Amended in Senate May 8, 2013

Amended in Senate April 25, 2013

Senate BillNo. 69


Introduced by Senator Liu

(Principal coauthors: Senators Block, De León, Lara, Leno, Padilla, and Steinberg)

(Coauthors: Senators Hancock, Hill, and Monning)

January 10, 2013


An act to amend Section 47634.1 of, to amendbegin insert and renumberend insert the heading of Article 4 (commencing with Section 2570) of Chapter 12 of Part 2 of Division 1 of Title 1 of, to amend and repeal Sections 14002.5, 42238, 42238.1, 42238.2, 42238.3, 42238.4, 42238.41, 42238.42, 42238.43, 42238.44, 42238.445, 42238.45, 42238.46, 42238.48, 42238.485, 42238.49, 42238.5, 42238.51, 42238.52, 42238.53, 42238.6, 42238.7, 42238.75, 42238.8, 42238.9, 42238.95, 42238.11, 42238.12, 42238.13, 42238.14, 42238.145, 42238.146, 42238.17, 42238.18, 42239, 42240.1, 42241.3, 42241.7, 42243.7, 47630.5, and 47633 of, to amend, repeal, and add Sections 1622, 14002, 14002.1, 14003, 14501, 33127, 41020, 41202, 42127, 46201.2, 47604.33, 47610, 47631, and 47632 of, to add Sections 2558.7, 2569, 42238.01, 42238.02, 42238.03, 42238.04, 42238.05, 42238.051, 42238.052, 42238.053, and 42238.06 to, to add Article 3 (commencing with Section 2574) to Chapter 12 of Part 2 of Division 1 of Title 1, to add Article 5 (commencing with Section 52060) to Chapter 6.1 of Part 28 of Division 4 of Title 2 of, and to repeal Article 3 (commencing with Section 2550) of Chapter 12 of Part 2 of Division 1 of Title 1 of, and to repeal Article 3.5 (commencing with Section 2560) of Chapter 12 of Part 2 of Division 1 of Title 1 of, the Education Code, relating to school finance.

LEGISLATIVE COUNSEL’S DIGEST

SB 69, as amended, Liu. School finance: new pupil funding formula.

(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 and for their provision of instruction at the public elementary and secondary schools these local educational agencies maintain. 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.

This bill, commencing in the 2014-15 fiscal year, would revise and recast the provisions related to the public school financing system by requiring state funding for county superintendents of schools, school districts, and charter schools that previously received a general-purpose entitlement, to be calculated pursuant to a local control funding formula, as specified.

(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.

This bill would require a county board of education, a governing board of a school district, and a governing body of a charter school that receives its funding directly, as specified, 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. By requiring county boards of education and school districts to annually adopt or revise a local control and accountability plan, the bill would impose a state-mandated local program.

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

begin insert

(4) This bill would become operative only if specified legislation is enacted in the 2013-14 Regular Session.

end insert
begin delete

(4)

end delete

begin insert(5)end insert 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.

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.

Vote: majority. Appropriation: no. Fiscal committee: yes. State-mandated local program: yes.

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

P3    1

SECTION 1.  

The Legislature finds and declares all of the
2following:

3(a) The local control funding formula proposal, as specified in
4AB 88 of the 2013-14 Regular Session, as amended April 3, 2013,
5attempts to increase local flexibility, make funding more equitable
6and transparent, and devote greater resources to children who come
7to school with greater challenges.

8(b) The Legislature supports the underlying goal expressed in
9the local control funding formula proposal of providing additional
10resources to support improved educational outcomes for
11disadvantaged pupils. However, the Legislature has concerns
12related to a number of its provisions, in particular the inadequate
13level of funding proposed for statewide pupil base grants.
14Additional concerns include, but are not limited to, proposed
15concentration grants, incomplete accountability provisions,
16inadequate data collection, lack of structure for high school grade
17span funding, perpetuation of historically inequitable funding
18allocations, and the timing for implementation of a new formula.

19(c) The local control funding formula proposal encompasses
20scores of repeals of sections, articles, and chapters of the Education
21Code, many of which could have unintended consequences. Such
22repeals require more careful consideration than the compressed
23annual Budget Act implementation timelines allow.

24(d) It is the intent of the Legislature to consider a new funding
25formula through a funding process that affords greater opportunity
26for analysis, amendment, and public input on a far reaching
27proposal that will have lasting impacts on California schools and
28the pupils they serve.

P4    1

SEC. 2.  

Section 1622 of the Education Code is amended to
2read:

3

1622.  

(a) On or before July 1 of each fiscal year, the county
4board of education shall adopt an annual budget for the budget
5year and shall file that budget with the Superintendent of Public
6Instruction, the county board of supervisors, and the county auditor.
7The budget, and supporting data, shall be maintained and made
8available for public review. The budget shall indicate the date,
9time, and location at which the county board of education held the
10public hearing required under Section 1620.

11(b) The Superintendent of Public Instruction shall examine the
12budget to determine whether it (1) complies with the standards
13and criteria adopted by the State Board of Education pursuant to
14Section 33127 for application to final local educational agency
15budgets, (2) allows the county office of education to meet its
16financial obligations during the fiscal year, and (3) is consistent
17with a financial plan that will enable the county office of education
18to satisfy its multiyear financial commitments. In addition, the
19Superintendent shall identify any technical corrections to the budget
20that must be made. On or before August 15, the Superintendent of
21Public Instruction shall approve or disapprove the budget and, in
22the event of a disapproval, transmit to the county office of
23education in writing his or her recommendations regarding revision
24of the budget and the reasons for those recommendations. For the
252011-12 fiscal year, notwithstanding any of the standards and
26criteria adopted by the state board pursuant to Section 33127, the
27Superintendent, as a condition on approval of a county office of
28education budget, shall not require a county office of education to
29project a lower level of revenue per unit of average daily attendance
30than it received in the 2010-11 fiscal year nor require the county
31superintendent to certify in writing whether or not the county office
32of education is able to meet its financial obligations for the two
33subsequent fiscal years.

34(c) On or before September 8, the county board of education
35shall revise the county office of education budget to reflect changes
36in projected income or expenditures subsequent to July 1, and to
37include any response to the recommendations of the Superintendent
38of Public Instruction, shall adopt the revised budget, and shall file
39the revised budget with the Superintendent of Public Instruction,
40the county board of supervisors, and the county auditor. Prior to
P5    1revising the budget, the county board of education shall hold a
2public hearing regarding the proposed revisions, which shall be
3made available for public inspection not less than three working
4days prior to the hearing. The agenda for that hearing shall be
5posted at least 72 hours prior to the public hearing and shall include
6the location where the budget will be available for public
7inspection. The revised budget, and supporting data, shall be
8maintained and made available for public review.

9(d) The Superintendent of Public Instruction shall examine the
10revised budget to determine whether it complies with the standards
11and criteria adopted by the State Board of Education pursuant to
12Section 33127 for application to final local educational agency
13budgets and, no later than October 8, shall approve or disapprove
14the revised budget. If the Superintendent of Public Instruction
15disapproves the budget, he or she shall call for the formation of a
16budget review committee pursuant to Section 1623. For the
172011-12 fiscal year, notwithstanding any of the standards and
18criteria adopted by the state board pursuant to Section 33127, the
19Superintendent, as a condition on approval of a county office of
20education budget, shall not require a county office of education to
21 project a lower level of revenue per unit of average daily attendance
22than it received in the 2010-11 fiscal year nor require the county
23superintendent to certify in writing whether or not the county office
24of education is able to meet its financial obligations for the two
25subsequent fiscal years.

26(e) Notwithstanding any other provision of this section, the
27budget review for a county office of education shall be governed
28by paragraphs (1), (2), and (3) of this subdivision, rather than by
29subdivisions (c) and (d), if the county board of education so elects,
30and notifies the Superintendent of Public Instruction in writing of
31that decision, no later than October 31 of the immediately
32preceding calendar year.

33(1) In the event of the disapproval of the budget of a county
34office of education pursuant to subdivision (b), on or before
35September 8, the county superintendent of schools and the county
36board of education shall review the recommendations of the
37Superintendent of Public Instruction at a regularly scheduled
38meeting of the county board of education and respond to those
39recommendations. That response shall include the proposed actions
40to be taken, if any, as a result of those recommendations.

P6    1(2) No later than October 8, after receiving the response required
2under paragraph (1), the Superintendent of Public Instruction shall
3review that response and either approve or disapprove the budget
4of the county office of education. If the Superintendent of Public
5Instruction disapproves the budget, he or she shall call for the
6formation of a budget review committee pursuant to Section 1623.

7(3) Not later than 45 days after the Governor signs the annual
8Budget Act, the county office of education shall make available
9for public review any revisions in revenues and expenditures that
10it has made to its budget to reflect the funding made available by
11that Budget Act.

12(f) This section shall become inoperative on July 1, 2014, and,
13as of January 1, 2015, is repealed, unless a later enacted statute,
14that becomes operative on or before January 1, 2015, deletes or
15extends the dates on which it becomes inoperative and is repealed.

16

SEC. 3.  

Section 1622 is added to the Education Code, to read:

17

1622.  

(a) On or before July 1 of each fiscal year, the county
18board of education shall adopt an annual budget for the budget
19year and, for the 2015-16 fiscal year and each fiscal year thereafter,
20take action on a local control and accountability plan pursuant to
21Sections 52062 and 52064begin insert,end insert and shall file the budget and local
22control and accountability plan with the Superintendent, the county
23board of supervisors, and the county auditor. The budget, the local
24control and accountability plan, and supporting data, shall be
25maintained and made available for public review. The budget shall
26indicate the date, time, and location at which the county board of
27 education held the public hearing required under Section 1620.
28For the 2015-16 fiscal year and each fiscal year thereafter, the
29county board of education shall not adopt a budget beforebegin delete the
30county board of educationend delete
begin insert itend insert adopts a local control and
31accountability plan or approves an update to an existing local
32control and accountability plan. The county board of education
33shall not adopt a budget that does not align with the local control
34and accountability plan that applies to the subsequent fiscal year.

35(b) (1)  The Superintendent shall examine the budget to
36determine if it (A) complies with the standards and criteria adopted
37by the state board pursuant to Section 33127 for application to
38final local educational agency budgets, (B) allows the county office
39of education to meet its financial obligations during the fiscal year,
40and (C) is consistent with a financial plan that will enable the
P7    1county office of education to satisfy its multiyear financial
2commitments. In addition, the Superintendent shall identify any
3technical corrections to the budget that must be made. On or before
4August 15, the Superintendent shall approve or disapprove the
5budget and, in the event of a disapproval, transmit to the county
6office of education in writing his or her recommendations regarding
7revision of the budget and the reasons for those recommendations.

8(2) For the 2011-12 fiscal year, notwithstanding any of the
9standards and criteria adopted by the state board pursuant to Section
1033127, the Superintendent, as a condition on approval of a county
11office of education budget, shall not require a county office of
12education to project a lower level of revenue per unit of average
13daily attendance than it received in the 2010-11 fiscal year nor
14require the county superintendent to certify in writing whether or
15not the county office of education is able to meet its financial
16obligations for the two subsequent fiscal years.

17(3) For the 2015-16 fiscal year and each fiscal year thereafter,
18the Superintendent shall disapprove a budget if any of the following
19occur:

20(A) The county board of education does not file a local control
21and accountability plan with the Superintendent pursuant to
22Sections 52062 and 52064.

23(B) If the Superintendent determines that a local control and
24accountability plan filed does not adhere to the template adopted
25by the state board pursuant to Section 52066.

26(C) If the Superintendent determines that a local control and
27accountability plan filed does not include all of the components
28identified in subdivision (a) of Section 52064.

29(D) If the Superintendent determines that the expenditures
30included in the budget do not reflect the costs necessary to
31implement the local control and accountability plan.

32(c) On or before September 8 of each fiscal year, the county
33board of education shall revise the county office of education
34budget to reflect changes in projected income or expenditures
35subsequent to July 1, and to include any response to the
36recommendations of the Superintendent, shall adopt the revised
37budget, and shall file the revised budget with the Superintendent,
38the county board of supervisors, and the county auditor. Before
39revising the budget, the county board of education shall hold a
40public hearing regarding the proposed revisions, which shall be
P8    1made available for public inspection not less than three working
2days before the hearing. The agenda for that hearing shall be posted
3at least 72 hours before the public hearing and shall include the
4location where the budget will be available for public inspection.
5The revised budget, and supporting data, shall be maintained and
6made available for public review.

7(d) The Superintendent shall examine the revised budget to
8determine whether it complies with the standards and criteria
9adopted by the state board pursuant to Section 33127 for
10application to final local educational agency budgets and, no later
11than October 8 of each fiscal year, shall approve or disapprove the
12revised budget. For the 2015-16 fiscal year and each fiscal year
13thereafter, the Superintendent shall disapprove a revised budget if
14the Superintendent determines that the expenditures included in
15the budget do not reflect the costs necessary to implement the local
16control and accountability plan adopted by a county board of
17education pursuant to Sections 52062 and 52064. If the
18Superintendent disapproves the budget, he or she shall call for the
19formation of a budget review committee pursuant to Section 1623.
20For the 2011-12 fiscal year, notwithstanding any of the standards
21and criteria adopted by the state board pursuant to Section 33127,
22the Superintendent, as a condition on approval of a county office
23of education budget, shall not require a county office of education
24to project a lower level of revenue per unit of average daily
25attendance than it received in the 2010-11 fiscal year nor require
26the county superintendent to certify in writing whether or not the
27county office of education is able to meet its financial obligations
28for the two subsequent fiscal years.

29(e) Notwithstanding any other provision of this section, the
30budget review for a county office of education shall be governed
31by paragraphs (1), (2), and (3) of this subdivision, rather than by
32subdivisions (c) and (d), if the county board of education so elects,
33and notifies the Superintendent in writing of that decision, no later
34than October 31 of the immediately preceding calendar year.

35(1) In the event of the disapproval of the budget of a county
36 office of education pursuant to subdivision (b), on or before
37September 8, the county superintendent of schools and the county
38board of education shall review the recommendations of the
39Superintendent at a regularly scheduled meeting of the county
40board of education and respond to those recommendations. That
P9    1response shall include the proposed actions to be taken, if any, as
2a result of those recommendations.

3(2) No later than October 8, after receiving the response required
4under paragraph (1), the Superintendent shall review that response
5and either approve or disapprove the budget of the county office
6of education. For the 2015-16 fiscal year and each fiscal year
7thereafter, the Superintendent shall disapprove a budget if a county
8board of education does not file a local control and accountability
9plan with the Superintendent or if the Superintendent determines
10that the expenditures included in the budget adopted by the county
11board of education do not reflect the costs necessary to implement
12the local control and accountability plan. If the Superintendent
13disapproves the budget, he or she shall call for the formation of a
14budget review committee pursuant to Section 1623.

15(3) Not later than 45 days after the Governor signs the annual
16Budget Act, the county office of education shall make available
17for public review any revisions in revenues and expenditures that
18it has made to its budget to reflect the funding made available by
19that Budget Act.

20(f) This section shall become operative on July 1, 2014.

21

SEC. 4.  

Section 2558.7 is added to the Education Code, to
22read:

23

2558.7.  

This article shall become inoperative on July 1, 2014,
24and, as of January 1, 2015, is repealed, unless a later enacted
25statute, that becomes operative on or before January 1, 2015,
26deletes or extends the dates on which it becomes inoperative and
27is repealed.

28

SEC. 5.  

Section 2569 is added to the Education Code, to read:

29

2569.  

This article shall become inoperative on July 1, 2014,
30and, as of January 1, 2015, is repealed, unless a later enacted
31statute, that becomes operative on or before January 1, 2015,
32deletes or extends the dates on which it becomes inoperative and
33is repealed.

34

SEC. 6.  

The heading of Article 4 (commencing with Section
352570) of Chapter 12 of Part 2 of Division 1 of Title 1 of the 36Education Code is amended and renumbered to read:

37 

38Article 2.  Allocation of Property Tax Revenues
39

 

P10   1

SEC. 7.  

Article 3 (commencing with Section 2574) is added
2to Chapter 12 of Part 2 of Division 1 of Title 1 of the Education
3Code
, to read:

4 

5Article 3.  County Local Control Funding Formula
6

 

7

2574.  

For the 2014-15 fiscal year and for each fiscal year
8thereafter, the Superintendent annually shall calculate the County
9Local Control Funding Formula for each county superintendent
10of schools as follows:

11(a) Compute a county office of education operations grant equal
12to the sum of each of the following amounts:

13(1) _____ dollars ($____).

14(2) ____ dollars ($____) multiplied by the number of school
15districts for which the county superintendent of schools has
16jurisdiction pursuant to Section 1253.

17(3) (A) ____ dollars ($____) multiplied by the number of units
18of countywide average daily attendance, up to a maximum of
1930,000 units. For purposes of this section, countywide average
20daily attendance means the aggregate number of annual units of
21average daily attendance within the county attributable to all school
22districts for which the county superintendent of schools has
23jurisdiction pursuant to Section 1253, charter schools within the
24county, and the schools operated by the county superintendent of
25schools.

