximum amount allowed for revolving cash funds
established pursuant to subdivision (a) shall be the lesser of:

(1) Two percent of the district’s estimated expenditures for the
current fiscal year, or

(2) A dollar amount limit of seventy-five thousand dollars
($75,000) for any elementary school or high school district and
one hundred fifty thousand dollars ($150,000) for any unified
school district for fiscal year 1990-91. The dollar amount limit
for each begin insert school end insert district begin delete shall thereafter end delete begin insert shall, through the 2012-13
fiscal year, end insert be increased annually by the percentage increase in
the district’s revenue limit established by Section 42238 begin insert , as that
section read on January 1, 2013. The dollar amount limit for each
school district shall thereafter be increased annually by the
percentage increase in the school district’s local control funding
formula allocation established pursuant to Section 42238.02, as
implemented pursuant to Section 42238.03 end insert .

begin insert

begin insert SEC. 65. end insert   

end insert

begin insert Section 46200 of the end insert begin insert Education Code end insert begin insert is amended to
read: end insert

begin delete

46200.  

(a) In the 1984-85 fiscal year, for each school district
that certifies to the Superintendent of Public Instruction that it
offers 180 days or more of instruction per school year, the
Superintendent of Public Instruction shall apportion thirty-five
dollars ($35) per unit of average daily attendance, exclusive of
adult average daily attendance, the average daily attendance of
pupils while participating in regional occupation centers or
programs, and average daily attendance for pupils attending
summer school. A multitrack year-round school shall be deemed
to be in compliance with the 180-day requirement if it certifies to
the Superintendent of Public Instruction that it is a multitrack
year-round school and maintains its school for a minimum of 163
schooldays. Each school district that received an apportionment
pursuant to this subdivision in the 1984-85 fiscal year shall add
thirty-five dollars ($35) to the district’s base revenue limit per unit
of average daily attendance for the 1985-86 fiscal year.

(b) For any school district that received an apportionment
pursuant to subdivision (a) and that offered less than 180 days, or
offered less than the number of days required in subdivision (a)
for multitrack year-round schools, of instruction in the 1985-86
fiscal year to the 2000-01 fiscal year, inclusive, and that does not
provide the minimum number of instructional minutes specified
in subdivision (a) of Section 46201 for that fiscal year, the
Superintendent of Public Instruction shall reduce the base revenue
limit per unit of average daily attendance for that fiscal year or
years by an amount attributable to the increase received pursuant
to subdivision (a), as adjusted in fiscal years subsequent to the
1984-85 fiscal year.

(c) 

end delete

begin insert

begin insert 46200. end insert   

end insert

For begin delete any end delete begin insert a end insert school district that received an apportionment
pursuant to subdivision (a) begin insert of this section, as it read on January
1, 2013, end insert and that offers less than 180 days of instruction or, in
multitrack year-round schools, fewer than the number of days
required in subdivision (a) begin insert of this section, as it read on January
1, 2013, end insert for multitrack year-round schools, in the begin delete 2001-02 end delete begin insert 2013-14 end insert
fiscal year, or any fiscal year thereafter, the Superintendent begin delete of
Public Instruction end delete shall withhold from the begin delete district’s revenue limit
apportionment end delete begin insert school district’s local control funding formula grant
apportionment pursuant to Section 42238.02, as implemented by
Section 42238.03, end insert for the average daily attendance of each affected
grade level the sum of 0.0056 multiplied by begin delete that apportionment, end delete
begin insert the apportionment received pursuant to subdivision (a) of this
section, as it read on January 1, 2013, end insert for each day less than 180,
or, in multitrack year-round schools, for each day less than the
number of days required in subdivision (a) for year-round schools
that the begin insert school end insert district offered.

begin delete

(d) For any school district that received an apportionment
pursuant to subdivision (a) and that offered less than 180 days of
instruction as required in subdivision (a) in the 1985-86 fiscal
year, to either the end of the final year of the teacher bargaining
unit contract in force in that district on January 1, 2002, inclusive,
or, if no teacher bargaining unit contract was in force in that district
on January 1, 2002, to the end of the 2001-02 fiscal year, inclusive,
and that provided the minimum number of instructional minutes
in subdivision (a) of Section 46201 during all of the period
applicable to the district pursuant to this subdivision, subdivision
(c) shall not apply until the first fiscal year following the end of
the applicable period of years.

end delete

begin insert

begin insert SEC. 66. end insert   

end insert

begin insert Section 46201 of the end insert begin insert Education Code end insert begin insert is amended to
read: end insert

begin delete

46201.  

(a) In each of the 1984-85, 1985-86, and 1986-87
fiscal years, for each school district that certifies to the
Superintendent of Public Instruction that it offers at least the
amount of instructional time specified in this subdivision at a grade
level or levels, the Superintendent of Public Instruction shall
determine an amount equal to twenty dollars ($20) per unit of
current year second principal apportionment regular average daily
attendance in kindergarten and grades 1 to 8, inclusive, and forty
dollars ($40) per unit of current year second principal
apportionment regular average daily attendance in grades 9 to 12,
inclusive. This section shall not apply to adult average daily
attendance, the average daily attendance for pupils attending
summer schools, alternative schools, regional occupational centers
and programs, continuation high schools, or opportunity schools,
and the attendance of pupils while participating in community
college or independent study programs.

(1) In the 1984-85 fiscal year, for kindergarten and each of
grades 1 to 12, inclusive, the sum of subparagraphs (A) and (B):

(A) The number of instructional minutes offered at that grade
level in the 1982-83 fiscal year.

(B) One-third of the difference between the number of minutes
specified for that grade level in paragraph (3) and the number of
instructional minutes offered at that grade level in the 1982-83
fiscal year.

(2) In the 1985-86 fiscal year, for kindergarten and each of
grades 1 to 12, inclusive, the sum of subparagraphs (A) and (B):

(A) The number of instructional minutes offered at that grade
level in the 1982-83 fiscal year.

(B) Two-thirds of the difference between the number of minutes
specified for that grade level in paragraph (3) and the number of
instructional minutes offered at that grade level in the 1982-83
fiscal year.

(3) In the 1986-87 fiscal year:

(A) Thirty-six thousand minutes in kindergarten.

(B) Fifty thousand four hundred minutes in grades 1 to 3,
inclusive.

(C) Fifty-four thousand minutes in grades 4 to 8, inclusive.

(D) Sixty-four thousand eight hundred minutes in grades 9 to
12, inclusive.

(4) In any fiscal year, each school district that receives an
apportionment pursuant to subdivision (a) for average daily
attendance in grades 9 to 12, inclusive, shall offer a program of
instruction that allows each student to receive at least 24 course
years of instruction, or the equivalent, during grades 9 to 12,
inclusive.

(5) For any schoolsite at which programs are operated in more
than one of the grade levels enumerated in subparagraph (B) or
(C) of paragraph (3), the school district may calculate a weighted
average of minutes for those grade levels at that schoolsite for
purposes of making the certification authorized by this subdivision.

(b) (1) If any of the amounts of instructional time specified in
paragraph (3) of subdivision (a) is a lesser number of minutes for
that grade level than actually provided by the district in the same
grade in the 1982-83 fiscal year, the 1982-83 fiscal year number
of minutes for that grade level, adjusted to comply with Section
46111, shall instead be the requirement for the purposes of
paragraphs (1), (2), and (3) of subdivision (a). Commencing with
the 1990-91 fiscal year, and each fiscal year through the 1995-96
fiscal year, any school district subject to this subdivision that does
not maintain the number of instructional minutes for a particular
grade level that the school district maintained for the 1982-83
fiscal year, adjusted to comply with Section 46111, shall not be
subject to paragraphs (1) to (3), inclusive, of subdivision (c) if that
school district maintains at least the minimum number of
instructional minutes for each grade level set forth in paragraph
(3) of subdivision (a) in the 1990-91 fiscal year and each fiscal
year through the 1994-95 fiscal year or the 1995-96 fiscal year
for districts whose instructional minutes were adjusted to comply
with Section 46111, and thereafter returns to the number of
instructional minutes maintained for each grade level in the
1982-83 fiscal year.

(2) The Legislature finds and declares that the school districts
to which paragraph (1) is applicable have not offered any less
instructional time than is required of all other school districts and
therefore should not be forced to pay any penalty.

(c) (1) For any school district that receives an apportionment
pursuant to subdivision (a) in the 1984-85 fiscal year and that
reduces the amount of instructional time offered below the
minimum amounts specified in paragraph (1) of subdivision (a)
in the 1985-86 fiscal year or any fiscal year thereafter, up to and
including the 2000-01 fiscal year, the Superintendent of Public
Instruction shall reduce the base revenue limit per unit of average
daily attendance for the fiscal year in which the reduction occurs
by an amount attributable to the increase in the 1985-86 fiscal
year base revenue limit per unit of average daily attendance
pursuant to paragraph (4) of subdivision (b) of Section 42238, as
adjusted in the 1985-86 fiscal year and fiscal years thereafter.

(2) For each school district that receives an apportionment
pursuant to subdivision (a) in the 1985-86 fiscal year and that
reduces the amount of instructional time offered below the
minimum amounts specified in paragraph (2) of subdivision (a)
in the 1986-87 fiscal year or any fiscal year thereafter, up to and
including the 2000-01 fiscal year, the Superintendent of Public
Instruction shall reduce the base revenue limit per unit of average
daily attendance for the fiscal year in which the reduction occurs
by an amount attributable to the increase in the 1986-87 fiscal
year base revenue limit per unit of average daily attendance
pursuant to paragraph (4) of subdivision (b) of Section 42238, as
adjusted in the 1986-87 fiscal year and fiscal years thereafter.

(3) For each school district that receives an apportionment
pursuant to subdivision (a) in the 1986-87 fiscal year and that
reduces the amount of instructional time offered below the
minimum amounts specified in paragraph (3) of subdivision (a)
in the 1987-88 fiscal year or any fiscal year thereafter, up to and
including the 2000-01 fiscal year, the Superintendent of Public
Instruction shall reduce the base revenue limit per unit of average
daily attendance for the fiscal year in which the reduction occurs
by an amount attributable to the increase in the 1987-88 fiscal
year base revenue limit per unit of average daily attendance
pursuant to paragraph (4) of subdivision (b) of Section 42238, as
adjusted in the 1987-88 fiscal year and fiscal years thereafter.

(d)

end delete

begin insert

begin insert 46201. end insert   

end insert

begin insert (a) end insert  For each school district that begin delete receives end delete begin insert received end insert an
apportionment pursuant to subdivision (a) begin delete in the 1986-87 fiscal
year end delete begin insert of this section, as it read on January 1, 2013, end insert and that reduces
the amount of instructional time offered below the minimum
amounts specified in begin delete either paragraph (3) of subdivision (a) or
paragraph (1) of end delete subdivision (b), begin delete whichever is applicable, in the
2001-02 fiscal year, or any fiscal year thereafter, end delete the
Superintendent begin delete of Public Instruction end delete shall withhold from the
begin delete district’s revenue limit apportionment end delete begin insert school district’s local control
funding formula grant apportionment pursuant to Section
42238.02, as implemented by Section 42238.03, end insert for the average
daily attendance of each affected grade level, the sum of begin delete that
apportionment end delete begin insert the apportionment received pursuant to subdivision
(a) of this section, as it read on January 1, 2013, end insert multiplied by
the percentage of the minimum offered minutes at that grade level
that the begin insert school end insert district failed to offer.

begin insert

(b) Commencing with the 2013-14 fiscal year:

end insert begin insert

(1) Thirty-six thousand minutes in kindergarten.

end insert begin insert

(2) Fifty thousand four hundred minutes in grades 1 to 3,
inclusive.

end insert begin insert

(3) Fifty-four thousand minutes in grades 4 to 8, inclusive.

end insert begin insert

(4) Sixty-four thousand eight hundred minutes in grades 9 to
12, inclusive.

end insert

begin insert

begin insert SEC. 67. end insert   

end insert

begin insert Section 46201.2 of the end insert begin insert Education Code end insert begin insert is amended
to read: end insert

46201.2.  

(a) Commencing with the 2009-10 school year and
continuing through the begin delete 2014-15 end delete begin insert 2012-13 end insert school year, a school
district, county office of education, or charter school may reduce
the equivalent of up to five days of instruction or the equivalent
number of instructional minutes without incurring the penalties
set forth in Sections 41420, 46200, 46200.5, 46201, 46201.5,
46202, and 47612.5 begin insert , as those sections read on January 1, 2013 end insert .
A school district, county office of education, or charter school
shall receive revenue limit funding based on the adjustments
prescribed pursuant to Section 42238.146 begin insert , as it read on January
1, 2013, end insert whether or not it reduces the number of schooldays or
instructional minutes.

begin insert

(b) For the 2013-14 and 2014-15 school years, a school district,
county office of education, or charter school may reduce the
equivalent of up to five days of instruction or the equivalent number
of instructional minutes without incurring the penalties set forth
in Sections 41420, 46200, 46200.5, 46201, 46201.5, 46202, and
47612.5.

end insert begin delete

(b)

end delete

begin insert (c) end insert  This section shall become inoperative on July 1, 2015, and,
as of January 1, 2016, is repealed, unless a later enacted statute,
that becomes operative on or before January 1, 2016, deletes or
extends the dates on which it becomes inoperative and is repealed.

begin insert

begin insert SEC. 68. end insert   

end insert

begin insert Section 46201.3 of the end insert begin insert Education Code end insert begin insert is repealed. end insert

begin delete

46201.3.  

(a) For the 2011-12 school year, the minimum
number of instructional days and minutes school districts, county
offices of education, and charter schools are required to offer as
set forth in Sections 41420, 46200, 46200.5, 46201, 46201.5,
46202, and 47612.5 shall be reduced by up to seven days.

(b) Implementation of the reduction in the number of
instructional days offered by a school district, county office of
education, and charter school that is subject to collective bargaining
pursuant to Chapter 10.7 (commencing with Section 3540) of
Division 4 of Title 1 of the Government Code shall be achieved
through the bargaining process, provided that the agreement has
been completed and reductions implemented no later than June
30, 2012.

(c) The revenue limit for each school district, county office of
education, and charter school determined pursuant to Article 3
(commencing with Section 2550) of Chapter 12 of Part 2 of
Division 1 of Title 1, Article 2 (commencing with Section 42238)
of Chapter 7 of Part 24 of Division 3, and Article 2 (commencing
with Section 47633) of Chapter 6 of Part 26.8 of Division 4 shall
be reduced by the product of 4 percent and the fraction determined
pursuant to paragraph (2).

(1) Subtract the revenue forecast determined pursuant to
subdivision (a) of Section 3.94 of the Budget Act of 2011 from
eighty-six billion four hundred fifty-two million five hundred
thousand dollars ($86,452,500,000).

(2) Divide the lesser of two billion dollars ($2,000,000,000) or
the amount calculated in paragraph (1) by two billion dollars
($2,000,000,000).

(d) This section does not affect the number of instructional days
or instructional minutes that may be reduced pursuant to Section
46201.2.

(e) The revenue limit reductions authorized by this section,
when combined with the reductions applied under subdivision (c)
of Section 3.94 of the Budget Act of 2011, may not be applied so
as to reduce school funding below the requirements of Section 8
of Article XVI of the California Constitution based on the
applicable revenues estimated by the Department of Finance
pursuant to Section 3.94 of the Budget Act of 2011.

(f) This section shall be operative on February 1, 2012, only for
the 2011-12 school year and only if subdivision (c) of Section
3.94 of the Budget Act of 2011 is operative.

end delete

begin insert

begin insert SEC. 69. end insert   

end insert

begin insert Section 46202 of the end insert begin insert Education Code end insert begin insert is amended to
read: end insert

begin delete

46202.  

(a) Except as otherwise provided in this section, in
fiscal year 2000-01 and prior, if the governing board of a school
district offers less instructional time than the amount of
instructional time fixed for the 1982-83 fiscal year, the
Superintendent of Public Instruction shall, in that fiscal year, reduce
that district’s apportionment by the average percentage increase
in the base revenue limit for districts of similar type and size
multiplied by the district’s units of average daily attendance.

(b) Except as otherwise provided in this section, in fiscal year
2001-02 and any fiscal year thereafter, if

end delete

begin insert

begin insert 46202. end insert   

end insert

begin insert If end insert a school district that does not participate in the
program set forth in begin delete this article end delete begin insert Sections 46200 to 46206, inclusive,
as those sections read on January 1, 2013, end insert offers less instructional
time begin insert in a fiscal year end insert than the amount of instructional time fixed
for the 1982-83 fiscal year, the Superintendent begin delete of Public Instruction end delete
shall withhold for that fiscal year, from the begin delete district’s revenue limit
apportionment end delete begin insert school district’s local control funding formula grant
apportionment pursuant to Section 42238.03, as implemented by
Section 42238.03, end insert for the average daily attendance of each affected
grade level, the amount of that apportionment multiplied by the
percentage of instructional minutes fixed in the 1982-83 school
year, at that grade level, that the begin insert school end insert district failed to offer.

begin delete

(c) The Glendora Unified School District shall reinstate the
sixth period, which shall be equivalent to at least 50 minutes of
instruction, effective the start of the second semester of the
1983-84 fiscal year.

end delete

begin insert

begin insert SEC. 70. end insert   

end insert

begin insert Section 46204 of the end insert begin insert Education Code end insert begin insert is repealed. end insert

begin delete

46204.  

The Superintendent of Public Instruction shall reduce
the time periods specified in Sections 46200 and 46201 to the
extent that the superintendent determines that insufficient funds
are available to fund the per pupil amounts prescribed by those
sections.

end delete

begin insert

begin insert SEC. 71. end insert   

end insert

begin insert Section 46207 is added to the end insert begin insert Education Code end insert begin insert , to
read: end insert

begin insert

begin insert 46207. end insert   

(a) Notwithstanding Sections 46200 to 46205, inclusive,
upon a determination that a school district equals or exceeds its
local control funding formula target computed pursuant to Section
42238.02 as determined by the calculation of a zero difference
pursuant to paragraph (1) of subdivision (b) of Section 42238.03,
each school district, as a condition of apportionment pursuant to
Section 42238.02, as implemented pursuant to Section 42238.03,
shall, for each fiscal year, offer, at a minimum, the following
number of minutes of instruction:

(1) To pupils in kindergarten, 36,000 minutes.

(2) To pupils in grades 1 to 3, inclusive, 50,400 minutes.

(3) To pupils in grades 4 to 8, inclusive, 54,000 minutes.

(4) To pupils in grades 9 to 12, inclusive, 64,800 minutes.

(b) For a school district that has met its local control funding
formula target that reduces the amount of instructional time offered
below the minimum amounts specified in subdivision (a), the
Superintendent shall withhold from the school district’s local
control funding formula apportionment for the average daily
attendance of each affected grade level, the product of that
apportionment multiplied by the percentage of the minimum offered
minutes at that grade level that the school district failed to offer.

(c) Notwithstanding subdivision (a), for the 2013-14 and
2014-15 school years, a school district that equals or exceeds its
computed local control funding formula target may reduce the
equivalent of up to five days of instruction or the equivalent number
of instructional minutes without incurring the penalties set forth
in this section.

end insert

begin insert

begin insert SEC. 72. end insert   

end insert

begin insert Section 46208 is added to the end insert begin insert Education Code end insert begin insert , to
read: end insert

begin insert

begin insert 46208. end insert   

(a) Notwithstanding Sections 46200 to 46205, inclusive,
upon a determination that a school district equals or exceeds its
local control funding formula target computed pursuant to Section
42238.02 as determined by the calculation of a zero difference
pursuant to paragraph (1) of subdivision (b) of Section 42238.03,
each school district, as a condition of apportionment pursuant to
Section 42238.02, as implemented pursuant to Section 42238.03,
shall offer 180 days or more of instruction per school year. A
school operating a multitrack year-round school shall be deemed
to be in compliance with the 180-day requirement if it certifies to
the Superintendent that it is a multitrack year-round school and
maintains its school for a minimum of 163 schooldays.

(b) Notwithstanding subdivision (a), for the 2013-14 and
2014-15 school years, a school district that equals or exceeds its
computed local control funding formula target may reduce the
equivalent of up to five days of instruction or the equivalent number
of instructional minutes without incurring the penalties set forth
in this section.

end insert

begin insert

begin insert SEC. 73. end insert   

end insert

begin insert Section 47604.32 of the end insert begin insert Education Code end insert begin insert is amended
to read: end insert

47604.32.  

Each chartering authority, in addition to any other
duties imposed by this part, shall do all of the following with
respect to each charter school under its authority:

(a) Identify at least one staff member as a contact person for
the charter school.

(b) Visit each charter school at least annually.

(c) Ensure that each charter school under its authority complies
with all reports required of charter schools by law begin insert , including the
annual update required pursuant to Section end insert begin insert 47606.5 end insert .

(d) Monitor the fiscal condition of each charter school under its
authority.

(e) Provide timely notification to the department if any of the
following circumstances occur or will occur with regard to a charter
school for which it is the chartering authority:

(1) A renewal of the charter is granted or denied.

(2) The charter is revoked.

(3) The charter school will cease operation for any reason.

(f) The cost of performing the duties required by this section
shall be funded with supervisorial oversight fees collected pursuant
to Section 47613.

begin insert

begin insert SEC. 74. end insert   

end insert

begin insert Section 47604.33 of the end insert begin insert Education Code end insert begin insert is amended
to read: end insert

47604.33.  

(a) Each charter school shall annually prepare and
submit the following reports to its chartering authority and the
county superintendent of schools, or only to the county
superintendent of schools if the county board of education is the
chartering authority:

(1) On or before July 1, a preliminary budget. For a charter
school in its first year of operation, the information submitted
pursuant to subdivision (g) of Section 47605 satisfies this
requirement.

begin insert

(2) On or before July 1, an annual update required pursuant to
Section 47606.5.

end insert begin delete

(2)

end delete

begin insert (3) end insert  On or before December 15, an interim financial report. This
report shall reflect changes through October 31.

begin delete

(3)

end delete

begin insert (4) end insert  On or before March 15, a second interim financial report.
This report shall reflect changes through January 31.

begin delete

(4)

end delete

begin insert (5) end insert  On or before September 15, a final unaudited report for the
full prior year.

(b) The chartering authority shall use any financial information
it obtains from the charter school, including, but not limited to,
the reports required by this section, to assess the fiscal condition
of the charter school pursuant to subdivision (d) of Section
47604.32.

(c) The cost of performing the duties required by this section
shall be funded with supervisorial oversight fees collected pursuant
to Section 47613.

begin insert

begin insert SEC. 75. end insert   

end insert

begin insert Section 47604.5 of the end insert begin insert Education Code end insert begin insert is amended
to read: end insert

47604.5.  

The begin delete State Board of Education, end delete begin insert state board, end insert whether
or not it is the authority that granted the charter, may, based upon
the recommendation of the Superintendent begin delete of Public Instruction end delete ,
take appropriate action, including, but not limited to, revocation
of the school’s charter, when the begin delete State Board of Education end delete begin insert state
board end insert finds any of the following:

(a) Gross financial mismanagement that jeopardizes the financial
stability of the charter school.

(b) Illegal or substantially improper use of charter school funds
for the personal benefit of any officer, director, or fiduciary of the
charter school.

(c) Substantial and sustained departure from measurably
successful practices such that continued departure would jeopardize
the educational development of the school’s pupils.

begin insert

(d) Failure to improve pupil outcomes across multiple state and
school priorities identified in the charter pursuant to subparagraph
(A) of paragraph (5) of subdivision (b) of Section 47605 or
subparagraph (A) of paragraph (5) of subdivision (d) of Section
47605.6.

end insert

begin insert

begin insert SEC. 76. end insert   

end insert

begin insert Section 47605 of the end insert begin insert Education Code end insert begin insert is amended to
read: end insert

47605.  

(a) (1) Except as set forth in paragraph (2), a petition
for the establishment of a charter school within a school district
may be circulated by one or more persons seeking to establish the
charter school. A petition for the establishment of a charter school
shall identify a single charter school that will operate within the
geographic boundaries of that school district. A charter school
may propose to operate at multiple sites within the school district,
as long as each location is identified in the charter school petition.
The petition may be submitted to the governing board of the school
district for review after either of the following conditions is met:

(A) The petition is signed by a number of parents or legal
guardians of pupils that is equivalent to at least one-half of the
number of pupils that the charter school estimates will enroll in
the school for its first year of operation.

(B) The petition is signed by a number of teachers that is
equivalent to at least one-half of the number of teachers that the
charter school estimates will be employed at the school during its
first year of operation.

(2) A petition that proposes to convert an existing public school
to a charter school that would not be eligible for a loan pursuant
to subdivision (b) of Section 41365 may be circulated by one or
more persons seeking to establish the charter school. The petition
may be submitted to the governing board of the school district for
review after the petition is signed by not less than 50 percent of
the permanent status teachers currently employed at the public
school to be converted.

(3) A petition shall include a prominent statement that a
signature on the petition means that the parent or legal guardian
is meaningfully interested in having his or her child or ward attend
the charter school, or in the case of a teacher’s signature, means
that the teacher is meaningfully interested in teaching at the charter
school. The proposed charter shall be attached to the petition.

(4) After receiving approval of its petition, a charter school that
proposes to establish operations at one or more additional sites
shall request a material revision to its charter and shall notify the
authority that granted its charter of those additional locations. The
authority that granted its charter shall consider whether to approve
those additional locations at an open, public meeting. If the
additional locations are approved, they shall be a material revision
to the charter school’s charter.

(5) A charter school that is unable to locate within the
jurisdiction of the chartering school district may establish one site
outside the boundaries of the school district, but within the county
in which that school district is located, if the school district within
the jurisdiction of which the charter school proposes to operate is
notified in advance of the charter petition approval, the county
superintendent of schools and the Superintendent are notified of
the location of the charter school before it commences operations,
and either of the following circumstances exists:

(A) The school has attempted to locate a single site or facility
to house the entire program, but a site or facility is unavailable in
the area in which the school chooses to locate.

(B) The site is needed for temporary use during a construction
or expansion project.

(6) Commencing January 1, 2003, a petition to establish a charter
school may not be approved to serve pupils in a grade level that
is not served by the school district of the governing board
considering the petition, unless the petition proposes to serve pupils
in all of the grade levels served by that school district.

(b) No later than 30 days after receiving a petition, in accordance
with subdivision (a), the governing board of the school district
shall hold a public hearing on the provisions of the charter, at
which time the governing board of the school district shall consider
the level of support for the petition by teachers employed by the
district, other employees of the district, and parents. Following
review of the petition and the public hearing, the governing board
of the school district shall either grant or deny the charter within
60 days of receipt of the petition, provided, however, that the date
may be extended by an additional 30 days if both parties agree to
the extension. In reviewing petitions for the establishment of
charter schools pursuant to this section, the chartering authority
shall be guided by the intent of the Legislature that charter schools
are and should become an integral part of the California educational
system and that establishment of charter schools should be
encouraged. The governing board of the school district shall grant
a charter for the operation of a school under this part if it is satisfied
that granting the charter is consistent with sound educational
practice. The governing board of the school district shall not deny
a petition for the establishment of a charter school unless it makes
written factual findings, specific to the particular petition, setting
forth specific facts to support one or more of the following
findings:

(1) The charter school presents an unsound educational program
for the pupils to be enrolled in the charter school.