26(B) ____ dollars ($____) multiplied by the number of units of
27countywide average daily attendance for the portion of countywide
28average daily attendance, if any, above 30,000 units, up to a
29maximum of 60,000 units.

30(C) ____ dollars ($____) multiplied by the number of units of
31countywide average daily attendance for the portion of countywide
32average daily attendance, if any, above 60,000, up to a maximum
33of 140,000 units.

34(D) ____ dollars ($____) multiplied by the number of units of
35countywide average daily attendance for the portion of countywide
36average daily attendance, if any, above 140,000 units.

37(4) For the 2015-16 fiscal year and each fiscal year thereafter,
38adjust each of the amounts provided in the prior year pursuant to
39paragraphs (1), (2), and (3) by the percentage change in the annual
40average value of the Implicit Price Deflator for State and Local
P11   1Government Purchases of Goods and Services for the United States,
2as published by the United States Department of Commerce for
3the 12-month period ending in the third quarter of the prior fiscal
4year. This percentage change shall be determined using the latest
5data available as of May 10 of the preceding fiscal year compared
6with the annual average value of the same deflator for the 12-month
7period ending in the third quarter of the second preceding fiscal
8year, using the latest data available as of May 10 of the preceding
9fiscal year, as reported by the Department of Finance.

10(b) Divide the enrollment of unduplicated pupils in all schools
11operated by a county superintendent of schools by the total
12enrollment in those schools.

13(1) For purposes of this section, an “unduplicated pupil” is a
14pupil who is classified as an English learner pursuant to Section
1552164, as that section read on January 1, 2014; eligible to receive
16a free or reduced-price meal pursuant to Section 49552, as that
17section read on January 1, 2014; or a foster child pursuant to
18Sections 300 and 601 of the Welfare and Institutions Code. A pupil
19shall be counted only once for purposes of this section if any of
20the following apply:

21(A) The pupil is classified as an English learner and is eligible
22for a free or reduced-price meal.

23(B) The pupil is classified as an English learner and is a foster
24child.

25(C) The pupil is classified as a foster child and is eligible for a
26free or reduced-price meal.

27(D) The pupil is classified as an English learner, is eligible for
28a free or reduced-price meal, and is a foster child.

begin delete

29(2) For purposes of this section, a pupil shall not be classified
30as an English learner for a total of more than five school years by
31any school district, charter school, or county office of education.

end delete
begin delete

4 32(3)

end delete

33begin insert(2)end insert For purposes of this subdivision, a pupil enrolled in a
34juvenile court school operated by a county superintendent of
35schools shall not be included in any enrollment counts.

begin delete

7 36(4)

end delete

37begin insert(3)end insert Commencing with the 2014-15 fiscal year, a county
38superintendent of schools annually shall report the enrollment of
39unduplicated pupils, pupils classified as English learners, pupils
40eligible for free and reduced-price meals, and foster children in
P12   1schools operated by the county superintendent of schools to the
2Superintendent using the California Longitudinal Pupil
3Achievement Data System. The Superintendent shall make the
4calculations pursuant to this section using the California
5Longitudinal Pupil Achievement Data System.

6(c) Compute an alternative education grant equal to the sum of
7the following:

8(1) For the 2014-15 fiscal year, a base grant of ____ dollars
9($____). For the 2015-16 fiscal year and each fiscal year thereafter,
10adjust the base grant provided in the prior year by the percentage
11change in the annual average value of the Implicit Price Deflator
12for State and Local Government Purchases of Goods and Services
13for the United States, as published by the United States Department
14of Commerce for the 12-month period ending in the third quarter
15of the prior fiscal year. This percentage change shall be determined
16using the latest data available as of May 10 of the preceding fiscal
17year compared with the annual average value of the same deflator
18for the 12-month period ending in the third quarter of the second
19preceding fiscal year, using the latest data available as of May 10
20of the preceding fiscal year, as reported by the Department of
21Finance.

22(2) A supplemental grant equal to 35 percent of the base grant
23defined in paragraph (1) multiplied by the percentage calculated
24in subdivision (b).

25(3) (A) Multiply the sum of paragraphs (1) and (2) by the total
26number of units of average daily attendance for pupils attending
27schools operated by a county office of education, excluding units
28of average daily attendance for pupils attending a juvenile court
29school, who are any of the following:

30(i) Probation-referred pursuant to Sections 300, 601, 602, and
31654 of the Welfare and Institutions Code.

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

33(iii) Expelled for any of the reasons specified in subdivision (a)
34or (c) of Section 48915.

35(B) Multiply the number of units of average daily attendance
36for pupils attending a juvenile court school by the sum of the base
37grant calculated in paragraph (1) and a supplemental grant equal
38to 35 percent of the base grant pursuant to paragraph (1).

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

P13   1(d) Add the amount calculated in subdivision (a) to the amount
2calculated in subparagraph (C) of paragraph (3) of subdivision (c).

3(e) Add all of the following to the amount calculated in
4subdivision (d):

5(1) The amount of funding a county superintendent of schools
6received for the 2013-14 fiscal year from funds allocated pursuant
7to the Targeted Instructional Improvement Block Grant program,
8as set forth in Article 6 (commencing with Section 41540) of
9Chapter 3.2 of Part 24 of Division 3 of Title 2, as that article read
10on January 1, 2014.

11(2) The amount of funding a county superintendent of schools
12received for the 2013-14 fiscal year from funds allocated pursuant
13to the Home to School Transportation program, as set forth in
14Article 2 (commencing with Section 39820) of Chapter 1 of Part
1523.5 of Division 3 of Title 2, and Article 10 (commencing with
16Section 41850) of Chapter 5 of Part 24 of Division 3 of Title 2, as
17those articles read on January 1, 2014.

18

2575.  

Commencing with the 2014-15 budget year and for each
19fiscal year thereafter, the Superintendent shall distribute the
20appropriations in Section 14002 to each county superintendent of
21schools according to the following formula:

22(a) Calculate a prior year amount of funding for each county
23superintendent of schools equal to the sum of all of the following:

24(1) Entitlements for revenue limits in the 2013-14 fiscal year
25pursuant to Article 3 (commencing with Section 2550) of Chapter
2612, as that article read on January 1, 2014, adjusted only for
27changes in average daily attendance claimed by the county
28superintendent of schools for pupils identified in clauses (i), (ii)
29and (iii) of subparagraph (A) of paragraph (3) of subdivision (c)
30of Section 2574 and of pupils attending juvenile court schools. All
31other average daily attendance claimed by the county
32superintendent of schools and any other average daily attendance
33used for purposes of calculating revenue limits pursuant to Article
343 (commencing with Section 2550) of Chapter 12, as that article
35read on January 1, 2014, shall be considered final for purposes of
36this section as of the annual apportionment for the 2013-14 fiscal
37year, as calculated for purposes of the certification required on or
38before February 20, 2015, pursuant to Section 41332.

39(2) The amount of funding received from appropriations
40contained in Section 2.00 of the Budget Act of 2013, as adjusted
P14   1by Section 12.42, in the following items: 6110-104-0001,
2begin delete 6110-105-0001,end delete 6110-107-0001, 6110-108-0001, 6110-111-0001,
3begin delete 6110-119-0001, 6110-122-0001,end delete 6110-124-0001, 6110-128-0001,
46110-137-0001, 6110-144-0001,begin delete 6110-156-0001,end delete 6110-158-0001,
5begin delete 6110-166-0001, 6110-167-0001,end delete 6110-181-0001, 6110-188-0001,
66110-189-0001, 6110-190-0001, 6110-193-0001, 6110-195-0001,
76110-198-0001, 6110-204-0001, 6110-208-0001, 6110-209-0001,
86110-211-0001, 6110-212-0001, 6110-227-0001, 6110-228-0001,
96110-232-0001, 6110-234-0001, 6110-240-0001, 6110-242-0001,
106110-243-0001, 6110-244-0001, 6110-245-0001, 6110-246-0001,
116110-247-0001, 6110-248-0001, 6110-260-0001, 6110-265-0001,
126110-266-0001, 6110-267-0001, 6110-268-0001, and
136360-101-0001, and 2013-14 fiscal year funding for the Class
14Size Reduction Program pursuant to Chapter 6.10 (commencing
15with Section 52120) of Part 28 of Division 4 of Title 2, as it read
16on January 1, 2014.

17(3) For the 2015-16 fiscal year and for each fiscal year
18thereafter, the amounts calculated pursuant to paragraph (3) of
19subdivision (b) in all prior years.

20(b) Calculate an adjustment to the amount in subdivision (a) as
21follows:

22(1) Subtract the amount in subdivision (a) from the amount
23computed in subdivision (e) of Section 2574. A difference of less
24than zero shall be deemed to be zero.

25(2) Divide the difference for the county superintendent of
26schools calculated in paragraph (1) by the total of the differences
27for all county superintendents of schools calculated pursuant to
28paragraph (1).

29(3) (A) Multiply the proportion calculated in paragraph (2) by
30the amount of funding appropriated for purposes of this section.
31The amount calculated shall not exceed the difference for the
32county superintendent of schools calculated in paragraph (1).

33(B) Add the amount calculated in subparagraph (A) to the
34allocation to the county superintendent of schools as calculated
35pursuant to subdivision (a).

36(c) Subtract from the amount calculated in subparagraph (B) of
37paragraph (3) of subdivision (b) the sum of each of the following:

38(1) Local property tax revenues received pursuant to Section
392573 in the then current fiscal year.

P15   1(2) Any amounts that the county superintendent of schools was
2required to maintain as restricted and not available for expenditure
3in the 1978-79 fiscal year as specified in the second paragraph of
4subdivision (c) of Section 6 of Chapter 292 of the Statutes of 1978,
5as amended by Chapter 51 of the Statutes of 1979.

6(3) The amount received pursuant to subparagraph (C) of
7paragraph (3) of subdivision (a) of Section 33607.5 of the Health
8and Safety Code that is considered property taxes pursuant to that
9section.

10(4) The amount, if any, received pursuant to Sections 34177,
1134179.5, 34179.6, and 34188 of the Health and Safety Code.

12(5) (A) The amount, if any, received pursuant to subparagraph
13(B) of paragraph (3) of subdivision (e) of Section 36 of Article
14XIII of the California Constitution.

15(B) The amount in subparagraph (A) shall only offset the amount
16included in paragraph (1) of subdivision (a).

17(d) (1) The Superintendent shall apportion to the county
18superintendent of schools either of the following:

19(A) If the calculation in paragraph (1) of subdivision (b) is
20positive, the amount calculated in subdivision (c).

21(B) (i) If the calculation in paragraph (1) of subdivision (b) is
22equal to zero or is negative, the sum of the amounts in paragraphs
23(1) and (2) of subdivision (a), less the sum of the amounts included
24in paragraphs (1) to (5), inclusive, of subdivision (c).

25(ii) For the first fiscal year in which the amount calculated in
26subdivision (e) of Section 2574 is greater than the sum of the
27amounts in paragraphs (1) and (2) of subdivision (a) and for each
28fiscal year thereafter, the Superintendent shall apportion to the
29county superintendent of schools the amount calculated in
30subdivision (e) of Section 2574, less the sum of the amounts
31included in paragraphs (1) to (5), inclusive, of subdivision (c).

begin insert

32(iii) In any fiscal year before clause (ii) is operative, the county
33superintendent of schools shall develop, and present at least twice
34per fiscal year to the parents of pupils and the county board of
35education, information that enhances their understanding of and
36familiarity with the local control funding formula and the local
37control and accountability plan. When presenting this information,
38the county superintendent of schools shall explain, at a minimum
39and consistent with Section 48985, how parents can meaningfully
40participate and how the county office of education will provide
P16   1meaningful opportunities for parental involvement, including, but
2not limited to, effective schoolsite councils and English learner
3advisory committees.

end insert

4(2) If the amount determined pursuant to paragraph (1) is
5negative, state aid shall not be apportioned to the county
6superintendent of schools pursuant to paragraph (1). An amount
7of funds of that county superintendent of schools equal to that
8negative amount shall be deemed restricted and not available for
9expenditure during the fiscal year in which subdivision (d) applies.
10In the following fiscal year, that amount shall be considered local
11property tax revenue for purposes of paragraph (1) of subdivision
12(c).

13(3) Commencing with the 2014-15 fiscal year, the
14Superintendent shall apportion to the county superintendent of
15schools an amount of state aid of no less than the amount calculated
16in paragraph (2) of subdivision (a), including any amount
17apportioned pursuant to paragraph (1).

18(e) (1) Funds apportioned pursuant to this section shall be
19available for any locally determined educational purpose.

20(2) Funds apportioned for purposes of a supplemental grant
21pursuant to paragraph (2) and subparagraph (B) of paragraph (3)
22of subdivision (c) of Section 2754, shallbegin delete be available for any locally
23determined educational purpose that benefitsend delete
begin insert only be used to serve
24and assistend insert
the pupilsbegin delete thatend deletebegin insert whose circumstancesend insert generated those
25fundsbegin insert and shall supplement, not supplant, existing state and federal
26funds expended on unduplicated pupilsend insert
pursuant to a local control
27and accountability plan adopted by the county board of education.

28(3) Commencing with the 2014-15 fiscal year, unless otherwise
29required by federal law, any requirements associated with the items
30listed in paragraph (2) of subdivision (a) shall not apply.

31

2576.  

(a) If a county superintendent of schools enrolls in a
32school operated by the county superintendent of schools a pupil
33not funded pursuant to clause (i), (ii), or (iii) of subparagraph (A)
34of paragraph (3) of subdivision (c) of Section 2574, any attendance
35generated by that pupil shall be credited to the school district of
36residence. That school district shall pay to the county
37superintendent of schools the entire entitlement generated for each
38unit of average daily attendance by that pupil.

39(b) For purposes of this section, the school district of residence
40for a homeless child, as defined in Section 1981.2, shall be deemed
P17   1to be the school district that last provided educational services to
2that child or, if it is not possible to determine that school district,
3the largest school district in the county.

4

2577.  

Notwithstanding any other law, revenue limit funding
5for county superintendents of schools for the 2013-14 fiscal year
6and prior fiscal years shall continue to be adjusted pursuant to
7Article 3 (commencing with Section 2550), as that section read
8on January 1, 2014.

9

2578.  

Commencing on July 1, 2014, all of the following shall
10apply:

11(a) All references to Section 2558 shall instead refer to Section
122575.

13(b) Unless context requires otherwise, all references to the
14revenue limit of a county office of education or county
15superintendent of schools shall instead refer to the county local
16control funding formula.

17

2579.  

This article shall become operative on July 1, 2014.

18

SEC. 8.  

Section 14002 of the Education Code is amended to
19read:

20

14002.  

(a) The Controller shall during each fiscal year
21commencing with the 1980-81 fiscal year, transfer from the
22General Fund of the state to that portion of the State School Fund
23restricted for elementary and high school purposes, hereinafter
24called Section A of the State School Fund such sums, in addition
25to the sums accruing from other sources, as shall provide in Section
26A of the State School Fund for apportionment during the fiscal
27year a total amount per pupil in average daily attendance during
28the preceding fiscal year credited to all elementary, high, and
29unified school districts and to all county superintendents of schools
30in the state, as certified by the Superintendent of Public Instruction,
31of one hundred eighty dollars ($180).

32(b) The Controller shall also transfer, as needed during each
33fiscal year commencing with the 1980-81 fiscal year, such
34additional amounts from the General Fund to Section A of the
35State School Fund as are certified from time to time by the
36Superintendent of Public Instruction to be necessary to meet actual
37computed apportionments from Section A of the State School Fund
38for the purposes set forth in Section 41301; provided that the total
39of such additional amounts transferred in a fiscal year shall not
40exceed, except pursuant to subdivision (c) of this section, one
P18   1thousand two hundred sixty-eight dollars ($1,268) for the 1980-81
2fiscal year and fiscal years thereafter, per pupil in average daily
3attendance during the preceding fiscal year credited to all
4elementary, high, and unified school districts and to all county
5superintendents of schools in the state, as certified by the
6Superintendent of Public Instruction.

7(c) In addition to the amounts authorized to be transferred to
8Section A of the State School Fund under subdivisions (a) and (b),
9the Controller shall transfer from the General Fund to Section A
10of the State School Fund during the fiscal year, upon certification
11of the Superintendent of Public Instruction, if necessary to meet
12actual computed apportionments for the fiscal year for the purposes
13set forth in Sections 41300 and 41301, an amount not to exceed
14the lesser of: (1) 1 percent of the total apportionment from Section
15A of the State School Fund in the preceding fiscal year for the
16purposes set forth in Sections 41300 and 41301, or (2) the net
17amount, if any, by which the total amounts authorized to be
18transferred from the General Fund to Section A of the State School
19Fund under subdivisions (a) and (b) in prior fiscal years have
20exceeded the total amounts actually apportioned in prior fiscal
21years for the purposes set forth in Sections 41300 and 41301.

22(d) The Controller shall also transfer to Section A of the State
23School Fund any additional amounts appropriated thereto by the
24Legislature in augmentation of any of the amounts for any of the
25purposes set forth in Sections 41300 and 41301 and such additional
26amounts shall be allowed and apportioned by the Superintendent
27of Public Instruction and warrants therefor drawn by the Controller
28in the manner provided in Sections 41050, 46304, and 84503 and
29in this article, Article 2 (commencing with Section 14040), Article
303 (commencing with Section 41330) of Chapter 3, and Article 1
31(commencing with Section 41600) of Chapter 4 of Part 24.

32(e) The amounts transferred under subdivisions (a) and (b) of
33this section shall be cumulatively increased by the following
34amounts:

35(1) In the 1981-82 fiscal year, by 7 percent.

36(2) In the 1982-83 fiscal year and each fiscal year thereafter,
37by 6 percent.

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

39(g) This section shall become inoperative on July 1, 2014, and,
40as of January 1, 2015, is repealed, unless a later enacted statute,
P19   1that becomes operative on or before January 1, 2015, deletes or
2extends the dates on which it becomes inoperative and is repealed.

3

SEC. 9.  

Section 14002 is added to the Education Code, to read:

4

14002.  

(a) Notwithstanding any other law, upon certification
5of the Superintendent, the Controller shall transfer from the General
6Fund to Section A of the State School Fund during each fiscal year
7the amount of moneys required to meet the actual computed
8apportionments for the fiscal year for the purposes set forth in
9Sections 2575, 42238.02, and 42238.03.

10(b) The Controller shall also transfer to Section A of the State
11School Fund any additional amounts appropriated thereto by the
12Legislature in augmentation of any of the amounts for any of the
13purposes set forth in Sections 2575, 42238.02, and 42238.03 and
14such additional amounts shall be allowed and apportioned by the
15Superintendent and warrants therefor drawn by the Controller in
16the manner provided in Sections 41050 and 46304, and in this
17 article, Article 2 (commencing with Section 14040), Article 3
18(commencing with Section 41330) of Chapter 3 of Part 24 of
19Division 3 of Title 2, and Article 1 (commencing with Section
2041600) of Chapter 4 of Part 24 of Division 3 of Title 2.

21(c) This section shall become operative on July 1, 2014.

22

SEC. 10.  

Section 14002.1 of the Education Code is amended
23to read:

24

14002.1.  

(a) Notwithstanding any other law, for purposes of
25determining (a) the amounts to be certified pursuant to Sections
2614002 and 14004, (b) allocations made pursuant to Section 41301,
27(c) the apportionments required to be made pursuant to Sections
2841330, 41332, and 41335, (d) revenue limits for school districts
29pursuant to Section 42238, as adjusted pursuant to Sections
3042238.14, 42238.145, and 42238.146, and (e) revenue limits for
31county offices of education pursuant to Section 2558, as adjusted
32pursuant to Sections 2558.4, 2558.45, and 2558.46, the
33Superintendent of Public Instruction shall use the property tax
34estimates received from county auditors pursuant to Section 75.70
35of the Revenue and Taxation Code.

36(b) This section shall become inoperative on July 1, 2014, and,
37as of January 1, 2015, is repealed, unless a later enacted statute,
38that becomes operative on or before January 1, 2015, deletes or
39extends the dates on which it becomes inoperative and is repealed.

P20   1

SEC. 11.  

Section 14002.1 is added to the Education Code, to
2read:

3

14002.1.  

(a) Notwithstanding any other law, for purposes of
4determining the amounts to be certified pursuant to subdivision
5(a) of Section 14002, the Superintendent shall use the property tax
6estimates received from county auditors pursuant to Section 75.70
7of the Revenue and Taxation Code.

8(b) This section shall become operative on July 1, 2014.

9

SEC. 12.  

Section 14002.5 of the Education Code is amended
10to read:

11

14002.5.  

(a) In making the computation prescribed by
12subdivision (b) of Section 14002, the Controller shall cumulatively
13increase the seventy-nine cents ($0.79) amount prescribed by that
14subdivision by 6 percent annually, and shall cumulatively increase
15the twenty-one dollar and fifty cents ($21.50) amount prescribed
16by that subdivision by 6 percent annually.

17(b) This section shall become inoperative on July 1, 2014, and,
18as of January 1, 2015, is repealed, unless a later enacted statute,
19that becomes operative on or before January 1, 2015, deletes or
20extends the dates on which it becomes inoperative and is repealed.

21

SEC. 13.  

Section 14003 of the Education Code is amended to
22read:

23

14003.  

(a) Commencing with the 2010-11 fiscal year, on
24March 28 of each fiscal year in which the percentage growth in
25per capita General Fund revenues exceeds the percentage growth
26in California per capita personal income, the Controller shall
27transfer from the General Fund to Sections A and B of the State
28School Fund, as set forth in subdivision (c), the amount determined
29pursuant to paragraph (1) minus the amount determined pursuant
30to paragraph (2).

31(1) The product of General Fund revenues from proceeds of
32taxes and one-half of the difference between the percentage growth
33in per capita General Fund revenues from proceeds of taxes and
34in California per capita personal income.

35(2) The amount of the maintenance factor certified pursuant to
36Section 41207.2 that is allocated in the current year pursuant to
37subdivision (e) of Section 8 of Article XVI of the California
38Constitution.

39(b) The amount transferred pursuant to subdivision (a) shall be
40in addition to amounts required to be allocated pursuant to
P21   1subdivision (b) of Section 8 of Article XVI of the California
2Constitution.

3(c) (1) Of the amount determined pursuant to subdivision (a),
4the Controller shall transfer 92 percent to Section A of the State
5School Fund. The Superintendent shall allocate the funds
6transferred pursuant to this paragraph in the following priority
7order:

8(A) An amount not to exceed two hundred million dollars
9($200,000,000) for the purposes of revenue limit equalization in
10a manner consistent with Section 42238.49 for the first fiscal year
11in which funds are transferred pursuant to this paragraph.

12(B) Such amounts as necessary to reduce the revenue limit
13deficit factors set forth in Sections 2558.46 and 42238.146 until
14the deficit factors are reduced to zero.

15(C) Any remaining amounts transferred pursuant to this
16paragraph shall be allocated as an equal increase per unit of average
17daily attendance in general purpose apportionments for purposes
18of Sections 2558, 42238, and 47633.

19(2) Of the amount determined pursuant to subdivision (a), the
20Controller shall transfer 8 percent to Section B of the State School
21Fund. The Chancellor of the Community Colleges shall allocate
22the funds transferred pursuant to this paragraph in equal amounts
23for the following purposes:

24(A) For purposes of career and technical education pursuant to
25Chapter 352 of the Statutes of 2005.

26(B) As a proportionate increase in general purpose
27apportionments for community college districts.

28(d) For purposes of determining the amount required pursuant
29to paragraph (2) or (3), as applicable, of subdivision (b) of Section
308 of Article XVI of the California Constitution for the following
31fiscal year, all amounts transferred in the prior fiscal year pursuant
32to this section shall be deemed allocations to school districts and
33community college districts from General Fund proceeds of taxes
34appropriated pursuant to Article XIII B for that prior fiscal year.

35(e) The sum of the amounts transferred pursuant to this section
36plus the sum of the amounts of the maintenance factor certified
37pursuant to Section 41207.2 that is allocated pursuant to
38subdivision (e) of Section 8 of Article XVI of the California
39Constitution shall not exceed the total amount of eleven billion
40two hundred twelve million nine hundred nine thousand dollars
P22   1($11,212,909,000) less any maintenance factor amount that is
2allocated for the 2009-10 fiscal year.

3(f) This section shall become inoperative on July 1, 2014, and,
4as of January 1, 2015, is repealed, unless a later enacted statute,
5that becomes operative on or before January 1, 2015, deletes or
6extends the dates on which it becomes inoperative and is repealed.

7

SEC. 14.  

Section 14003 is added to the Education Code, to
8read:

9

14003.  

(a) Commencing with the 2010-11 fiscal year, on
10March 28 of each fiscal year in which the percentage growth in
11per capita General Fund revenues exceeds the percentage growth
12in California per capita personal income, the Controller shall
13transfer from the General Fund to Sections A and B of the State
14School Fund, as set forth in subdivision (c), the amount determined
15pursuant to paragraph (1) minus the amount determined pursuant
16to paragraph (2).

17(1) The product of General Fund revenues from proceeds of
18taxes and one-half of the difference between the percentage growth
19in per capita General Fund revenues from proceeds of taxes and
20in California per capita personal income.

21(2) The amount of the maintenance factor certified pursuant to
22Section 41207.2 that is allocated in the current year pursuant to
23subdivision (e) of Section 8 of Article XVI of the California
24Constitution.

25(b) The amount transferred pursuant to subdivision (a) shall be
26in addition to amounts required to be allocated pursuant to
27subdivision (b) of Section 8 of Article XVI of the California
28Constitution.

29(c) (1) Of the amount determined pursuant to subdivision (a),
30the Controller shall transfer 92 percent to Section A of the State
31School Fund. The Superintendent shall allocate the funds
32transferred pursuant to this paragraph in the following priority
33order:

34(A) Such amounts as necessary to implement the local control
35funding formula pursuant to Section 42238.02, as implemented
36by Section 42238.03, and the county local control funding formula,
37pursuant to Section 2575.

38(B) Any remaining amounts transferred pursuant to this
39paragraph shall be allocated pursuant to Sections 2575 and
4042238.02, as implemented by Section 42238.03.

P23   1(2) Of the amount determined pursuant to subdivision (a), the
2Controller shall transfer 8 percent to Section B of the State School
3Fund. The Chancellor of the Community Colleges shall allocate
4the funds transferred pursuant to this paragraph in equal amounts
5for the following purposes:

6(A) For purposes of career and technical education pursuant to
7Chapter 352 of the Statutes of 2005.

8(B) As a proportionate increase in general purpose
9apportionments for community college districts.

10(d) For purposes of determining the amount required pursuant
11to paragraph (2) or (3), as applicable, of subdivision (b) of Section
128 of Article XVI of the California Constitution for the following
13fiscal year, all amounts transferred in the prior fiscal year pursuant
14to this section shall be deemed allocations to school districts and
15community college districts from General Fund proceeds of taxes
16appropriated pursuant to Article XIII B for that prior fiscal year.

17(e) The sum of the amounts transferred pursuant to this section
18plus the sum of the amounts of the maintenance factor certified
19pursuant to Section 41207.2 that is allocated pursuant to
20subdivision (e) of Section 8 of Article XVI of the California
21Constitution shall not exceed the total amount of eleven billion
22two hundred twelve million nine hundred nine thousand dollars
23($11,212,909,000) less any maintenance factor amount that is
24allocated for the 2009-10 fiscal year.

25(f) This section shall become operative on July 1, 2014.

26

SEC. 15.  

Section 14501 of the Education Code is amended to
27read:

28

14501.  

(a) As used in this chapter, “financial and compliance
29audit” shall be consistent with the definition provided in the
30“Standards for Audits of Governmental Organizations, Programs,
31Activities, and Functions” promulgated by the Comptroller General
32of the United States. Financial and compliance audits conducted
33under this chapter shall fulfill federal single audit requirements.

34(b) As used in this chapter, “compliance audit” means an audit
35that ascertains and verifies whether or not funds provided through
36apportionment, contract, or grant, either federal or state, have been
37properly disbursed and expended as required by law or regulation
38or both and includes the verification of each of the following:

39(1) The reporting requirements for the sufficiency of textbooks
40or instructional materials, or both, as defined in Section 60119.

P24   1(2) Teacher misassignments pursuant to Section 44258.9.

2(3) The accuracy of information reported on the School
3Accountability Report Card required by Section 33126. The
4requirements set forth in paragraphs (1) and (2) and this paragraph
5shall be added to the audit guide requirements pursuant to
6subdivision (b) of Section 14502.1.

7(c) This section shall become inoperative on July 1, 2014, and,
8as of January 1, 2015, is repealed, unless a later enacted statute,
9that becomes operative on or before January 1, 2015, deletes or
10extends the dates on which it becomes inoperative and is repealed.

11

SEC. 16.  

Section 14501 is added to the Education Code, to
12read:

13

14501.  

(a) As used in this chapter, “financial and compliance
14audit” shall be consistent with the definition provided in the
15“Standards for Audits of Governmental Organizations, Programs,
16Activities, and Functions” promulgated by the Comptroller General
17of the United States. Financial and compliance audits conducted
18under this chapter shall fulfill federal single audit requirements.

19(b) As used in this chapter, “compliance audit” means an audit
20that ascertains and verifies whether or not funds provided through
21apportionment, contract, or grant, either federal or state, have been
22properly disbursed and expended as required by law or regulation
23or both and includes the verification of each of the following:

24(1) Expenditure of these funds in accordance with the local
25control and accountability plan adopted by the governing board
26of the school district pursuant to Sections 52060 and 52064 or the
27county board of education pursuant to Sections 52062 and 52064.

28(2) The reporting requirements for the sufficiency of textbooks
29or instructional materials, or both, as defined in Section 60119.

30(3) Teacher misassignments pursuant to Section 44258.9.

31(4) The accuracy of information reported on the School
32Accountability Report Card required by Section 33126. The
33requirements set forth in paragraphs (1) and (2) and this paragraph
34shall be added to the audit guide requirements pursuant to
35subdivision (b) of Section 14502.1.

36(c) This section shall become operative on July 1, 2014.

37

SEC. 17.  

Section 33127 of the Education Code is amended to
38read:

39

33127.  

(a) The Superintendent of Public Instruction, the
40Controller, and the Director of the Department of Finance shall
P25   1develop, on or before March 1, 1989, standards and criteria to be
2reviewed and adopted by the State Board of Education, and to be
3used by local educational agencies in the development of annual
4budgets and the management of subsequent expenditures from that
5budget. During the development of the standards and criteria, the
6Superintendent of Public Instruction shall convene a committee
7composed of representatives from school districts, county offices
8of education, state agencies, the Legislature, and appropriate labor
9and professional organizations. The committee may review and
10comment on the proposal standards and criteria prior to their
11adoption. In addition, the standards and criteria shall be used to
12monitor the fiscal stability of local educational agencies as provided
13for in Sections 1240.1, 1240.2, 1621, 1623, 33131, 42127, and
1442127.1.

15(b) The Superintendent of Public Instruction, the Controller,
16and the Director of the Department of Finance shall update the
17standards and criteria developed pursuant to subdivision (a) on or
18before September 1, 2005. The updated standards and criteria shall
19be reviewed and adopted pursuant to the procedure established by
20subdivision (a) and are applicable to local educational agency
21budgets commencing with the 2006-07 fiscal year and each fiscal
22year thereafter.

23(c) After September 1, 2005, to the extent necessary, any
24revisions or updates to the standards and criteria shall be developed
25by the Superintendent of Public Instruction, the Controller, and
26the Director of the Department of Finance pursuant the procedures
27established by subdivision (a). The revisions or updates shall
28specify the fiscal year in which the revisions or updates are
29applicable.

30(d) This section shall become inoperative on July 1, 2014, and,
31as of January 1, 2015, is repealed, unless a later enacted statute,
32that becomes operative on or before January 1, 2015, deletes or
33extends the dates on which it becomes inoperative and is repealed.

34

SEC. 18.  

Section 33127 is added to the Education Code, to
35read:

36

33127.  

(a) The Superintendent, the Controller, and the Director
37of the Department of Finance shall develop, on or before March
381, 1989, standards and criteria to be reviewed and adopted by the
39state board, and to be used by local educational agencies in the
40development of annual budgets and the management of subsequent
P26   1expenditures from that budget. During the development of the
2standards and criteria, the Superintendent shall convene a
3committee composed of representatives from school districts,
4county offices of education, state agencies, the Legislature, and
5appropriate labor and professional organizations. The committee
6may review and comment on the proposal standards and criteria
7prior to their adoption. In addition, the standards and criteria shall
8be used to monitor the fiscal stability of local educational agencies
9as provided for in Sections 1240.1, 1240.2, 1621, 1623, 33131,
1042127, and 42127.1.

11(b) The Superintendent, the Controller, and the Director of the
12Department of Finance shall update the standards and criteria
13developed pursuant to subdivision (a) on or before September 1,
142005. The updated standards and criteria shall be reviewed and
15adopted pursuant to the procedure established by subdivision (a)
16and are applicable to local educational agency budgets commencing
17with the 2006-07 fiscal year and each fiscal year thereafter.