(2) The petitioners are demonstrably unlikely to successfully
implement the program set forth in the petition.

(3) The petition does not contain the number of signatures
required by subdivision (a).

(4) The petition does not contain an affirmation of each of the
conditions described in subdivision (d).

(5) The petition does not contain reasonably comprehensive
descriptions of all of the following:

(A) (i) A description of the educational program of the school,
designed, among other things, to identify those whom the school
is attempting to educate, what it means to be an “educated person”
in the 21st century, and how learning best occurs. The goals
identified in that program shall include the objective of enabling
pupils to become self-motivated, competent, and lifelong learners.

begin insert

(ii) A description, for the charter school, of annual goals, for
all pupils and for each subgroup of pupils identified pursuant to
Section 52052, to be achieved in the state priorities, as described
in subdivision (d) of Section 52060, that apply for the grade levels
served, or the nature of the program operated, by the charter
school, and specific annual actions to achieve those goals. A
charter petition may identify additional school priorities, the goals
for the school priorities, and the specific annual actions to achieve
those goals.

end insert begin delete

(ii)

end delete

begin insert (iii) end insert  If the proposed school will serve high school pupils, a
description of the manner in which the charter school will inform
parents about the transferability of courses to other public high
schools and the eligibility of courses to meet college entrance
requirements. Courses offered by the charter school that are
accredited by the Western Association of Schools and Colleges
may be considered transferable and courses approved by the
University of California or the California State University as
creditable under the “A” to “G” admissions criteria may be
considered to meet college entrance requirements.

(B) The measurable pupil outcomes identified for use by the
charter school. “Pupil outcomes,” for purposes of this part, means
the extent to which all pupils of the school demonstrate that they
have attained the skills, knowledge, and attitudes specified as goals
in the school’s educational program. Pupil outcomes shall include
outcomes that address increases in pupil academic achievement
both schoolwide and for all groups of pupils served by the charter
school, as that term is defined in subparagraph (B) of paragraph
(3) of subdivision (a) of Section 47607. begin insert The pupil outcomes shall
align with the state priorities, as described in subdivision (d) of
Section 52060, that apply for the grade levels served, or the nature
of the program operated, by the charter school. end insert

(C) The method by which pupil progress in meeting those pupil
outcomes is to be measured. begin insert To the extent practicable, the method
for measuring pupil end insert begin insert outcomes for state priorities shall be consistent
with the way information is reported on a school accountability
report card. end insert

(D) The governance structure of the school, including, but not
limited to, the process to be followed by the school to ensure
parental involvement.

(E) The qualifications to be met by individuals to be employed
by the school.

(F) The procedures that the school will follow to ensure the
health and safety of pupils and staff. These procedures shall include
the requirement that each employee of the school furnish the school
with a criminal record summary as described in Section 44237.

(G) The means by which the school will achieve a racial and
ethnic balance among its pupils that is reflective of the general
population residing within the territorial jurisdiction of the school
district to which the charter petition is submitted.

(H) Admission requirements, if applicable.

(I) The manner in which annual, independent financial audits
shall be conducted, which shall employ generally accepted
accounting principles, and the manner in which audit exceptions
and deficiencies shall be resolved to the satisfaction of the
chartering authority.

(J) The procedures by which pupils can be suspended or
expelled.

(K) The manner by which staff members of the charter schools
will be covered by the State Teachers’ Retirement System, the
Public Employees’ Retirement System, or federal social security.

(L) The public school attendance alternatives for pupils residing
within the school district who choose not to attend charter schools.

(M) A description of the rights of any employee of the school
district upon leaving the employment of the school district to work
in a charter school, and of any rights of return to the school district
after employment at a charter school.

(N) The procedures to be followed by the charter school and
the entity granting the charter to resolve disputes relating to
provisions of the charter.

(O) A declaration whether or not the charter school shall be
deemed the exclusive public school employer of the employees of
the charter school for purposes of Chapter 10.7 (commencing with
Section 3540) of Division 4 of Title 1 of the Government Code.

(P) A description of the procedures to be used if the charter
school closes. The procedures shall ensure a final audit of the
school to determine the disposition of all assets and liabilities of
the charter school, including plans for disposing of any net assets
and for the maintenance and transfer of pupil records.

(c) (1) Charter schools shall meet all statewide standards and
conduct the pupil assessments required pursuant to Sections 60605
and 60851 and any other statewide standards authorized in statute
or pupil assessments applicable to pupils in noncharter public
schools.

(2) Charter schools shall, on a regular basis, consult with their
parents, legal guardians, and teachers regarding the school’s
educational programs.

(d) (1) In addition to any other requirement imposed under this
part, a charter school shall be nonsectarian in its programs,
admission policies, employment practices, and all other operations,
shall not charge tuition, and shall not discriminate against any
pupil on the basis of the characteristics listed in Section 220. Except
as provided in paragraph (2), admission to a charter school shall
not be determined according to the place of residence of the pupil,
or of his or her parent or legal guardian, within this state, except
that an existing public school converting partially or entirely to a
charter school under this part shall adopt and maintain a policy
giving admission preference to pupils who reside within the former
attendance area of that public school.

(2) (A) A charter school shall admit all pupils who wish to
attend the school.

(B) If the number of pupils who wish to attend the charter school
exceeds the school’s capacity, attendance, except for existing pupils
of the charter school, shall be determined by a public random
drawing. Preference shall be extended to pupils currently attending
the charter school and pupils who reside in the district except as
provided for in Section 47614.5. Other preferences may be
permitted by the chartering authority on an individual school basis
and only if consistent with the law.

(C) In the event of a drawing, the chartering authority shall
make reasonable efforts to accommodate the growth of the charter
school and in no event shall take any action to impede the charter
school from expanding enrollment to meet pupil demand.

(3) If a pupil is expelled or leaves the charter school without
graduating or completing the school year for any reason, the charter
school shall notify the superintendent of the school district of the
pupil’s last known address within 30 days, and shall, upon request,
provide that school district with a copy of the cumulative record
of the pupil, including a transcript of grades or report card, and
health information. This paragraph applies only to pupils subject
to compulsory full-time education pursuant to Section 48200.

(e) The governing board of a school district shall not require
any employee of the school district to be employed in a charter
school.

(f) The governing board of a school district shall not require
any pupil enrolled in the school district to attend a charter school.

(g) The governing board of a school district shall require that
the petitioner or petitioners provide information regarding the
proposed operation and potential effects of the school, including,
but not limited to, the facilities to be used by the school, the manner
in which administrative services of the school are to be provided,
and potential civil liability effects, if any, upon the school and
upon the school district. The description of the facilities to be used
by the charter school shall specify where the school intends to
locate. The petitioner or petitioners shall also be required to provide
financial statements that include a proposed first-year operational
budget, including startup costs, and cashflow and financial
projections for the first three years of operation.

(h) In reviewing petitions for the establishment of charter
schools within the school district, the governing board of the school
district shall give preference to petitions that demonstrate the
capability to provide comprehensive learning experiences to pupils
identified by the petitioner or petitioners as academically low
achieving pursuant to the standards established by the department
under Section 54032, as it read before July 19, 2006.

(i) Upon the approval of the petition by the governing board of
the school district, the petitioner or petitioners shall provide written
notice of that approval, including a copy of the petition, to the
applicable county superintendent of schools, the department, and
the state board.

(j) (1) If the governing board of a school district denies a
petition, the petitioner may elect to submit the petition for the
establishment of a charter school to the county board of education.
The county board of education shall review the petition pursuant
to subdivision (b). If the petitioner elects to submit a petition for
establishment of a charter school to the county board of education
and the county board of education denies the petition, the petitioner
may file a petition for establishment of a charter school with the
state board, and the state board may approve the petition, in
accordance with subdivision (b). A charter school that receives
approval of its petition from a county board of education or from
the state board on appeal shall be subject to the same requirements
concerning geographic location to which it would otherwise be
subject if it received approval from the entity to which it originally
submitted its petition. A charter petition that is submitted to either
a county board of education or to the state board shall meet all
otherwise applicable petition requirements, including the
identification of the proposed site or sites where the charter school
will operate.

(2) In assuming its role as a chartering agency, the state board
shall develop criteria to be used for the review and approval of
charter school petitions presented to the state board. The criteria
shall address all elements required for charter approval, as
identified in subdivision (b) and shall define “reasonably
comprehensive” as used in paragraph (5) of subdivision (b) in a
way that is consistent with the intent of this part. Upon satisfactory
completion of the criteria, the state board shall adopt the criteria
on or before June 30, 2001.

(3) A charter school for which a charter is granted by either the
county board of education or the state board based on an appeal
pursuant to this subdivision shall qualify fully as a charter school
for all funding and other purposes of this part.

(4) If either the county board of education or the state board
fails to act on a petition within 120 days of receipt, the decision
of the governing board of the school district to deny a petition
shall, thereafter, be subject to judicial review.

(5) The state board shall adopt regulations implementing this
subdivision.

(6) Upon the approval of the petition by the county board of
education, the petitioner or petitioners shall provide written notice
of that approval, including a copy of the petition to the department
and the state board.

(k) (1) The state board may, by mutual agreement, designate
its supervisorial and oversight responsibilities for a charter school
approved by the state board to any local educational agency in the
county in which the charter school is located or to the governing
board of the school district that first denied the petition.

(2) The designated local educational agency shall have all
monitoring and supervising authority of a chartering agency,
including, but not limited to, powers and duties set forth in Section
47607, except the power of revocation, which shall remain with
the state board.

(3) A charter school that is granted its charter through an appeal
to the state board and elects to seek renewal of its charter shall,
before expiration of the charter, submit its petition for renewal to
the governing board of the school district that initially denied the
charter. If the governing board of the school district denies the
school’s petition for renewal, the school may petition the state
board for renewal of its charter.

(l) Teachers in charter schools shall hold a Commission on
Teacher Credentialing certificate, permit, or other document
equivalent to that which a teacher in other public schools would
be required to hold. These documents shall be maintained on file
at the charter school and are subject to periodic inspection by the
chartering authority. It is the intent of the Legislature that charter
schools be given flexibility with regard to noncore, noncollege
preparatory courses.

(m) A charter school shall transmit a copy of its annual,
independent financial audit report for the preceding fiscal year, as
described in subparagraph (I) of paragraph (5) of subdivision (b),
to its chartering entity, the Controller, the county superintendent
of schools of the county in which the charter school is sited, unless
the county board of education of the county in which the charter
school is sited is the chartering entity, and the department by
December 15 of each year. This subdivision does not apply if the
audit of the charter school is encompassed in the audit of the
chartering entity pursuant to Section 41020.

begin insert

begin insert SEC. 77. end insert   

end insert

begin insert Section 47605.6 of the end insert begin insert Education Code end insert begin insert is amended
to read: end insert

47605.6.  

(a) (1) In addition to the authority provided by
Section 47605.5, a county board of education may also approve a
petition for the operation of a charter school that operates at one
or more sites within the geographic boundaries of the county and
that provides instructional services that are not generally provided
by a county office of education. A county board of education may
approve a countywide charter only if it finds, in addition to the
other requirements of this section, that the educational services to
be provided by the charter school will offer services to a pupil
population that will benefit from those services and that cannot be
served as well by a charter school that operates in only one school
district in the county. A petition for the establishment of a
countywide charter school pursuant to this subdivision may be
circulated throughout the county by any one or more persons
seeking to establish the charter school. The petition may be
submitted to the county board of education for review after either
of the following conditions is met:

(A) The petition is signed by a number of parents or guardians
of pupils residing within the county that is equivalent to at least
one-half of the number of pupils that the charter school estimates
will enroll in the school for its first year of operation and each of
the school districts where the charter school petitioner proposes
to operate a facility has received at least 30 days’ notice of the
petitioner’s intent to operate a school pursuant to this section.

(B) The petition is signed by a number of teachers that is
equivalent to at least one-half of the number of teachers that the
charter school estimates will be employed at the school during its
first year of operation and each of the school districts where the
charter school petitioner proposes to operate a facility has received
at least 30 days’ notice of the petitioner’s intent to operate a school
pursuant to this section.

(2) An existing public school may not be converted to a charter
school in accordance with this section.

(3) After receiving approval of its petition, a charter school that
proposes to establish operations at additional sites within the
geographic boundaries of the county board of education shall notify
the school districts where those sites will be located. The charter
school shall also request a material revision of its charter by the
county board of education that approved its charter and the county
board of education shall consider whether to approve those
additional locations at an open, public meeting, held no sooner
than 30 days following notification of the school districts where
the sites will be located. If approved, the location of the approved
sites shall be a material revision of the school’s approved charter.

(4) A petition shall include a prominent statement indicating
that a signature on the petition means that the parent or guardian
is meaningfully interested in having his or her child or ward attend
the charter school, or in the case of a teacher’s signature, means
that the teacher is meaningfully interested in teaching at the charter
school. The proposed charter shall be attached to the petition.

(b) No later than 60 days after receiving a petition, in accordance
with subdivision (a), the county board of education shall hold a
public hearing on the provisions of the charter, at which time the
county board of education shall consider the level of support for
the petition by teachers, parents or guardians, and the school
districts where the charter school petitioner proposes to place
school facilities. Following review of the petition and the public
hearing, the county board of education shall either grant or deny
the charter within 90 days of receipt of the petition. However, this
date may be extended by an additional 30 days if both parties agree
to the extension. A county board of education may impose any
additional requirements beyond those required by this section that
it considers necessary for the sound operation of a countywide
charter school. A county board of education may grant a charter
for the operation of a school under this part only if the board is
satisfied that granting the charter is consistent with sound
educational practice and that the charter school has reasonable
justification for why it could not be established by petition to a
school district pursuant to Section 47605. The county board of
education shall deny a petition for the establishment of a charter
school if the board finds one or more of the following:

(1) The charter school presents an unsound educational program
for the pupils to be enrolled in the charter school.

(2) The petitioners are demonstrably unlikely to successfully
implement the program set forth in the petition.

(3) The petition does not contain the number of signatures
required by subdivision (a).

(4) The petition does not contain an affirmation of each of the
conditions described in subdivision (d).

(5) The petition does not contain reasonably comprehensive
descriptions of all of the following:

(A) (i) A description of the educational program of the school,
designed, among other things, to identify those pupils whom the
school is attempting to educate, what it means to be an “educated
person” in the 21st century, and how learning best occurs. The
goals identified in that program shall include the objective of
enabling pupils to become self-motivated, competent, and lifelong
learners.

begin insert

(ii) A description, for the charter school, of annual goals, for
all pupils and for each subgroup of pupils identified pursuant to
Section 52052, to be achieved in the state priorities, as described
in subdivision (d) of Section 52060, that apply for the grade levels
served, or the nature of the program operated, by the charter
school, and specific annual actions to achieve those goals. A
charter petition may identify additional school priorities, the goals
for the school priorities, and the specific annual actions to achieve
those goals.

end insert begin delete

(ii)

end delete

begin insert (iii) end insert  If the proposed charter school will enroll high school pupils,
a description of the manner in which the charter school will inform
parents regarding the transferability of courses to other public high
schools. Courses offered by the charter school that are accredited
by the Western Association of Schools and Colleges may be
considered to be transferable to other public high schools.

begin delete

(iii)

end delete

begin insert (iv) end insert  If the proposed charter school will enroll high school pupils,
information as to the manner in which the charter school will
inform parents as to whether each individual course offered by the
charter school meets college entrance requirements. Courses
approved by the University of California or the California State
University as satisfying their prerequisites for admission may be
considered as meeting college entrance requirements for purposes
of this clause.

(B) The measurable pupil outcomes identified for use by the
charter school. “Pupil outcomes,” for purposes of this part, means
the extent to which all pupils of the school demonstrate that they
have attained the skills, knowledge, and aptitudes specified as
goals in the school’s educational program. Pupil outcomes shall
include outcomes that address increases in pupil academic
achievement both schoolwide and for all groups of pupils served
by the charter school, as that term is defined in subparagraph (B)
of paragraph (3) of subdivision (a) of Section 47607. begin insert The pupil
outcomes shall align with the state priorities, as described in
subdivision (d) of Section 52060, that apply for the grade levels
served, or the nature of the program operated, by the charter
school. end insert

(C) The method by which pupil progress in meeting those pupil
outcomes is to be measured. begin insert To the extent practicable, the method
for measuring pupil outcomes for state priorities shall be consistent
with the way information is reported on a school accountability
report card. end insert

(D) The location of each charter school facility that the petitioner
proposes to operate.

(E) The governance structure of the school, including, but not
limited to, the process to be followed by the school to ensure
parental involvement.

(F) The qualifications to be met by individuals to be employed
by the school.

(G) The procedures that the school will follow to ensure the
health and safety of pupils and staff. These procedures shall include
the requirement that each employee of the school furnish the school
with a criminal record summary as described in Section 44237.

(H) The means by which the school will achieve a racial and
ethnic balance among its pupils that is reflective of the general
population residing within the territorial jurisdiction of the school
district to which the charter petition is submitted.

(I) The manner in which annual, independent, financial audits
shall be conducted, in accordance with regulations established by
the state board, and the manner in which audit exceptions and
deficiencies shall be resolved.

(J) The procedures by which pupils can be suspended or
expelled.

(K) The manner by which staff members of the charter schools
will be covered by the State Teachers’ Retirement System, the
Public Employees’ Retirement System, or federal social security.

(L) The procedures to be followed by the charter school and the
county board of education to resolve disputes relating to provisions
of the charter.

(M) A declaration whether or not the charter school shall be
deemed the exclusive public school employer of the employees of
the charter school for purposes of the Educational Employment
Relations Act (Chapter 10.7 (commencing with Section 3540) of
Division 4 of Title 1 of the Government Code).

(N) Admission requirements of the charter school, if applicable.

(O) The public school attendance alternatives for pupils residing
within the county who choose not to attend the charter school.

(P) A description of the rights of an employee of the county
office of education, upon leaving the employment of the county
office of education, to be employed by the charter school, and a
description of any rights of return to the county office of education
that an employee may have upon leaving the employ of the charter
school.

(Q) A description of the procedures to be used if the charter
school closes. The procedures shall ensure a final audit of the
school to determine the disposition of all assets and liabilities of
the charter school, including plans for disposing of any net assets
and for the maintenance and transfer of public records.

(6) Any other basis that the county board of education finds
justifies the denial of the petition.

(c) A county board of education that approves a petition for the
operation of a countywide charter may, as a condition of charter
approval, enter into an agreement with a third party, at the expense
of the charter school, to oversee, monitor, and report to the county
board of education on the operations of the charter school. The
county board of education may prescribe the aspects of the charter
school’s operations to be monitored by the third party and may
prescribe appropriate requirements regarding the reporting of
information concerning the operations of the charter school to the
county board of education.

(d) (1) Charter schools shall meet all statewide standards and
conduct the pupil assessments required pursuant to Section 60605
and any other statewide standards authorized in statute or pupil
assessments applicable to pupils in noncharter public schools.

(2) Charter schools shall on a regular basis consult with their
parents and teachers regarding the school’s educational programs.

(e) (1) In addition to any other requirement imposed under this
part, a charter school shall be nonsectarian in its programs,
admission policies, employment practices, and all other operations,
shall not charge tuition, and shall not discriminate against any
pupil on the basis of ethnicity, national origin, gender, gender
identity, gender expression, or disability. Except as provided in
paragraph (2), admission to a charter school shall not be determined
according to the place of residence of the pupil, or of his or her
parent or guardian, within this state.

(2) (A) A charter school shall admit all pupils who wish to
attend the school.

(B) If the number of pupils who wish to attend the charter school
exceeds the school’s capacity, attendance, except for existing pupils
of the charter school, shall be determined by a public random
drawing. Preference shall be extended to pupils currently attending
the charter school and pupils who reside in the county except as
provided for in Section 47614.5. Other preferences may be
permitted by the chartering authority on an individual school basis
and only if consistent with the law.

(C) In the event of a drawing, the county board of education
shall make reasonable efforts to accommodate the growth of the
charter school and in no event shall take any action to impede the
charter school from expanding enrollment to meet pupil demand.

(f) The county board of education shall not require any employee
of the county or a school district to be employed in a charter school.

(g) The county board of education shall not require any pupil
enrolled in a county program to attend a charter school.

(h) The county board of education shall require that the
petitioner or petitioners provide information regarding the proposed
operation and potential effects of the school, including, but not
limited to, the facilities to be used by the school, the manner in
which administrative services of the school are to be provided,
and potential civil liability effects, if any, upon the school, any
school district where the charter school may operate, and upon the
county board of education. The petitioner or petitioners shall also
be required to provide financial statements that include a proposed
first-year operational budget, including startup costs, and cashflow
and financial projections for the first three years of operation.

(i) In reviewing petitions for the establishment of charter schools
within the county, the county board of education shall give
preference to petitions that demonstrate the capability to provide
comprehensive learning experiences to pupils identified by the
petitioner or petitioners as academically low achieving pursuant
to the standards established by the department under Section 54032,
as it read before July 19, 2006.

(j) Upon the approval of the petition by the county board of
education, the petitioner or petitioners shall provide written notice
of that approval, including a copy of the petition, to the school
districts within the county, the Superintendent, and to the state
board.

(k) If a county board of education denies a petition, the petitioner
may not elect to submit the petition for the establishment of the
charter school to the state board.

(l) Teachers in charter schools shall be required to hold a
Commission on Teacher Credentialing certificate, permit, or other
document equivalent to that which a teacher in other public schools
would be required to hold. These documents shall be maintained
on file at the charter school and shall be subject to periodic
inspection by the chartering authority.

(m) A charter school shall transmit a copy of its annual,
independent, financial audit report for the preceding fiscal year,
as described in subparagraph (I) of paragraph (5) of subdivision
(b), to the county office of education, the Controller, and the
department by December 15 of each year. This subdivision shall
not apply if the audit of the charter school is encompassed in the
audit of the chartering entity pursuant to Section 41020.

begin insert

begin insert SEC. 78. end insert   

end insert

begin insert Section 47606.5 is added to the end insert begin insert Education Code end insert begin insert , to
read: end insert

begin insert

begin insert 47606.5. end insert   

(a) On or before July 1, 2015, and each year
thereafter, a charter school shall update the goals and annual
actions to achieve those goals identified in the charter pursuant
to subparagraph (A) of paragraph (5) of subdivision (b) of Section
47605 or subparagraph (A) of paragraph (5) of subdivision (b) of
Section 47605.6. The annual update shall be developed using the
template adopted pursuant to Section 52064 and shall include all
of the following:

(1) A review of the progress toward the goals included in the
charter, an assessment of the effectiveness of the specific actions
described in the charter toward achieving the goals, and a
description of changes to the specific actions the charter school
will make as a result of the review and assessment.

(2) A listing and description of the expenditures for the fiscal
year implementing the specific actions included in the charter as
a result of the reviews and assessment required by paragraph (1).

(b) The expenditures identified in subdivision (a) shall be
classified using the California School Accounting Manual pursuant
to Section 41010.

(c) For purposes of the review required by subdivision (a), a
governing body of a charter school may consider qualitative
information, including, but not limited to, findings that result from
school quality reviews conducted pursuant to subparagraph (J)
or paragraph (4) of subdivision (a) of Section 52052 or any other
reviews.

(d) To the extent practicable, data reported pursuant to this
section shall be reported in a manner consistent with how
information is reported on a school accountability report card.

(e) The charter school shall consult with teachers, principals,
administrators, other school personnel, parents, and pupils in
developing the annual update.

end insert

begin insert

begin insert SEC. 79. end insert   

end insert

begin insert Section 47607.3 is added to the end insert begin insert Education Code end insert begin insert , to
read: end insert

begin insert

begin insert 47607.3. end insert   

(a) If a charter school fails to improve outcomes for
three or more pupil subgroups identified pursuant to Section 52052,
or, if the charter school has less than three pupil subgroups, all
of the charter school’s pupil subgroups, in regard to one or more
state or school priority identified in the charter pursuant to
subparagraph (A) of paragraph (5) of subdivision (b) of Section
47605 or subparagraph (A) of paragraph (5) of subdivision (b) of
Section 47605.6, in three out of four consecutive school years, all
of the following shall apply:

(1) Using an evaluation rubric adopted by the state board
pursuant to Section 52064.5, the chartering authority shall provide
technical assistance to the charter school.

(2) The Superintendent may assign, at the request of the
chartering authority and with the approval of the state board, the
California Collaborative for Educational Excellence to provide
advice and assistance to the charter school pursuant to Section
52074.

(b) A chartering authority shall consider for revocation any
charter school to which the California Collaborative for
Educational Excellence has provided advice and assistance
pursuant to subdivision (a) and about which it has made either of
the following findings, which shall be submitted to the chartering
authority:

(1) That the charter school has failed, or is unable, to implement
the recommendations of the California Collaborative for
Educational Excellence.

(2) That the inadequate performance of the charter school,
based upon an evaluation rubric adopted pursuant to Section
52064.5, is either so persistent or so acute as to require revocation
of the charter.

(c) The chartering authority shall consider increases in pupil
academic achievement for all pupil subgroups served by the charter
school as the most important factor in determining whether to
revoke the charter.

(d) A chartering authority shall comply with the hearing process
described in subdivision (e) of Section 47607 in revoking a charter.
A charter school may not appeal a revocation of a charter made
pursuant to this section.

end insert

begin insert

begin insert SEC. 80. end insert   

end insert

begin insert Section 47612.7 of the end insert begin insert Education Code end insert begin insert is repealed. end insert

begin delete

47612.7.  

(a) Notwithstanding Section 47612.5 or any other
law, the Center for Advanced Research and Technology, operating
pursuant to a joint powers agreement between the Clovis Unified
School District and the Fresno Unified School District, is eligible
to receive general-purpose funding, as calculated pursuant to
Section 47633, for the 2005-06 and 2006-07 fiscal years for a
total average daily attendance not to exceed the center’s average
daily attendance as determined at the second principal
apportionment for the 2005-06 and 2006-07 fiscal years,
respectively, and for the 2007-08 fiscal year for a total average
daily attendance not to exceed the center’s average daily attendance
as determined at the second principal apportionment for the
2006-07 fiscal year.

(b) Commencing with the 2008-09 fiscal year, the Center for
Advanced Research and Technology, as described in subdivision
(a), is not eligible to receive funding pursuant to Chapter 6
(commencing with Section 47630).

(c) This section shall become inoperative on July 1, 2017, and,
as of January 1, 2018, is repealed, unless a later enacted statute,
that becomes operative on or before January 1, 2018, deletes or
extends the dates on which it becomes inoperative and is repealed.

end delete

begin insert

begin insert SEC. 81. end insert   

end insert

begin insert Section 47613 of the end insert begin insert Education Code end insert begin insert is amended to
read: end insert

47613.  

(a) Except as set forth in subdivision (b), a chartering
authority may charge for the actual costs of supervisorial oversight
of a charter school not to exceed 1 percent of the revenue of the
charter school.

(b) A chartering authority may charge for the actual costs of
supervisorial oversight of a charter school not to exceed 3 percent
of the revenue of the charter school if the charter school is able to
obtain substantially rent free facilities from the chartering authority.

(c) A local agency that is given the responsibility for
supervisorial oversight of a charter school, pursuant to paragraph
(1) of subdivision (k) of Section 47605, may charge for the actual
costs of supervisorial oversight, and administrative costs necessary
to secure charter school funding. A charter school that is charged
for costs under this subdivision may not be charged pursuant to
subdivision (a) or (b).

(d) This section does not prevent the charter school from
separately purchasing administrative or other services from the
chartering authority or any other source.

(e) For purposes of this section, a chartering authority means a
school district, county board of education, or the state board, that
granted the charter to the charter school.

(f) For purposes of this section, “revenue of the charter school”
means the general purpose entitlement and categorical block grant,
as defined in subdivisions (a) and (b) of Section 47632.

begin insert

(g) For purposes of this section, “costs of supervisorial
oversight” includes, but is not limited to, costs incurred pursuant
to Section 47607.3.

end insert begin delete

(g) (1) The California Research Bureau of the California State
Library shall prepare and submit to the Legislature on or before
January 8, 2009, a report on the key elements and actual costs of
charter school oversight. For purposes of the report, the bureau
shall define fiscal and academic oversight and shall include any
financial relationship between a charter school and its chartering
authority that has the effect of furthering the operations of the
charter school and that may provide opportunities to oversee the
charter school. The report, at a minimum, shall address all of the
following issues:

end delete begin delete

(A) The range of annual activities that entities providing
supervisorial oversight of charter schools are expected to perform.

end delete begin delete

(B) Staff time spent on reviewing charter petitions measured
by the size of school districts and the number of charter petitions
reviewed.

end delete begin delete

(C) Staff time spent on oversight responsibilities measured by
the size of school districts and the number of charter schools.

end delete begin delete

(D) Best practices for charter school oversight measured by
efficiency and effectiveness. A cost analysis of those best practices
after being measured by efficiency and effectiveness.

end delete begin delete

(E) Comparison of school district costs and revenues attributable
to charter school oversight.

end delete begin delete

(F) Administrative services provided to a charter school by a
chartering authority, such as human resources, that may be useful
in the oversight of the charter school and chartering authority
revenues attributable to those services.

end delete begin delete

(G) Length of time required to review a single charter petition.

end delete begin delete

(H) Recommendations for structuring charter school oversight
and accountability in California, including an assessment of
whether or not the associated costs specified in subdivisions (a)
and (b) and subparagraph (F) are adequate to support appropriate
supervisorial oversight.

end delete begin delete

(2) In preparing its report, the California Research Bureau shall
consult with an advisory panel to ensure technical accuracy.

end delete

begin insert

begin insert SEC. 82. end insert   

end insert

begin insert Section 47631 of the end insert begin insert Education Code end insert begin insert is amended to
read: end insert

47631.  

(a)  begin delete Article 2 (commencing with Section 47633) and end delete
Article 3 (commencing with Section 47636) begin delete may end delete begin insert shall end insert not apply
to a charter granted pursuant to Section 47605.5.

begin delete

(b) Notwithstanding subdivision (a), a pupil attending a
county-sponsored charter school who is eligible to attend that
school solely as a result of parental request pursuant to subdivision
(b) of Section 1981 shall be funded pursuant to this chapter.

end delete begin insert

(b) A county-sponsored charter school shall receive the average
daily attendance rate calculated pursuant to paragraph (1) of
subdivision (c) of Section 2574 for enrolled pupils who are
identified as any of the following:

end insert begin insert

(1) Probation-referred pursuant to Section 300, 601, 602, or
654 of the Welfare and Institutions Code.

end insert begin insert

(2) On probation or parole and not attending a school.

end insert begin insert

(3) Expelled for any of the reasons specified in subdivision (a)
or (c) of Section 48915.

end insert begin insert

(c) A county-sponsored charter school shall be funded pursuant
to the local control funding formula pursuant to Section 42238.02,
as implemented by Section 42238.03, for all pupils except for pupils
funded pursuant to subdivision (b).

end insert

begin insert

begin insert SEC. 83. end insert   

end insert

begin insert Section 47632 of the end insert begin insert Education Code end insert begin insert is amended to
read: end insert

47632.  

For purposes of this chapter, the following terms shall
be defined as follows:

(a) “General-purpose entitlement” means an amount computed
by the begin delete formula set forth in Section 47633 beginning in the
1999-2000 fiscal year, which is based on the statewide average
amounts of general-purpose funding from those state and local
sources identified in Section 47633 received by school districts of
similar type and serving similar pupil populations end delete begin insert local control
funding formula pursuant to Section 42238.02, as implemented by
Section 42238.03 end insert .

begin delete

(b) “Categorical block grant” means an amount computed by
the formula set forth in Section 47634 beginning in the 1999-2000
fiscal year, which is based on the statewide average amounts of
categorical aid from those sources identified in Section 47634
received by school districts of similar type and serving similar
pupil populations.

end delete begin delete

(c)

end delete begin insert

(b) “Economic impact aid-eligible pupils” means those pupils
that are included in the economic impact aid-eligible pupil count
pursuant to Section 54023. For purposes of applying Section 54023
to charter schools, “economically disadvantaged pupils” means
the pupils described in paragraph (2) of subdivision (a) of Section
54026.

end insert

begin insert (c) end insert  “General-purpose funding” means those funds that consist
of state aid, local property taxes, and other revenues applied toward
a school district’s begin delete revenue limit, pursuant to Section 42238 end delete begin insert local
control funding formula, pursuant to Section 42238.02, as
implemented by Section 42238.03 end insert .

(d) “Categorical aid” means aid that consists of state or federally
funded programs, or both, which are apportioned for specific
purposes set forth in statute or regulation.

begin delete

(e) “Economic impact aid-eligible pupils” means those pupils
that are included in the economic impact aid-eligible pupil count
pursuant to Section 54023. For purposes of applying Section 54023
to charter schools, “economically disadvantaged pupils” means
the pupils described in paragraph (2) of subdivision (a) of Section
54026.

end delete begin delete

(f)

end delete

begin insert (e) end insert  “Educationally disadvantaged pupils” means those begin delete pupils
who are eligible for subsidized meals pursuant to Section 49552
or are identified as English learners pursuant to subdivision (a) of
Section 306, or both end delete begin insert end insert begin insert pupils who meet federal eligibility criteria
for free and reduced-price meals as specified in Section 49531,
as that section read on January 1, 2013, except in regard to meals
in family day care homes end insert .

begin delete

(g)

end delete

begin insert (f) end insert  “Operational funding” means all funding except funding for
capital outlay.

begin delete

(h)

end delete

begin insert (g) end insert  “School district of a similar type” means a school district
that is serving similar grade levels.

begin delete

(i)

end delete

begin insert (h) end insert  “Similar pupil population” means similar numbers of pupils
by grade level, with a similar proportion of educationally
disadvantaged pupils.

begin delete

(j)

end delete

begin insert (i) end insert  “Sponsoring local educational agency” means the following:

(1) If a charter school is granted by a school district, the
sponsoring local educational agency is the school district.

(2) If a charter is granted by a county office of education after
having been previously denied by a school district, the sponsoring
local educational agency means the school district that initially
denied the charter petition.

(3) If a charter is granted by the state board after having been
previously denied by a local educational agency, the sponsoring
local educational agency means the local educational agency
designated by the state board pursuant to paragraph (1) of
subdivision (k) of Section 47605 or if a local educational agency
is not designated, the local educational agency that initially denied
the charter petition.

(4) For pupils attending county-sponsored charter schools who
are eligible to attend those schools solely as a result of parental
request pursuant to subdivision (b) of Section 1981, the sponsoring
local educational agency means the pupils’ school district of
residence.

(5) For pupils attending countywide charter schools pursuant
to Section 47605.6 who reside in a basic aid school district, the
sponsoring local educational agency means the school district of
residence of the pupil. For purposes of this paragraph, “basic aid
school district” means a school district that does not receive an
apportionment of state funds begin delete pursuant to end delete begin insert as described in end insert
subdivision begin delete (h) end delete begin insert (o) end insert of Section begin delete 42238 end delete begin insert 42238.02 end insert .

begin insert

begin insert SEC. 84. end insert   

end insert

begin insert Section 47632.5 of the end insert begin insert Education Code end insert begin insert is repealed. end insert

begin delete

47632.5.  

A charter school that is established through the
conversion of an existing public school where the charter is granted
by a district other than the district in which the school is located
may not generate or receive revenue limit funding in excess of the
revenue limit of the school district in which the school was located
prior to the conversion to charter status. This limitation shall apply
whether the charter converts to charter status a single existing
public school or multiple existing public schools.

end delete

begin insert

begin insert SEC. 85. end insert   

end insert

begin insert Section 47635 of the end insert begin insert Education Code end insert begin insert is amended to
read: end insert

47635.  

(a) A sponsoring local educational agency shall
annually transfer to each of its charter schools funding in lieu of
property taxes equal to the lesser of the following two amounts:

(1) The average amount of property taxes per unit of average
daily attendance, including average daily attendance attributable
to charter schools, received by the local educational agency,
multiplied by the charter school’s average daily attendance.

(2) The statewide average begin delete general-purpose funding end delete begin insert local control end insert
begin insert funding formula grant funding computed pursuant to subdivision
(d) of Section 42238.02, end insert per unit of average daily attendance
received by school districts, as determined by the begin delete State Department
of Education, end delete begin insert department, end insert multiplied by the charter school’s
average daily attendance in each of the four corresponding grade
level ranges: kindergarten and grades 1, 2, and 3; grades 4, 5, and
6; grades 7 and 8; and grades 9 to 12, inclusive.

begin insert

(3) Notwithstanding paragraph (2), until the Superintendent
determines that a charter school is funded pursuant to Section
42238.02 in the prior fiscal year, the Superintendent shall
apportion funding per unit of average daily attendance pursuant
to this article. The base grant for purposes of paragraph (2) shall
be the sum of the entitlements for the charter school in the specified
fiscal year as computed pursuant to paragraphs (1) to (4),
inclusive, of subdivision (a) of Section 42238.03 and paragraph
(3) of subdivision (b) of Section 42238.03, multiplied by the ratio
of local control funding formula base grant funding computed
pursuant to subdivision (d) of Section 42238.02 to the local control
funding formula amount for the fiscal year computed pursuant to
Section 42238.02.

end insert

(b) The sponsoring local educational agency shall transfer
funding in lieu of property taxes to the charter school in monthly
installments, by no later than the 15th of each month.

(1) For the months of August to February, inclusive, a charter
school’s funding in lieu of property taxes shall be computed based
on the amount of property taxes received by the sponsoring local
educational agency during the preceding fiscal year, as reported
to the Superintendent begin delete of Public Instruction end delete for purposes of the
second principal apportionment. A sponsoring local educational
agency shall transfer to the charter school the charter school’s
estimated annual entitlement to funding in lieu of property taxes
as follows:

(A) Six percent in August.

(B) Twelve percent in September.

(C) Eight percent each month in October, November, December,
January, and February.

(2) For the months of March to June, inclusive, a charter
school’s funding in lieu of property taxes shall be computed based
on the amount of property taxes estimated to be received by the
sponsoring local educational agency during the fiscal year, as
reported to the Superintendent begin delete of Public Instruction end delete for purposes
of the first principal apportionment. A sponsoring local educational
agency shall transfer to each of its charter schools an amount equal
to one-sixth of the difference between the school’s estimated annual
entitlement to funding in lieu of property taxes and the amounts
provided pursuant to paragraph (1). An additional one-sixth of this
difference shall be included in the amount transferred in the month
of March.

(3) For the month of July, a charter school’s funding in lieu of
property taxes shall be computed based on the amount of property
taxes estimated to be received by the sponsoring local educational
agency during the prior fiscal year, as reported to the
Superintendent begin delete of Public Instruction end delete for purposes of the second
principal apportionment. A sponsoring local educational agency
shall transfer to each of its charter schools an amount equal to the
remaining difference between the school’s estimated annual
entitlement to funding in lieu of property taxes and the amounts
provided pursuant to paragraphs (1) and (2).

(4) Final adjustments to the amount of funding in lieu of
property taxes allocated to a charter school shall be made in
February, in conjunction with the final reconciliation of annual
apportionments to schools.

(5) Subdivision (a) and paragraphs (1) to (4), inclusive, begin delete of
subdivision (b) end delete do not apply for pupils who reside in, and are
otherwise eligible to attend a school in, a basic aid school district,
but who attend a charter school in a nonbasic aid school district.
With regard to these pupils, the sponsoring basic aid begin insert school end insert district
shall transfer to the charter school an amount of funds equivalent
to the begin delete revenue limit end delete begin insert local control funding formula grant pursuant
to Section 42238.02, as implemented by Section 42238.03, end insert earned
through average daily attendance by the charter school for each
pupil’s attendance, not to exceed the average property tax share
per unit of average daily attendance for pupils residing and
attending in the basic aid begin insert school end insert district. The transfer of funds shall
be made in not fewer than two installments at the request of the
charter school, the first occurring not later than February 1 and the
second not later than June 1 of each school year. Payments shall
reflect the average daily attendance certified for the time periods
of the first and second principal apportionments, respectively. The
Superintendent begin delete of Public Instruction end delete may not apportion any funds
for the attendance of pupils described in this subdivision unless
the amount transferred by the basic aid district is less than the
begin delete revenue limit end delete begin insert local control funding formula grant pursuant to
Section 42238.02, as implemented by Section 42238.03, end insert earned by
the charter school, in which event the Superintendent begin delete of Public
Instruction end delete shall apportion the difference to the charter school from
state funds.

begin insert

begin insert SEC. 86. end insert   

end insert

begin insert Section 47636 of the end insert begin insert Education Code end insert begin insert is amended to
read: end insert

47636.  

(a) This chapter begin delete does end delete begin insert shall end insert not prevent a charter school
from negotiating with a local educational agency for a share of
operational funding from sources not otherwise set forth in this
chapter including, but not limited to, all of the following:

(1) Forest reserve revenues and other operational revenues
received due to harvesting or extraction of minerals or other natural
resources.

(2) Sales and use taxes, to the extent that the associated revenues
are available for noncapital expenses of public schools.

(3) Parcel taxes, to the extent that the associated revenues are
available for noncapital expenses of public schools.

(4) Ad valorem property taxes received by a school district
which exceed its begin delete revenue limit entitlement end delete begin insert local control funding
formula entitlement pursuant to Section 42238.02, as implemented
by Section 42238.03 end insert .

(5) “Basic aid” received by a school district pursuant to Section
6 of Article IX of the California Constitution.

(b) This section shall become operative July 1, 2006.

begin insert

begin insert SEC. 87. end insert   

end insert

begin insert Section 47660 of the end insert begin insert Education Code end insert begin insert is amended to
read: end insert

47660.  

begin delete (a) end delete begin delete   end delete For purposes of computing eligibility for, and
entitlements to, general purpose funding and operational funding
for categorical programs, the enrollment and average daily
attendance of a sponsoring local educational agency shall exclude
the enrollment and attendance of pupils in its charter schools
funded pursuant to this chapter.

begin delete

(b) (1) Notwithstanding subdivision (a), and commencing with
the 2005-06 fiscal year, for purposes of computing eligibility for,
and entitlements to, revenue limit funding, the average daily
attendance of a unified school district, other than a unified school
district that has converted all of its schools to charter status
pursuant to Section 47606, shall include all attendance of pupils
who reside in the unified school district and who would otherwise
have been eligible to attend a noncharter school of the school
district, if the school district was a basic aid school district in the
prior fiscal year, or if the pupils reside in the unified school district
and attended a charter school of that school district that converted
to charter status on or after July 1, 2005. Only the attendance of
the pupils described by this paragraph shall be included in the
calculation made pursuant to paragraph (7) of subdivision (h) of
Section 42238.

(2) Notwithstanding subdivision (a), for the 2005-06 fiscal year
only, for purposes of computing eligibility for, and entitlements
to, revenue limit funding, the average daily attendance of a unified
school district, other than a unified school district that has
converted all of its schools to charter status pursuant to Section
47606 and is operating them as charter schools, shall include all
attendance of pupils who reside in the unified school district and
who would otherwise have been eligible to attend a noncharter
school of the unified school district if the pupils attended a charter
school operating in the unified school district prior to July 1, 2005.
Only the attendance of pupils described by this paragraph shall be
included in the calculation made pursuant to Section 42241.3. The
attendance of the pupils described by this paragraph shall be
included in the calculation made pursuant to paragraph (7) of
subdivision (h) of Section 42238.

(c) (1) For the attendance of pupils specified in subdivision (b),
the general-purpose entitlement for a charter school that is
established through the conversion of an existing public school
within a unified school district on or after July 1, 2005, but before
January 1, 2010, shall be determined using the following amount
of general-purpose funding per unit of average daily attendance,
in lieu of the amount calculated pursuant to subdivision (a) of
Section 47633:

(A) The amount of the actual unrestricted revenues expended
per unit of average daily attendance for that school in the year
prior to its conversion to, and operation as, a charter school,
adjusted for the base revenue limit per pupil inflation increase
adjustment set forth in Section 42238.1, if this adjustment is
provided, and also adjusted for equalization, deficit reduction, and
other state general-purpose increases, if any, provided for the
unified school district in the year of conversion to, and operation
as a charter school.

(B) For a subsequent fiscal year, the general-purpose entitlement
shall be determined based on the amount per unit of average daily
attendance allocated in the prior fiscal year adjusted for the base
revenue limit per pupil inflation increase adjustment set forth in
Section 42238.1, if this adjustment is provided, and also adjusted
for equalization, deficit reduction, and other state general-purpose
increases, if any, provided for the unified school district in that
fiscal year.

(2) This subdivision shall not apply to a charter school that is
established through the conversion of an existing public school
within a unified school district on or after January 1, 2010, which
instead shall receive general-purpose funding

pursuant to Section 47633. This paragraph does not preclude a
charter school or unified school district from agreeing to an
alternative funding formula.

(d) Commencing with the 2005-06 fiscal year, the
general-purpose funding per unit of average daily attendance
specified for a unified school district for purposes of paragraph
(7) of subdivision (h) of Section 42238 for a school within the
unified school district that converted to charter status on or after
July 1, 2005, shall be deemed to be the amount computed pursuant
to subdivision (c).

(e) A unified school district that is the sponsoring local
educational agency as defined in subdivision (j) of Section 47632
of a charter school that is subject to paragraphs (1) and (2) of
subdivision (c) shall certify to the Superintendent the amount
specified in paragraph (1) of subdivision (c) prior to the approval
of the charter petition by the governing board of the school district.
This amount may be based on estimates of the unrestricted revenues
expended in the fiscal year prior to the school’s conversion to
charter status and the school’s operation as a charter school,
provided that the amount is recertified when the actual data
becomes available.

(f) For the purposes of this section, “basic aid school district”
means a school district that does not receive from the state an
apportionment of state funds pursuant to subdivision (h) of Section
42238.

(g) A school district may use the existing Standardized Account
Code Structure and cost allocation methods, if appropriate, for an
accounting of the actual unrestricted revenues expended in support
of a school pursuant to subdivision (c).

(h) For purposes of this section and Section 42241.3, “operating”
means that pupils are attending and receiving instruction at the
charter school.

end delete

begin insert

begin insert SEC. 88. end insert   

end insert

begin insert Section 47663 of the end insert begin insert Education Code end insert begin insert is amended to
read: end insert

47663.  

(a)  begin insert (1) end insert begin insert   end insert For a pupil of a charter school sponsored by
a basic aid school district who resides in, and is otherwise eligible
to attend, a school district other than a basic aid school district,
the Superintendent begin delete of Public Instruction end delete shall apportion to the
sponsoring school district an amount equal to 70 percent of the
begin delete revenue limit end delete begin insert local control funding formula base grant computed
pursuant to subdivision (d) of Section 42238.02, end insert per unit of average
daily attendance that would have been apportioned to the school
district that the pupil resides in and would otherwise have been
eligible to attend.

begin insert

(2) Notwithstanding paragraph (1), until the Superintendent
determines that the school district the pupil resides in, and would
otherwise have been eligible to attend, is funded pursuant to
Section 42238.02 in the prior fiscal year, the Superintendent shall
apportion, for average daily attendance pursuant to this article,
70 percent of the sum of the entitlements for the school district
that the pupil resides in, and would otherwise have been eligible
to attend, for the specified fiscal year as computed pursuant to
paragraphs (1) to (4), inclusive, of subdivision (a) of Section
42238.03 and paragraph (3) of subdivision (b) of Section 42238.03,
divided by the average daily attendance for that fiscal year and
then multiplied by the ratio of local control funding formula base
grant funding computed pursuant to subdivision (d) of Section
42238.02 to the local control funding formula amount for the fiscal
year computed pursuant to Section 42238.02.

end insert

(b) A begin insert school end insert district that loses basic aid status as a result of
transferring property taxes to a charter school or schools pursuant
to Section 47635 begin insert for pupils who reside in, and are otherwise
eligible to attend, a school district other than the school district
that sponsors the charter school, end insert shall be eligible to receive a pro
rata share of funding provided by subdivision (a), with the proration
factor calculated as the ratio of the following:

(1) The amount of property taxes that the begin insert school end insert district receives
in excess of its total begin delete revenue limit guarantee, prior to end delete begin insert base grant
per unit of average daily attendance calculated pursuant to Section
42238.02, as imp end insert begin insert lemented by Section 42238.03, before end insert any
transfers made pursuant to Section 47635 begin insert , except for transfers of
in lieu of property taxes made for pupils who reside in, and would
otherwise be eligible to attend, a school of the school district end insert .

(2) The total amount of begin insert in lieu of end insert property taxes transferred
pursuant to Section 47635 to the charter school or schools that it
sponsors begin insert , except for transfers of in lieu of property taxes made for
pupils who reside in, and would otherwise be eligible to attend, a
school of the school district end insert .

begin insert

(c) In no event shall the amount provided pursuant to this section
exceed the amount of in lieu of property taxes transferred on behalf
of charter school pupils who do not reside in the school district,
less the proportionate amount of base grant state aid provided
pursuant to Section 42238.02, as implemented by Section 42238.03,
that is attributable to the charter school pupils who do not reside
in the school district.

end insert begin delete

(c)

end delete

begin insert (d) end insert  The Superintendent begin delete of Public Instruction may end delete begin insert shall end insert not
apportion funds for the attendance of a pupil in a charter school
of a nonbasic aid school district who resides in, and is otherwise
eligible to attend school in, a basic aid school district unless the
pupil is subject to the exception set forth in paragraph (5) of
subdivision (b) of Section 47635.

begin delete

(d)

end delete

begin insert (e) end insert  For purposes of this section, “basic aid school district” means
a school district that does not receive from the state, for any fiscal
year in which the subdivision is applied, an apportionment of state
funds begin delete pursuant to end delete begin insert as described in end insert subdivision begin delete (h) end delete begin insert (o) end insert of Section
begin delete 42238 end delete begin insert 42238.02 end insert .

begin insert

begin insert SEC. 89. end insert   

end insert

begin insert Section 47664 of the end insert begin insert Education Code end insert begin insert is repealed. end insert

begin delete

47664.  

(a) A school district in which all schools have been
converted to charter schools pursuant to Section 47606, at the
school district’s discretion, may use the funding method provided
for by this chapter. A school district that elects to have its funding
determined pursuant to the method provided for by this chapter
shall so notify the Superintendent of Public Instruction by June 1
prior to the affected fiscal year. Once made, an election to be
funded pursuant to the method provided for by this chapter is
irrevocable.

(b) In the case of a school district in which all schools have been
converted to charter schools pursuant to Section 47606, and that
has not elected to be funded pursuant to the method provided for
by this chapter, any increase in district average daily attendance
attributable to pupils who reside in, and would otherwise be eligible
to attend, a district other than the district sponsoring the charter
school shall be funded at the lesser of the following:

(1) The sponsoring district’s own base revenue limit per unit of
average daily attendance.

(2) The statewide average base revenue limit per unit of average
daily attendance for districts of a similar type. For purposes of this
paragraph, increases in average daily attendance shall be measured
relative to the 1998-99 fiscal year or the fiscal year in which all
schools in the district were converted to charter schools pursuant
to Section 47606, whichever fiscal year is later.

(c) A school district in which all schools have been converted
to charter schools pursuant to Section 47606 and that is the
sponsoring entity for a charter school or schools that were
previously funded pursuant to the method provided pursuant to
this chapter shall have its base revenue limit computed as follows:

(1) The average daily attendance of the charter school or schools
for the fiscal year prior to the fiscal year in which the conversion
is effective shall be multiplied by the statewide average base
revenue limit per unit of average daily attendance for districts of
similar type for the fiscal year in which the conversion is effective.

(2) The school district’s remaining average daily attendance for
the fiscal year prior to the fiscal year in which the conversion is
effective shall be multiplied by the school district’s base revenue
limit per unit of average daily attendance for the fiscal year in
which the conversion is effective.

(3) The amounts computed in paragraphs (1) and (2) shall be
added and this total shall be divided by the district’s total average
daily attendance, including average daily attendance in charter
schools for which it is the sponsoring entity, for the fiscal year
prior to the fiscal year in which the conversion is effective.

end delete

begin insert

begin insert SEC. 90. end insert   

end insert

begin insert Section 48310 of the end insert begin insert Education Code end insert begin insert is amended to
read: end insert

48310.  

(a) The average daily attendance for pupils admitted
by a school district of choice pursuant to this article shall be
credited to that begin insert school end insert district pursuant to Section 46607. The
attendance report for the school district of choice may include an
identification of the school district of residence.

(b) Notwithstanding other provisions of law, state aid for
categorical education programs for pupils admitted under this
article shall be apportioned to the school district of choice.