18(c) The Superintendent, the Controller, and the Director of the
19Department of Finance shall update the standards and criteria
20developed pursuant to subdivision (a) on or before January 1, 2015.
21Standards and criteria related to the requirements of Articlebegin delete 3.8end deletebegin insert 5end insert
22 (commencing with Section 52060) of Chapter 6.1 of Part 28 of
23Title 2 shall be included. The updated standards and criteria shall
24be reviewed and adopted pursuant to the procedure established by
25subdivision (a) and are applicable to local educational agency
26budgets commencing with the 2015-16 fiscal year and each fiscal
27year thereafter.

28(d) After January 1, 2015, to the extent necessary, any revisions
29or updates to the standards and criteria shall be developed by the
30Superintendent, the Controller, and the Director of the Department
31of Finance pursuant the procedures established by subdivision (a).
32The revisions or updates shall specify the fiscal year in which the
33revisions or updates are applicable.

34(e) This section shall become operative on July 1, 2014.

35

SEC. 19.  

Section 41020 of the Education Code is amended to
36read:

37

41020.  

(a) It is the intent of the Legislature to encourage sound
38fiscal management practices among local educational agencies for
39the most efficient and effective use of public funds for the
P27   1education of children in California by strengthening fiscal
2accountability at the district, county, and state levels.

3(b) (1) Not later than the first day of May of each fiscal year,
4each county superintendent of schools shall provide for an audit
5of all funds under his or her jurisdiction and control and the
6governing board of each local educational agency shall either
7provide for an audit of the books and accounts of the local
8educational agency, including an audit of income and expenditures
9by source of funds, or make arrangements with the county
10superintendent of schools having jurisdiction over the local
11educational agency to provide for that auditing.

12(2) A contract to perform the audit of a local educational agency
13that has a disapproved budget or has received a negative
14certification on any budget or interim financial report during the
15current fiscal year or either of the two preceding fiscal years, or
16for which the county superintendent of schools has otherwise
17determined that a lack of going concern exists, is not valid unless
18approved by the responsible county superintendent of schools and
19the governing board.

20(3) If the governing board of a local educational agency has not
21provided for an audit of the books and accounts of the local
22educational agency by April 1, the county superintendent of schools
23having jurisdiction over the local educational agency shall provide
24for the audit of each local educational agency.

25(4) An audit conducted pursuant to this section shall comply
26fully with the Government Auditing Standards issued by the
27Comptroller General of the United States.

28(5) For purposes of this section, “local educational agency” does
29not include community colleges.

30(c) Each audit conducted in accordance with this section shall
31include all funds of the local educational agency, including the
32student body and cafeteria funds and accounts and any other funds
33under the control or jurisdiction of the local educational agency.
34Each audit shall also include an audit of pupil attendance
35procedures.

36(d) All audit reports for each fiscal year shall be developed and
37reported using a format established by the Controller after
38 consultation with the Superintendent and the Director of Finance.

39(e) (1) The cost of the audits provided for by the county
40superintendent of schools shall be paid from the county school
P28   1service fund and the county superintendent of schools shall transfer
2the pro rata share of the cost chargeable to each district from district
3funds.

4(2) The cost of the audit provided for by a governing board shall
5be paid from local educational agency funds. The audit of the funds
6under the jurisdiction and control of the county superintendent of
7schools shall be paid from the county school service fund.

8(f) (1) The audits shall be made by a certified public accountant
9or a public accountant, licensed by the California Board of
10Accountancy, and selected by the local educational agency, as
11 applicable, from a directory of certified public accountants and
12public accountants deemed by the Controller as qualified to conduct
13audits of local educational agencies, which shall be published by
14the Controller not later than December 31 of each year.

15(2) Commencing with the 2003-04 fiscal year and except as
16provided in subdivision (d) of Section 41320.1, it is unlawful for
17a public accounting firm to provide audit services to a local
18educational agency if the lead audit partner, or coordinating audit
19partner, having primary responsibility for the audit, or the audit
20partner responsible for reviewing the audit, has performed audit
21services for that local educational agency in each of the six previous
22fiscal years. The Education Audits Appeal Panel may waive this
23requirement if the panel finds that no otherwise eligible auditor is
24 available to perform the audit.

25(3) It is the intent of the Legislature that, notwithstanding
26paragraph (2), the rotation within public accounting firms conform
27to provisions of the federal Sarbanes-Oxley Act of 2002 (P.L.
28107-204; 15 U.S.C. Sec. 7201 et seq.), and upon release of the
29report required by the act of the Comptroller General of the United
30States addressing the mandatory rotation of registered public
31accounting firms, the Legislature intends to reconsider the
32provisions of paragraph (2). In determining which certified public
33accountants and public accountants shall be included in the
34directory, the Controller shall use the following criteria:

35(A) The certified public accountants or public accountants shall
36be in good standing as certified by the Board of Accountancy.

37(B) The certified public accountants or public accountants, as
38a result of a quality control review conducted by the Controller
39pursuant to Section 14504.2, shall not have been found to have
P29   1conducted an audit in a manner constituting noncompliance with
2subdivision (a) of Section 14503.

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

4(A) A statement that the audit was conducted pursuant to
5standards and procedures developed in accordance with Chapter
63 (commencing with Section 14500) of Part 9 of Division 1 of
7Title 1.

8(B) A summary of audit exceptions and management
9improvement recommendations.

10(C) Each audit of a local educational agency shall include an
11evaluation by the auditor on whether there is substantial doubt
12about the ability of the local educational agency to continue as a
13going concern for a reasonable period of time. This evaluation
14shall be based on the Statement of Auditing Standards (SAS) No.
1559, as issued by the AICPA regarding disclosure requirements
16relating to the ability of the entity to continue as a going concern.

17(2) To the extent possible, a description of correction or plan
18of correction shall be incorporated in the audit report, describing
19the specific actions that are planned to be taken, or that have been
20taken, to correct the problem identified by the auditor. The
21descriptions of specific actions to be taken or that have been taken
22shall not solely consist of general comments such as “will
23implement,” “accepted the recommendation,” or “will discuss at
24a later date.”

25(h) Not later than December 15, a report of each local
26educational agency audit for the preceding fiscal year shall be filed
27with the county superintendent of schools of the county in which
28the local educational agency is located, the department, and the
29Controller. The Superintendent shall make any adjustments
30necessary in future apportionments of all state funds, to correct
31any audit exceptions revealed by those audit reports.

32(i) (1) Commencing with the 2002-03 audit of local educational
33agencies pursuant to this section and subdivision (d) of Section
3441320.1, each county superintendent of schools shall be responsible
35for reviewing the audit exceptions contained in an audit of a local
36educational agency under his or her jurisdiction related to
37attendance, inventory of equipment, internal control, and any
38miscellaneous items, and determining whether the exceptions have
39been either corrected or an acceptable plan of correction has been
40developed.

P30   1(2) Commencing with the 2004-05 audit of local educational
2agencies pursuant to this section and subdivision (d) of Section
341320.1, each county superintendent of schools shall include in
4the review of audit exceptions performed pursuant to this
5subdivision those audit exceptions related to use of instructional
6materials program funds, teacher misassignments pursuant to
7Section 44258.9, information reported on the school accountability
8report card required pursuant to Section 33126 and shall determine
9whether the exceptions are either corrected or an acceptable plan
10of correction has been developed.

11(j) Upon submission of the final audit report to the governing
12board of each local educational agency and subsequent receipt of
13the audit by the county superintendent of schools having
14jurisdiction over the local educational agency, the county office
15of education shall do all of the following:

16(1) Review audit exceptions related to attendance, inventory of
17equipment, internal control, and other miscellaneous exceptions.
18 Attendance exceptions or issues shall include, but not be limited
19to, those related to revenue limits, adult education, and independent
20study.

21(2) If a description of the correction or plan of correction has
22not been provided as part of the audit required by this section, then
23the county superintendent of schools shall notify the local
24educational agency and request the governing board of the local
25educational agency to provide to the county superintendent of
26schools a description of the corrections or plan of correction by
27March 15.

28(3) Review the description of correction or plan of correction
29and determine its adequacy. If the description of the correction or
30plan of correction is not adequate, the county superintendent of
31schools shall require the local educational agency to resubmit that
32portion of its response that is inadequate.

33(k) Each county superintendent of schools shall certify to the
34Superintendent and the Controller, not later than May 15, that his
35or her staff has reviewed all audits of local educational agencies
36under his or her jurisdiction for the prior fiscal year, that all
37exceptions that the county superintendent was required to review
38were reviewed, and that all of those exceptions, except as otherwise
39noted in the certification, have been corrected by the local
40educational agency or that an acceptable plan of correction has
P31   1been submitted to the county superintendent of schools. In addition,
2the county superintendent shall identify, by local educational
3agency, any attendance-related audit exception or exceptions
4involving state funds, and require the local educational agency to
5which the audit exceptions were directed to submit appropriate
6reporting forms for processing by the Superintendent.

7(l) In the audit of a local educational agency for a subsequent
8year, the auditor shall review the correction or plan or plans of
9correction submitted by the local educational agency to determine
10if the exceptions have been resolved. If not, the auditor shall
11immediately notify the appropriate county office of education and
12the department and restate the exception in the audit report. After
13receiving that notification, the department shall either consult with
14the local educational agency to resolve the exception or require
15the county superintendent of schools to follow up with the local
16educational agency.

17(m) (1) The Superintendent shall be responsible for ensuring
18that local educational agencies have either corrected or developed
19plans of correction for any one or more of the following:

20(A) All federal and state compliance audit exceptions identified
21in the audit.

22(B) Any exceptions that the county superintendent certifies as
23of May 15 have not been corrected.

24(C) Any repeat audit exceptions that are not assigned to a county
25superintendent to correct.

26(2) In addition, the Superintendent shall be responsible for
27ensuring that county superintendents of schools and each county
28board of education that serves as the governing board of a local
29educational agency either correct all audit exceptions identified in
30the audits of county superintendents of schools and of the local
31educational agencies for which the county boards of education
32serve as the governing boards or develop acceptable plans of
33correction for those exceptions.

34(3) The Superintendent shall report annually to the Controller
35on his or her actions to ensure that school districts, county
36superintendents of schools, and each county board of education
37that serves as the governing board of a school district have either
38corrected or developed plans of correction for any of the exceptions
39noted pursuant to paragraph (1).

P32   1(n) To facilitate correction of the exceptions identified by the
2audits issued pursuant to this section, commencing with 2002-03
3audits pursuant to this section, the Controller shall require auditors
4to categorize audit exceptions in each audit report in a manner that
5will make it clear to both the county superintendent of schools and
6the Superintendent which exceptions they are responsible for
7ensuring the correction of by a local educational agency. In
8addition, the Controller annually shall select a sampling of county
9superintendents of schools and perform a followup of the audit
10resolution process of those county superintendents of schools and
11report the results of that followup to the Superintendent and the
12county superintendents of schools that were reviewed.

13(o) County superintendents of schools shall adjust subsequent
14local property tax requirements to correct audit exceptions relating
15to local educational agency tax rates and tax revenues.

16(p) If a governing board or county superintendent of schools
17fails or is unable to make satisfactory arrangements for the audit
18pursuant to this section, the Controller shall make arrangements
19for the audit and the cost of the audit shall be paid from local
20educational agency funds or the county school service fund, as the
21case may be.

22(q) Audits of regional occupational centers and programs are
23subject to the provisions of this section.

24(r) This section does not authorize examination of, or reports
25on, the curriculum used or provided for in any local educational
26agency.

27(s) Notwithstanding any other provision of law, a nonauditing,
28management, or other consulting service to be provided to a local
29educational agency by a certified public accounting firm while the
30certified public accounting firm is performing an audit of the
31agency pursuant to this section must be in accord with Government
32Accounting Standards, Amendment No. 3, as published by the
33United States General Accounting Office.

34(t) This section shall become inoperative on July 1, 2014, and,
35as of January 1, 2015, is repealed, unless a later enacted statute,
36that becomes operative on or before January 1, 2015, deletes or
37extends the dates on which it becomes inoperative and is repealed.

38

SEC. 20.  

Section 41020 is added to the Education Code, to
39read:

P33   1

41020.  

(a) It is the intent of the Legislature to encourage sound
2fiscal management practices among local educational agencies for
3the most efficient and effective use of public funds for the
4education of children in California by strengthening fiscal
5accountability at the school district, county, and state levels.

6(b) (1) Not later than the first day of May of each fiscal year,
7each county superintendent of schools shall provide for an audit
8of all funds under his or her jurisdiction and control and the
9governing board of each local educational agency shall either
10provide for an audit of the books and accounts of the local
11educational agency, including an audit of income and expenditures
12by source of funds, or make arrangements with the county
13superintendent of schools having jurisdiction over the local
14educational agency to provide for that auditing.

15(2) A contract to perform the audit of a local educational agency
16that has a disapproved budget or has received a negative
17certification on any budget or interim financial report during the
18current fiscal year or either of the two preceding fiscal years, or
19for which the county superintendent of schools has otherwise
20determined that a lack of going concern exists, is not valid unless
21approved by the responsible county superintendent of schools and
22the governing boardbegin insert of the local educational agencyend insert.

23(3) If the governing board of a local educational agency has not
24provided for an audit of the books and accounts of the local
25educational agency by April 1, the county superintendent of schools
26having jurisdiction over the local educational agency shall provide
27for the audit of each local educational agency.

28(4) An audit conducted pursuant to this section shall comply
29fully with the Government Auditing Standards issued by the
30Comptroller General of the United States.

31(5) For purposes of this section, “local educational agency” does
32not include community colleges.

33(c) Each audit conducted in accordance with this section shall
34include all funds of the local educational agency, including the
35student body and cafeteria funds and accounts and any other funds
36under the control or jurisdiction of the local educational agency.
37Each audit shall also include an audit of pupil attendance
38procedures. Each audit shall include a determination of whether
39funds were expended in accordance with a local control and
P34   1accountability plan pursuant to Articlebegin delete 3.8end deletebegin insert 5end insert (commencing with
2Section 52060) of Chapter 6.1 of Part 28 of Division 3.

3(d) All audit reports for each fiscal year shall be developed and
4reported using a format established by the Controller after
5consultation with the Superintendent and the Director of Finance.

6(e) (1) The cost of the audits provided for by the county
7superintendent of schools shall be paid from the county school
8service fund and the county superintendent of schools shall transfer
9the pro rata share of the cost chargeable to each school district
10from school district funds.

11(2) The cost of the audit provided for by a governing boardbegin insert of
12a local educational agencyend insert
shall be paid from local educational
13agency funds. The audit of the funds under the jurisdiction and
14control of the county superintendent of schools shall be paid from
15the county school service fund.

16(f) (1) The audits shall be made by a certified public accountant
17or a public accountant, licensed by the California Board of
18Accountancy, and selected by the local educational agency, as
19applicable, from a directory of certified public accountants and
20public accountants deemed by the Controller as qualified to conduct
21audits of local educational agencies, which shall be published by
22the Controller not later than December 31 of each year.

23(2) Commencing with the 2003-04 fiscal year and except as
24provided in subdivision (d) of Section 41320.1, it is unlawful for
25a public accounting firm to provide audit services to a local
26educational agency if the lead audit partner, or coordinating audit
27partner, having primary responsibility for the audit, or the audit
28partner responsible for reviewing the audit, has performed audit
29services for that local educational agency in each of the six previous
30fiscal years. The Education Audits Appeal Panel may waive this
31requirement if the panel finds that no otherwise eligible auditor is
32available to perform the audit.

33(3) It is the intent of the Legislature that, notwithstanding
34paragraph (2), the rotation within public accounting firms conform
35to provisions of the federal Sarbanes-Oxley Act of 2002 (Public
36Law 107-204; 15 U.S.C. Sec. 7201 et seq.), and upon release of
37the report required by the act of the Comptroller General of the
38United States addressing the mandatory rotation of registered
39public accounting firms, the Legislature intends to reconsider the
40provisions of paragraph (2). In determining which certified public
P35   1accountants and public accountants shall be included in the
2directory, the Controller shall use the following criteria:

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

5(B) The certified public accountants or public accountants, as
6a result of a quality control review conducted by the Controller
7pursuant to Section 14504.2, shall not have been found to have
8conducted an audit in a manner constituting noncompliance with
9subdivision (a) of Section 14503.

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

11(A) A statement that the audit was conducted pursuant to
12standards and procedures developed in accordance with Chapter
133 (commencing with Section 14500) of Part 9 of Division 1 of
14Title 1.

15(B) A summary of audit exceptions and management
16improvement recommendations.

17(C) Each audit of a local educational agency shall include an
18evaluation by the auditor on whether there is substantial doubt
19about the ability of the local educational agency to continue as a
20going concern for a reasonable period of time. This evaluation
21shall be based on the Statement on Auditing Standards (SAS) No.
2259, as issued by the AICPA regarding disclosure requirements
23relating to the ability of the entity to continue as a going concern.

24(2) To the extent possible, a description of correction or plan
25of correction shall be incorporated in the audit report, describing
26the specific actions that are planned to be taken, or that have been
27taken, to correct the problem identified by the auditor. The
28descriptions of specific actions to be taken or that have been taken
29shall not solely consist of general comments such as “will
30implement,” “accepted the recommendation,” or “will discuss at
31a later date.”