(c)  begin insert (1) end insert begin insert   end insert For begin delete any end delete begin insert a end insert school district of choice that is a basic aid
begin insert school end insert district, the apportionment of state funds for begin delete any end delete average
daily attendance credited pursuant to this section shall be 70 percent
of the district begin delete revenue limit calculated end delete begin insert local control funding
formula base grant computed end insert pursuant to begin insert subdivision (d) of end insert Section
begin delete 42238 end delete begin insert 42238.02, as implemented by Section 42238.03, end insert that would
have been apportioned to the begin insert school end insert district of residence. begin delete For
purposes of this subdivision, the term “basic aid district” means a
school district that does not receive from the state, for any fiscal
year in which the subdivision is applied, an apportionment of state
funds pursuant to subdivision (h) of Section 42238. end delete

begin insert

(2) Notwithstanding paragraph (1), until the Superintendent
determines that the school district of residence is funded pursuant
to Section 42238.02 in the prior fiscal year, the Superintendent
shall apportion, for average daily attendance pursuant to this
article, 70 percent of the sum of the entitlements for the school
district of residence for the specified fiscal year as computed
pursuant to paragraphs (1) to (4), inclusive, of subdivision (a) of
Section 42238.03 and paragraph (3) of subdivision (b) of Section
42238.03, divided by the average daily attendance pursuant to
this article for that fiscal year and then multiplied by the ratio of
local control funding formula base grant funding computed
pursuant to subdivision (d) of Section 42238.02 to the local control
funding formula amount for the fiscal year computed pursuant to
Section 42238.02.

end insert begin insert

(3) For purposes of this subdivision, the term “basic aid school
district” means a school district that does not receive from the
state, for a fiscal year in which this subdivision is applied, an
apportionment of state funds as described in subdivision (o) of
Section 42238.02.

end insert

(d) The average daily attendance of pupils admitted by a school
district of choice pursuant to this article shall be credited to that
school district for begin delete the end delete purposes of any determination under Article
2 (commencing with Section 17010) of Chapter 12 of Part 10 begin insert of
Division 1 of Title 1 end insert that begin delete utilizes end delete begin insert uses end insert an average daily attendance
calculation.

begin insert

begin insert SEC. 91. end insert   

end insert

begin insert Section 48359.5 of the end insert begin insert Education Code end insert begin insert is amended
to read: end insert

48359.5.  

begin insert (a) end insert begin insert   end insert For a school district of enrollment that is a basic
aid begin insert school end insert district, the apportionment of state funds for begin delete any end delete average
daily attendance credited pursuant to this article shall be 70 percent
of the begin insert school end insert district begin delete revenue limit end delete begin insert local control funding end insert begin insert formula
base grant end insert that would have been apportioned to the school district
of residence begin insert pursuant to subdivision (d) of Section 42238.02 end insert .
Apportionment of these funds shall begin in the second consecutive
year of enrollment, and continue annually until the pupil graduates
from, or is no longer enrolled in, the school district of enrollment.
begin delete For purposes of this section, “basic aid school district” means a
school district that does not receive an apportionment of state funds
pursuant to subdivision (h) of Section 42238 for any fiscal year in
which this subdivision may apply. end delete

begin insert

(b) Notwithstanding subdivision (a), until the Superintendent
determines that the school district of enrollment is funded pursuant
to Section 42238.02 in the prior fiscal year, the Superintendent
shall apportion, for average daily attendance pursuant to this
article, 70 percent of the sum of the entitlements for the school
district of enrollment for the specified fiscal year as computed
pursuant to paragraphs (1) to (4), inclusive, of subdivision (a) of
Section 42238.03 and paragraph (3) of subdivision (b) of Section
42238.03, divided by the average daily attendance pursuant to
this article for that fiscal year and then multiplied by the ratio of
local control funding formula base grant funding computed
pursuant to subdivision (d) of Section 42238.02 to the local control
funding formula amount for the fiscal year computed pursuant to
Section 42238.02.

end insert begin insert

(c) For purposes of this section, “basic aid school district”
means a school district that does not receive an apportionment of
state funds as described in subdivision (o) of Section 42238.02 for
a fiscal year in which this section may apply.

end insert

begin insert

begin insert SEC. 92. end insert   

end insert

begin insert Section 49085 of the end insert begin insert Education Code end insert begin insert is amended to
read: end insert

49085.  

begin insert (a) end insert begin insert   end insert The department begin delete shall ensure that the California
School Information Services system meets the needs of pupils in
foster care and includes disaggregated data on pupils in foster care. end delete
begin insert and the State Department of Social Services shall develop and
enter into a memorandum of understanding that shall, at a
minimum, require the State Department of Social Services, at least
once per week, to share with the department both of the following: end insert

begin insert

(1) Disaggregated information on children and youth in foster
care sufficient for the department to identify pupils in foster care.

end insert begin insert

(2) Disaggregated data on children and youth in foster care
that is helpful to county offices of education and other local
educational agencies responsible for ensuring that pupils in foster
care received appropriate educational supports and services.

end insert begin insert

(b) To the extent allowable under federal law, the department
shall regularly identify pupils in foster care and designate those
pupils in the California Longitudinal Pupil Achievement Data
System or any future data system used by the department to collect
disaggregated pupil outcome data.

end insert begin insert

(c) To the extent allowable under federal law, the
Superintendent, on or before February 15 of each even-numbered
year, shall report to the Legislature and the Governor on the
educational outcomes for pupils in foster care at both the individual
schoolsite level and school district level. The report shall include,
but is not limited to, all of the following:

end insert begin insert

(1) Individual schoolsite level and school district level
educational outcome data for each local educational agency that
enrolls at least 15 pupils in foster care, each county in which at
least 15 pupils in foster care attend school, and for the entire state.

end insert begin insert

(2) The number of pupils in foster care statewide and by each
local educational agency.

end insert begin insert

(3) The academic achievement of pupils in foster care.

end insert begin insert

(4) The incidence of suspension and expulsion for pupils in
foster care.

end insert begin insert

(5) Truancy rates, attendance rates, and dropout rates for pupils
in foster care.

end insert begin insert

(d) To the extent allowable under federal law, the department,
at least once per week, shall do all of the following:

end insert begin insert

(1) Inform school districts and charter schools of any pupils
enrolled in those school districts or charter schools who are in
foster care.

end insert begin insert

(2) Inform county offices of education of any pupils enrolled in
schools in the county who are in foster care.

end insert begin insert

(3) Provide schools districts, county office of education, and
charter schools disaggregated data helpful to ensuring pupils in
foster care receive appropriate educational supports and services.

end insert begin insert

(e) For purposes of this section “pupil in foster care” means a
pupil who is under the jurisdiction of the juvenile court pursuant
to Section 300, 601, or 602 of the Welfare and Institutions Code.

end insert

begin insert

begin insert SEC. 93. end insert   

end insert

begin insert Section 49536 of the end insert begin insert Education Code end insert begin insert is amended to
read: end insert

49536.  

begin delete The State Department of Education end delete begin insert (a) end insert begin insert   end insert begin insert The department end insert
shall, begin delete prior to end delete begin insert before end insert July 1 of each year, prescribe an adjustment
in the state meal contribution rates established pursuant to this
section for the forthcoming fiscal year. The adjustments shall
reflect the changes in the cost of operating a school breakfast and
lunch program and shall be made commencing on July 1 of each
year. The adjustment shall be the average of the separate indices
of the “Food Away From Home Index” for Los Angeles and San
Francisco as prepared by the United States Bureau of Labor
Statistics.

begin insert (b) end insert begin insert   end insert In giving effect to the cost-of-living provisions of this
section, the begin delete Department of Education end delete begin insert department end insert shall use the
same month for computation of the percentage change in the cost
of living after July 1, 1975. The same month shall be used annually
thereafter. The product of begin delete any end delete begin insert a end insert percentage increase or decrease
in the average index and the per meal reimbursement disbursement
rate shall be adjusted by the amount of begin delete any end delete begin insert a end insert cost-of-living change
currently in effect pursuant to the provisions of this section.

begin delete

Commencing with

end delete

begin insert (c) end insert begin insert   end insert begin insert For end insert the 1990-91 fiscal begin delete year, end delete begin insert year to the 2012-13 fiscal year,
inclusive, end insert the cost-of-living adjustment shall be equal to the
percentage change determined pursuant to subdivision (b) of
Section 42238.1 begin insert , as that section read on January 1, 2013.
Commencing with the 2013-14 fiscal year, the cost-of-living
adjustment shall be equal to the percentage determined pursuant
to paragraph (2) of subdivision (d) of Section 42238.02 end insert .

begin insert

begin insert SEC. 94. end insert   

end insert

begin insert Section 52051 of the end insert begin insert Education Code end insert begin insert is repealed. end insert

begin delete

52051.  

The Public School Performance Accountability Program
is hereby established and shall consist of the following three
component parts:

(a) The state Academic Performance Index, to be known as the
API.

(b) The Immediate Intervention/Underperforming Schools
Program.

(c) The Governor’s High Achieving/Improving Schools
Program.

end delete

begin insert

begin insert SEC. 95. end insert   

end insert

begin insert Section 52052 of the end insert begin insert Education Code end insert begin insert is amended to
read: end insert

52052.  

(a) (1) The Superintendent, with approval of the state
board, shall develop an Academic Performance Index (API), to
measure the performance of begin delete schools, end delete begin insert schools and school districts, end insert
especially the academic performance of pupils.

(2) A school begin insert or school district end insert shall demonstrate comparable
improvement in academic achievement as measured by the API
by all numerically significant pupil subgroups at the begin delete school, end delete begin insert school
or school district, end insert including:

(A) Ethnic subgroups.

(B) Socioeconomically disadvantaged pupils.

(C) English learners.

(D) Pupils with disabilities.

begin insert

(E) Foster youth.

end insert

(3) (A) For purposes of this section, a numerically significant
pupil subgroup is one that begin delete meets both of the following criteria: end delete
begin insert consists of at least 30 pupils, each of whom has a valid test score. end insert

begin delete

(i) The subgroup consists of at least 50 pupils each of whom
has a valid test score.

end delete begin delete

(ii) The subgroup constitutes at least 15 percent of the total
population of pupils at a school who have valid test scores.

end delete begin delete

(B) If a subgroup does not constitute 15 percent of the total
population of pupils at a school who have valid test scores, the
subgroup may constitute a numerically significant pupil subgroup
if it has at least 100 valid test scores.

end delete begin insert

(B) Notwithstanding subparagraph (A), for a subgroup of pupils
who are foster youth, a numerically significant pupil subgroup is
one that consists of at least 15 pupils.

end insert

(C) For a school begin insert or school district end insert with an API score that is
based on no fewer than 11 and no more than 99 pupils with valid
test scores, numerically significant pupil subgroups shall be defined
by the Superintendent, with approval by the state board.

(4) (A) The API shall consist of a variety of indicators currently
reported to the department, including, but not limited to, the results
of the achievement test administered pursuant to Section 60640,
attendance rates for pupils in elementary schools, middle schools,
and secondary schools, and the graduation rates for pupils in
secondary schools.

(B) The Superintendent, with the approval of the state board,
may also incorporate into the API the rates at which pupils
successfully promote from one grade to the next in middle school
and high school, and successfully matriculate from middle school
to high school.

(C) Graduation rates for pupils in secondary schools shall be
calculated for the API as follows:

(i) Four-year graduation rates shall be calculated by taking the
number of pupils who graduated on time for the current school
year, which is considered to be three school years after the pupils
entered grade 9 for the first time, and dividing that number by the
total calculated in clause (ii).

(ii) The number of pupils entering grade 9 for the first time in
the school year three school years before the current school year,
plus the number of pupils who transferred into the class graduating
at the end of the current school year between the school year that
was three school years before the current school year and the date
of graduation, less the number of pupils who transferred out of the
school between the school year that was three school years before
the current school year and the date of graduation who were
members of the class that is graduating at the end of the current
school year.

(iii) Five-year graduation rates shall be calculated by taking the
number of pupils who graduated on time for the current school
year, which is considered to be four school years after the pupils
entered grade 9 for the first time, and dividing that number by the
total calculated in clause (iv).

(iv) The number of pupils entering grade 9 for the first time in
the school year four years before the current school year, plus the
number of pupils who transferred into the class graduating at the
end of the current school year between the school year that was
four school years before the current school year and the date of
graduation, less the number of pupils who transferred out of the
school between the school year that was four years before the
current school year and the date of graduation who were members
of the class that is graduating at the end of the current school year.

(v) Six-year graduation rates shall be calculated by taking the
number of pupils who graduated on time for the current school
year, which is considered to be five school years after the pupils
entered grade 9 for the first time, and dividing that number by the
total calculated in clause (vi).

(vi) The number of pupils entering grade 9 for the first time in
the school year five years before the current school year, plus the
number of pupils who transferred into the class graduating at the
end of the current school year between the school year that was
five school years before the current school year and the date of
graduation, less the number of pupils who transferred out of the
school between the school year that was five years before the
current school year and the date of graduation who were members
of the class that is graduating at the end of the current school year.

(D) The inclusion of five- and six-year graduation rates for
pupils in secondary schools shall meet the following requirements:

(i) Schools shall be granted one-half the credit in their API
scores for graduating pupils in five years that they are granted for
graduating pupils in four years.

(ii) Schools begin insert and school districts end insert shall be granted one-quarter
the credit in their API scores for graduating pupils in six years that
they are granted for graduating pupils in four years.

(iii) Notwithstanding clauses (i) and (ii), schools begin insert and school
districts end insert shall be granted full credit in their API scores for
graduating in five or six years a pupil with disabilities who
graduates in accordance with his or her individualized education
program.

(E) The pupil data collected for the API that comes from the
achievement test administered pursuant to Section 60640 and the
high school exit examination administered pursuant to Section
60851, when fully implemented, shall be disaggregated by special
education status, English learners, socioeconomic status, gender,
and ethnic group. Only the test scores of pupils who were counted
as part of the enrollment in the annual data collection of the
California Basic Educational Data System for the current fiscal
year and who were continuously enrolled during that year may be
included in the test result reports in the API score of the school.

(F) (i) Commencing with the baseline API calculation in 2016,
and for each year thereafter, results of the achievement test and
other tests specified in subdivision (b) shall constitute no more
than 60 percent of the value of the index for secondary schools.

(ii)  In addition to the elements required by this paragraph, the
Superintendent, with approval of the state board, may incorporate
into the index for secondary schools valid, reliable, and stable
measures of pupil preparedness for postsecondary education and
career.

(G) Results of the achievement test and other tests specified in
subdivision (b) shall constitute at least 60 percent of the value of
the index for primary schools and middle schools.

(H) It is the intent of the Legislature that the state’s system of
public school accountability be more closely aligned with both the
public’s expectations for public education and the workforce needs
of the state’s economy. It is therefore necessary that the
accountability system evolve beyond its narrow focus on pupil test
scores to encompass other valuable information about school
performance, including, but not limited to, pupil preparedness for
college and career, as well as the high school graduation rates
already required by law.

(I) The Superintendent shall annually determine the accuracy
of the graduation rate data. Notwithstanding any other law,
graduation rates for pupils in dropout recovery high schools shall
not be included in the API. For purposes of this subparagraph,
“dropout recovery high school” means a high school in which 50
percent or more of its pupils have been designated as dropouts
pursuant to the exit/withdrawal codes developed by the department
or left a school and were not otherwise enrolled in a school for a
period of at least 180 days.

(J) To complement the API, the Superintendent, with the
approval of the state board, may develop and implement a program
of school quality review that features locally convened panels to
visit schools, observe teachers, interview pupils, and examine pupil
work, if an appropriation for this purpose is made in the annual
Budget Act.

(K) The Superintendent shall annually provide to local
educational agencies and the public a transparent and
understandable explanation of the individual components of the
API and their relative values within the API.

(L) An additional element chosen by the Superintendent and
the state board for inclusion in the API pursuant to this paragraph
shall not be incorporated into the API until at least one full school
year after the state board’s decision to include the element into the
API.

(b) Pupil scores from the following tests, when available and
when found to be valid and reliable for this purpose, shall be
incorporated into the API:

(1) The standards-based achievement tests provided for in
Section 60642.5.

(2) The high school exit examination.

(c) Based on the API, the Superintendent shall develop, and the
state board shall adopt, expected annual percentage growth targets
for all schools based on their API baseline score from the previous
year. Schools are expected to meet these growth targets through
effective allocation of available resources. For schools below the
statewide API performance target adopted by the state board
pursuant to subdivision (d), the minimum annual percentage growth
target shall be 5 percent of the difference between the actual API
score of a school and the statewide API performance target, or one
API point, whichever is greater. Schools at or above the statewide
API performance target shall have, as their growth target,
maintenance of their API score above the statewide API
performance target. However, the state board may set differential
growth targets based on grade level of instruction and may set
higher growth targets for the lowest performing schools because
they have the greatest room for improvement. To meet its growth
target, a school shall demonstrate that the annual growth in its API
is equal to or more than its schoolwide annual percentage growth
target and that all numerically significant pupil subgroups, as
defined in subdivision (a), are making comparable improvement.

(d) Upon adoption of state performance standards by the state
board, the Superintendent shall recommend, and the state board
shall adopt, a statewide API performance target that includes
consideration of performance standards and represents the
proficiency level required to meet the state performance target.
begin delete When the API is fully developed, schools, at a minimum, shall
meet their annual API growth targets to be eligible for the
Governor’s Performance Award Program as set forth in Section
52057. The state board may establish additional criteria that schools
must meet to be eligible for the Governor’s Performance Award
Program. end delete

(e) (1) A school begin insert or school district end insert with 11 to 99 pupils with
valid test scores shall receive an API score with an asterisk that
indicates less statistical certainty than API scores based on 100 or
more test scores.

(2) A school begin insert or school district end insert annually shall receive an API
score, unless the Superintendent determines that an API score
would be an invalid measure of the performance of the school begin insert or
school district end insert for one or more of the following reasons:

(A) Irregularities in testing procedures occurred.

(B) The data used to calculate the API score of the school begin insert or
school district end insert are not representative of the pupil population at the
school begin insert or school district end insert .

(C) Significant demographic changes in the pupil population
render year-to-year comparisons of pupil performance invalid.

(D) The department discovers or receives information indicating
that the integrity of the API score has been compromised.

(E) Insufficient pupil participation in the assessments included
in the API.

(3) If a school begin insert or school district end insert has fewer than 100 pupils with
valid test scores, the calculation of the API or adequate yearly
progress pursuant to the federal No Child Left Behind Act of 2001
(20 U.S.C. Sec. 6301 et seq.) and federal regulations may be
calculated over more than one annual administration of the tests
administered pursuant to Section 60640 and the high school exit
examination administered pursuant to Section 60851, consistent
with regulations adopted by the state board.

(f) Only schools with 100 or more test scores contributing to
the API may be included in the API rankings.

(g) The Superintendent, with the approval of the state board,
shall develop an alternative accountability system for schools under
the jurisdiction of a county board of education or a county
superintendent of schools, community day schools, nonpublic,
nonsectarian schools pursuant to Section 56366, and alternative
schools serving high-risk pupils, including continuation high
schools and opportunity schools. Schools in the alternative
accountability system may receive an API score, but shall not be
included in the API rankings.

begin insert

(h) For purposes of this section, county offices of education
shall be considered school districts.

end insert

begin insert

begin insert SEC. 96. end insert   

end insert

begin insert Section 52052.1 of the end insert begin insert Education Code end insert begin insert is amended
to read: end insert

52052.1.  

(a) Beginning July 1, 2011, in addition to the test
scores specified in subparagraph (B) of paragraph (4) of subdivision
(a) of Section 52052, the Academic Performance Index (API) for
a school or school district shall do all of the following:

(1) Include the test scores and other accountability data of
enrolled pupils who were referred by the school or school district
of residence to an alternative education program, including
community, community day, and continuation high schools and
independent study, and be calculated by assigning all accountability
data on pupils in alternative education programs, including
community, community day, and continuation high schools and
independent study, to the school and school district of residence
to ensure that placement decisions are in the best interests of
affected pupils. If a pupil is referred to an alternative education
program by a juvenile court judge or other correctional or judicial
official, or if the pupil is expelled pursuant to subdivision (a) begin delete , (b), end delete
or (c) of Section 48915, the test scores of that pupil shall remain
with the alternative education program and with the school district
or county office of education serving that pupil. This section does
not prohibit the alternative education program from counting the
test scores of those pupils served in their alternative education
program. It is the intent of the Legislature that these alternative
education programs remain accountable to the pupils they serve.

(2) Exclude the test scores or other data of those pupils exempt
pursuant to federal statute or federal regulation.

(3) Include school and school district dropout rates for pupils
who drop out of school while enrolled in grade 8 or 9. If reliable
data is not available by July 1, 2011, the Superintendent, on or
before that date, shall report to the Legislature the reasons for the
delay and date he or she anticipates the specified dropout rates
will be included in the API.

(b) The advisory committee established pursuant to Section
52052.5 shall recommend to the Superintendent and the state board
all of the following:

(1) The length of time for which the accountability data on
pupils in alternative education programs shall be assigned to the
school and school district of residence pursuant to paragraph (1)
of subdivision (a).

(2) Whether it is appropriate to assign accountability data to the
school or the school district, pursuant to paragraph (1) of
subdivision (a), if the pupil never attended the school of residence
or has been absent for more than one year from the school district
of residence due to placement in another school or school district
or out of state.

begin insert

(c) Before January 30, 2014, the advisory committee established
pursuant to Section 52052.5 shall review, and recommend to the
Superintendent and the state board any changes proposed for, the
assignment of accountability data to the school district of residence
pursuant to paragraph (1) of subdivision (a) based on the addition
of Sections 2574, 2575, 42238.02, and 42238.03, and Article 4.5
(commencing with Section 52060) by the act adding this
subdivision.

end insert

begin insert

begin insert SEC. 97. end insert   

end insert

begin insert Section 52052.2 of the end insert begin insert Education Code end insert begin insert is repealed. end insert

begin delete

52052.2.  

A school that receives an API score with an asterisk
shall be eligible for the Governor’s Performance Awards Program,
as set forth in Section 52057 and for participation in the Immediate
Intervention/Underperforming Schools Program, as set forth in
Section 52053.

end delete

begin insert

begin insert SEC. 98. end insert   

end insert

begin insert Section 52052.5 of the end insert begin insert Education Code end insert begin insert is amended
to read: end insert

52052.5.  

(a) The Superintendent shall establish a broadly
representative and diverse advisory committee to advise the
Superintendent begin delete of Public Instruction end delete and the state board on all
appropriate matters relative to the creation of the Academic
Performance Index begin delete and the implementation of the Immediate
Intervention/Underperforming Schools Program and the High
Achieving/Improving Schools Program end delete . Members of the advisory
committee shall serve without compensation for terms not to
exceed two years. The department shall provide staff to the
advisory panel.

(b) By July 1, 2005, the advisory committee established pursuant
to this section shall make recommendations to the Superintendent
on the appropriateness and feasibility of a methodology for
generating a measurement of academic performance by begin delete utilizing end delete
begin insert using end insert unique pupil identifiers for pupils in kindergarten and any
of grades 1 to 12, inclusive, and annual academic achievement
growth to provide a more accurate measure of a school’s growth
over time. If appropriate and feasible, the Superintendent, with the
approval of the state board, shall thereafter implement this
measurement of academic performance.

(c) By January 1, 2011, the Superintendent and the state board,
in consultation with the advisory committee established pursuant
to subdivision (a), shall make recommendations to the Legislature
and the Governor on each of the following:

(1) Approaches to increasing the emphasis of science and
mathematics in the calculation of the Academic Performance Index
or any successor measure.

(2) Methods to incorporate into the Academic Performance
Index, or into other aspects of the state’s accountability system, a
measure of the degree to which pupils graduate from high school
with the skills and knowledge necessary to attain entry-level
employment in business or industry, as set forth in subdivision (b)
of Section 51228.

(3) Methods to incorporate into the Academic Performance
Index, or into other aspects of the state’s accountability system, a
measure of the degree to which pupils graduate from high school
with the skills and knowledge necessary to succeed in
postsecondary education.

(d) By July 1, 2013, the Superintendent and the state board, in
consultation with the advisory committee established pursuant to
subdivision (a), shall make recommendations to the Legislature
and the Governor on the establishment of a methodology for
generating a measurement of group and individual academic
performance growth by utilizing individual pupil results from a
longitudinally valid achievement assessment system. These
recommendations should also address any interactions between
the Academic Performance Index, or any successor measure, and
individual test scores from the state’s tests, as well as implications
for the reauthorization of the state’s assessment system. This
paragraph shall not be construed to supersede the provisions of
Chapter 273 of the Statutes of 2009.

begin insert

begin insert SEC. 99. end insert   

end insert

begin insert Article 3 (commencing with Section 52053) of Chapter
601 of Part 28 of Division 4 of Title 2 of the end insert begin insert Education Code end insert begin insert is
repealed. end insert

begin insert

begin insert SEC. 100. end insert   

end insert

begin insert Article 3.5 (commencing with Section 52055.600)
of Chapter 6.1 of Part 28 of Division 4 of Title 2 of the end insert begin insert Education
Code end insert begin insert is repealed. end insert

begin insert

begin insert SEC. 101. end insert   

end insert

begin insert Section 52055.750 of the end insert begin insert Education Code end insert begin insert is amended
to read: end insert

52055.750.  

(a) A school district or chartering authority that
receives funding pursuant to this article shall agree to do all of the
following for each funded school within its jurisdiction:

(1) Comply with the program requirements of this article and
require that each funded schoolsite complete and meet the criteria
of an academic review process that includes the elements of the
school assistance and intervention team review process described
in Section 52055.51 begin insert , as that section read on January 1, 2013 end insert .

(2) Ensure that funded schools meet the requirements of this
article.

(3) Ensure that each school administrator in a funded school is
confirmed to have exemplary qualifications and experience by the
end of the first full year of funding and in each year of funding
thereafter. Those qualifications shall include the ability to support
the success of all pupils by facilitating the development,
articulation, implementation, and stewardship of a vision of
learning that is shared and supported by the school community as
well as the ability to advocate, nurture, and sustain a school culture
and instructional program that is conducive to pupils learning and
staff professional growth. The school district or chartering authority
shall provide for high quality professional development for each
administrator through leadership training, coaching, and mentoring
and shall take all reasonable steps to maintain stable school
leadership in schools that receive funding pursuant to this article.
To the extent appropriate begin insert , end insert the professional development shall be
similar in quality and rigor to that provided pursuant to the
Administrator Training Program under Article 4.6 (commencing
with Section 44510) of Chapter 3 of Part 25.

(4) Provide all fiscal and evaluation data requested by the
Superintendent for initial approval, annual reviews, and reports.

(5) Comply with subdivisions (a) to (c), inclusive, of Section
52055.630, begin insert as that section read on January 1, 2013, end insert and in the
same manner consult with the exclusive representative of classified
employees.

(6) Assist eligible schools in developing and carrying out a plan
to implement the provisions of this article to ensure the begin insert school end insert
district’s plan supports the work of the school.

(7) Agree to focus on conditions that improve instruction and
achievement in funded schools.

(8) Express its full understanding that not meeting annual and
final program and academic achievement requirements under this
article will result in the termination of funding.

(9) Ensure that the funds received on behalf of funded schools
are expended on that school, except that during the first partial
year of funding begin insert school end insert districts may use funding under this article
for facilities necessary to meet the class size reduction requirements
of this article, if all funds are spent on funded schools within the
begin insert school end insert district.

(10) Use the uniform process recommended by the
Superintendent pursuant to subdivision (d) of Section 52055.730
to ensure that the average teaching experience of the classroom
teachers in funded schools is equal to or greater than the average
teaching experience of classroom teachers in the school district as
a whole.

(b) If not expressly prohibited by federal law, a school district
or chartering authority on behalf of a funded school is exempt from
requirements imposed on the use of state categorical or federal
funds in the consolidated application, except those funds related
to economic impact aid, if those funds are identified in the revised
plan of Section 52055.755. Funded schools are exempt from all
program requirements associated with funds in the consolidated
application, except requirements regarding parent advisory
committees, schoolsite councils, and special education. Funds
provided under the economic aid program shall not be used to
implement this program.

(c) Each funded school shall ensure that each teacher in a
subject-specific classroom or teaching covered subjects participates
in professional development that is made available by the begin insert school end insert
district or the schoolsite councils, is developed in a collaborative
process with interested parties, and is articulated in an improvement
plan. For purposes of this article, professional development
activities may include collaboration time for teachers to develop
new instructional lessons or analyze pupil data, mentoring projects
for new teachers, or extra support for teachers to improve practice.
At a minimum, appropriate professional development for the site
shall be part of a coherent plan that combines school activities
within the school, including, but not limited to, lesson study or
coteaching, and external learning opportunities that meet all of the
following criteria:

(1) Are related to the academic subjects taught.

(2) Provide time to meet and work with other teachers.

(3) Support instruction and pupil learning to improve instruction
in a manner that is consistent with academic content standards.

(4) Include an average of 40 hours per teacher per year.