32(h) Not later than December 15, a report of each local
33educational agency audit for the preceding fiscal year shall be filed
34with the county superintendent of schools of the county in which
35the local educational agency is located, the department, and the
36Controller. The Superintendent shall make any adjustments
37necessary in future apportionments of all state funds, to correct
38any audit exceptions revealed by those audit reports.

39(i) (1) Commencing with the 2002-03 audit of local educational
40agencies pursuant to this section and subdivision (d) of Section
P36   141320.1, each county superintendent of schools shall be responsible
2for reviewing the audit exceptions contained in an audit of a local
3educational agency under his or her jurisdiction related to
4attendance, inventory of equipment, internal control, and any
5miscellaneous items, and determining whether the exceptions have
6been either corrected or an acceptable plan of correction has been
7developed.

8(2) Commencing with the 2004-05 audit of local educational
9agencies pursuant to this section and subdivision (d) of Section
1041320.1, each county superintendent of schools shall include in
11the review of audit exceptions performed pursuant to this
12subdivision those audit exceptions related to use of instructional
13materials program funds, teacher misassignments pursuant to
14Section 44258.9, information reported on the school accountability
15report card required pursuant to Section 33126 and shall determine
16whether the exceptions are either corrected or an acceptable plan
17of correction has been developed.

18(j) Upon submission of the final audit report to the governing
19board of each local educational agency and subsequent receipt of
20the audit by the county superintendent of schools having
21 jurisdiction over the local educational agency, the county office
22of education shall do all of the following:

23(1) Review audit exceptions related to attendance, inventory of
24equipment, internal control, and other miscellaneous exceptions.
25Attendance exceptions or issues shall include, but not be limited
26to, those related to local control funding formula allocations
27pursuant to Section 42238.02, as implemented by Section 42238.03,
28and independent study.

29(2) If a description of the correction or plan of correction has
30not been provided as part of the audit required by this section, then
31the county superintendent of schools shall notify the local
32educational agency and request the governing board of the local
33educational agency to provide to the county superintendent of
34schools a description of the corrections or plan of correction by
35March 15.

36(3) Review the description of correction or plan of correction
37and determine its adequacy. If the description of the correction or
38plan of correction isbegin delete not adequate,end deletebegin insert inadequate,end insert the county
39superintendent of schools shall require the local educational agency
40to resubmit that portion of its response that is inadequate.

P37   1(k) Each county superintendent of schools shall certify to the
2Superintendent and the Controller, not later than May 15, that his
3or her staff has reviewed all audits of local educational agencies
4under his or her jurisdiction for the prior fiscal year, that all
5exceptions that the county superintendent was required to review
6were reviewed, and that all of those exceptions, except as otherwise
7noted in the certification, have been corrected by the local
8educational agency or that an acceptable plan of correction has
9been submitted to the county superintendent of schools. In addition,
10the county superintendent shall identify, by local educational
11agency, any attendance-related audit exception or exceptions
12involving state funds, and require the local educational agency to
13which the audit exceptions were directed to submit appropriate
14reporting forms for processing by the Superintendent.

15(l) In the audit of a local educational agency for a subsequent
16year, the auditor shall review the correction or plan or plans of
17correction submitted by the local educational agency to determine
18if the exceptions have been resolved. If not, the auditor shall
19immediately notify the appropriate county office of education and
20the department and restate the exception in the audit report. After
21receiving that notification, the department shall either consult with
22the local educational agency to resolve the exception or require
23the county superintendent of schools to follow up with the local
24educational agency.

25(m) (1) The Superintendent shall be responsible for ensuring
26that local educational agencies have either corrected or developed
27plans of correction for any one or more of the following:

28(A) All federal and state compliance audit exceptions identified
29in the audit.

30(B) Any exceptions that the county superintendent certifies as
31of May 15 have not been corrected.

32(C) Any repeat audit exceptions that are not assigned to a county
33superintendent to correct.

34(2) In addition, the Superintendent shall be responsible for
35ensuring that county superintendents of schools and each county
36board of education that serves as the governing board of a local
37educational agency either correct all audit exceptions identified in
38the audits of county superintendents of schools and of the local
39educational agencies for which the county boards of education
P38   1serve as the governing boards or develop acceptable plans of
2correction for those exceptions.

3(3) The Superintendent shall report annually to the Controller
4on his or her actions to ensure that school districts, county
5superintendents of schools, and each county board of education
6that serves as the governing board of a school district have either
7corrected or developed plans of correction for any of the exceptions
8noted pursuant to paragraph (1).

9(n) To facilitate correction of the exceptions identified by the
10audits issued pursuant to this section, commencing with 2002-03
11audits pursuant to this section, the Controller shall require auditors
12to categorize audit exceptions in each audit report in a manner that
13will make it clear to both the county superintendent of schools and
14the Superintendent which exceptions they are responsible for
15ensuring the correction of by a local educational agency. In
16addition, the Controller annually shall select a sampling of county
17superintendents of schools and perform a followup of the audit
18resolution process of those county superintendents of schools and
19report the results of that followup to the Superintendent and the
20county superintendents of schools that were reviewed.

21(o) County superintendents of schools shall adjust subsequent
22local property tax requirements to correct audit exceptions relating
23to local educational agency tax rates and tax revenues.

24(p) If a governing boardbegin insert of a local educational agencyend insert or county
25superintendent of schools fails or is unable to make satisfactory
26arrangements for the audit pursuant to this section, the Controller
27shall make arrangements for the audit and the cost of the audit
28shall be paid from local educational agency funds or the county
29school service fund, as the case may be.

begin insert

30(q) Audits of regional occupational centers and programs are
31subject to the provisions on this section.

end insert
begin delete

34 32(q)

end delete

33begin insert(r)end insert This section does not authorize examination of, or reports
34on, the curriculum used or provided for in any local educational
35agency.

begin delete

37 36(r)

end delete

37begin insert(s)end insert Notwithstanding any other law, a nonauditing, management,
38or other consulting service to be provided to a local educational
39agency by a certified public accounting firm while the certified
40public accounting firm is performing an audit of thebegin insert local
P39   1educationalend insert
agency pursuant to this section must be in accord with
2Government Accounting Standards, Amendment No. 3, as
3published by the United States General Accounting Office.

begin delete

4 4(s)

end delete

5begin insert(t)end insert This section shall become operative on July 1, 2014.

6

SEC. 21.  

Section 41202 of the Education Code is amended to
7read:

8

41202.  

The words and phrases set forth in subdivision (b) of
9Section 8 of Article XVI of the Constitution of the State of
10California shall have the following meanings:

11(a) “Moneys to be applied by the State,” as used in subdivision
12(b) of Section 8 of Article XVI of the California Constitution,
13means appropriations from the General Fund that are made for
14allocation to school districts, as defined, or community college
15districts. An appropriation that is withheld, impounded, or made
16without provisions for its allocation to school districts or
17community college districts, shall not be considered to be “moneys
18to be applied by the State.”

19(b) “General Fund revenues which may be appropriated pursuant
20to Article XIII B,” as used in paragraph (1) of subdivision (b) of
21Section 8 of Article XVI, means General Fund revenues that are
22the proceeds of taxes as defined by subdivision (c) of Section 8 of
23Article XIII B of the California Constitution, including, for the
241986-87 fiscal year only, any revenues that are determined to be
25in excess of the appropriations limit established pursuant to Article
26XIII B for the fiscal year in which they are received. General Fund
27revenues for a fiscal year to which paragraph (1) of subdivision
28(b) is being applied shall include, in that computation, only General
29Fund revenues for that fiscal year that are the proceeds of taxes,
30as defined in subdivision (c) of Section 8 of Article XIII B of the
31California Constitution, and shall not include prior fiscal year
32revenues. Commencing with the 1995-96 fiscal year, and each
33fiscal year thereafter, “General Fund revenues that are the proceeds
34of taxes,” as defined in subdivision (c) of Section 8 of Article
35XIII B of the California Constitution, includes any portion of the
36proceeds of taxes received from the state sales tax that are
37transferred to the counties pursuant to, and only if, legislation is
38enacted during the 1995-96 fiscal year the purpose of which is to
39realign children’s programs. The amount of the proceeds of taxes
40shall be computed for any fiscal year in a manner consistent with
P40   1the manner in which the amount of the proceeds of taxes was
2computed by the Department of Finance for purposes of the
3Governor’s Budget for the Budget Act of 1986.

4(c) “General Fund revenues appropriated for school districts,”
5as used in paragraph (1) of subdivision (b) of Section 8 of Article
6XVI of the California Constitution, means the sum of
7appropriations made that are for allocation to school districts, as
8defined in Section 41302.5, regardless of whether those
9appropriations were made from the General Fund to the
10Superintendent, to the Controller, or to any other fund or state
11agency for the purpose of allocation to school districts. The full
12amount of any appropriation shall be included in the calculation
13of the percentage required by paragraph (1) of subdivision (b) of
14Article XVI, without regard to any unexpended balance of any
15appropriation. Any reappropriation of funds appropriated in any
16prior year shall not be included in the sum of appropriations.

17(d) “General Fund revenues appropriated for community college
18districts,” as used in paragraph (1) of subdivision (b) of Section 8
19of Article XVI of the California Constitution, means the sum of
20appropriations made that are for allocation to community college
21districts, regardless of whether those appropriations were made
22from the General Fund to the Controller, to the Chancellor of the
23California Community Colleges, or to any other fund or state
24agency for the purpose of allocation to community college districts.
25The full amount of any appropriation shall be included in the
26calculation of the percentage required by paragraph (1) of
27subdivision (b) of Article XVI, without regard to any unexpended
28balance of any appropriation. Any reappropriation of funds
29appropriated in any prior year shall not be included in the sum of
30appropriations.

31(e) “Total allocations to school districts and community college
32districts from General Fund proceeds of taxes appropriated pursuant
33to Article XIII B,” as used in paragraph (2) or (3) of subdivision
34(b) of Section 8 of Article XVI of the California Constitution,
35means the sum of appropriations made that are for allocation to
36school districts, as defined in Section 41302.5, and community
37college districts, regardless of whether those appropriations were
38made from the General Fund to the Controller, to the
39Superintendent, to the Chancellor of the California Community
40Colleges, or to any other fund or state agency for the purpose of
P41   1allocation to school districts and community college districts. The
2full amount of any appropriation shall be included in the calculation
3of the percentage required by paragraph (2) or (3) of subdivision
4(b) of Section 8 of Article XVI, without regard to any unexpended
5balance of any appropriation. Any reappropriation of funds
6appropriated in any prior year shall not be included in the sum of
7appropriations.

8(f) “General Fund revenues appropriated for school districts
9and community college districts, respectively” and “moneys to be
10applied by the state for the support of school districts and
11community college districts,” as used in Section 8 of Article XVI
12of the California Constitution, shall include funds appropriated for
13part-day California state preschool programs under Article 7
14(commencing with Section 8235) of Chapter 2 of Part 6 of Division
151 of Title 1, and the After School Education and Safety Program
16established pursuant to Article 22.5 (commencing with Section
178482) of Chapter 2 of Part 6 of Division 1 of Title 1, and shall not
18include any of the following:

19(1) Any appropriation that is not made for allocation to a school
20district, as defined in Section 41302.5, or to a community college
21district, regardless of whether the appropriation is made for any
22purpose that may be considered to be for the benefit to a school
23district, as defined in Section 41302.5, or a community college
24district. This paragraph shall not be construed to exclude any
25funding appropriated for part-day California state preschool
26programs under Article 7 (commencing with Section 8235) of
27Chapter 2 of Part 6 of Division 1 of Title 1 or the After School
28Education and Safety Program established pursuant to Article 22.5
29(commencing with Section 8482) of Chapter 2 of Part 6 of Division
301 of Title 1.

31(2) Any appropriation made to the Teachers’ Retirement Fund
32or to the Public Employees’ Retirement Fund except those
33appropriations for reimbursable state mandates imposed on or
34before January 1, 1988.

35(3) Any appropriation made to service any public debt approved
36by the voters of this state.

37(4) With the exception of the programs identified in paragraph
38(1), commencing with the 2011-12 fiscal year, any funds
39appropriated for the Child Care and Development Services Act,
P42   1pursuant to Chapter 2 (commencing with Section 8200) of Part 6
2of Division 1 of Title 1.

3(g) “Allocated local proceeds of taxes,” as used in paragraph
4(2) or (3) of subdivision (b) of Section 8 of Article XVI of the
5California Constitution, means, for school districts as defined,
6those local revenues, except revenues identified pursuant to
7paragraph (5) of subdivision (h) of Section 42238, that are used
8to offset state aid for school districts in calculations performed
9pursuant to Sections 2558, 42238, and Chapter 7.2 (commencing
10with Section 56836) of Part 30.

11(h) “Allocated local proceeds of taxes,” as used in paragraph
12(2) or (3) of subdivision (b) of Section 8 of Article XVI of the
13California Constitution, means, for community college districts,
14those local revenues that are used to offset state aid for community
15college districts in calculations performed pursuant to Section
1684700. In no event shall the revenues or receipts derived from
17student fees be considered “allocated local proceeds of taxes.”

18(i) For purposes of calculating the 4-percent entitlement pursuant
19to subdivision (a) of Section 8.5 of Article XVI of the California
20Constitution, “the total amount required pursuant to Section 8(b)”
21shall mean the General Fund aid required for schools pursuant to
22subdivision (b) of Section 8 of Article XVI of the California
23Constitution, and shall not include allocated local proceeds of
24taxes.

25(j) This section shall become inoperative on December 15, 2012,
26and, as of January 1, 2013, is repealed, only if the Schools and
27Local Public Safety Protection Act of 2012 (Attorney General
28reference number 12-0009) is not approved by the voters at the
29November 6, 2012, statewide general election, or if the provisions
30of that act that modify personal income tax rates do not become
31operative due to a conflict with another initiative measure that is
32approved at the same election and receives a greater number of
33affirmative votes.

34(k) This section shall become inoperative on July 1, 2014, and,
35as of January 1, 2015, is repealed, unless a later enacted statute,
36that becomes operative on or before January 1, 2015, deletes or
37extends the dates on which it becomes inoperative and is repealed.

38

SEC. 22.  

Section 41202 is added to the Education Code, to
39read:

P43   1

41202.  

The words and phrases set forth in subdivision (b) of
2Section 8 of Article XVI of the Constitution of the State of
3California shall have the following meanings:

4(a) “Moneys to be applied by the State,” as used in subdivision
5(b) of Section 8 of Article XVI of the California Constitution,
6means appropriations from the General Fund that are made for
7allocation to school districts, as defined, or community college
8districts. An appropriation that is withheld, impounded, or made
9without provisions for its allocation to school districts or
10community college districts, shall not be considered to be “moneys
11to be applied by the State.”

12(b) “General Fund revenues which may be appropriated pursuant
13to Article XIII B,” as used in paragraph (1) of subdivision (b) of
14Section 8 of Article XVI, means General Fund revenues that are
15the proceeds of taxes as defined by subdivision (c) of Section 8 of
16Article XIII B of the California Constitution, including, for the
171986-87 fiscal year only, any revenues that are determined to be
18in excess of the appropriations limit established pursuant to Article
19XIII B for the fiscal year in which they are received. General Fund
20revenues for a fiscal year to which paragraph (1) of subdivision
21(b) is being applied shall include, in that computation, only General
22Fund revenues for that fiscal year that are the proceeds of taxes,
23as defined in subdivision (c) of Section 8 of Article XIII B of the
24California Constitution, and shall not include prior fiscal year
25revenues. Commencing with the 1995-96 fiscal year, and each
26fiscal year thereafter, “General Fund revenues that are the proceeds
27of taxes,” as defined in subdivision (c) of Section 8 of Article
28XIII B of the California Constitution, includes any portion of the
29proceeds of taxes received from the state sales tax that are
30transferred to the counties pursuant to, and only if, legislation is
31enacted during the 1995-96 fiscal year the purpose of which is to
32realign children’s programs. The amount of the proceeds of taxes
33shall be computed for any fiscal year in a manner consistent with
34the manner in which the amount of the proceeds of taxes was
35computed by the Department of Finance for purposes of the
36Governor’s Budget for the Budget Act of 1986.

37(c) “General Fund revenues appropriated for school districts,”
38as used in paragraph (1) of subdivision (b) of Section 8 of Article
39XVI of the California Constitution, means the sum of
40appropriations made that are for allocation to school districts, as
P44   1defined in Section 41302.5, regardless of whether those
2appropriations were made from the General Fund to the
3Superintendent, to the Controller, or to any other fund or state
4agency for the purpose of allocation to school districts. The full
5amount of any appropriation shall be included in the calculation
6of the percentage required by paragraph (1) of subdivision (b) of
7Article XVI, without regard to any unexpended balance of any
8appropriation. Any reappropriation of funds appropriated in any
9prior year shall not be included in the sum of appropriations.