(d) At a minimum, professional development in a self-contained
classroom shall include content regarding mathematics, science,
English language arts, reading, and English language development.
Professional development for teachers teaching subject specific
courses shall include the specific subject and English language
development. To the extent appropriate the professional
development shall be similar in quality and rigor to the training
provided under the Mathematics and Reading Professional
Development Program in Article 3 (commencing with Section
99230) of Chapter 5 of Part 65 begin insert of Division 14 of Title 3 end insert .

(e) On or before the end of the first three years of full funding,
funded schools shall do the following:

(1) Increase actual pupil attendance, as compared with monthly
enrollment in the school.

(2) For secondary schools, increase graduation rates as described
in Section 52055.640.

begin insert

begin insert SEC. 102. end insert   

end insert

begin insert Article 4 (commencing with Section 52056) of
Chapter 6.1 of Part 28 of Division 4 of Title 2 of the end insert begin insert Education
Code end insert begin insert is repealed. end insert

begin insert

begin insert SEC. 103. end insert   

end insert

begin insert Article 4.5 (commencing with Section 52060) is
added to Chapter 6.1 of Part 28 of Division 4 of Title 2 of the end insert begin insert Education Code end insert begin insert , to read: end insert

begin insert

 

Article begin insert 4.5. end insert   Local Control and Accountability Plans

 

begin insert 52060. end insert   

(a) On or before July 1, 2014, the governing board of
each school district shall adopt a local control and accountability
plan using a template adopted by the state board.

(b) A local control and accountability plan adopted by a
governing board of a school district shall be effective for a period
of three years, and shall be updated on or before July 1 of each
year.

(c) A local control and accountability plan adopted by a
governing board of a school district shall include, for the school
district and each school within the school district, a description
of both of the following:

(1) The annual goals, for all pupils and each subgroup of pupils
identified pursuant to Section 52052, to be achieved for each of
the state priorities identified in subdivision (d) and for any
additional local priorities identified by the governing board of the
school district. For purposes of this article, a subgroup of pupils
identified pursuant to Section 52052 shall be a numerically
significant pupil subgroup as specified in paragraphs (2) and (3)
of subdivision (a) of Section 52052.

(2) The specific actions the school district will take during each
year of the local control and accountability plan to achieve the
goals identified in paragraph (1), including the enumeration of
any specific actions necessary for that year to correct any
deficiencies in regard to the state priorities listed in paragraph
(1) of subdivision (d).

(d) All of the following are state priorities:

(1) The degree to which the teachers of the school district are
appropriately assigned in accordance with Section 44258.9, and
fully credentialed in the subject areas, and, for the pupils they are
teaching, every pupil in the school district has sufficient access to
the standards-aligned instructional materials as determined
pursuant to Section 60119, and school facilities are maintained
in good repair as specified in subdivision (d) of Section 17002.

(2) Implementation of the academic content and performance
standards adopted by the state board, including how the programs
and services will enable English learners to access the common
core academic content standards adopted pursuant to Section
60605.8 and the English language development standards adopted
pursuant to Section 60811.3 for purposes of gaining academic
content knowledge and English language proficiency.

(3) Parental involvement, including efforts the school district
makes to seek parent input in making decisions for the school
district and each individual schoolsite, and including how the
school district will promote parental participation in programs
for unduplicated pupils and individuals with exceptional needs.

(4) Pupil achievement, as measured by all of the following, as
applicable:

(A) Statewide assessments administered pursuant to Article 4
(commencing with Section 60640) of Chapter 5 of Part 33 or any
subsequent assessment, as certified by the state board.

(B) The Academic Performance Index, as described in Section
52052.

(C) The percentage of pupils who have successfully completed
courses that satisfy the requirements for entrance to the University
of California and the California State University, or career
technical education sequences or clusters of courses that satisfy
the requirements of subdivision (a) of Section 52302, subdivision
(a) of Section 52372.5, or paragraph (2) of subdivision (e) of
Section 54692, and align with state board-approved career
technical education standards and frameworks.

(D) The percentage of English learner pupils who make progress
toward English proficiency as measured by the California English
Language Development Test or any subsequent assessment of
English proficiency, as certified by the state board.

(E) The English learner reclassification rate.

(F) The percentage of pupils who have passed an advanced
placement examination with a score of 3 or higher.

(G) The percentage of pupils who participate in, and
demonstrate college preparedness pursuant to, the Early
Assessment Program, as described in Chapter 6 (commencing with
Section 99300) of Part 65 of Division 14 of Title 3, or any
subsequent assessment of college preparedness.

(5) Pupil engagement, as measured by all of the following, as
applicable:

(A) School attendance rates.

(B) Chronic absenteeism rates.

(C) Middle school dropout rates, as described in paragraph (3)
of subdivision (a) of Section 52052.1.

(D) High school dropout rates.

(E) High school graduation rates.

(6) School climate, as measured by all of the following, as
applicable:

(A) Pupil suspension rates.

(B) Pupil expulsion rates.

(C) Other local measures, including surveys of pupils, parents,
and teachers on the sense of safety and school connectedness.

(7) The extent to which pupils have access to, and are enrolled
in, a broad course of study that includes all of the subject areas
described in Section 51210 and subdivisions (a) to (i), inclusive,
of Section 51220, as applicable, including the programs and
services developed and provided to unduplicated pupils and
individuals with exceptional needs, and the program and services
that are provided to benefit these pupils as a result of the funding
received pursuant to Section 42238.02, as implemented by Section
42238.03.

(8) Pupil outcomes, if available, in the subject areas described
in Section 51210 and subdivisions (a) to (i), inclusive, of Section
51220, as applicable.

(e) For purposes of the descriptions required by subdivision
(c), a governing board of a school district may consider qualitative
information, including, but not limited to, findings that result from
school quality reviews conducted pursuant to subparagraph (J)
or paragraph (4) of subdivision (a) of Section 52052 or any other
reviews.

(f) To the extent practicable, data reported in a local control
and accountability plan shall be reported in a manner consistent
with how information is reported on a school accountability report
card.

(g) A governing board of a school district shall consult with
teachers, principals, administrators, other school personnel,
parents, and pupils in developing a local control and accountability
plan.

(h) A school district may identify local priorities, goals in regard
to the local priorities, and the method for measuring the school
district’s progress toward achieving those goals.

begin insert 52061. end insert   

(a) On or before July 1, 2015, and each year thereafter,
a school district shall update the local control and accountability
plan. The annual update shall be developed using a template
developed pursuant to Section 52064 and shall include all of the
following:

(1) A review of any changes in the applicability of the goals
described in paragraph (1) of subdivision (c) of Section 52060.

(2) A review of the progress toward the goals included in the
existing local control and accountability plan, an assessment of
the effectiveness of the specific actions described in the existing
local control and accountability plan toward achieving the goals,
and a description of changes to the specific actions the school
district will make as a result of the review and assessment.

(3) A listing and description of the expenditures for the fiscal
year implementing the specific actions included in the local control
and accountability plan as a result of the reviews and assessment
required by paragraphs (1) and (2).

(4) A listing and description of expenditures for the fiscal year
that will serve the pupils to whom one or more of the definitions
in Section 42238.01 apply and pupils redesignated as fluent English
proficient.

(b) The expenditures identified in subdivision (a) shall be
classified using the California School Accounting Manual pursuant
to Section 41010.

begin insert 52062. end insert   

(a) Before the governing board of a school district
considers the adoption of a local control and accountability plan
or an annual update to the local control and accountability plan,
all of the following shall occur:

(1) The superintendent of the school district shall present the
local control and accountability plan or annual update to the local
control and accountability plan to the parent advisory committee
established pursuant to Section 52063 for review and comment.
The superintendent of the school district shall respond, in writing,
to comments received from the parent advisory committee.

(2) The superintendent of the school district shall present the
local control and accountability plan or annual update to the local
control and accountability plan to the English learner parent
advisory committee established pursuant to Section 52063, if
applicable, for review and comment. The superintendent of the
school district shall respond, in writing, to comments received
from the English learner parent advisory committee.

(3) The superintendent of the school district shall notify members
of the public of the opportunity to submit written comments
regarding the specific actions and expenditures proposed to be
included in the local control and accountability plan or annual
update to the local control and accountability plan, using the most
efficient method of notification possible. This paragraph shall not
require a school district to produce printed notices or to send
notices by mail.

(4) The superintendent of the school district shall review school
plans submitted pursuant to Section 64001 for schools within the
school district and ensure that the specific actions included in the
local control and accountability plan or annual update to the local
control and accountability plan are consistent with strategies
included in the school plans submitted pursuant to Section 64001.

(b) (1) A governing board of a school district shall hold at least
one public hearing to solicit the recommendations and comments
of members of the public regarding the specific actions and
expenditures proposed to be included in the local control and
accountability plan or annual update to the local control and
accountability plan. The agenda for the public hearing shall be
posted at least 72 hours before the public hearing and shall include
the location where the local control and accountability plan or
annual update to the local control and accountability plan will be
available for public inspection. The public hearing shall be held
at the same meeting as the public hearing required by paragraph
(1) of subdivision (a) of Section 42127.

(2) A governing board of a school district shall adopt a local
control and accountability plan or annual update to the local
control and accountability plan in a public meeting. This meeting
shall be held after, but not on the same day as, the public hearing
held pursuant to paragraph (1). This meeting shall be the same
meeting as that during which the governing board of the school
district adopts a budget pursuant to paragraph (2) of subdivision
(a) of Section 42127.

(c) A governing board of a school district may adopt revisions
to a local control and accountability plan during the period the
local control and accountability plan is in effect. A governing
board of a school district may only adopt a revision to a local
control and accountability plan if it follows the process to adopt
a local control and accountability plan pursuant to this section
and the revisions are adopted in a public meeting.

begin insert 52063. end insert   

(a) (1) The governing board of a school district shall
establish a parent advisory committee to provide advice to the
governing board of the school district and the superintendent of
the school district regarding the requirements of this article.

(2) A parent advisory committee shall include parents or legal
guardians of pupils to whom one or more of the definitions in
Section 42238.01 apply.

(3) This subdivision shall not require the governing board of
the school district to establish a new parent advisory committee
if the governing board of the school district already has established
a parent advisory committee that meets the requirements of this
subdivision, including any committee established to meet the
requirements of the federal No Child Left Behind Act of 2001
(Public Law 107-110) pursuant to Section 1112 of Subpart 1 of
Part A of Title I of that act.

(b) (1) The governing board of a school district shall establish
an English learner parent advisory committee if the enrollment of
the school district includes at least 15 percent English learners
and the school district enrolls at least 50 pupils who are English
learners.

(2) This subdivision shall not require the governing board of
the school district to establish a new English learner parent
advisory committee if the governing board of the school district
already has established a committee that meets the requirements
of this subdivision.

begin insert 52064. end insert   

(a) On or before March 31, 2014, the state board shall
adopt templates for the following purposes:

(1) For use by school districts to meet the requirements of
Sections 52060 to 52063, inclusive.

(2) For use by county superintendents of schools to meet the
requirements of Sections 52066 to 52069, inclusive.

(3) For use by charter schools to meet the requirements of
Section 47606.5.

(b) The templates developed by the state board shall allow a
school district, county superintendent of schools, or charter school
to complete a single local control and accountability plan to meet
the requirements of this article and the requirements of the federal
No Child Left Behind Act of 2001 related to local educational
agency plans pursuant to Section 1112 of Subpart 1 of Part A of
Title I of Public Law 107-110. The state board shall also take steps
to minimize duplication of effort at the local level to the greatest
extent possible.

(c) If possible, the templates identified in paragraph (2) of
subdivision (a) for use by county superintendents of schools shall
allow a county superintendent of schools to develop a single local
control and accountability plan that would also satisfy the
requirements of Section 48926.

(d) The state board shall adopt the template pursuant to the
requirements of the Administrative Procedure Act (Chapter 3.5
(commencing with Section 11340) of Part 1 of Division 3 of Title
2 of the Government Code). The state board may adopt emergency
regulations for purposes of implementing this section.

(e) Revisions to a template or evaluation rubric shall be
approved by the state board by January 31 before the fiscal year
during which the template or evaluation rubric is to be used by a
school district, county superintendent of schools, or charter school.

(f) The adoption of a template or evaluation rubric by the state
board shall not create a requirement for a governing board of a
school district, a county board of education, or a governing body
of a charter school to submit a local control and accountability
plan to the state board, unless otherwise required by federal law.
The Superintendent shall not require a local control and
accountability plan to be submitted by a governing board of a
school district or the governing body of a charter school to the
state board. The state board may adopt a template or evaluation
rubric that would authorize a school district or a charter school
to submit to the state board only the sections of the local control
and accountability plan required by federal law.

begin insert 52064.5. end insert   

(a) On or before October 1, 2015, the state board
shall adopt evaluation rubrics for all of the following purposes:

(1) To assist a school district, county office of education, or
charter school in evaluating its strengths, weaknesses, and areas
that require improvement.

(2) To assist a county superintendent of schools in identifying
school districts and charter schools in need of technical assistance
pursuant to Section 52071 or 47607.3, as applicable, and the
specific priorities upon which the technical assistance should be
focused.

(3) To assist the Superintendent in identifying school districts
for which intervention pursuant to Section 52072 is warranted.

(b) The evaluation rubrics shall reflect a holistic,
multidimensional assessment of school district and individual
schoolsite performance and shall include all of the state priorities
described in subdivision (d) of Section 52060.

(c) As part of the evaluation rubrics, the state board shall adopt
standards for school district and individual schoolsite performance
and expectation for improvement in regard to each of the state
priorities described in subdivision (d) of Section 52060.

begin insert 52065. end insert   

(a) The superintendent of a school district shall post
on the Internet Web site of the school district any local control
and accountability plan approved by the governing board of the
school district, and any updates or revisions to a local control and
accountability plan approved by the governing board of the school
district.

(b) A county superintendent of schools shall do all of the
following:

(1) Post on the Internet Web site of the county office of education
any local control and accountability plan approved by the county
board of education, and any updates or revisions to a local control
and accountability plan approved by the county board of education.

(2) Post all local control and accountability plans submitted by
school districts, or links to those plans, on the Internet Web site
of the county office of education.

(3) Transmit or otherwise make available to the Superintendent
all local control and accountability plans submitted to the county
superintendent of schools by school districts and the local control
and accountability plan approved by the county board of education.

(c) The Superintendent shall post links to all local control and
accountability plans approved by the governing boards of school
districts and county boards of education on the Internet Web site
of the department.

begin insert 52066. end insert   

(a) On or before July 1, 2014, each county
superintendent of schools shall develop, and present to the county
board of education for adoption, a local control and accountability
plan using a template adopted by the state board.

(b) A local control and accountability plan adopted by a county
board of education shall be effective for a period of three years,
and shall be updated on or before July 1 of each year.

(c) A local control and accountability plan adopted by a county
board of education shall include, for each school or program
operated by the county superintendent of schools, a description of
both of the following:

(1) The annual goals, for all pupils and each subgroup of pupils
identified pursuant to Section 52052, to be achieved for each of
the state priorities identified in subdivision (d), as applicable to
the pupils served, and for any additional local priorities identified
by the county board of education.

(2) The specific actions the county superintendent of schools
will take during each year of the local control and accountability
plan to achieve the goals identified in paragraph (1), including
the enumeration of any specific actions necessary for that year to
correct any deficiencies in regard to the state priorities listed in
paragraph (1) of subdivision (d).

(d) All of the following are state priorities:

(1) The degree to which the teachers in the schools or programs
operated by the county superintendent of schools are appropriately
assigned in accordance with Section 44258.9 and fully credentialed
in the subject areas, and, for the pupils they are teaching, every
pupil in the schools or programs operated by the county
superintendent of schools has sufficient access to the
standards-aligned instructional materials as determined pursuant
to Section 60119, and school facilities are maintained in good
repair as specified in subdivision (d) of Section 17002.

(2) Implementation of the academic content and performance
standards adopted by the state board, including how the programs
and services will enable English learners to access the common
core academic content standards adopted pursuant to Section
60605.8 and the English language development standards adopted
pursuant to Section 60811.3 for purposes of gaining academic
content knowledge and English language proficiency.

(3) Parental involvement, including efforts the county
superintendent of schools makes to seek parent input in making
decisions for each individual schoolsite and program operated by
a county superintendent of schools, and including how the county
superintendent of schools will promote parental participation in
programs for unduplicated pupils and individuals with exceptional
needs.

(4) Pupil achievement, as measured by all of the following, as
applicable:

(A) Statewide assessments administered pursuant to Article 4
(commencing with Section 60640) of Chapter 5 of Part 33 or any
subsequent assessment, as certified by the state board.

(B) The Academic Performance Index, as described in Section
52052.

(C) The percentage of pupils who have successfully completed
courses that satisfy the requirements for entrance to the University
of California and the California State University, or career
technical education sequences or clusters of courses that satisfy
the requirements of subdivision (a) of Section 52302, subdivision
(a) of Section 52372.5, or paragraph (2) of subdivision (e) of
Section 54692, and align with state board-approved career
technical education standards and frameworks.

(D) The percentage of English learner pupils who make progress
toward English proficiency as measured by the California English
Language Development Test or any subsequent assessment of
English proficiency, as certified by the state board.

(E) The English learner reclassification rate.

(F) The percentage of pupils who have passed an advanced
placement examination with a score of 3 or higher.

(G) The percentage of pupils who participate in, and
demonstrate college preparedness pursuant to, the Early
Assessment Program, as described in Chapter 6 (commencing with
Section 99300) of Part 65 of Division 14 of Title 3, or any
subsequent assessment of college preparedness.

(5) Pupil engagement, as measured by all of the following, as
applicable:

(A) School attendance rates.

(B) Chronic absenteeism rates.

(C) Middle school dropout rates, as described in paragraph (3)
of subdivision (a) of Section 52052.1.

(D) High school dropout rates.

(E) High school graduation rates.

(6) School climate, as measured by all of the following, as
applicable:

(A) Pupil suspension rates.

(B) Pupil expulsion rates.

(C) Other local measures, including surveys of pupils, parents,
and teachers on the sense of safety and school connectedness.

(7) The extent to which pupils have access to, and are enrolled
in, a broad course of study that includes all of the subject areas
described in Section 51210 and subdivisions (a) to (i), inclusive,
of Section 51220, as applicable, including the programs and
services developed and provided to unduplicated pupils and
individuals with exceptional needs, and the program and services
that are provided to benefit these pupils as a result of the funding
received pursuant to Section 42238.02, as implemented by Section
42238.03.

(8) Pupil outcomes, if available, in the subject areas described
in Section 51210 and subdivisions (a) to (i), inclusive, of Section
51220, as applicable.

(9) How the county superintendent of schools will coordinate
instruction of expelled pupils pursuant to Section 48926.

(10) How the county superintendent of schools will coordinate
services for foster children, including, but not limited to, all of the
following:

(A) Working with the county child welfare agency to minimize
changes in school placement.

(B) Providing education-related information to the county child
welfare agency to assist the county child welfare agency in the
delivery of services to foster children, including, but not limited
to, educational status and progress information that is required
to be included in court reports.

(C) Responding to requests from the juvenile court for
information and working with the juvenile court to ensure the
delivery and coordination of necessary educational services.

(D) Establishing a mechanism for the efficient expeditious
transfer of health and education records and the health and
education passport.

(e) For purposes of the descriptions required by subdivision
(c), a county board of education may consider qualitative
information, including, but not limited to, findings that result from
school quality reviews conducted pursuant to subparagraph (J)
or paragraph (4) of subdivision (a) of Section 52052 or any other
reviews.

(f) To the extent practicable, data reported in a local control
and accountability plan shall be reported in a manner consistent
with how information is reported on a school accountability report
card.

(g) The county superintendent of schools shall consult with
teachers, principals, administrators, other school personnel,
parents, and pupils in developing a local control and accountability
plan.

(h) A county board of education may identify local priorities,
goals in regard to the local priorities, and the method for
measuring the county office of education’s progress toward
achieving those goals.

begin insert 52067. end insert   

(a) On or before July 1, 2015, and each year thereafter,
a county board of education shall update the local control and
accountability plan. The annual update shall be developed using
a template developed pursuant to Section 52064 and shall include
all of the following:

(1) A review of any changes in the applicability of the goals
described in paragraph (1) of subdivision (c) of Section 52066.

(2) A review of the progress toward the goals included in the
existing local control and accountability plan, an assessment of
the effectiveness of the specific actions described in the existing
local control and accountability plan toward achieving the goals,
and a description of changes to the specific actions the county
office of education will make as a result of the review and
assessment.

(3) A listing and description of the expenditures for the fiscal
year implementing the specific actions included in the local control
and accountability plan as a result of the reviews and assessment
required by paragraphs (1) and (2).

(4) A listing and description of expenditures for the fiscal year
that will serve the pupils to whom one or more of the definitions
in Section 42238.01 apply and pupils redesignated as fluent English
proficient.

(b) The expenditures identified in subdivision (a) shall be
classified using the California School Accounting Manual pursuant
to Section 41010.

begin insert 52068. end insert   

(a) Before the county board of education considers the
adoption of a local control and accountability plan or an annual
update to the local control and accountability plan, all of the
following shall occur:

(1) The county superintendent of schools shall present the local
control and accountability plan or annual update to the local
control and accountability plan to a parent advisory committee
established pursuant to Section 52069 for review and comment.
The county superintendent of schools shall respond, in writing, to
comments received from the parent advisory committee.

(2) The county superintendent of schools shall present the local
control and accountability plan or annual update to the local
control and accountability plan to the English learner parent
advisory committee established pursuant to Section 52069, if
applicable, for review and comment. The county superintendent
of schools shall respond, in writing, to comments received from
the English learner parent advisory committee.

(3) The county superintendent of schools shall notify members
of the public of the opportunity to submit written comments
regarding the specific actions and expenditures proposed to be
included in the local control and accountability plan or annual
update to the local control and accountability plan, using the most
efficient method of notification possible. This paragraph shall not
require a county superintendent of schools to produce printed
notices or to send notices by mail.

(4) The county superintendent of schools shall review school
plans submitted pursuant to Section 64001 for schools operated
by the county superintendent of schools and ensure that the specific
actions included in the local control and accountability plan or
annual update to the local control and accountability plan are
consistent with strategies included in the school plans submitted
pursuant to Section 64001.

(b) (1) The county board of education shall hold at least one
public hearing to solicit the recommendations and comments of
members of the public regarding the specific actions and
expenditures proposed to be included in the local control and
accountability plan or annual update to the local control and
accountability plan. The agenda for the public hearing shall be
posted at least 72 hours before the public hearing and shall include
the location where the local control and accountability plan or
annual update to the local control and accountability plan, and
any comments received pursuant to paragraphs (1) to (3), inclusive,
of subdivision (a), will be available for public inspection. The
public hearing shall be held at the same meeting as the public
hearing required by Section 1620.

(2) The county board of education shall adopt a local control
and accountability plan or annual update to the local control and
accountability plan in a public meeting. This meeting shall be held
after, but not on the same day as, the public hearing held pursuant
to paragraph (1). This meeting shall be the same meeting as that
during which the county board of education adopts a budget
pursuant to Section 1622.

(c) A county superintendent of schools may develop and present
to a county board of education for adoption revisions to a local
control and accountability plan during the period the local control
and accountability plan is in effect. The county board of education
may only adopt a revision to a local control and accountability
plan if it follows the process to adopt a local control and
accountability plan pursuant to this section and the revisions are
adopted in a public meeting.

begin insert 52069. end insert   

(a) (1) A county superintendent of schools shall
establish a parent advisory committee to provide advice to the
county board of education and the county superintendent of schools
regarding the requirements of this article.

(2) A parent advisory committee shall include parents or legal
guardians of pupils to whom one or more of the definitions in
Section 42238.01 apply.

(3) This subdivision shall not require the county superintendent
of schools to establish a new parent advisory committee if the
county superintendent of schools already has established a parent
advisory committee that meets the requirements of this subdivision,
including any committee established to meet the requirements of
the federal No Child Left Behind Act of 2001 (Public Law 107-110)
pursuant to Section 1112 of Subpart 1 of Part A of Title I of that
act.

(b) (1) A county superintendent of schools shall establish an
English learner parent advisory committee if the enrollment of the
pupils in the schools and programs operated by the county
superintendent of schools includes at least 15 percent English
learners and the schools and programs operated by the county
superintendent of schools enroll at least 50 pupils who are English
learners.

(2) This subdivision shall not require the county superintendent
of schools to establish a new English learner parent advisory
committee if the county superintendent of schools already has
established a committee that meets the requirements of this
subdivision.

begin insert 52070. end insert   

(a) Not later than five days after adoption of a local
control and accountability plan or annual update to a local control
and accountability plan, the governing board of a school district
shall file the local control and accountability plan or annual update
to the local control and accountability plan with the county
superintendent of schools.

(b) On or before August 15 of each year, the county
superintendent of schools may seek clarification, in writing, from
the governing board of a school district about the contents of the
local control and accountability plan or annual update to the local
control and accountability plan. Within 15 days the governing
board of a school district shall respond, in writing, to requests for
clarification.

(c) Within 15 days of receiving the response from the governing
board of the school district, the county superintendent of schools
may submit recommendations, in writing, for amendments to the
local control and accountability plan or annual update to the local
control and accountability plan. The governing board of a school
district shall consider the recommendations submitted by the county
superintendent of schools in a public meeting within 15 days of
receiving the recommendations.

(d) The county superintendent of schools shall approve a local
control and accountability plan or annual update to a local control
and accountability plan on or before October 8, if he or she
determines both of the following:

(1) The local control and accountability plan or annual update
to the local control and accountability plan adheres to the template
adopted by the state board pursuant to Section 52064.

(2) The budget for the applicable fiscal year adopted by the
governing board of the school district includes expenditures
sufficient to implement the specific actions and strategies included
in the local control and accountability plan adopted by the
governing board of the school district, based on the projections
of the costs included in the plan.

(e) If a county superintendent of schools has jurisdiction over
a single school district, the Superintendent shall designate a county
superintendent of schools of an adjoining county to perform the
duties specified in this section.

begin insert 52070.5. end insert   

(a) Not later than five days after adoption of a local
control and accountability plan or annual update to a local control
and accountability plan, the county board of education shall file
the local control and accountability plan or annual update to the
local control and accountability plan with the Superintendent.

(b) On or before August 15 of each year, the Superintendent
may seek clarification, in writing, from the county board of
education about the contents of the local control and accountability
plan or annual update to the local control and accountability plan.
Within 15 days the county board of education shall respond, in
writing, to requests for clarification.

(c) Within 15 days of receiving the response from the county
board of education, the Superintendent may submit
recommendations, in writing, for amendments to the local control
and accountability plan or annual update to the local control and
accountability plan. The county board of education shall consider
the recommendations submitted by the Superintendent in a public
meeting within 15 days of receiving the recommendations.

(d) The Superintendent shall approve a local control and
accountability plan or annual update to a local control and
accountability plan on or before October 8, if he or she determines
both of the following:

(1) The local control and accountability plan or annual update
to the local control and accountability plan adheres to the template
adopted by the state board pursuant to Section 52064.

(2) The budget for the applicable fiscal year adopted by the
county board of education includes expenditures sufficient to
implement the specific actions and strategies included in the local
control and accountability plan adopted by the county board of
education, based on the projections of the costs included in the
plan.

begin insert 52071. end insert   

(a) If a county superintendent of schools does not
approve a local control and accountability plan or annual update
to the local control and accountability plan approved by a
governing board of a school district, or if the governing board of
a school district requests technical assistance, the county
superintendent of schools shall provide technical assistance,
including, among other things, any of the following:

(1) Identification of the school district’s strengths and
weaknesses in regard to the state priorities described in subdivision
(d) of Section 52060, communicated in writing to the school
district. This identification shall include a review of effective,
evidence-based programs that apply to the school district’s goals.

(2) Assignment of an academic expert or team of academic
experts to assist the school district in identifying and implementing
effective programs that are designed to improve the outcomes for
all pupil subgroups identified pursuant to Section 52052. The
county superintendent of schools may also solicit another school
district within the county to act as a partner to the school district
in need of technical assistance.

(3) Request that the Superintendent assign the California
Collaborative for Educational Excellence to provide advice and
assistance to the school district.

(b) Using an evaluation rubric adopted by the state board
pursuant to Section 52064.5, the county superintendent of schools
shall provide the technical assistance described in subdivision (a)
to any school district that fails to improve pupil achievement across
more than one state priority described in subdivision (d) of Section
52060 for one or more pupil subgroup identified pursuant to
Section 52052.

(c) Technical assistance provided pursuant to this section at
the request of a school district shall be paid for by the school
district requesting the assistance.

begin insert 52071.5. end insert   

(a) If the Superintendent does not approve a local
control and accountability plan or annual update to the local
control and accountability plan approved by a county board of
education, or if the county board of education requests technical
assistance, the Superintendent shall provide technical assistance,
including, among other things, any of the following:

(1) Identification of the county board of education’s strengths
and weaknesses in regard to the state priorities described in
subdivision (d) of Section 52066, communicated in writing to the
county board of education. This identification shall include a
review of effective, evidence-based programs that apply to the
board’s goals.

(2) Assignment of an academic expert or team of academic
experts, or the California Collaborative for Educational Excellence
established pursuant to Section 52074, to assist the county board
of education in identifying and implementing effective programs
that are designed to improve the outcomes for all pupil subgroups
identified pursuant to Section 52052. The Superintendent may also
solicit another county office of education to act as a partner to the
county office of education in need of technical assistance.

(b) Using an evaluation rubric adopted by the state board
pursuant to Section 52064.5, the Superintendent shall provide the
technical assistance described in subdivision (a) to any county
office of education that fails to improve pupil achievement in
regard to more than one state priority described in subdivision
(d) of Section 52066 for one or more pupil subgroups identified
pursuant to Section 52052.

(c) Technical assistance provided pursuant to this section at
the request of a county board of education shall be paid for by the
county board of education receiving assistance.

begin insert 52072. end insert   

(a) The Superintendent may, with the approval of the
state board, identify school districts in need of intervention.

(b) The Superintendent shall only intervene in a school district
that meets both of the following criteria:

(1) The school district did not improve the outcomes for three
or more pupil subgroups identified pursuant to Section 52052 or,
if the school district has less than three pupil subgroups, all of the
school district’s pupil subgroups, in regard to more than one state
or local priority in three out of four consecutive school years.

(2) The California Collaborative for Educational Excellence
has provided advice and assistance to the school district pursuant
to Section 52071 and submits either of the following findings to
the Superintendent:

(A) That the school district has failed, or is unable, to implement
the recommendations of the California Collaborative for
Educational Excellence.

(B) That the inadequate performance of the school district,
based upon an evaluation rubric adopted pursuant to Section
52064.5, is either so persistent or acute as to require intervention
by the Superintendent.

(c) For school districts identified pursuant to subdivision (a),
the Superintendent may, with the approval of the state board, do
one or more of the following:

(1) Make changes to a local control and accountability plan
adopted by the governing board of the school district.

(2) Develop and impose a budget revision, in conjunction with
revisions to the local control and accountability plan, that the
Superintendent determines would allow the school district to
improve the outcomes for all pupil subgroups identified pursuant
to Section 52052 in regard to state and local priorities.

(3) Stay or rescind an action, if that action is not required by a
local collective bargaining agreement, that would prevent the
school district from improving outcomes for all pupil subgroups
identified pursuant to Section 52052 in regard to state or local
priorities.

(4) Appoint an academic trustee to exercise the powers and
authority specified in this section on his or her behalf.

(d) The Superintendent shall notify the county superintendent
of schools, the county board of education, the superintendent of
the school district, and the governing board of the school district
of any action by the state board to direct him or her to exercise
any of the powers and authorities specified in this section.

begin insert 52072.5. end insert   

(a) The Superintendent may, with the approval of
the state board, identify county offices of education in need of
intervention.

(b) The Superintendent shall only intervene in a county office
of education that meets both of the following criteria:

(1) The county office of education did not improve the outcomes
for three or more pupil subgroups identified pursuant to Section
52052 or, if the county office of education has less than three pupil
subgroups, all of the county office of education’s pupil subgroups,
in regard to more than one state or local priority in three out of
four consecutive school years.

(2) The California Collaborative for Educational Excellence
has provided advice and assistance to the county office of education
pursuant to Section 52071.5 and submits either of the following
findings to the Superintendent:

(A) That the county office of education has failed, or is unable,
to implement the recommendations of the California Collaborative
for Educational Excellence.

(B) That the inadequate performance of the county office of
education, based upon an evaluation rubric adopted pursuant to
Section 52064.5, is either so persistent or acute as to require
intervention by the Superintendent.

(c) For county offices of education identified pursuant to
subdivision (a), the Superintendent may, with the approval of the
state board, do one or more of the following:

(1) Make changes to a local control and accountability plan
adopted by the county board of education.

(2) Develop and impose a budget revision, in conjunction with
revisions to the local control and accountability plan, that the
Superintendent determines would allow the county office of
education to improve the outcomes for all pupil subgroups
identified pursuant to Section 52052 in regard to state and local
priorities.

(3) Stay or rescind an action, if that action is not required by a
local collective bargaining agreement, that would prevent the
county office of education from improving outcomes for all pupil
subgroups identified pursuant to Section 52052 in regard to state
or local priorities.

(4) Appoint an academic trustee to exercise the powers and
authority specified in this section on his or her behalf.

(d) The Superintendent shall notify the county board of
education and the county superintendent of schools, in writing, of
any action by the state board to direct him or her to exercise any
of the powers and authorities specified in this section.

begin insert 52074. end insert   

(a) The California Collaborative for Educational
Excellence is hereby established.

(b) The purpose of the California Collaborative for Educational
Excellence is to advise and assist school districts, county
superintendents of schools, and charter schools in achieving the
goals set forth in a local control and accountability plan adopted
pursuant to this article.

(c) The Superintendent shall, with the approval of the state
board, contract with individuals, local educational agencies, or
organizations with the expertise, experience, and a record of
success to carry out the purposes of this article. The areas of
expertise, experience, and record of success shall include, but are
not limited to, all of the following:

(1) State priorities as described in subdivision (d) of Section
52060.

(2) Improving the quality of teaching.

(3) Improving the quality of school district and schoolsite
leadership.

(4) Successfully addressing the needs of special pupil
populations, including, but not limited to, English learners, pupils
eligible to receive a free or reduced-price meal, pupils in foster
care, and individuals with exceptional needs.

(d) The Superintendent may direct the California Collaborative
for Educational Excellence to advise and assist a school district,
county superintendent of schools, or charter school in any of the
following circumstances:

(1) If the governing board of a school district, county board of
education, or governing body or a charter school requests the
advice and assistance of the California Collaborative for
Educational Excellence.

(2) If the county superintendent of schools of the county in which
the school district or charter school is located determines,
following the provision of technical assistance pursuant to Section
52071 or 47607.3 as applicable, that the advice and assistance of
the California Collaborative for Educational Excellence is
necessary to help the school district or charter school accomplish
the goals described in the local control and accountability plan
adopted pursuant to this article.

(3) If the Superintendent determines that the advice and
assistance of the California Collaborative for Educational
Excellence is necessary to help the school district, county
superintendent of schools, or charter school accomplish the goals
set forth in the local control and accountability plan adopted
pursuant to this article.

begin insert 52075. end insert   

(a) A complaint that a school district, county
superintendent of schools, or charter school has not complied with
the requirements of this article or Sections 47606.5 and 47607.3,
as applicable, may be filed with a school district, county
superintendent of schools, or charter school pursuant to the
Uniform Complaint Procedures set forth in Chapter 5.1
(commencing with Section 4600) of Division 1 of Title 5 of the
California Code of Regulations.

(b) A complaint may be filed anonymously if the complaint
provides evidence or information leading to evidence to support
an allegation of noncompliance with the requirements of this
article.

(c) A complainant not satisfied with the decision of a school
district, county superintendent of schools, or charter school may
appeal the decision to the Superintendent and shall receive a
written appeal decision within 60 days of the Superintendent’s
receipt of the appeal.

(d) If a school district, county superintendent of schools, or
charter school finds merit in a complaint, or the Superintendent
finds merit in an appeal, the school district, county superintendent
of schools, or charter school shall provide a remedy to all affected
pupils, parents, and guardians.

(e) Information regarding the requirements of this article shall
be included in the annual notification distributed to pupils, parents
and guardians, employees, and other interested parties pursuant
to Section 4622 of Title 5 of the California Code of Regulations
or any successor regulation.

(f) School districts, county superintendents of schools, and
charter schools shall establish local policies and procedures to
implement the provisions of this section on or before June 30,
2014.

begin insert 52076. end insert   

Notwithstanding any other law, this article shall not
be subject to waiver by the state board pursuant to Section 33050
or by the Superintendent.

begin insert 52077. end insert   

If any activities authorized pursuant to this article and
implementing regulations are found to be a state reimbursable
mandate pursuant to Section 6 of Article XIII B of the California
Constitution, funding provided for school districts and county
offices of education pursuant to Sections 2574, 2575, 42238.02,
and 42238.03 shall be used to directly offset any mandated costs.

end insert

begin insert

begin insert SEC. 104. end insert   

end insert

begin insert Section 56365 of the end insert begin insert Education Code end insert begin insert is amended
to read: end insert

56365.  

(a) Services provided by nonpublic, nonsectarian
schools, as defined pursuant to Section 56034, and nonpublic,
nonsectarian agencies, as defined pursuant to Section 56035, shall
be made available. These services shall be provided pursuant to
Section 56366, and in accordance with Section 300.146 of Title
34 of the Code of Federal Regulations, under contract with the
local educational agency to provide the appropriate special
educational facilities, special education, or designated instruction
and services required by the individual with exceptional needs if
no appropriate public education program is available.

(b) Pupils enrolled in nonpublic, nonsectarian schools and
agencies under this section shall be deemed to be enrolled in public
schools for all purposes of Chapter 4 (commencing with Section
41600) of Part 24 begin insert of Division 3 end insert and Section begin delete 42238 end delete begin insert 42238.02 end insert . The
local educational agency shall be eligible to receive allowances
under Articles 3 (commencing with Section 56836.165) and 4
(commencing with Section 56836.20) of Chapter 7.2 for services
that are provided to individuals with exceptional needs pursuant
to the contract.

(c) If the state participates in the federal program of assistance
for state-operated or state-supported programs for individuals with
exceptional needs begin delete (P.L. end delete begin insert (Public Law end insert 89-313, Sec. 6), pupils
enrolled in nonpublic, nonsectarian schools shall be deemed to be
enrolled in state-supported institutions for all purposes of that
program and shall be eligible to receive allowances under Chapter
7.2 (commencing with Section 56836) for supplemental services
provided to individuals with exceptional needs pursuant to a
contract with a local educational agency. In order to participate in
the federal program, the state shall find that participation will not
result in any additional expenditures from the General Fund.

(d) The local educational agency shall pay to the nonpublic,
nonsectarian school or agency the full amount of the tuition for
individuals with exceptional needs that are enrolled in programs
provided by the nonpublic, nonsectarian school pursuant to the
contract.

(e) Before contracting with a nonpublic, nonsectarian school or
agency outside of this state, the local educational agency shall
document its efforts to utilize public schools or to locate an
appropriate nonpublic, nonsectarian school or agency program, or
both, within the state.

(f) If a local educational agency places a pupil with a nonpublic,
nonsectarian school or agency outside of this state, the pupil’s
individualized education program team shall submit a report to
the Superintendent within 15 days of the placement decision. The
report shall include information about the special education and
related services provided by the out-of-state program placement
and the costs of the special education and related services provided,
and shall indicate the efforts of the local educational agency to
locate an appropriate public school or nonpublic, nonsectarian
school or agency, or a combination thereof, within the state. The
Superintendent shall submit a report to the board on all placements
made outside of this state.

(g) If a local educational agency decides to place a pupil with
a nonpublic, nonsectarian school or agency outside of this state,
that local educational agency shall indicate the anticipated date
for the return of the pupil to a public or nonpublic, nonsectarian
school or agency placement, or a combination thereof, located in
the state and shall document efforts during the previous placement
year to return the pupil.

(h) In addition to meeting the requirements of Section 56366.1,
a nonpublic, nonsectarian school or agency that operates a program
outside of this state shall be certified or licensed by that state to
provide, respectively, special education and related services and
designated instruction and related services to pupils under the
federal Individuals with Disabilities Education Act (20 U.S.C. Sec.
1400 et seq.).

(i) A nonpublic, nonsectarian school or agency that is located
outside of this state is eligible for certification pursuant to Section
56366.1 only if a pupil is enrolled in a program operated by that
school or agency pursuant to the recommendation of an
individualized education program team in California, and if that
pupil’s parents or guardians reside in California.

(j) In accordance with Section 300.147(b) and (c) of Title 34 of
the Code of Federal Regulations, the department shall disseminate
copies of applicable standards to each nonpublic, nonsectarian
school and nonpublic, nonsectarian agency to which a local
educational agency has referred or placed an individual with
exceptional needs and shall provide an opportunity for those
nonpublic, nonsectarian schools and nonpublic, nonsectarian
agencies to participate in the development and revision of state
standards that apply to those entities.

begin insert

begin insert SEC. 105. end insert   

end insert

begin insert Section 56366.1 of the end insert begin insert Education Code end insert begin insert is amended
to read: end insert

56366.1.  

(a) A nonpublic, nonsectarian school or agency that
seeks certification shall file an application with the Superintendent
on forms provided by the department and include the following
information on the application:

(1) A description of the special education and designated
instruction and services provided to individuals with exceptional
needs if the application is for nonpublic, nonsectarian school
certification.

(2) A description of the designated instruction and services
provided to individuals with exceptional needs if the application
is for nonpublic, nonsectarian agency certification.

(3) A list of appropriately qualified staff, a description of the
credential, license, or registration that qualifies each staff member
rendering special education or designated instruction and services
to do so, and copies of their credentials, licenses, or certificates of
registration with the appropriate state or national organization that
has established standards for the service rendered.

(4) An annual operating budget.

(5) Affidavits and assurances necessary to comply with all
applicable federal, state, and local laws and regulations that include
criminal record summaries required of all nonpublic, nonsectarian
school or agency personnel having contact with minor children
under Section 44237.

(b) (1) The applicant shall provide the special education local
plan area in which the applicant is located with the written
notification of its intent to seek certification or renewal of its
certification. The applicant shall submit on a form, developed by
the department, a signed verification by local educational agency
representatives that they have been notified of the intent to certify
or renew certification. The verification shall include a statement
that representatives of the local educational agency for the area in
which the applicant is located have had the opportunity to review
the application at least 60 calendar days prior to submission of an
initial application to the Superintendent, or at least 30 calendar
days prior to submission of a renewal application to the
Superintendent. The signed verification shall provide assurances
that local educational agency representatives have had the
opportunity to provide input on all required components of the
application.

(2) If the applicant has not received a response from the local
educational agency 60 calendar days from the date of the return
receipt for initial applications or 30 calendar days from the date
of the return receipt for renewal applications, the applicant may
file the application with the Superintendent. A copy of the return
receipt shall be included with the application as verification of
notification efforts to the local educational agency.

(3) The department shall mail renewal application materials to
certified nonpublic, nonsectarian schools and agencies at least 120
days begin delete prior to end delete begin insert before end insert the date their current certification expires.

(c) If the applicant operates a facility or program on more than
one site, each site shall be certified.

(d) If the applicant is part of a larger program or facility on the
same site, the Superintendent shall consider the effect of the total
program on the applicant. A copy of the policies and standards for
the nonpublic, nonsectarian school or agency and the larger
program shall be available to the Superintendent.

(e)  begin delete Prior to end delete begin insert Before end insert certification, the Superintendent shall conduct
an onsite review of the facility and program for which the applicant
seeks certification. The Superintendent may be assisted by
representatives of the special education local plan area in which
the applicant is located and a nonpublic, nonsectarian school or
agency representative who does not have a conflict of interest with
the applicant. The Superintendent shall conduct an additional onsite
review of the facility and program within three years of the
effective date of the certification, unless the Superintendent
conditionally certifies the school or agency or unless the
Superintendent receives a formal complaint against the school or
agency. In the latter two cases, the Superintendent shall conduct
an onsite review at least annually.

(f) The Superintendent shall make a determination on an
application within 120 days of receipt of the application and shall
certify, conditionally certify, or deny certification to the applicant.
If the Superintendent fails to take one of these actions within 120
days, the applicant is automatically granted conditional certification
for a period terminating on August 31 of the current school year.
If certification is denied, the Superintendent shall provide reasons
for the denial. The Superintendent may certify the school or agency
for a period of not longer than one year.

(g) Certification becomes effective on the date the nonpublic,
nonsectarian school or agency meets all the application
requirements and is approved by the Superintendent. Certification
may be retroactive if the school or agency met all the requirements
of this section on the date the retroactive certification is effective.
Certification expires on December 31 of the terminating year.

(h) The Superintendent annually shall review the certification
of each nonpublic, nonsectarian school and agency. For this
purpose, a certified school or agency annually shall update its
application between August 1 and October 31, unless the board
grants a waiver pursuant to Section 56101. The Superintendent
may conduct an onsite review as part of the annual review.

(i) (1) The Superintendent shall conduct an investigation of a
nonpublic, nonsectarian school or agency onsite at any time without
prior notice if there is substantial reason to believe that there is an
immediate danger to the health, safety, or welfare of a child. The
Superintendent shall document the concern and submit it to the
nonpublic, nonsectarian school or agency at the time of the onsite
investigation. The Superintendent shall require a written response
to any noncompliance or deficiency found.

(2) With respect to a nonpublic, nonsectarian school, the
Superintendent shall conduct an investigation, which may include
an unannounced onsite visit, if the Superintendent receives
evidence of a significant deficiency in the quality of educational
services provided, a violation of Section 56366.9, or
noncompliance with the policies expressed by subdivision (b) of
Section 1501 of the Health and Safety Code by the nonpublic,
nonsectarian school. The Superintendent shall document the
complaint and the results of the investigation and shall provide
copies of the documentation to the complainant, the nonpublic,
nonsectarian school, and the contracting local educational agency.

(3) Violations or noncompliance documented pursuant to
paragraph (1) or (2) shall be reflected in the status of the
certification of the school, at the discretion of the Superintendent,
pending an approved plan of correction by the nonpublic,
nonsectarian school. The department shall retain for a period of
10 years all violations pertaining to certification of the nonpublic,
nonsectarian school or agency.

(j) The Superintendent shall monitor the facilities, the
educational environment, and the quality of the educational
program, including the teaching staff, the credentials authorizing
service, the standards-based core curriculum being employed, and
the standard-focused instructional materials used, of an existing
certified nonpublic, nonsectarian school or agency on a three-year
cycle, as follows:

(1) The nonpublic, nonsectarian school or agency shall complete
a self-review in year one.

(2) The Superintendent shall conduct an onsite review of the
nonpublic, nonsectarian school or agency in year two.

(3) The Superintendent shall conduct a followup visit to the
nonpublic, nonsectarian school or agency in year three.

(k) (1) Notwithstanding any other begin delete provision of end delete law, the
Superintendent shall not certify a nonpublic, nonsectarian school
or agency that proposes to initiate or expand services to pupils
currently educated in the immediate prior fiscal year in a juvenile
court program, community school pursuant to Section 56150, or
other nonspecial education program, including independent study
or adult school, or both, unless the nonpublic, nonsectarian school
or agency notifies the county superintendent of schools and the
special education local plan area in which the proposed new or
expanded nonpublic, nonsectarian school or agency is located of
its intent to seek certification.

(2) The notification shall occur no later than the December 1
begin delete prior to end delete begin insert before end insert the new fiscal year in which the proposed or
expanding school or agency intends to initiate services. The notice
shall include the following:

(A) The specific date upon which the proposed nonpublic,
nonsectarian school or agency is to be established.

(B) The location of the proposed program or facility.

(C) The number of pupils proposed for services, the number of
pupils currently served in the juvenile court, community school,
or other nonspecial education program, the current school services
including special education and related services provided for these
pupils, and the specific program of special education and related
services to be provided under the proposed program.

(D) The reason for the proposed change in services.

(E) The number of staff who will provide special education and
designated instruction and services and hold a current valid
California credential or license in the service rendered.

(3) In addition to the requirements in subdivisions (a) to (f),
inclusive, the Superintendent shall require and consider the
following in determining whether to certify a nonpublic,
nonsectarian school or agency as described in this subdivision:

(A) A complete statement of the information required as part
of the notice under paragraph (1).

(B) Documentation of the steps taken in preparation for the
conversion to a nonpublic, nonsectarian school or agency, including
information related to changes in the population to be served and
the services to be provided pursuant to each pupil’s individualized
education program.

(4) Notwithstanding any other begin delete provision of end delete law, the certification
becomes effective no earlier than July 1 if the school or agency
provided the notification required pursuant to paragraph (1).

(l) (1) Notwithstanding any other begin delete provision of end delete law, the
Superintendent shall not certify or renew the certification of a
nonpublic, nonsectarian school or agency, unless all of the
following conditions are met:

(A) The entity operating the nonpublic, nonsectarian school or
agency maintains separate financial records for each entity that it
operates, with each nonpublic, nonsectarian school or agency
identified separately from any licensed children’s institution that
it operates.

(B) The entity submits an annual budget that identifies the
projected costs and revenues for each entity and demonstrates that
the rates to be charged are reasonable to support the operation of
the entity.

(C) The entity submits an entitywide annual audit that identifies
its costs and revenues, by entity, in accordance with generally
accepted accounting and auditing principles. The audit shall clearly
document the amount of moneys received and expended on the
education program provided by the nonpublic, nonsectarian school.

(D) The relationship between various entities operated by the
same entity are documented, defining the responsibilities of the
entities. The documentation shall clearly identify the services to
be provided as part of each program, for example, the residential
or medical program, the mental health program, or the educational
program. The entity shall not seek funding from a public agency
for a service, either separately or as part of a package of services,
if the service is funded by another public agency, either separately
or as part of a package of services.

(2) For purposes of this section, “licensed children’s institution”
has the same meaning as it is defined by Section 56155.5.

(m) The school or agency shall be charged a reasonable fee for
certification. The Superintendent may adjust the fee annually
commensurate with the statewide average percentage inflation
adjustment computed for begin delete revenue limits end delete begin insert local control funding
formula allocations pursuant to Section 42238.02, as implemented
by Section 42238.03, end insert of unified school districts with greater than
1,500 units of average daily attendance if the percentage increase
is reflected in the begin insert school end insert district begin delete revenue limit end delete begin insert local control funding
formula allocation pursuant to Section 42238.02, as implemented
by Section 42238.03, end insert for inflation purposes. For purposes of this
section, the base fee shall be the following:

 

(1) 1-5 pupils		$  300
(2) 6-10 pupils		500
(3) 11-24 pupils		1,000
(4) 25-75 pupils		1,500
(5) 76 pupils and over		2,000

 

The school or agency shall pay this fee when it applies for
certification and when it updates its application for annual renewal
by the Superintendent. The Superintendent shall use these fees to
conduct onsite reviews, which may include field experts. No fee
shall be refunded if the application is withdrawn or is denied by
the Superintendent.

(n) (1) Notwithstanding any other begin delete provision of end delete law, only those
nonpublic, nonsectarian schools and agencies that provide special
education and designated instruction and services utilizing staff
who hold a certificate, permit, or other document equivalent to
that which staff in a public school are required to hold in the service
rendered are eligible to receive certification. Only those nonpublic,
nonsectarian schools or agencies located outside of California that
employ staff who hold a current valid credential or license to render
special education and related services as required by that state shall
be eligible to be certified.

(2) The board shall develop regulations to implement this
subdivision.

(o) In addition to meeting the standards adopted by the board,
a nonpublic, nonsectarian school or agency shall provide written
assurances that it meets all applicable standards relating to fire,
health, sanitation, and building safety.

begin insert

begin insert SEC. 106. end insert   

end insert

begin insert Section 56836.21 of the end insert begin insert Education Code end insert begin insert is amended
to read: end insert

56836.21.  

(a) The department shall administer an extraordinary
cost pool to protect special education local plan areas from the
extraordinary costs associated with single placements as described
in subdivision (d). Funds shall be appropriated for this purpose in
the annual Budget Act. Special education local plan areas shall be
eligible for reimbursement from this pool in accordance with this
section.

(b) The threshold amount for claims under this section shall be
the lesser of the following:

(1) One percent of the allocation calculated pursuant to Section
56836.08 for the special education local plan area for the current
fiscal year for any special education local plan area that meets the
criteria in Section 56212.

(2) The department shall calculate the average cost of a
nonpublic, nonsectarian school placement in the 1997-98 fiscal
year. This amount shall be multiplied by 2.5, then by one plus the
inflation factor computed pursuant to Section 42238.1, begin insert as that
section read on January 1, 2013, end insert to obtain the alternative threshold
amount for claims in the 1998-99 fiscal year. In subsequent fiscal
years, the alternative threshold amount shall be the alternative
threshold amount for the prior fiscal year multiplied by one plus
the inflation factor computed pursuant to Section 42238.1 begin insert , as that
section read on January 1, 2013, through the 2012-13 fiscal year
and, commencing with the 2013-14 fiscal year, paragraph (2) of end insert
begin insert subdivision (d) of Section 42238.02 end insert .

(c) Special education local plan areas are eligible to submit
claims for costs exceeding the threshold amount on forms
developed by the department. All claims for a fiscal year shall be
submitted by November 30 following the close of the fiscal year.
If the total amount claimed by special education local plan areas
exceeds the amount appropriated, the claims shall be prorated.

(d) Special education local plan areas are eligible to submit
claims for the costs of nonpublic, nonsectarian school placements
in excess of those in existence in the 1997-98 fiscal year and of
special education and related services for pupils who reside in
licensed children’s institutions.

begin insert

begin insert SEC. 107. end insert   

end insert

begin insert Section 56836.24 of the end insert begin insert Education Code end insert begin insert is amended
to read: end insert

56836.24.  

Commencing with the 1998-99 fiscal year and each
year thereafter, the begin delete superintendent end delete begin insert end insert begin insert Superintendent end insert shall make the
following computations to determine the amount of funding for
the purposes specified in Section 56836.23 to apportion to each
special education local plan area for the fiscal year in which the
computation is made:

(a) For the 1998-99 fiscal year the superintendent shall make
the following computations:

(1) Multiply the total amount of state General Fund money
allocated to the special education local plan areas in the 1997-98
fiscal year, for the purposes of Article 9 (commencing with Section
56780) of Chapter 7, as that chapter existed on December 31, 1998,
by one plus the inflation factor computed pursuant to subdivision
(b) of Section 42238.1 begin insert , as that section read on January 1, 2013, end insert
for the 1998-99 fiscal year.