10(d) “General Fund revenues appropriated for community college
11districts,” as used in paragraph (1) of subdivision (b) of Section 8
12of Article XVI of the California Constitution, means the sum of
13appropriations made that are for allocation to community college
14districts, regardless of whether those appropriations were made
15from the General Fund to the Controller, to the Chancellor of the
16California Community Colleges, or to any other fund or state
17agency for the purpose of allocation to community college districts.
18The full amount of any appropriation shall be included in the
19calculation of the percentage required by paragraph (1) of
20subdivision (b) of Article XVI, without regard to any unexpended
21balance of any appropriation. Any reappropriation of funds
22appropriated in any prior year shall not be included in the sum of
23appropriations.

24(e) “Total allocations to school districts and community college
25districts from General Fund proceeds of taxes appropriated pursuant
26to Article XIII B,” as used in paragraph (2) or (3) of subdivision
27(b) of Section 8 of Article XVI of the California Constitution,
28means the sum of appropriations made that are for allocation to
29school districts, as defined in Section 41302.5, and community
30college districts, regardless of whether those appropriations were
31made from the General Fund to the Controller, to the
32Superintendent, to the Chancellor of the California Community
33Colleges, or to any other fund or state agency for the purpose of
34allocation to school districts and community college districts. The
35full amount of any appropriation shall be included in the calculation
36of the percentage required by paragraph (2) or (3) of subdivision
37(b) of Section 8 of Article XVI, without regard to any unexpended
38balance of any appropriation. Any reappropriation of funds
39appropriated in any prior year shall not be included in the sum of
40appropriations.

P45   1(f) “General Fund revenues appropriated for school districts
2and community college districts, respectively” and “moneys to be
3applied by the state for the support of school districts and
4community college districts,” as used in Section 8 of Article XVI
5of the California Constitution, shall include funds appropriated for
6part-day California state preschool programs under Article 7
7(commencing with Section 8235) of Chapter 2 of Part 6 of Division
81 of Title 1, and the After School Education and Safety Program
9established pursuant to Article 22.5 (commencing with Section
108482) of Chapter 2 of Part 6 of Division 1 of Title 1, and shall not
11include any of the following:

12(1) Any appropriation that is not made for allocation to a school
13district, as defined in Section 41302.5, or to a community college
14district, regardless of whether the appropriation is made for any
15purpose that may be considered to be for the benefit to a school
16district, as defined in Section 41302.5, or a community college
17district. This paragraph shall not be construed to exclude any
18funding appropriated for part-day California state preschool
19programs under Article 7 (commencing with Section 8235) of
20Chapter 2 of Part 6 of Division 1 of Title 1 or the After School
21Education and Safety Program established pursuant to Article 22.5
22(commencing with Section 8482) of Chapter 2 of Part 6 of Division
231 of Title 1.

24(2) Any appropriation made to the Teachers’ Retirement Fund
25or to the Public Employees’ Retirement Fund except those
26appropriations for reimbursable state mandates imposed on or
27before January 1, 1988.

28(3) Any appropriation made to service any public debt approved
29by the voters of this state.

30(4) With the exception of the programs identified in paragraph
31(1), commencing with the 2011-12 fiscal year, any funds
32appropriated for the Child Care and Development Services Act,
33pursuant to Chapter 2 (commencing with Section 8200) of Part 6
34of Division 1 of Title 1.

35(g) “Allocated local proceeds of taxes,” as used in paragraph
36(2) or (3) of subdivision (b) of Section 8 of Article XVI of the
37California Constitution, means, for school districts as defined,
38those local revenues, except revenues identified pursuant to
39paragraph (5) of subdivision (i) of Section 42238.02, that are used
40to offset state aid for school districts in calculations performed
P46   1pursuant to Sections 2575, 42238.02, and Chapter 7.2 (commencing
2with Section 56836) of Part 30 of Division 4.

3(h) “Allocated local proceeds of taxes,” as used in paragraph
4(2) or (3) of subdivision (b) of Section 8 of Article XVI of the
5California Constitution, means, for community college districts,
6those local revenues that are used to offset state aid for community
7college districts. In no event shall the revenues or receipts derived
8from student fees be considered “allocated local proceeds of taxes.”

9(i) For purposes of calculating the 4-percent entitlement pursuant
10to subdivision (a) of Section 8.5 of Article XVI of the California
11Constitution, “the total amount required pursuant to Section 8(b)”
12shall mean the General Fund aid required for schools pursuant to
13subdivision (b) of Section 8 of Article XVI of the California
14Constitution, and shall not include allocated local proceeds of
15taxes.

16(j) This section shall become operative on July 1, 2014.

17

SEC. 23.  

Section 42127 of the Education Code is amended to
18read:

19

42127.  

(a) On or before July 1 of each year, the governing
20board of each school district shall accomplish the following:

21(1) Hold a public hearing on the budget to be adopted for the
22subsequent fiscal year. The budget to be adopted shall be prepared
23in accordance with Section 42126. The agenda for that hearing
24shall be posted at least 72 hours before the public hearing and shall
25include the location where the budget will be available for public
26inspection.

27(A) For the 2011-12 fiscal year, notwithstanding any of the
28standards and criteria adopted by the state board pursuant to Section
2933127, each school district budget shall project the same level of
30revenue per unit of average daily attendance as it received in the
312010-11 fiscal year and shall maintain staffing and program levels
32commensurate with that level.

33(B) For the 2011-12 fiscal year, the school district shall not be
34required to demonstrate that it is able to meet its financial
35obligations for the two subsequent fiscal years.

36(2) Adopt a budget. Not later than five days after that adoption
37or by July 1, whichever occurs first, the governing board of the
38school district shall file that budget with the county superintendent
39of schools. That budget and supporting data shall be maintained
40and made available for public review. If the governing board of
P47   1the school district does not want all or a portion of the property
2tax requirement levied for the purpose of making payments for the
3interest and redemption charges on indebtedness as described in
4paragraph (1) or (2) of subdivision (b) of Section 1 of Article
5XIII A of the California Constitution, the budget shall include a
6statement of the amount or portion for which a levy shall not be
7made.

8(b) The county superintendent of schools may accept changes
9in any statement included in the budget, pursuant to subdivision
10(a), of the amount or portion for which a property tax levy shall
11not be made. The county superintendent of schools or the county
12auditor shall compute the actual amounts to be levied on the
13property tax rolls of the school district for purposes that exceed
14apportionments to the school district pursuant to Chapter 6
15(commencing with Section 95) of Part 0.5 of Division 1 of the
16Revenue and Taxation Code. Each school district shall provide all
17data needed by the county superintendent of schools or the county
18auditor to compute the amounts. On or before August 15, the
19county superintendent of schools shall transmit the amounts
20computed to the county auditor who shall compute the tax rates
21necessary to produce the amounts. On or before September 1, the
22county auditor shall submit the rate computed to the board of
23supervisors for adoption.

24(c) The county superintendent of schools shall do all of the
25following:

26(1) Examine the adopted budget to determine whether it
27complies with the standards and criteria adopted by the state board
28pursuant to Section 33127 for application to final local educational
29agency budgets. The county superintendent of schools shall
30identify, if necessary, technical corrections that are required to be
31made to bring the budget into compliance with those standards
32and criteria.

33(2) Determine whether the adopted budget will allow the school
34district to meet its financial obligations during the fiscal year and
35is consistent with a financial plan that will enable the school district
36to satisfy its multiyear financial commitments. In addition to his
37or her own analysis of the budget of each school district, the county
38superintendent of schools shall review and consider studies, reports,
39evaluations, or audits of the school district that were commissioned
40by the school district, the county superintendent of schools, the
P48   1Superintendent, and state control agencies and that contain
2evidence that the school district is showing fiscal distress under
3the standards and criteria adopted in Section 33127 or that contain
4a finding by an external reviewer that more than three of the 15
5most common predictors of a school district needing intervention,
6as determined by the County Office Fiscal Crisis and Management
7Assistance Team, are present. The county superintendent of schools
8shall either conditionally approve or disapprove a budget that does
9not provide adequate assurance that the school district will meet
10its current and future obligations and resolve any problems
11identified in studies, reports, evaluations, or audits described in
12this paragraph.

13(d) On or before August 15, the county superintendent of schools
14shall approve, conditionally approve, or disapprove the adopted
15budget for each school district. If a school district does not submit
16a budget to the county superintendent of schools, the county
17superintendent of schools shall develop, at school district expense,
18a budget for that school district by September 15 and transmit that
19budget to the governing board of the school district. The budget
20prepared by the county superintendent of schools shall be deemed
21adopted, unless the county superintendent of schools approves any
22modifications made by the governing board of the school district.
23The approved budget shall be used as a guide for the school
24district’s priorities. The Superintendent shall review and certify
25the budget approved by the county. If, pursuant to the review
26conducted pursuant to subdivision (c), the county superintendent
27of schools determines that the adopted budget for a school district
28does not satisfy paragraph (1) or (2) of that subdivision, he or she
29shall conditionally approve or disapprove the budget and, not later
30than August 15, transmit to the governing board of the school
31district, in writing, his or her recommendations regarding revision
32of the budget and the reasons for those recommendations,
33including, but not limited to, the amounts of any budget
34adjustments needed before he or she can approve that budget. The
35county superintendent of schools may assign a fiscal adviser to
36assist the school district to develop a budget in compliance with
37those revisions. In addition, the county superintendent of schools
38may appoint a committee to examine and comment on the
39superintendent’s review and recommendations, subject to the
40requirement that the committee report its findings to the county
P49   1superintendent of schools no later than August 20. For the 2011-12
2fiscal year, notwithstanding any of the standards and criteria
3adopted by the state board pursuant to Section 33127, the county
4superintendent of schools, as a condition on approval of a school
5district budget, shall not require a school district to project a lower
6level of revenue per unit of average daily attendance than it
7received in the 2010-11 fiscal year nor require the school district
8to demonstrate that it is able to meet its financial obligations for
9the two subsequent fiscal years.

10(e) On or before September 8, the governing board of the school
11district shall revise the adopted budget to reflect changes in
12projected income or expenditures subsequent to July 1, and to
13include any response to the recommendations of the county
14superintendent of schools, shall adopt the revised budget, and shall
15file the revised budget with the county superintendent of schools.
16Before revising the budget, the governing board of the school
17district shall hold a public hearing regarding the proposed revisions,
18to be conducted in accordance with Section 42103. In addition, if
19the adopted budget is disapproved pursuant to subdivision (d), the
20governing board of the school district and the county
21superintendent of schools shall review the disapproval and the
22recommendations of the county superintendent of schools regarding
23revision of the budget at the public hearing. The revised budget
24and supporting data shall be maintained and made available for
25public review.

26(1) For the 2011-12 fiscal year, notwithstanding any of the
27standards and criteria adopted by the state board pursuant to Section
2833127, each school district budget shall project the same level of
29revenue per unit of average daily attendance as it received in the
302010-11 fiscal year and shall maintain staffing and program levels
31commensurate with that level.

32(2) For the 2011-12 fiscal year, the school district shall not be
33required to demonstrate that it is able to meet its financial
34obligations for the two subsequent fiscal years.

35(f) On or before September 22, the county superintendent of
36schools shall provide a list to the Superintendent identifying all
37school districts for which budgets may be disapproved.

38(g) The county superintendent of schools shall examine the
39revised budget to determine whether it (1) complies with the
40standards and criteria adopted by the state board pursuant to Section
P50   133127 for application to final local educational agency budgets,
2(2) allows the school district to meet its financial obligations during
3the fiscal year, (3) satisfies all conditions established by the county
4superintendent of schools in the case of a conditionally approved
5budget, and (4) is consistent with a financial plan that will enable
6the school district to satisfy its multiyear financial commitments,
7and, not later than October 8, shall approve or disapprove the
8revised budget. If the county superintendent of schools disapproves
9the budget, he or she shall call for the formation of a budget review
10committee pursuant to Section 42127.1, unless the governing board
11of the school district and the county superintendent of schools
12agree to waive the requirement that a budget review committee be
13formed and the department approves the waiver after determining
14that a budget review committee is not necessary. Upon the grant
15of a waiver, the county superintendent of schools immediately has
16the authority and responsibility provided in Section 42127.3. Upon
17approving a waiver of the budget review committee, the department
18shall ensure that a balanced budget is adopted for the school district
19by November 30. If no budget is adopted by November 30, the
20Superintendent may adopt a budget for the school district. The
21Superintendent shall report to the Legislature and the Director of
22Finance by December 10 if any school district, including a school
23district that has received a waiver of the budget review committee
24process, does not have an adopted budget by November 30. This
25report shall include the reasons why a budget has not been adopted
26by the deadline, the steps being taken to finalize budget adoption,
27the date the adopted budget is anticipated, and whether the
28Superintendent has or will exercise his or her authority to adopt a
29budget for the school district. For the 2011-12 fiscal year,
30notwithstanding any of the standards and criteria adopted by the
31state board pursuant to Section 33127, the county superintendent
32of schools, as a condition on approval of a school district budget,
33shall not require a school district to project a lower level of revenue
34per unit of average daily attendance than it received in the 2010-11
35fiscal year nor require the school district to demonstrate that it is
36able to meet its financial obligations for the two subsequent fiscal
37years.

38(h) Not later than October 8, the county superintendent of
39schools shall submit a report to the Superintendent identifying all
40school districts for which budgets have been disapproved or budget
P51   1review committees waived. The report shall include a copy of the
2written response transmitted to each of those school districts
3pursuant to subdivision (d).

4(i) Notwithstanding any other provision of this section, the
5budget review for a school district shall be governed by paragraphs
6(1), (2), and (3), rather than by subdivisions (e) and (g), if the
7governing board of the school district so elects and notifies the
8county superintendent of schools in writing of that decision, not
9later than October 31 of the immediately preceding calendar year.
10On or before July 1, the governing board of a school district for
11which the budget review is governed by this subdivision, rather
12than by subdivisions (e) and (g), shall conduct a public hearing
13regarding its proposed budget in accordance with Section 42103.

14(1) If the adopted budget of a school district is disapproved
15pursuant to subdivision (d), on or before September 8, the
16governing board of the school district, in conjunction with the
17county superintendent of schools, shall review the superintendent’s
18recommendations at a regular meeting of the governing board of
19the school district and respond to those recommendations. The
20response shall include any revisions to the adopted budget and
21other proposed actions to be taken, if any, as a result of those
22recommendations.

23(2) On or before September 22, the county superintendent of
24schools shall provide a list to the Superintendent identifying all
25school districts for which a budget may be tentatively disapproved.

26(3) Not later than October 8, after receiving the response
27required under paragraph (1), the county superintendent of schools
28shall review that response and either approve or disapprove the
29budget. If the county superintendent of schools disapproves the
30budget, he or she shall call for the formation of a budget review
31committee pursuant to Section 42127.1, unless the governing board
32of the school district and the county superintendent of schools
33agree to waive the requirement that a budget review committee be
34formed and the department approves the waiver after determining
35that a budget review committee is not necessary. Upon the grant
36of a waiver, the county superintendent has the authority and
37responsibility provided to a budget review committee in Section
3842127.3. Upon approving a waiver of the budget review committee,
39the department shall ensure that a balanced budget is adopted for
40the school district by November 30. The Superintendent shall
P52   1report to the Legislature and the Director of Finance by December
210 if any school district, including a school district that has received
3a waiver of the budget review committee process, does not have
4an adopted budget by November 30. This report shall include the
5reasons why a budget has not been adopted by the deadline, the
6steps being taken to finalize budget adoption, and the date the
7adopted budget is anticipated. For the 2011-12 fiscal year,
8notwithstanding any of the standards and criteria adopted by the
9state board pursuant to Section 33127, the county superintendent
10of schools, as a condition on approval of a school district budget,
11shall not require a school district to project a lower level of revenue
12per unit of average daily attendance than it received in the 2010-11
13fiscal year nor require the school district to demonstrate that it is
14able to meet its financial obligations for the two subsequent fiscal
15years.

16(4) Not later than 45 days after the Governor signs the annual
17 Budget Act, the school district shall make available for public
18review any revisions in revenues and expenditures that it has made
19to its budget to reflect the funding made available by that Budget
20Act.

21(j) Any school district for which the county board of education
22serves as the governing board of the school district is not subject
23to subdivisions (c) to (h), inclusive, but is governed instead by the
24budget procedures set forth in Section 1622.

25(k) This section shall become inoperative on July 1, 2014, and,
26as of January 1, 2015, is repealed, unless a later enacted statute,
27that becomes operative on or before January 1, 2015, deletes or
28extends the dates on which it becomes inoperative and is repealed.

29

SEC. 24.  

Section 42127 is added to the Education Code, to
30read:

31

42127.  

(a) On or before July 1 of each year, the governing
32board of each school district shall accomplish the following:

33(1) Hold a public hearing on the budget to be adopted for the
34subsequent fiscal year. The budget to be adopted shall be prepared
35in accordance with Section 42126. The agenda for that hearing
36shall be posted at least 72 hours before the public hearing and shall
37include the location where the budget will be available for public
38inspection.

39(A) For the 2011-12 fiscal year, notwithstanding any of the
40standards and criteria adopted by the state board pursuant to Section
P53   133127, each school district budget shall project the same level of
2revenue per unit of average daily attendance as it received in the
32010-11 fiscal year and shall maintain staffing and program levels
4commensurate with that level.

5(B) For the 2011-12 fiscal year, the school district shall not be
6required to demonstrate that it is able to meet its financial
7obligations for the two subsequent fiscal years.

8(2) Adopt a budget and take action on a local control and
9accountability plan pursuant to Sections 52060 and 52064. Not
10later than five days after that adoption or by July 1, whichever
11occurs first, the governing board of the school district shall file
12that budget with the county superintendent of schools. The budget,
13the local control and accountability plan, and supporting data shall
14be maintained and made available for public review. If the
15governing board of the school district does not want all or a portion
16of the property tax requirement levied for the purpose of making
17payments for the interest and redemption charges on indebtedness
18as described in paragraph (1) or (2) of subdivision (b) of Section
191 of Article XIII A of the California Constitution, the budget shall
20include a statement of the amount or portion for which a levy shall
21not be made. For the 2015-16 fiscal year and each fiscal year
22thereafter, the governing board of the school district shall not adopt
23a budget before the governing board of the school district adopts
24a local control and accountability plan or approves an update to
25an existing local control and accountability plan pursuant to
26Sections 52060 and 52064. The governing board of a school district
27shall not adopt a budget that does not align with the local control
28 and accountability plan that applies to the subsequent fiscal year.

29(b) The county superintendent of schools may accept changes
30in any statement included in the budget, pursuant to subdivision
31(a), of the amount or portion for which a property tax levy shall
32not be made. The county superintendent of schools or the county
33auditor shall compute the actual amounts to be levied on the
34property tax rolls of the school district for purposes that exceed
35apportionments to the school district pursuant to Chapter 6
36(commencing with Section 95) of Part 0.5 of Division 1 of the
37Revenue and Taxation Code. Each school district shall provide all
38data needed by the county superintendent of schools or the county
39auditor to compute the amounts. On or before August 15, the
40county superintendent of schools shall transmit the amounts
P54   1computed to the county auditor who shall compute the tax rates
2necessary to produce the amounts. On or before September 1, the
3county auditor shall submit the rate computed to the board of
4supervisors for adoption.

5(c) The county superintendent of schools shall do all of the
6following:

7(1) Examine the adopted budget to determine whether it
8complies with the standards and criteria adopted by the state board
9pursuant to Section 33127 for application to final local educational
10agency budgets. The county superintendent of schools shall
11identify, if necessary, technical corrections that are required to be
12made to bring the budget into compliance with those standards
13and criteria.

14(2) Determine whether the adopted budget will allow the school
15district to meet its financial obligations during the fiscal year and
16is consistent with a financial plan that will enable the school district
17to satisfy its multiyear financial commitments. In addition to his
18or her own analysis of the budget of each school district, the county
19superintendent of schools shall review and consider studies, reports,
20evaluations, or audits of the school district that were commissioned
21by the school district, the county superintendent of schools, the
22Superintendent, and state control agencies and that contain
23evidence that the school district is showing fiscal distress under
24the standards and criteria adopted in Section 33127 or that contain
25a finding by an external reviewer that more than three of the 15
26most common predictors of a school district needing intervention,
27as determined by the County Office Fiscal Crisis and Management
28Assistance Team, are present. The county superintendent of schools
29shall either conditionally approve or disapprove a budget that does
30not provide adequate assurance that the school district will meet
31its current and future obligations and resolve any problems
32identified in studies, reports, evaluations, or audits described in
33this paragraph.

34(3) Determine whether the adopted budget will allow the school
35district to implement the specific actions and strategies included
36in the local control and accountability plan adopted by the
37governing board of the school district pursuant to Section 52060
38and 52064.

39(d) On or before August 15, the county superintendent of schools
40shall approve, conditionally approve, or disapprove the adopted
P55   1budget for each school district. For the 2015-16 fiscal year and
2each fiscal year thereafter, the county superintendent of schools
3shall disapprove a budget if a school district does not file a local
4control and accountability plan with the county superintendent of
5schools, if the Superintendent determines that a local control and
6accountability plan filed does not adhere to the template adopted
7by the state board pursuant to Section 52066 or does not include
8all of the components identified in subdivision (a) of Section
952064, or if the county superintendent of schools determines that
10the expenditures included in the budget do not reflect the costs
11necessary to implement thebegin insert local control and accountabilityend insert plan.
12If a school district does not submit a budget to the county
13superintendent of schools, the county superintendent of schools
14shall develop, at school district expense, a budget for that school
15district by September 15 and transmit that budget to the governing
16board of the school district. The budget prepared by the county
17superintendent of schools shall be deemed adopted, unless the
18county superintendent of schools approves any modifications made
19by the governing board of the school district. The approved budget
20shall be used as a guide for the school district’s priorities. The
21Superintendent shall review and certify the budget approved by
22the county. If, pursuant to the review conducted pursuant to
23subdivision (c), the county superintendent of schools determines
24that the adopted budget for a school district does not satisfy
25paragraph (1) or (2) of that subdivision, he or she shall
26conditionally approve or disapprove the budget and, not later than
27August 15, transmit to the governing board of the school district,
28in writing, his or her recommendations regarding revision of the
29budget and the reasons for those recommendations, including, but
30not limited to, the amounts of any budget adjustments needed
31before he or she can approve that budget. The county
32superintendent of schools may assign a fiscal adviser to assist the
33school district to develop a budget in compliance with those
34revisions. In addition, the county superintendent of schools may
35appoint a committee to examine and comment on the
36superintendent’s review and recommendations, subject to the
37requirement that the committee report its findings to the county
38superintendent of schools no later than August 20. For the 2011-12
39fiscal year, notwithstanding any of the standards and criteria
40adopted by the state board pursuant to Section 33127, the county
P55   1superintendent of schools, as a condition on approval of a school
2district budget, shall not require a school district to project a lower
3level of revenue per unit of average daily attendance than it
4received in the 2010-11 fiscal year nor require the school district
5to demonstrate that it is able to meet its financial obligations for
6the two subsequent fiscal years.

7(e) On or before September 8, the governing board of the school
8district shall revise the adopted budget to reflect changes in
9projected income or expenditures subsequent to July 1, and to
10include any response to the recommendations of the county
11superintendent of schools, shall adopt the revised budget, and shall
12file the revised budget with the county superintendent of schools.
13Before revising the budget, the governing board of the school
14district shall hold a public hearing regarding the proposed revisions,
15to be conducted in accordance with Section 42103. In addition, if
16the adopted budget is disapproved pursuant to subdivision (d), the
17governing board of the school district and the county
18superintendent of schools shall review the disapproval and the
19recommendations of the county superintendent of schools regarding
20revision of the budget at the public hearing. The revised budget
21and supporting data shall be maintained and made available for
22public review.

23(1) For the 2011-12 fiscal year, notwithstanding any of the
24standards and criteria adopted by the state board pursuant to Section
2533127, each school district budget shall project the same level of
26revenue per unit of average daily attendance as it received in the
272010-11 fiscal year and shall maintain staffing and program levels
28commensurate with that level.

29(2) For the 2011-12 fiscal year, the school district shall not be
30required to demonstrate that it is able to meet its financial
31obligations for the two subsequent fiscal years.

32(f) On or before September 22, the county superintendent of
33schools shall provide a list to the Superintendent identifying all
34school districts for which budgets may be disapproved.

35(g) The county superintendent of schools shall examine the
36revised budget to determine whether it (1) complies with the
37standards and criteria adopted by the state board pursuant to Section
3833127 for application to final local educational agency budgets,
39(2) allows the school district to meet its financial obligations during
40the fiscal year, (3) satisfies all conditions established by the county
P57   1superintendent of schools in the case of a conditionally approved
2budget, and (4) is consistent with a financial plan that will enable
3the school district to satisfy its multiyear financial commitments,
4and, not later than October 8, shall approve or disapprove the
5revised budget. If the county superintendent of schools disapproves
6the budget, he or she shall call for the formation of a budget review
7committee pursuant to Section 42127.1, unless the governing board
8of the school district and the county superintendent of schools
9agree to waive the requirement that a budget review committee be
10formed and the department approves the waiver after determining
11that a budget review committee is not necessary. Upon the grant
12of a waiver, the county superintendent of schools immediately has
13the authority and responsibility provided in Section 42127.3. Upon
14approving a waiver of the budget review committee, the department
15shall ensure that a balanced budget is adopted for the school district
16by November 30. If no budget is adopted by November 30, the
17Superintendent may adopt a budget for the school district. The
18Superintendent shall report to the Legislature and the Director of
19Finance by December 10 if any school district, including a school
20district that has received a waiver of the budget review committee
21process, does not have an adopted budget by November 30. This
22report shall include the reasons why a budget has not been adopted
23by the deadline, the steps being taken to finalize budget adoption,
24the date the adopted budget is anticipated, and whether the
25 Superintendent has or will exercise his or her authority to adopt a
26budget for the school district. For the 2011-12 fiscal year,
27notwithstanding any of the standards and criteria adopted by the
28state board pursuant to Section 33127, the county superintendent
29of schools, as a condition on approval of a school district budget,
30shall not require a school district to project a lower level of revenue
31per unit of average daily attendance than it received in the 2010-11
32fiscal year nor require the school district to demonstrate that it is
33able to meet its financial obligations for the two subsequent fiscal
34years.

35(h) Not later than October 8, the county superintendent of
36schools shall submit a report to the Superintendent identifying all
37school districts for which budgets have been disapproved or budget
38review committees waived. The report shall include a copy of the
39written response transmitted to each of those school districts
40pursuant to subdivision (d).

P58   1(i) Notwithstanding any other provision of this section, the
2budget review for a school district shall be governed by paragraphs
3(1), (2), and (3), rather than by subdivisions (e) and (g), if the
4governing board of the school district so elects and notifies the
5county superintendent of schools in writing of that decision, not
6later than October 31 of the immediately preceding calendar year.
7On or before July 1, the governing board of a school district for
8which the budget review is governed by this subdivision, rather
9than by subdivisions (e) and (g), shall conduct a public hearing
10regarding its proposed budget in accordance with Section 42103.

11(1) If the adopted budget of a school district is disapproved
12pursuant to subdivision (d), on or before September 8, the
13governing board of the school district, in conjunction with the
14county superintendent of schools, shall review the superintendent’s
15recommendations at a regular meeting of the governing board of
16the school district and respond to those recommendations. The
17response shall include any revisions to the adopted budget and
18other proposed actions to be taken, if any, as a result of those
19recommendations.

20(2) On or before September 22, the county superintendent of
21schools shall provide a list to the Superintendent identifying all
22school districts for which a budget may be tentatively disapproved.

23(3) Not later than October 8, after receiving the response
24required under paragraph (1), the county superintendent of schools
25shall review that response and either approve or disapprove the
26budget. If the county superintendent of schools disapproves the
27budget, he or she shall call for the formation of a budget review
28committee pursuant to Section 42127.1, unless the governing board
29of the school district and the county superintendent of schools
30agree to waive the requirement that a budget review committee be
31formed and the department approves the waiver after determining
32that a budget review committee is not necessary. Upon the grant
33of a waiver, the county superintendent has the authority and
34responsibility provided to a budget review committee in Section
3542127.3. Upon approving a waiver of the budget review committee,
36the department shall ensure that a balanced budget is adopted for
37the school district by November 30. The Superintendent shall
38report to the Legislature and the Director of Finance by December
3910 if any school district, including a school district that has received
40a waiver of the budget review committee process, does not have
P59   1an adopted budget by November 30. This report shall include the
2reasons why a budget has not been adopted by the deadline, the
3steps being taken to finalize budget adoption, and the date the
4adopted budget is anticipated. For the 2011-12 fiscal year,
5 notwithstanding any of the standards and criteria adopted by the
6state board pursuant to Section 33127, the county superintendent
7of schools, as a condition on approval of a school district budget,
8shall not require a school district to project a lower level of revenue
9per unit of average daily attendance than it received in the 2010-11
10fiscal year nor require the school district to demonstrate that it is
11able to meet its financial obligations for the two subsequent fiscal
12years.

13(4) Not later than 45 days after the Governor signs the annual
14Budget Act, the school district shall make available for public
15review any revisions in revenues and expenditures that it has made
16to its budget to reflect the funding made available by that Budget
17Act.

18(j) Any school district for which the county board of education
19serves as the governing board of the school district is not subject
20to subdivisions (c) to (h), inclusive, but is governed instead by the
21budget procedures set forth in Section 1622.

22(k) This section shall become operative on July 1, 2014.

23

SEC. 25.  

Section 42238 of the Education Code is amended to
24read:

25

42238.  

(a) For the 1984-85 fiscal year and each fiscal year
26thereafter, the county superintendent of schools shall determine a
27revenue limit for each school district in the county pursuant to this
28section.

29(b) The base revenue limit for a fiscal year shall be determined
30by adding to the base revenue limit for the prior fiscal year the
31following amounts:

32(1) The inflation adjustment specified in Section 42238.1.

33(2) For the 1995-96 fiscal year, the equalization adjustment
34specified in Section 42238.4.

35(3) For the 1996-97 fiscal year, the equalization adjustments
36specified in Sections 42238.41, 42238.42, and 42238.43.

37(4) For the 1985-86 fiscal year, the amount per unit of average
38daily attendance received in the 1984-85 fiscal year pursuant to
39Section 42238.7.

P60   1(5) For the 1985-86, 1986-87, and 1987-88 fiscal years, the
2amount per unit of average daily attendance received in the prior
3fiscal year pursuant to Section 42238.8.

4(6) For the 2004-05 fiscal year, the equalization adjustment
5specified in Section 42238.44.

6(7) For the 2006-07 fiscal year, the equalization adjustment
7specified in Section 42238.48.

8(8) For the 2011-12 fiscal year, the equalization adjustment
9specified in Section 42238.49.

10(c) (1) (A) For the 2010-11 fiscal year, the Superintendent
11shall compute an add-on for each school district by adding the
12inflation adjustment specified in Section 42238.1 to the adjustment
13specified in Section 42238.485.

14(B) For the 2011-12 fiscal year and each fiscal year thereafter,
15the Superintendent shall compute an add-on for each school district
16by adding the inflation adjustment specified in Section 42238.1 to
17the amount computed pursuant to this paragraph for the prior fiscal
18year.

19(2) Commencing with the 2010-11 fiscal year, the
20Superintendent shall compute an add-on for each school district
21by dividing each school district’s fiscal year average daily
22attendance computed pursuant to Section 42238.5 by the total
23adjustments in funding for each district made for the 2007-08
24fiscal year pursuant to Section 42238.22 as it read on January 1,
252009.

26(d) The sum of the base revenue limit computed pursuant to
27subdivision (b) and the add-on computed pursuant to subdivision
28(c) shall be multiplied by the district average daily attendance
29computed pursuant to Section 42238.5.

30(e) For districts electing to compute units of average daily
31attendance pursuant to paragraph (2) of subdivision (a) of Section
3242238.5, the amount computed pursuant to Article 4 (commencing
33with Section 42280) shall be added to the amount computed in
34subdivision (c) or (d), as appropriate.

35(f) For the 1984-85 fiscal year only, the county superintendent
36shall reduce the total revenue limit computed in this section by the
37amount of the decreased employer contributions to the Public
38Employees’ Retirement System resulting from enactment of
39Chapter 330 of the Statutes of 1982, offset by any increase in those
P61   1contributions, as of the 1983-84 fiscal year, resulting from
2subsequent changes in employer contribution rates.

3(g) The reduction required by subdivision (f) shall be calculated
4as follows:

5(1) Determine the amount of employer contributions that would
6have been made in the 1983-84 fiscal year if the applicable Public
7Employees’ Retirement System employer contribution rate in effect
8immediately before the enactment of Chapter 330 of the Statutes
9of 1982 was in effect during the 1983-84 fiscal year.

10(2) Subtract from the amount determined in paragraph (1) the
11greater of subparagraph (A) or (B):

12(A) The amount of employer contributions that would have been
13made in the 1983-84 fiscal year if the applicable Public
14 Employees’ Retirement System employer contribution rate in effect
15immediately after the enactment of Chapter 330 of the Statutes of
161982 was in effect during the 1983-84 fiscal year.

17(B) The actual amount of employer contributions made to the
18Public Employees’ Retirement System in the 1983-84 fiscal year.

19(3) For purposes of this subdivision, employer contributions to
20the Public Employees’ Retirement System for either of the
21following shall be excluded from the calculation specified above:

22(A) Positions supported totally by federal funds that were subject
23to supplanting restrictions.