(2) Divide the amount calculated in paragraph (1) by the units
of average daily attendance, exclusive of average daily attendance
for absences excused pursuant to subdivision (b) of Section 46010
as that subdivision read on July 1, 1997, reported for the special
education local plan area for the 1997-98 fiscal year.

(3) To determine the amount to be allocated to each special
education local plan area in the 1998-99 fiscal year, the
superintendent shall multiply the amount computed in paragraph
(2) by the number of units of average daily attendance reported
for the special education local plan area for the 1998-99 fiscal
year, except that a special education local plan area designated as
a necessary small special education local plan area in accordance
with Section 56212 and reporting fewer than 15,000 units of
average daily attendance for the 1998-99 fiscal year shall be
deemed to have 15,000 units of average daily attendance, and no
special education local plan area shall receive less than it received
in the 1997-98 fiscal year.

(b) For the 1999-2000 fiscal year and each fiscal year thereafter,
the begin delete superintendent end delete begin insert Superintendent end insert shall make the following
calculations:

(1) Multiply the amount determined in paragraph (2) of
subdivision (a) by one plus the inflation factor computed pursuant
to subdivision (b) of Section 42238.1 begin insert , as that section read on
January 1, 2013, and commencing with the 2013-14 fiscal year,
paragraph (2) of subdivision (d) of Section 42238.02 end insert for the current
fiscal year.

(2) Multiply the amount determined in paragraph (1) by the
number of units of average daily attendance reported for the special
education local plan area for the current fiscal year, except that a
special education local plan area designated as a necessary small
special education local plan area in accordance with Section 56212
and reporting fewer than 15,000 units of average daily attendance
for the current fiscal year shall be deemed to have 15,000 units of
average daily attendance.

begin insert

begin insert SEC. 108. end insert   

end insert

begin insert Section 7906 of the end insert begin insert Government Code end insert begin insert is amended
to read: end insert

7906.  

For school districts:

(a) “ADA” means a school district’s second principal
apportionment units of average daily attendance as determined
pursuant to Section begin delete 42238.5 end delete begin insert 42238.5 end insert of the Education Code,
including average daily attendance in summer school, regional
occupational centers and programs, and apprenticeship programs,
and excluding average daily attendance in adult education
programs. All other units of average daily attendance including,
but not limited to, special day classes for special education pupils,
shall be included.

begin delete

(1) For purposes of this subdivision, the average daily attendance
of summer school programs shall be determined pursuant to
subparagraph (F) of paragraph (1) of subdivision (a) of Section
14022.5 of the Education Code.

(2)

end delete

begin insert (1) end insert  For purposes of this subdivision, the average daily attendance
of apprenticeship programs shall be determined pursuant to
begin delete subparagraph (D) of paragraph (1) of subdivision (a) of Section
14022.5 end delete begin insert Section 79149.1 end insert of the Education Code.

begin delete

(3) For the 2008-09, 2009-10, 2010-11, 2011-12, 2012-13,
2013-14, and 2014-15 fiscal years, the

end delete

begin insert (2) end insert begin insert   end insert begin insert For the 2008-09 fiscal year and each fiscal year thereafter,
the end insert average daily attendance of public school districts, including
county superintendents of schools, serving kindergarten and grades
1 to 12, inclusive, or any part thereof, shall include the same
amount of average daily attendance for classes for supplemental
instruction and regional occupational centers and programs that
was used for purposes of this section for the 2007-08 fiscal year.

(b) “Foundation program level” means:

(1) For the 1978-79 fiscal year, one thousand two hundred
forty-one dollars ($1,241) for elementary school districts, one
thousand three hundred twenty-two dollars ($1,322) for unified
school districts, and one thousand four hundred twenty-seven
dollars ($1,427) for high school districts.

(2) For the 1979-80 fiscal year to the 1986-87 fiscal year,
inclusive, the levels specified in paragraph (1) increased by the
lesser of the change in cost of living or California per capita
personal income for the preceding calendar year.

(3) For the 1986-87 fiscal year, the levels specified in paragraph
(2) increased by one hundred eighty dollars ($180) for elementary
school districts, one hundred ninety-one dollars ($191) for unified
school districts, and two hundred seven dollars ($207) for high
school districts.

(4) For the 1987-88 fiscal year, the levels specified in paragraph
(3) increased by the lesser of the change in cost of living or
California per capita personal income for the preceding calendar
year.

(5) For the 1988-89 fiscal year and each fiscal year thereafter,
the foundation program level shall be the appropriations limit of
the school district for the current fiscal year, plus amounts paid
for any nonreimbursed court or federal mandates imposed on or
after November 6, 1979, less the sum of the following:

(A) Interest earned on the proceeds of taxes during the current
fiscal year.

(B) The 50 percent of miscellaneous funds received during the
current fiscal year that are from the proceeds of taxes.

(C) Locally voted taxes received during the current fiscal year,
such as parcel taxes or square foot taxes, unless for voter-approved
bonded debt.

(D) Any other local proceeds of taxes received during the current
fiscal year, other than local taxes which count towards the revenue
limit, such as excess bond revenues transferred to a district’s
general fund pursuant to Section 15234 of the Education Code.

(c) “Proceeds of taxes” shall be deemed to include subventions
received from the state only if those subventions are for one of the
following two purposes:

(1) Basic aid subventions of one hundred twenty dollars ($120)
per ADA.

(2) Additional apportionments that, when added to the district’s
local revenues as defined in Section 42238 of the Education Code,
do not exceed the foundation program level for that district. In no
case shall subventions received from the state for reimbursement
of state mandates in accordance with the provisions of Section 6
of Article XIII B of the California Constitution or of Section 17561
or for reimbursement of court or federal mandates imposed on or
after November 6, 1979, be considered “proceeds of taxes” for
purposes of this section.

(d) Proceeds of taxes for a fiscal year shall not include any
proceeds of taxes within the district’s beginning balance or reserve,
unless those funds were not appropriated in a prior fiscal year.
Funds that were appropriated to a reserve or other fund referenced
in Section 5 of Article XIII B of the California Constitution shall
be deemed to be appropriated for the purpose of this paragraph.

(e) The remainder of the state apportionments, including special
purpose apportionments and categorical aid subventions shall not
be considered proceeds of taxes for a school district.

(f) Each school district shall report to the Superintendent of
Public Instruction and to the Director of Finance at least annually
its appropriations limit, its appropriations subject to limitation, the
amount of its state aid apportionments and subventions included
within the proceeds of taxes of the school district, and amounts
excluded from its appropriations limit, at a time and in a manner
prescribed by the Superintendent of Public Instruction and
approved by the Director of Finance.

(g) For the 1988-89 fiscal year and each fiscal year thereafter,
nothing in paragraph (2) of subdivision (c) shall be so construed
as to require that the amount determined pursuant to subdivision
(b) be multiplied by the amount determined pursuant to subdivision
(a) for purposes of determining the amount of state aid included
in school district “proceeds of taxes” for purposes of this section.

begin insert

begin insert SEC. 109. end insert   

end insert

begin insert Section 50286 of the end insert begin insert Government Code end insert begin insert is amended
to read: end insert

50286.  

(a) If a contract is canceled under Section 50284, the
owner shall pay a cancellation fee equal to 121⁄2 percent of the
current fair market value of the property , as determined by the
county assessor as though the property were free of the contractual
restriction.

(b) The cancellation fee shall be paid to the county auditor, at
the time and in the manner that the county auditor shall prescribe,
and shall be allocated by the county auditor to each jurisdiction in
the tax rate area in which the property is located in the same manner
as the auditor allocates the annual tax increment in that tax rate
area in that fiscal year.

(c) Notwithstanding any other begin delete provision of end delete law, revenue received
by a school district pursuant to this section shall be considered
property tax revenue for the purposes of Section begin delete 42238 end delete begin insert 42238.02
of the Education Code, as implemented pursuant to Section
42238.03 end insert of the Education Code, and revenue received by a county
superintendent of schools pursuant to this section shall be
considered property tax revenue for begin delete the end delete purposes of Article begin delete 3 end delete begin insert 4 end insert
(commencing with Section begin delete 2550) end delete begin insert 2570) end insert of Chapter 12 of Part 2
of Division 1 of Title 1 of the Education Code.

begin insert

begin insert SEC. 110. end insert   

end insert

begin insert Section 33492.78 of the end insert begin insert Health and Safety Code end insert begin insert is
amended to read: end insert

33492.78.  

(a) Section 33607.5 shall not apply to an agency
created pursuant to this article. For purposes of Sections begin delete 42238,
84750, end delete begin insert 42238.02, 84750.5, end insert and 84751 of the Education Code,
funds allocated pursuant to this section shall be treated as if they
were allocated pursuant to Section 33607.5.

(1) This section shall apply to each redevelopment project area
created pursuant to a redevelopment plan that contains the
provisions required by Section 33670 and is created pursuant to
this article. All the amounts calculated pursuant to this section
shall be calculated after the amount required to be deposited in the
Low and Moderate Income Housing Fund pursuant to Sections
33334.2, 33334.3, and 33334.6, as modified by Section 33492.76,
has been deducted from the total amount of tax-increment funds
received by the agency in the applicable fiscal year.

(2) The payments made pursuant to this section shall be in
addition to any amounts the school district or districts and
community college district or districts receive pursuant to
subdivision (a) of Section 33670. The agency shall reduce its
payments pursuant to this section to an affected school or
community college district by any amount the agency has paid,
directly or indirectly, pursuant to Section 33445, 33445.5, or 33446,
or any provision of law other than this section for, or in connection
with, a public facility owned or leased by that affected school or
community college district.

(3) (A) Of the total amount paid each year pursuant to this
section to school districts, 43.9 percent shall be considered to be
property taxes for the purposes of paragraph (1) of subdivision begin delete (h) end delete
begin insert (j) end insert of Section begin delete 42238 end delete begin insert 42238.02 end insert of the Education Code, and 56.1
percent shall not be considered to be property taxes for the purposes
of that section, and shall be available to be used for educational
facilities.

(B) Of the total amount paid each year pursuant to this section
to community college districts, 47.5 percent shall be considered
to be property taxes for the purposes of Section begin delete 84750 end delete begin insert 84751 end insert of
the Education Code, and 52.5 percent shall not be considered to
be property taxes for the purposes of that section, and shall be
available to be used for educational facilities.

(C) Of the total amount paid each year pursuant to this section
to county offices of education, 19 percent shall be considered to
be property taxes for the purposes of paragraph (1) of subdivision
begin delete (h) end delete begin insert (c) end insert of Section begin delete 42238 end delete begin insert 2575 end insert of the Education Code, and 81
percent shall not be considered to be property taxes for the purposes
of that section, and shall be available to be used for educational
facilities.

(D) Of the total amount paid each year pursuant to this section
to special education, 19 percent shall be considered to be property
taxes for the purposes of paragraph (1) of subdivision begin delete (h) end delete begin insert (j) end insert of
Section begin delete 42238 end delete begin insert 42238.02 end insert of the Education Code, and 81 percent
shall not be considered to be property taxes for the purposes of
that section, and shall be available to be used for educational
facilities.

(4) Local education agencies that use funds received pursuant
to this section for educational facilities shall spend these funds at
schools that are any one of the following:

(A) Within the project area.

(B) Attended by students from the project area.

(C) Attended by students generated by projects that are assisted
directly by the redevelopment agency.

(D) Determined by a local education agency to be of benefit to
the project area.

(b) Commencing with the first fiscal year in which the agency
receives tax increments, and continuing through the last fiscal year
in which the agency receives tax increments, a redevelopment
agency created pursuant to this article shall pay to each affected
school and community college district an amount equal to the
product of 25 percent times the percentage share of total property
taxes collected that are allocated to each affected school or
community college district, including any amount allocated to each
district pursuant to Sections 97.03 and 97.035 of the Revenue and
Taxation Code times the total of the tax increments received by
the agency after the amount required to be deposited in the Low
and Moderate Income Housing Fund has been deducted.

(c) Commencing with the 11th fiscal year in which the agency
receives tax increments and continuing through the last fiscal year
in which the agency receives tax increments, a redevelopment
agency created pursuant to this article shall pay to each affected
school and community college district, in addition to the amounts
paid pursuant to subdivision (b), an amount equal to the product
of 21 percent times the percentage share of total property taxes
collected that are allocated to each affected school or community
college district, including any amount allocated to each district
pursuant to Sections 97.03 and 97.035 of the Revenue and Taxation
Code times the total of the first adjusted tax increments received
by the agency after the amount required to be deposited in the Low
and Moderate Income Housing Fund has been deducted. The first
adjusted tax increments received by the agency shall be calculated
by applying the tax rate against the amount of assessed value by
which the current year assessed value exceeds the first adjusted
base year assessed value. The first adjusted base year assessed
value is the assessed value of the project area in the 10th fiscal
year in which the agency receives tax increment.

(d) Commencing with the 31st fiscal year in which the agency
receives tax increments and continuing through the last fiscal year
in which the agency receives tax increments, a redevelopment
agency shall pay to the affected school and community college
districts, in addition to the amounts paid pursuant to subdivisions
(b) and (c), an amount equal to 14 percent times the percentage
share of total property taxes collected that are allocated to each
affected school or community college district, including any
amount allocated to each district pursuant to Sections 97.03 and
97.035 of the Revenue and Taxation Code times the total of the
second adjusted tax increments received by the agency after the
amount required to be deposited in the Low and Moderate Income
Housing Fund has been deducted. The second adjusted tax
increments received by the agency shall be calculated by applying
the tax rate against the amount of assessed value by which the
current year assessed value exceeds the second adjusted base year
assessed value. The second adjusted base year assessed value is
the assessed value of the project area in the 30th fiscal year in
which the agency receives tax increments.

(e) (1) The Legislature finds and declares both of the following:

(A) The payments made pursuant to this section are necessary
in order to alleviate the financial burden and detriment that affected
school and community college districts may incur as a result of
the adoption of a redevelopment plan, and payments made pursuant
to this section will benefit redevelopment project areas.

(B) The payments made pursuant to this section are the exclusive
payments that are required to be made by a redevelopment agency
to affected school and community college districts during the term
of a redevelopment plan.

(2) Notwithstanding any other provision of law, a redevelopment
agency shall not be required, either directly or indirectly, as a
measure to mitigate a significant environmental effect or as part
of any settlement agreement or judgment brought in any action to
contest the validity of a redevelopment plan pursuant to Section
33501, to make any other payments to affected school or
community college districts, or to pay for public facilities that will
be owned or leased to an affected school or community college
district.

(f) As used in this section, a “local education agency” includes
a school district, a community college district, or a county office
of education.

begin insert

begin insert SEC. 111. end insert   

end insert

begin insert Section 33607.5 of the end insert begin insert Health and Safety Code end insert begin insert is
amended to read: end insert

33607.5.  

(a) (1) This section shall apply to each
redevelopment project area that, pursuant to a redevelopment plan
which contains the provisions required by Section 33670, is either:
(A) adopted on or after January 1, 1994, including later
amendments to these redevelopment plans; or (B) adopted prior
to January 1, 1994, but amended, after January 1, 1994, to include
new territory. For plans amended after January 1, 1994, only the
tax increments from territory added by the amendment shall be
subject to this section. All the amounts calculated pursuant to this
section shall be calculated after the amount required to be deposited
in the Low and Moderate Income Housing Fund pursuant to
Sections 33334.2, 33334.3, and 33334.6 has been deducted from
the total amount of tax increment funds received by the agency in
the applicable fiscal year.

(2) The payments made pursuant to this section shall be in
addition to any amounts the affected taxing entities receive
pursuant to subdivision (a) of Section 33670. The payments made
pursuant to this section to the affected taxing entities, including
the community, shall be allocated among the affected taxing
entities, including the community if the community elects to receive
payments, in proportion to the percentage share of property taxes
each affected taxing entity, including the community, receives
during the fiscal year the funds are allocated, which percentage
share shall be determined without regard to any amounts allocated
to a city, a city and county, or a county pursuant to Sections 97.68
and 97.70 of the Revenue and Taxation Code, and without regard
to any allocation reductions to a city, a city and county, a county,
a special district, or a redevelopment agency pursuant to Sections
97.71, 97.72, and 97.73 of the Revenue and Taxation Code and
Section 33681.12. The agency shall reduce its payments pursuant
to this section to an affected taxing entity by any amount the agency
has paid, directly or indirectly, pursuant to Section 33445, 33445.5,
33445.6, 33446, or any other provision of law other than this
section for, or in connection with, a public facility owned or leased
by that affected taxing agency, except: (A)  any amounts the
agency has paid directly or indirectly pursuant to an agreement
with a taxing entity adopted prior to January 1, 1994; or (B)  any
amounts that are unrelated to the specific project area or
amendment governed by this section. The reduction in a payment
by an agency to a school district, community college district, or
county office of education, or for special education, shall be
subtracted only from the amount that otherwise would be available
for use by those entities for educational facilities pursuant to
paragraph (4). If the amount of the reduction exceeds the amount
that otherwise would have been available for use for educational
facilities in any one year, the agency shall reduce its payment in
more than one year.

(3) If an agency reduces its payment to a school district,
community college district, or county office of education, or for
special education, the agency shall do all of the following:

(A) Determine the amount of the total payment that would have
been made without the reduction.

(B) Determine the amount of the total payment without the
reduction which: (i) would have been considered property taxes;
and (ii) would have been available to be used for educational
facilities pursuant to paragraph (4).

(C) Reduce the amount available to be used for educational
facilities.

(D) Send the payment to the school district, community college
district, or county office of education, or for special education,
with a statement that the payment is being reduced and including
the calculation required by this subdivision showing the amount
to be considered property taxes and the amount, if any, available
for educational facilities.

(4) (A) Except as specified in subparagraph (E), of the total
amount paid each year pursuant to this section to school districts,
43.3 percent shall be considered to be property taxes for the
purposes of paragraph (1) of subdivision (h) of Section 42238 of
the Education Code, begin insert as it read on January 1, 2013, and paragraph
(1) of subdivision (j) of Section 42238.02 of the Education Code, end insert
and 56.7 percent shall not be considered to be property taxes for
the purposes of that section and shall be available to be used for
educational facilities, including, in the case of amounts paid during
the 2011-12 fiscal year through the 2015-16 fiscal year, inclusive,
land acquisition, facility construction, reconstruction, remodeling,
maintenance, or deferred maintenance.

(B) Except as specified in subparagraph (E), of the total amount
paid each year pursuant to this section to community college
districts, 47.5 percent shall be considered to be property taxes for
the purposes of Section 84751 of the Education Code, and 52.5
percent shall not be considered to be property taxes for the purposes
of that section and shall be available to be used for educational
facilities, including, in the case of amounts paid during the 2011-12
fiscal year through the 2015-16 fiscal year, inclusive, land
acquisition, facility construction, reconstruction, remodeling,
maintenance, or deferred maintenance.

(C) Except as specified in subparagraph (E), of the total amount
paid each year pursuant to this section to county offices of
education, 19 percent shall be considered to be property taxes for
the purposes of Section 2558 of the Education Code, begin insert as it read on
January 1, 2013, and Section 2575 of the Education Code, end insert and 81
percent shall not be considered to be property taxes for the purposes
of that section and shall be available to be used for educational
facilities, including, in the case of amounts paid during the 2011-12
fiscal year through the 2015-16 fiscal year, inclusive, land
acquisition, facility construction, reconstruction, remodeling,
maintenance, or deferred maintenance.

(D) Except as specified in subparagraph (E), of the total amount
paid each year pursuant to this section for special education, 19
percent shall be considered to be property taxes for the purposes
of Section 56712 of the Education Code, and 81 percent shall not
be considered to be property taxes for the purposes of that section
and shall be available to be used for education facilities, including,
in the case of amounts paid during the 2011-12 fiscal year through
the 2015-16 fiscal year, inclusive, land acquisition, facility
construction, reconstruction, remodeling, maintenance, or deferred
maintenance.

(E) If, pursuant to paragraphs (2) and (3), an agency reduces its
payments to an educational entity, the calculation made by the
agency pursuant to paragraph (3) shall determine the amount
considered to be property taxes and the amount available to be
used for educational facilities in the year the reduction was made.

(5) Local education agencies that use funds received pursuant
to this section for school facilities shall spend these funds at schools
that are: (A) within the project area, (B) attended by students from
the project area, (C) attended by students generated by projects
that are assisted directly by the redevelopment agency, or (D)
determined by the governing board of a local education agency to
be of benefit to the project area.

(b) Commencing with the first fiscal year in which the agency
receives tax increments and continuing through the last fiscal year
in which the agency receives tax increments, a redevelopment
agency shall pay to the affected taxing entities, including the
community if the community elects to receive a payment, an
amount equal to 25 percent of the tax increments received by the
agency after the amount required to be deposited in the Low and
Moderate Income Housing Fund has been deducted. In any fiscal
year in which the agency receives tax increments, the community
that has adopted the redevelopment project area may elect to
receive the amount authorized by this paragraph.

(c) Commencing with the 11th fiscal year in which the agency
receives tax increments and continuing through the last fiscal year
in which the agency receives tax increments, a redevelopment
agency shall pay to the affected taxing entities, other than the
community which has adopted the project, in addition to the
amounts paid pursuant to subdivision (b) and after deducting the
amount allocated to the Low and Moderate Income Housing Fund,
an amount equal to 21 percent of the portion of tax increments
received by the agency, which shall be calculated by applying the
tax rate against the amount of assessed value by which the current
year assessed value exceeds the first adjusted base year assessed
value. The first adjusted base year assessed value is the assessed
value of the project area in the 10th fiscal year in which the agency
receives tax increment revenues.

(d) Commencing with the 31st fiscal year in which the agency
receives tax increments and continuing through the last fiscal year
in which the agency receives tax increments, a redevelopment
agency shall pay to the affected taxing entities, other than the
community which has adopted the project, in addition to the
amounts paid pursuant to subdivisions (b) and (c) and after
deducting the amount allocated to the Low and Moderate Income
Housing Fund, an amount equal to 14 percent of the portion of tax
increments received by the agency, which shall be calculated by
applying the tax rate against the amount of assessed value by which
the current year assessed value exceeds the second adjusted base
year assessed value. The second adjusted base year assessed value
is the assessed value of the project area in the 30th fiscal year in
which the agency receives tax increments.

(e) (1) Prior to incurring any loans, bonds, or other
indebtedness, except loans or advances from the community, the
agency may subordinate to the loans, bonds, or other indebtedness
the amount required to be paid to an affected taxing entity by this
section, provided that the affected taxing entity has approved these
subordinations pursuant to this subdivision.

(2) At the time the agency requests an affected taxing entity to
subordinate the amount to be paid to it, the agency shall provide
the affected taxing entity with substantial evidence that sufficient
funds will be available to pay both the debt service and the
payments required by this section, when due.

(3) Within 45 days after receipt of the agency’s request, the
affected taxing entity shall approve or disapprove the request for
subordination. An affected taxing entity may disapprove a request
for subordination only if it finds, based upon substantial evidence,
that the agency will not be able to pay the debt payments and the
amount required to be paid to the affected taxing entity. If the
affected taxing entity does not act within 45 days after receipt of
the agency’s request, the request to subordinate shall be deemed
approved and shall be final and conclusive.

(f) (1) The Legislature finds and declares both of the following:

(A) The payments made pursuant to this section are necessary
in order to alleviate the financial burden and detriment that affected
taxing entities may incur as a result of the adoption of a
redevelopment plan, and payments made pursuant to this section
will benefit redevelopment project areas.

(B) The payments made pursuant to this section are the exclusive
payments that are required to be made by a redevelopment agency
to affected taxing entities during the term of a redevelopment plan.

(2) Notwithstanding any other provision of law, a redevelopment
agency shall not be required, either directly or indirectly, as a
measure to mitigate a significant environmental effect or as part
of any settlement agreement or judgment brought in any action to
contest the validity of a redevelopment plan pursuant to Section
33501, to make any other payments to affected taxing entities, or
to pay for public facilities that will be owned or leased to an
affected taxing entity.

(g) As used in this section, a “local education agency” is a school
district, a community college district, or a county office of
education.

begin insert

begin insert SEC. 112. end insert   

end insert

begin insert Section 33684 of the end insert begin insert Health and Safety Code end insert begin insert is
amended to read: end insert

33684.  

(a) (1) This section shall apply to each redevelopment
project area that, pursuant to a redevelopment plan that contains
the provisions required by Section 33670, meets any of the
following:

(A) Was adopted on or after January 1, 1994, including later
amendments to these redevelopment plans.

(B) Was adopted prior to January 1, 1994, but amended after
January 1, 1994, to include new territory. For plans amended after
January 1, 1994, only the tax increments from territory added by
the amendment shall be subject to this section.

(C) Was adopted prior to January 1, 1994, but amended after
January 1, 1994, to increase the limitation on the number of dollars
to be allocated to the agency or that increased, or eliminated,
pursuant to paragraph (1) of subdivision (e) of Section 33333.6,
the time limit on the establishing of loans, advances, and
indebtedness established pursuant to paragraphs (1) and (2) of
subdivision (a) of Section 33333.6, as those paragraphs read on
December 31, 2001, or that lengthened the period during which
the redevelopment plan is effective if the redevelopment plan being
amended contains the provisions required by subdivision (b) of
Section 33670.

(2) This section shall apply to passthrough payments, as required
by Sections 33607.5 and 33607.7, for the 2003-04 to 2008-09,
inclusive, fiscal years. For purposes of this section, a passthrough
payment shall be considered the responsibility of an agency in the
fiscal year the agency receives the tax increment revenue for which
the passthrough payment is required.

(3) For purposes of this section, “local educational agency” is
a school district, a community college district, or a county office
of education.

(b) On or before October 1, 2008, each agency shall submit a
report to the county auditor and to each affected taxing entity that
describes each project area, including its location, purpose, date
established, date or dates amended, and statutory and contractual
passthrough requirements. The report shall specify, by year, for
each project area all of the following:

(1) Gross tax increment received between July 1, 2003, and
June 30, 2008, that is subject to a passthrough payment pursuant
to Sections 33607.5 and 33607.7, and accumulated gross tax
increments through June 30, 2003.

(2) Total passthrough payments to each taxing entity that the
agency deferred pursuant to a subordination agreement approved
by the taxing agency under subdivision (e) of Section 33607.5 and
the dates these deferred payments will be made.

(3) Total passthrough payments to each taxing entity that the
agency was responsible to make between July 1, 2003, and June
30, 2008, pursuant to Sections 33607.5 and 33607.7, excluding
payments identified in paragraph (2).

(4) Total passthrough payments that the agency disbursed to
each taxing entity between July 1, 2003, and June 30, 2008,
pursuant to Sections 33607.5 and 33607.7.

(5) Total sums reported in paragraph (4) for each local
educational agency that are considered to be property taxes under
the provisions of paragraph (4) of subdivision (a) of Section
33607.5 and Section 33607.7.

(6) Total outstanding payment obligations to each taxing entity
as of June 30, 2008. This amount shall be calculated by subtracting
the amounts reported in paragraph (4) from paragraph (3) and
reporting any positive difference.

(7) Total outstanding overpayments to each taxing entity as of
June 30, 2008. This amount shall be calculated by subtracting the
amounts reported in paragraph (3) from paragraph (4) and reporting
any positive difference.

(8) The dates on which the agency made payments identified
in paragraph (6) or intends to make the payments identified in
paragraph (6).

(9) A revised estimate of the agency’s total outstanding
passthrough payment obligation to each taxing agency pursuant
to paragraph (6) of subdivision (b) and paragraph (6) of subdivision
(c) and the dates on which the agency intends to make these
payments.

(c) On or before October 1, 2009, each agency shall submit a
report to the county auditor and to each affected taxing entity that
describes each project area, including its location, purpose, date
established, date or dates amended, and statutory and contractual
passthrough requirements. The report shall specify, by year, for
each project area all of the following:

(1) Gross tax increment received between July 1, 2008, and
June 30, 2009, that is subject to a passthrough payment pursuant
to Sections 33607.5 and 33607.7.

(2) Total passthrough payments to each taxing entity that the
agency deferred pursuant to a subordination agreement approved
by the taxing entity under subdivision (e) of Section 33607.5 and
the dates these deferred payments will be made.

(3) Total passthrough payments to each taxing entity that the
agency was responsible to make between July 1, 2008, and June
30, 2009, pursuant to Sections 33607.5 and 33607.7, excluding
payments identified in paragraph (2).

(4) Total passthrough payments that the agency disbursed to
each taxing entity between July 1, 2008, and June 30, 2009,
pursuant to Sections 33607.5 and 33607.7.

(5) Total sums reported in paragraph (4) for each local
educational agency that are considered to be property taxes under
the provisions of paragraph (4) of subdivision (a) of Sections
33607.5 and 33607.7.

(6) Total outstanding payment obligations to each taxing entity
as of June 30, 2009. This amount shall be calculated by subtracting
the amounts reported in paragraph (4) from paragraph (3) and
reporting any positive difference.

(7) Total outstanding overpayments to each taxing entity as of
June 30, 2009. This amount shall be calculated by subtracting the
amounts reported in paragraph (3) from paragraph (4) and reporting
any positive difference.

(8) The dates on which the agency made payments identified
in paragraph (6) or intends to make the payments identified in
paragraph (6).

(d) If an agency reports pursuant to paragraph (6) of subdivision
(b) or paragraph (6) of subdivision (c) that it has an outstanding
passthrough payment obligation to any taxing entity, the agency
shall submit annual updates to the county auditor on October 1 of
each year until such time as the county auditor notifies the agency
in writing that the agency’s outstanding payment obligations have
been fully satisfied. The report shall contain both of the following:

(1) A list of payments to each taxing agency and to the
Educational Revenue Augmentation Fund pursuant to subdivision
(j) that the agency disbursed after the agency’s last update filed
pursuant to this subdivision or, if no update has been filed, after
the agency’s submission of the reports required pursuant to
subdivisions (b) and (c). The list of payments shall include only
those payments that address obligations identified pursuant to
paragraph (6) of subdivision (b) and paragraph (6) of subdivision
(c). The update shall specify the date on which each payment was
disbursed.

(2) A revised estimate of the agency’s total outstanding
passthrough payment obligation to each taxing agency pursuant
to paragraph (6) of subdivision (b) and paragraph (6) of subdivision
(c) and the dates on which the agency intends to make these
payments.

(e) The county auditor shall review each agency’s reports
submitted pursuant to subdivisions (b) and (c) and any other
relevant information to determine whether the county auditor
concurs with the information included in the reports.

(1) If the county auditor concurs with the information included
in a report, the county auditor shall issue a finding of concurrence
within 45 days.

(2) If the county auditor does not concur with the information
included in a report or considers the report to be incomplete, the
county auditor shall return the report to the agency within 45 days
with information identifying the elements of the report with which
the county auditor does not concur or considers to be incomplete.
The county auditor shall provide the agency at least 15 days to
respond to concerns raised by the county auditor regarding the
information contained in the report. An agency may revise a report
that has not received a finding of concurrence and resubmit it to
the county auditor.

(3) If an agency and county auditor do not agree regarding the
passthrough requirements of Sections 33607.5 and 33607.7, an
agency may submit a report pursuant to subdivisions (b) and (c)
and a statement of dispute identifying the issue needing resolution.

(4) An agency may amend a report for which the county auditor
has issued a finding of concurrence and resubmit the report
pursuant to paragraphs (1), (2), and (3) if any of the following
apply:

(A) The county auditor and agency agree that an issue identified
in the agency’s statement of dispute has been resolved and the
agency proposes to modify the sections of the report to conform
with the resolution of the statement of dispute.

(B) The county auditor and agency agree that the amount of
gross tax increment or the amount of a passthrough payment to a
taxing entity included in the report is not accurate.

(5) The Controller may revoke a finding of concurrence and
direct the agency to resubmit a report to the county auditor pursuant
to paragraphs (1), (2), and (3) if the Controller finds significant
errors in a report.

(f) On or before December 15, 2008, and annually thereafter
through 2014, the county auditor shall submit a report to the
Controller that includes all of the following:

(1) The name of each redevelopment project area in the county
for which an agency must submit a report pursuant to subdivision
(b) or (c) and information as to whether the county auditor has
issued a finding of concurrence regarding the report.

(2) A list of the agencies for which the county auditor has issued
a finding of concurrence for all project areas identified in paragraph
(1).

(3) A list of agencies for which the county auditor has not issued
a finding of concurrence for all project areas identified in paragraph
(1).

(4) Using information applicable to agencies listed in paragraph
(2), the county auditor shall report all of the following:

(A) The total sums reported by each redevelopment agency
related to each taxing entity pursuant to paragraphs (1) to (7),
inclusive, of subdivision (b) and, on or after December 15, 2009,
pursuant to paragraphs (1) to (7), inclusive, of subdivision (c).

(B) The names of agencies that have outstanding passthrough
payment obligations to a local educational agency that exceed the
amount of outstanding passthrough payments to the local
educational agency.

(C) Summary information regarding agencies’ stated plans to
pay the outstanding amounts identified in paragraph (6) of
subdivision (b) and paragraph (6) of subdivision (c) and the actual
amounts that have been deposited into the county Educational
Revenue Augmentation Fund pursuant to subdivision (j).

(D) All unresolved statements of dispute filed by agencies
pursuant to paragraph (3) of subdivision (e) and the county
auditor’s analyses supporting the county auditor’s conclusions
regarding the issues under dispute.

(g) (1) On or before February 1, 2009, and annually thereafter
through 2015, the Controller shall submit a report to the Legislative
Analyst’s Office and the Department of Finance and provide a
copy to the Board of Governors of the California Community
Colleges. The report shall provide information as follows:

(A) Identify agencies for which the county auditor has issued
a finding of concurrence for all reports required under subdivisions
(b) and (c).

(B) Identify agencies for which the county auditor has not issued
a finding of concurrence for all reports required pursuant to
subdivision (b) and all reports required pursuant to subdivision (c)
or for which a finding of concurrence has been withdrawn by the
Controller.

(C) Summarize the information reported in paragraph (4) of
subdivision (f). This summary shall identify, by local educational
agency and by year, the total amount of passthrough payments that
each local educational agency received, was entitled to receive,
subordinated, or that has not yet been paid, and the portion of these
amounts that are considered to be property taxes for purposes of
Sections 2558 begin delete , end delete begin insert and end insert 42238 begin insert of the Education Code, as those sections
read on January 1, 2013, and, after June 30, 2013, Sections 2575
and 42238.02, end insert and begin insert Section end insert 84751 of the Education Code. The
report shall identify, by agency, the amounts that have been
deposited to the county Educational Revenue Augmentation Fund
pursuant to subdivision (j).

(D) Summarize the statements of dispute. The Controller shall
specify the status of these disputes, including whether the
Controller or other state entity has provided instructions as to how
these disputes should be resolved.

(E) Identify agencies that have outstanding passthrough payment
liabilities to a local educational agency that exceed the amount of
outstanding passthrough overpayments to the local educational
agency.

(2) On or before February 1, 2009, and annually thereafter
through 2015, the Controller shall submit a report to the State
Department of Education and the Board of Governors of the
California Community Colleges. The report shall identify, by local
educational agency and by year of receipt, the total amount of
passthrough payments that the local educational agency received
from redevelopment agencies listed in subparagraph (A) of
paragraph (1).

(h) (1) On or before April 1, 2009, and annually thereafter until
April 1, 2015, the State Department of Education shall do all of
the following:

(A) Calculate for each school district for the 2003-04 to
2007-08, inclusive, fiscal years the difference between 43.3 percent
of the amount reported pursuant to paragraph (2) of subdivision
(g) and the amount subtracted from each school district’s
apportionment pursuant to paragraph (6) of subdivision (h) of
Section 42238 of the Education Code begin insert , as it read end insert begin insert on January 1,
2013 end insert .

(B) Calculate for each county superintendent of schools for the
2003-04 to 2007-08, inclusive, fiscal years the difference between
19 percent of the amount reported pursuant to paragraph (2) of
subdivision (g) and the amount received pursuant to Sections
33607.5 and 33607.7 and subtracted from each county
superintendent of schools apportionment pursuant to subdivision
(c) of Section 2558 of the Education Code begin insert , as it read end insert begin insert on January
1, 2013 end insert .

(C) Notify each school district and county superintendent of
schools for which any amount calculated in subparagraph (A) or
(B) is nonzero as to the reported change and its resulting impact
on apportionments. After April 1, 2009, however, the department
shall not notify a school district or county superintendent of schools
if the amount calculated in subparagraph (A) or (B) is the same
amount as the department calculated in the preceding year.

(2) On or before April 1, 2010, and annually thereafter until
April 1, 2015, the State Department of Education shall do all of
the following:

(A) Calculate for each school district for the 2008-09 fiscal
year the difference between 43.3 percent of the amount reported
pursuant to paragraph (2) of subdivision (g) and the amount
subtracted from each school district’s apportionment pursuant to
paragraph (6) of subdivision (h) of Section 42238 of the Education
Code begin insert , as it read on January 1, 2013 end insert .

(B) Calculate for each county superintendent of schools for the
2008-09 fiscal year the difference between 19 percent of the
amount reported pursuant to paragraph (2) of subdivision (g) and
the amount received pursuant to Sections 33607.5 and 33607.7
and subtracted from each county superintendent of schools
apportionment pursuant to subdivision (c) of Section 2558 of the
Education Code begin insert , as it read on January 1, 2013 end insert .

(C) Notify each school district and county superintendent of
schools for which any amount calculated in subparagraph (A) or
(B) is nonzero as to the reported change and its resulting impact
on revenue limit apportionments. After April 1, 2010, however,
the department shall not notify a school district or county
superintendent of schools if the amount calculated in subparagraph
(A) or (B) is the same amount as the department calculated in the
preceding year.

(3) For the purposes of Article 3 (commencing with Section
41330) of Chapter 3 of Part 24 of Division 3 of Title 2 of the
Education Code, the amounts reported to each school district and
county superintendent of schools in the notification required
pursuant to subparagraph (C) of paragraph (1) and subparagraph
(C) of paragraph (2) shall be deemed to be apportionment
significant audit exceptions and the date of receipt of that
notification shall be deemed to be the date of receipt of the final
audit report that includes those audit exceptions.

(4) On or before March 1, 2009, and annually thereafter until
March 1, 2015, the Board of Governors of the California
Community Colleges shall do all of the following:

(A) Calculate for each community college district for the
2003-04 to 2007-08, inclusive, fiscal years the difference between
47.5 percent of the amount reported pursuant to paragraph (2) of
subdivision (g) and the amount subtracted from each district’s total
revenue owed pursuant to subdivision (d) of Section 84751 of the
Education Code.

(B) Notify each community college district for which any
amount calculated in subparagraph (A) is nonzero as to the reported
change and its resulting impact on apportionments. After March
1, 2009, however, the board shall not notify a school district or
county superintendent of schools if the amount calculated in
subparagraph (A) is the same amount as the board calculated in
the preceding year.

(5) On or before March 1, 2010, and annually thereafter until
March 1, 2015, the Board of Governors of the California
Community Colleges shall do all of the following:

(A) Calculate for each community college district for the
2003-04 to 2007-08, inclusive, fiscal years the difference between
47.5 percent of the amount reported pursuant to paragraph (2) of
subdivision (g) and the amount subtracted from each district’s total
revenue owed pursuant to subdivision (d) of Section 84751 of the
Education Code.

(B) Notify each community college district for which any
amount calculated in subparagraph (A) is nonzero as to the reported
change and its resulting impact on revenue apportionments. After
March 1, 2010, however, the board shall not notify a community
college district if the amount calculated in subparagraph (A) is the
same amount as the board calculated in the preceding year.

(6) A community college district may submit documentation to
the Board of Governors of the California Community Colleges
showing that all or part of the amount reported to the district
pursuant to subparagraph (B) of paragraph (4) and subparagraph
(B) of paragraph (5) was previously reported to the California
Community Colleges for the purpose of the revenue level
calculations made pursuant to Section 84751 of the Education
Code. Upon acceptance of the documentation, the board shall
adjust the amounts calculated in paragraphs (4) and (5) accordingly.

(7) The Board of Governors of the California Community
Colleges shall make corrections in any amounts allocated in any
fiscal year to each community college district for which any amount
calculated in paragraphs (4) and (5) is nonzero so as to account
for the changes reported pursuant to paragraph (4) of subdivision
(b) and paragraph (4) of subdivision (c). The board may make the
corrections over a period of time, not to exceed five years.

(i) (1) After February 1, 2009, for an agency listed on the most
recent Controller’s report pursuant to subparagraph (B) or (E) of
paragraph (1) of subdivision (g), all of the following shall apply:

(A) The agency shall be prohibited from adding new project
areas or expanding existing project areas. For purposes of this
paragraph, “project area” has the same meaning as in Sections
33320.1 to 33320.3, inclusive, and Section 33492.3.

(B) The agency shall be prohibited from issuing new bonds,
notes, interim certificates, debentures, or other obligations, whether
funded, refunded, assumed, or otherwise, pursuant to Article 5
(commencing with Section 33640).

(C) The agency shall be prohibited from encumbering any funds
or expending any moneys derived from any source, except that
the agency may encumber funds and expend funds to pay, if any,
all of the following:

(i) Bonds, notes, interim certificates, debentures, or other
obligations issued by an agency before the imposition of the
prohibition in subparagraph (B) whether funded, refunded,
assumed, or otherwise, pursuant to Article 5 (commencing with
Section 33460).

(ii) Loans or moneys advanced to the agency, including, but not
limited to, loans from federal, state, local agencies, or a private
entity.

(iii) Contractual obligations that, if breached, could subject the
agency to damages or other liabilities or remedies.

(iv) Obligations incurred pursuant to Section 33445.

(v) Indebtedness incurred pursuant to Section 33334.2 or
33334.6.

(vi) Obligations incurred pursuant to Section 33401.

(vii) An amount, to be expended for the monthly operation and
administration of the agency, that may not exceed 75 percent of
the average monthly amount spent for those purposes in the fiscal
year preceding the fiscal year in which the agency was first listed
on the Controller’s report pursuant to subparagraph (B) or (E) of
paragraph (1) of subdivision (g).

(2) After February 1, 2009, an agency identified in subparagraph
(B) or (E) of paragraph (1) of subdivision (g) shall incur interest
charges on any passthrough payment that is made to a local
educational agency more than 60 days after the close of the fiscal
year in which the passthrough payment was required. Interest shall
be charged at a rate equal to 150 percent of the current Pooled
Money Investment Account earnings annual yield rate and shall
be charged for the period beginning 60 days after the close of the
fiscal year in which the passthrough payment was due through the
date that the payment is made.

(3) The Controller, with the concurrence of the Director of
Finance, may waive the provisions of paragraphs (1) and (2) for
a period of up to 12 months if the Controller determines all of the
following:

(A) The county auditor has identified the agency in its most
recent report issued pursuant to paragraph (2) of subdivision (f)
as an agency for which the auditor has issued a finding of
concurrence for all reports required pursuant to subdivisions (b)
and (c).

(B) The agency has filed a statement of dispute on an issue or
issues that, in the opinion of the Controller, are likely to be resolved
in a manner consistent with the agency’s position.

(C) The agency has made passthrough payments to local
educational agencies and the county Educational Revenue
Augmentation Fund, or has had funds previously withheld by the
auditor, in amounts that would satisfy the agency’s passthrough
payment requirements to local educational agencies if the issue or
issues addressed in the statement of dispute were resolved in a
manner consistent with the agency’s position.

(D) The agency would sustain a fiscal hardship if it made
passthrough payments to local educational agencies and the county
Educational Revenue Augmentation Fund in the amounts estimated
by the county auditor.

(j) Notwithstanding any other provision of law, if an agency
report submitted pursuant to subdivision (b) or (c) indicates
outstanding payment obligations to a local educational agency,
the agency shall make these outstanding payments as follows:

(1) Of the outstanding payments owed to school districts,
including any interest payments pursuant to paragraph (2) of
subdivision (i), 43.3 percent shall be deposited in the county
Educational Revenue Augmentation Fund and the remainder shall
be allocated to the school district or districts.

(2) Of the outstanding payments owed to community college
districts, including any interest payments pursuant to paragraph
(2) of subdivision (i), 47.5 percent shall be deposited in the county
Educational Revenue Augmentation Fund and the remainder shall
be allocated to the community college district or districts.

(3) Of the outstanding payments owed to county offices of
education, including any interest payments pursuant to paragraph
(2) of subdivision (i), 19 percent shall be deposited in the county
Educational Revenue Augmentation Fund and the remainder shall
be allocated to the county office of education.

(k) (1) This section shall not be construed to increase any
allocations of excess, additional, or remaining funds that would
otherwise have been allocated to cities, counties, cities and
counties, or special districts pursuant to clause (i) of subparagraph
(B) of paragraph (4) of subdivision (d) of Section 97.2 of, clause
(i) of subparagraph (B) of paragraph (4) of subdivision (d) of
Section 97.3 of, or Article 4 (commencing with Section 98) of
Chapter 6 of Part 0.5 of Division 1 of, the Revenue and Taxation
Code had this section not been enacted.

(2) Notwithstanding any other provision of law, no funds
deposited in the county Educational Revenue Augmentation Fund
pursuant to subdivision (j) shall be distributed to a community
college district.

(l) A county may require an agency to reimburse the county for
any expenses incurred by the county in performing the services
required by this section.

begin insert

begin insert SEC. 113. end insert   

end insert

begin insert Section 95 of the end insert begin insert Revenue and Taxation Code end insert begin insert is
amended to read: end insert

95.  

For begin delete the purpose end delete begin insert purposes end insert of this chapter:

(a) “Local agency” means a city, county, and special district.

(b) “Jurisdiction” means a local agency, school district,
community college district, or county superintendent of schools.
A jurisdiction as defined in this subdivision is a “district” for
purposes of Section 1 of Article XIII A of the California
Constitution.

For jurisdictions located in more than one county, the county
auditor of each county in which that jurisdiction is located shall,
for the purposes of computing the amount for that jurisdiction
pursuant to this chapter, treat the portion of the jurisdiction located
within that county as a separate jurisdiction.

(c) “Property tax revenue” includes the amount of state
reimbursement for the homeowners’ exemption. “Property tax
revenue” does not include the amount of property tax levied for
the purpose of making payments for the interest and principal on
either of the following:

(1) General obligation bonds or other indebtedness approved
by the voters prior to July 1, 1978, including tax rates levied
pursuant to Part 10 (commencing with Section 15000) of Division
1 of, and Sections 39308 and 39311 and former Sections 81338
and 81341 of the Education Code, and Section 26912.7 of the
Government Code.

(2) Bonded indebtedness for the acquisition or improvement of
real property approved by two-thirds of the voters on or after June
4, 1986.

(d) “Taxable assessed value” means total assessed value minus
all exemptions other than the homeowners’ and business inventory
exemptions.

(e) “Jurisdictional change” includes any change of organization,
as defined in Section 56021 of the Government Code and a
reorganization, as defined in Section 56073 of the Government
Code. “Jurisdictional change” also includes any change in the
boundary of those special districts that are not under the jurisdiction
of a local agency formation commission.

“Jurisdictional change” also includes a functional consolidation
where two or more local agencies, except two or more counties,
exchange or otherwise reassign functions and any change in the
boundaries of a school district or community college district or
county superintendent of schools.

(f) “School entities” means school districts, community college
districts, the Educational Revenue Augmentation Fund, and county
superintendents of schools.

(g) Except as otherwise provided in this subdivision, “tax rate
area” means a specific geographic area all of which is within the
jurisdiction of the same combination of local agencies and school
entities for the current fiscal year.

In the case of a jurisdictional change pursuant to Section 99, the
area subject to the change shall constitute a new tax rate area,
except that if the area subject to change is within the same
combinations of local agencies and school entities as an existing
tax rate area, the two tax rate areas may be combined into one tax
rate area.

Existing tax rate areas having the same combinations of local
agencies and school entities may be combined into one tax rate
area. For the combination of existing tax rate areas, the factors
used to allocate the annual tax increment pursuant to Section 98
shall be determined by calculating a weighted average of the annual
tax increment factors used in the tax rate areas being combined.

(h) “State assistance payments” means:

(1) For counties, amounts determined pursuant to subdivision
(b) of Section 16260 of the Government Code, increased by the
amount specified for each county pursuant to Section 94 of Chapter
282 of the Statutes of 1979, with the resultant sum reduced by an
amount derived by the calculation made pursuant to Section 16713
of the Welfare and Institutions Code.

(2) For cities, 82.91 percent of the amounts determined pursuant
to subdivisions (b) and (i) of Section 16250 of the Government
Code, plus for any city an additional amount equal to one-half of
the amount of any outstanding debt as of June 30, 1978, for
“museums” as shown in the Controller’s “Annual Report of
Financial Transactions of Cities for Fiscal Year 1977-78.”

(3) For special districts, 95.24 percent of the amounts received
pursuant to Chapter 3 (commencing with Section 16270) of Part
1.5 of Division 4 of Title 2 of the Government Code, Section 35.5
of Chapter 332 of the Statutes of 1978, and Chapter 12 of the
Statutes of 1979.

(i) “City clerk” means the clerk of the governing body of a city
or city and county.

(j) “Executive officer” means the executive officer of a local
agency formation commission.

(k) “City” means any city whether general law or charter, except
a city and county.

(l) “County” means any chartered or general law county.
“County” includes a city and county.

(m) “Special district” means any agency of the state for the local
performance of governmental or proprietary functions within
limited boundaries. “Special district” includes a county service
area, a maintenance district or area, an improvement district or
improvement zone, or any other zone or area, formed for the
purpose of designating an area within which a property tax rate
will be levied to pay for a service or improvement benefiting that
area. “Special district” includes the Bay Area Air Quality
Management District. “Special district” does not include a city, a
county, a school district, or a community college district. “Special
district” does not include any agency that is not authorized by
statute to levy a property tax rate. However, any special district
authorized to levy a property tax by the statute under which the
district was formed shall be considered a special district.
Additionally, a county free library established pursuant to Article
1 (commencing with Section 19100) of Chapter 6 of Part 11 of
Division 1 of Title 1 of the Education Code, and for which a
property tax was levied in the 1977-78 fiscal year, shall be
considered a special district.

(n) “Excess tax school entity” means an educational agency for
which the amount of the state funding entitlement determined
under begin delete Section 2558, 42238, 84750, end delete begin insert subdivision (e), (f), or (g) of
Section 2575, or Section 84750.5 end insert or 84751 of the Education Code,
as appropriate, is zero begin insert , and as described in subdivision (o) of
Section 42238.02 of the Education Code, as implemented by
Section 42238.03 of the Education Code end insert .

begin insert

begin insert SEC. 114. end insert   

end insert

begin insert Section 196.4 of the end insert begin insert Revenue and Taxation Code end insert begin insert is
amended to read: end insert

196.4.  

(a) In the 1991-92 fiscal year, the county auditor of an
eligible county, proclaimed by the Governor to be in a state of
disaster as a result of the Oakland/Berkeley Fire that occurred in
October 1991, shall certify to the Director of Finance an estimate
of the total amount of the reduction in property tax revenues on
both the regular secured roll and the supplemental roll for that
fiscal year resulting from the reassessment of eligible properties
by the county assessor pursuant to Section 170, except that the
amount certified shall not include any estimated property tax
revenue reductions to school districts (other than basic state aid
school districts), county offices of education, and community
college districts.

(b) In the 1991-92 fiscal year, the county auditor of an eligible
county, proclaimed by the Governor to be in a state of disaster as
a result of the Painted Cave Fire that occurred in June 1990, shall
certify to the Director of Finance an estimate of the total amount
of the reduction in property tax revenues on both the regular
secured roll and the supplemental roll for the 1990-91 fiscal year
resulting from the reassessment of eligible properties by the county
assessor pursuant to Section 170, except that the amount certified
shall not include any estimated property tax revenue reductions to
school districts (other than basic aid school districts), county offices
of education, and community college districts.

(c) For purposes of this section, “basic state aid school district”
means any school district that does not receive a state
apportionment pursuant to subdivision (h) of Section 42238 of the
Education Code, begin insert as it read on January 1, 2013, end insert but receives from
the state only a basic apportionment pursuant to Section 6 of Article
IX of the California Constitution.

begin insert

begin insert SEC. 115. end insert   

end insert begin insert

(a) The sum of two billion ninety-nine million one
hundred sixty-one thousand dollars ($2,099,161,000) is hereby
appropriated from the General Fund for the purposes of this act
as follows:

end insert begin insert

(1) Two million dollars ($2,000,000) shall be appropriated to
the Governor’s Office of Planning and Research for purposes of
implementing Sections 42238.07, 52064, and 52064.5 of the
Education Code.

end insert begin insert

(2) Two billion sixty-seven million one hundred forty thousand
dollars ($2,067,140,000) shall be appropriated to the
Superintendent of Public Instruction and shall be allocated
pursuant to the calculation in subdivision (b) of Section 42238.03
of the Education Code.

end insert begin insert

(3) Thirty-two million twenty-one thousand dollars
($32,021,000) shall be appropriated to the Superintendent of Public
Instruction and shall be allocated pursuant to the calculation in
subdivision (f) of Section 2575 of the Education Code.

end insert begin insert

(b) For purposes of making the computations required by
Section 8 of Article XVI of the California Constitution, the
appropriation made by subdivision (a) shall be deemed to be
“General Fund revenues appropriated for school districts,” as
defined in subdivision (c) of Section 41202 of the Education Code,
for the 2013-14 fiscal year, and included within the “total
allocations to school districts and community college districts
from General Fund proceeds of taxes appropriated pursuant to
Article XIII B,” as defined in subdivision (e) of Section 41202 of
the Education Code, for the 2013-14 fiscal year.

end insert

begin insert

begin insert SEC. 116. end insert   

end insert begin insert

If the Commission on State Mandates determines
that this act contains costs mandated by the state, reimbursement
to local agencies and school districts for those costs shall be made
pursuant to Part 7 (commencing with Section 17500) of Division
4 of Title 2 of the Government Code.

end insert

begin insert

begin insert SEC. 117. end insert   

end insert begin insert

This act is a bill providing for appropriations related
to the Budget Bill within the meaning of subdivision (e) of Section
12 of Article IV of the California Constitution, has been identified
as related to the budget in the Budget Bill, and shall take effect
immediately.

end insert

begin delete

SECTION 1.  

It is the intent of the Legislature to enact statutory
changes relating to the Budget Act of 2013.

end delete