24(B) Positions supported, to the extent of employer contributions
25not exceeding twenty-five thousand dollars ($25,000) by a single
26educational agency, from a revenue source determined on the basis
27of equity to be properly excludable from the provisions of this
28subdivision by the Superintendent with the approval of the Director
29of Finance.

30(4) For accounting purposes, the reduction made by this
31subdivision may be reflected as an expenditure from appropriate
32sources of revenue as directed by the Superintendent.

33(h) The Superintendent shall apportion to each school district
34the amount determined in this section less the sum of:

35(1) The district’s property tax revenue received pursuant to
36Chapter 3.5 (commencing with Section 75) and Chapter 6
37(commencing with Section 95) of Part 0.5 of Division 1 of the
38Revenue and Taxation Code.

P62   1(2) The amount, if any, received pursuant to Part 18.5
2(commencing with Section 38101) of Division 2 of the Revenue
3and Taxation Code.

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

7(4) Prior years’ taxes and taxes on the unsecured roll.

8(5) Fifty percent of the amount received pursuant to Section
941603.

10(6) (A) The amount, if any, received pursuant to the Community
11Redevelopment Law (Part 1 (commencing with Section 33000)
12of Division 24 of the Health and Safety Code), except for any
13amount received pursuant to Section 33401 or 33676 of the Health
14and Safety Code that is used for land acquisition, facility
15construction, reconstruction, or remodeling, or deferred
16maintenance, except for any amount received pursuant to Section
17 33492.15 of, paragraph (4) of subdivision (a) of Section 33607.5
18of, or Section 33607.7 of, the Health and Safety Code that is
19allocated exclusively for educational facilities.

20(B) The amount, if any, received pursuant to Sections 34177,
2134179.5, 34179.6, and 34188 of the Health and Safety Code.

22(C) The amount, if any, received pursuant to subparagraph (B)
23of paragraph (3) of subdivision (e) of Section 36 of Article XIII
24of the California Constitution.

25(7) For a unified school district, other than a unified school
26district that has converted all of its schools to charter status
27pursuant to Section 47606, the amount of statewide average
28general-purpose funding per unit of average daily attendance
29received by school districts for each of four grade level ranges, as
30computed by the department pursuant to Section 47633, multiplied
31by the average daily attendance, in corresponding grade level
32ranges, of any pupils who attend charter schools funded pursuant
33to Chapter 6 (commencing with Section 47630) of Part 26.8 of
34Division 4 for which the school district is the sponsoring local
35educational agency, as defined in Section 47632, and who reside
36in and would otherwise have been eligible to attend a noncharter
37school of the school district.

38(i) A transfer of pupils of grades 7 and 8 between an elementary
39school district and a high school district shall not result in the
40receiving school district receiving a revenue limit apportionment
P63   1for those pupils that exceeds 105 percent of the statewide average
2revenue limit for the type and size of the receiving school district.

3(j) This section shall become inoperative on July 1, 2014, and,
4as of January 1, 2015, is repealed, unless a later enacted statute,
5that becomes operative on or before January 1, 2015, deletes or
6extends the dates on which it becomes inoperative and is repealed.

7

SEC. 26.  

Section 42238.01 is added to the Education Code, to
8read:

9

42238.01.  

It is the intent of the Legislature to do all of the
10following:

11(a) Phase in implementation of the local control funding formula,
12as specified in AB 88 of the 2013-14 Regular Session, as amended
13April 3, 2013, in a manner and on a timeline that allows the state
14to restore local educational agency funding levels to those that
15existed before state budget cuts that were imposed starting in the
162008-09 fiscal year.

17(b) Redirect the dollar amounts that have been proposed for
18concentration grants to instead increase both base grants and
19supplemental grants, in proportions to be determined.

20(c) Require that the adjustment for grades 9 to 12, inclusive, as
21described in paragraph (4) of subdivision (d) of Section 42238.02
22be spent on programs that prepare pupils for college and career.
23It is further the intent of the Legislature to consider other incentives
24for schools to continue successful career preparation programs,
25including the possible maintenance of existing categorical and
26competitive grant programs.

27(d) Require that funds allocated based on the current
28home-to-school transportation formula be spent on home-to-school
29transportation. It is further the intent of the Legislature, as increased
30funding allows, to adjust those allocations across school districts
31until all school districts are funded equitably, at a percentage of
32allowable costs to be determined.

33(e) Consider remedies for other funding allocations that are
34distributed according to inequitable, historically-based formulas.

35(f) Provide some level of supplemental support for English
36learner pupils beyond the five-year limit proposed in paragraph
37(2) of subdivision (b) of Section 42238.02. It is further the intent
38of the Legislature to ensure greater transparency in the provision
39of instruction and services for English learner pupils, such that
P64   1strong local- and state-level oversight and accountability are
2supported.

3(g) This section shall become operative on July 1, 2014.

4

SEC. 27.  

Section 42238.02 is added to the Education Code, to
5read:

6

42238.02.  

(a) The amount computed pursuant to this section
7shall be known as the school district and charter school local
8control funding formula.

9(b) (1) For purposes of this section “unduplicated pupil” means
10a pupil enrolled in a school district or a charter school who is either
11classified as an English learner pursuant to Section 52164, as that
12section read on January 1, 2014, eligible to receive a free or
13reduced-price meal pursuant to Section 49552, as that section read
14on January 1, 2014, or is a foster youth pursuant to Sections 300
15and 601 of the Welfare and Institutions Code. A pupil shall be
16counted only once for purposes of this section if any of the
17following apply:

18(A) The pupil is classified as an English learner and is eligible
19for a free or reduced-price meal.

20(B) The pupil is classified as an English learner and is a foster
21youth.

22(C) The pupil is classified as a foster youth and is eligible for
23a free or reduced-price meal.

24(D) The pupil is classified as an English learner, is eligible for
25a free or reduced-price meal, and is a foster youth.

begin delete

26(2) For purposes if this section, a pupil shall not be classified
27as an English learner for more than five school years in total.

end delete
begin delete

28 28(3)

end delete

29begin insert(2)end insert Commencing with the 2014-15 fiscal year, a school district
30or charter school shall annually report its enrolled unduplicated
31pupil, free and reduced-price meal eligibility, foster youth, and
32English learner pupil counts to the Superintendent.

begin delete

32 33(4)

end delete

34begin insert(3)end insert Commencing with the 2014-15 fiscal year, a county office
35of education shall review and validate reported English learner,
36foster youth, and free or reduced-price meal eligible pupil data for
37 school districts and charter schools under their jurisdiction to
38ensure the data is reported accurately.

begin delete

37 39(5)

end delete

P65   1begin insert(4)end insert The counts of unduplicated pupils shall be derived by the
2Superintendent using the California Longitudinal Pupil
3Achievement Data System.

begin delete

P65 1 4(6)

end delete

5begin insert(5)end insert The Superintendent shall calculate the percentage of
6unduplicated pupils for each school district and charter school by
7dividing the enrollment of unduplicated pupils in a school district
8or charter school by the total enrollment in that school district or
9charter school.

10(c) Commencing with the 2014-15 fiscal year and each fiscal
11year thereafter, the Superintendent shall annually calculate a local
12control funding formula grant for each school district and charter
13school in the state pursuant to this section.

14(d) The Superintendent shall compute a grade span adjusted
15base grant equal to the total of the following amounts:

16(1) For the 2014-15 fiscal year, a base grant of:

17(A) ____ dollars ($____) for average daily attendance in grades
189 to 12, inclusive.

19(B) ____ dollars ($____) for average daily attendance in grades
207 and 8.

21(C) ____ dollars ($____) for average daily attendance in grades
224 to 6, inclusive.

23(D) ____ dollars ($____) for average daily attendance in
24kindergarten and grades 1 to 3, inclusive.

25(2) In each year the grade span adjusted base grants in paragraph
26(1) shall be adjusted by the percentage change in the annual average
27value of the Implicit Price Deflator for State and Local Government
28Purchases of Goods and Services for the United States, as published
29by the United States Department of Commerce for the 12-month
30period ending in the third quarter of the prior fiscal year. This
31percentage change shall be determined using the latest data
32available as of May 10 of the preceding fiscal year compared with
33the annual average value of the same deflator for the 12-month
34period ending in the third quarter of the second preceding fiscal
35year, using the latest data available as of May 10 of the preceding
36fiscal year, as reported by the Department of Finance.

37(3) (A) The Superintendent shall compute an additional
38adjustment to the kindergarten and grades 1 to 3, inclusive, base
39grant as adjusted for inflation pursuant to paragraph (2) equal to
4011.23 percent. The additional grant shall be calculated by
P66   1multiplying the kindergarten and grades 1 to 3, inclusive, base
2grant as adjusted by paragraph (2) by 11.23 percent.

3(B) Until paragraph (4) of subdivision (b) of Section 42238.03
4is effective, as a condition of the receipt of funds in this paragraph,
5a school district shall make progress toward maintaining an annual
6average class size of not more than 24 pupils for each classroom
7per school site in kindergarten and grades 1 to 3, inclusive, unless
8a collectively bargained alternative annual average class size for
9each classroom per school site in those grades is agreed to by the
10school district, pursuant to the following calculation:

11(i) Determine a school district’s annual average class size for
12each classroom per school site for kindergarten and grades 1 to 3,
13inclusive, in the prior year. For the 2014-15 fiscal year, this amount
14shall be the annual average class size for each classroom per school
15site for kindergarten and grades 1 to 3, inclusive, in the 2013-14
16fiscal year.

17(ii) Determine a school district’s percentage of total need
18pursuant to paragraph (2) of subdivision (b) of Section 42238.03.

19(iii) Determine the percentage of the need calculated in clause
20(ii) that is met by funding provided to the school district pursuant
21to paragraph (3) of subdivision (b) of Section 42238.03.

22(iv) Determine the difference between the amount computed
23pursuant to clause (i) and an annual average class size of not more
24than 24 pupils for each classroom per school site.

25(v) Calculate a current year annual average class size adjustment
26for each classroom per school site for kindergarten and grades 1
27to 3, inclusive, equal to the adjustment calculated in clause (iv)
28multiplied by one minus the percentage determined pursuant to
29clause (iii).

30(C) School districts that have an annual average class size for
31each classroom per school site for kindergarten and grades 1 to 3,
32inclusive, of 24 pupils or less for each classroom per school site
33in the 2013-14 fiscal year, shall be exempt from the requirements
34of subparagraph (B) so long as the school district continues to
35maintain an annual average class size for each classroom per school
36site for kindergarten and grades 1 to 3, inclusive, of not more than
3724 pupils in each classroom, unless a collectively bargained
38alternative ratio is agreed to by the school district.

39(D) Upon full implementation of the local control funding
40formula, as a condition of the receipt of funds in this paragraph,
P67   1all school districts shall maintain an annual average class size for
2each classroom per school site for kindergarten and grades 1 to 3,
3inclusive, of not more than 24 pupils for each classroom per school
4site in kindergarten and grades 1 to 3, inclusive, unless a
5collectively bargained alternative ratio is agreed to by the school
6district.

7(E) The annual average class size requirement for each
8classroom per school site for kindergarten and grades 1 to 3,
9inclusive, established pursuant to this paragraph shall not be subject
10to waiver by the state board pursuant to Section 33050 or by the
11Superintendent.

12(4) The Superintendent shall compute an additional adjustment
13to the base grant for grades 9 to 12, inclusive, as adjusted for
14inflation pursuant to paragraph (2), equal to 2.8 percent. The
15additional grant shall be calculated by multiplying the base grant
16for grades 9 to 12, inclusive, as adjusted by paragraph (2), by 2.8
17percent.

18(e) The Superintendent shall compute a supplemental grant
19add-on equal to 35 percent of the base grants as specified in
20subparagraphs (A) to (D), inclusive, of paragraph (1) of subdivision
21(d), as adjusted by paragraph (2) of subdivision (d), for each school
22district or charter school percentage of unduplicated pupils. The
23supplemental grant shall be calculated by multiplying the base
24grants as specified in subparagraphs (A) to (D), inclusive, of
25paragraph (1), as adjusted by paragraph (2) of subdivision (d), by
2635 percent and by the percentage of unduplicated pupils in that
27 school district or charter school.

28(f) The Superintendent shall compute an add-on to the total sum
29of a school district’s or charter school’s base and supplemental
30grants equal to the amount of funding a school district or charter
31school received from funds allocated pursuant to the Targeted
32Instructional Improvement Block Grant program, as set forth in
33Article 6 (commencing with Section 41540) of Chapter 3.2, for
34the 2013-14 fiscal year, as that article read on January 1, 2014. A
35school district or charter school shall not receive a total funding
36amount from this add-on greater than the total amount of funding
37received by the school district or charter school from that program
38in the 2013-14 fiscal year.

39(g) The Superintendent shall compute an add-on to the total
40sum of a school district’s or charter school’s base and supplemental
P68   1grants equal to the amount of funding a school district or charter
2school received from funds allocated pursuant to the
3Home-to-School Transportation program, as set forth in former
4Article 2 (commencing with Section 39820) of Chapter 1 of Part
523.5 and former Article 10 (commencing with Section 41850) of
6Chapter 5, for the 2013-14 fiscal year. A school district or charter
7school shall not receive a total funding amount from this add-on
8greater than the total amount received by the school district or
9charter school for that program in the 2013-14 fiscal year.

10(h) The sum of the local control funding formula rates computed
11pursuant to subdivisions (c) to (e), inclusive, shall be multiplied
12by:

13(1) For school districts, the average daily attendance of the
14school district in the corresponding grade level ranges computed
15pursuant to Section 42238.05.

16(2) For charter schools, the total current year average daily
17attendance in the corresponding grade level ranges.

18(i) Notwithstanding any other law, the Superintendent shall
19adjust the sum of each school district’s or charter school’s amount
20determined in subdivisions (f) to (h), inclusive, pursuant to the
21calculation specified in Section 42238.03, less the sum of the
22following:

23(1) (A) For school districts, the property tax revenue received
24pursuant to Chapter 3.5 (commencing with Section 75) and Chapter
256 (commencing with Section 95) of Part 0.5 of Division 1 of the
26Revenue and Taxation Code.

27(B) For charter schools, the in-lieu property tax amount provided
28to a charter school pursuant to Section 47635.

29(2) The amount, if any, received pursuant to Part 18.5
30(commencing with Section 38101) of Division 2 of the Revenue
31and Taxation Code.

32(3) The amount, if any, received pursuant to Chapter 3
33(commencing with Section 16140) of Part 1 of Division 4 of Title
342 of the Government Code.

35(4) Prior years’ taxes and taxes on the unsecured roll.

36(5) Fifty percent of the amount received pursuant to Section
3741603.

38(6) The amount, if any, received pursuant to the Community
39Redevelopment Law (Part 1 (commencing with Section 33000)
40of Division 24 of the Health and Safety Code), less any amount
P69   1received pursuant to Section 33401 or 33676 of the Health and
2Safety Code that is used for land acquisition, facility construction,
3reconstruction, or remodeling, or deferred maintenance and that
4is not an amount received pursuant to Section 33492.15, or
5paragraph (4) of subdivision (a) of Section 33607.5, or Section
633607.7 of the Health and Safety Code that is allocated exclusively
7for educational facilities.

8(7) The amount, if any, received pursuant to Sections 34183
9and 34188 of the Health and Safety Code.

10(8) (A) Revenue received pursuant to subparagraph (B) of
11paragraph (3) of subdivision (e) of Section 36 of Article XIII of
12the California Constitution.

13(B) Subparagraph (A) shall only offset entitlements provided
14for the purpose of paragraph (1) of subdivision (a) of Section
1542238.03 as continued in subsequent years by paragraph (3) of
16subdivision (a) of Section 42238.03.

17(j) A school district shall annually transfer to each of its charter
18schools funding in lieu of property taxes pursuant to Section 47635.

19(k) (1) The funds apportioned pursuant to this section and
20Section 42238.03, shall be available to a school district or charter
21school for any locally determined educational purpose.

22(2) School districts and charter schools that receive supplemental
23grants pursuant to this section shallbegin insert onlyend insert use those fundsbegin delete for any
24locally determined educational purpose so long as it substantially
25benefits the unduplicatedend delete
begin insert to serve and assist theend insert pupilsbegin delete thatend deletebegin insert whose
26circumstancesend insert
generated those fundsbegin delete as provided for inend deletebegin insert and shall
27supplement, not supplant, existing state and federal fundsend insert
begin insert expended
28on unduplicated pupils pursuant toend insert
a school district’s or charter
29school’s local control and accountability plan.

30(l) Nothing in this section shall be interpreted to authorize a
31school district that receives funding on behalf of a charter school
32pursuant to Section 47651 to redirect this funding for another
33purpose unless otherwise authorized in law or pursuant to an
34agreement between a charter school and its chartering authority.

35(m) Any calculations in law that are used for purposes of
36determining if a local educational agency is an excess tax school
37entity or basic aid school district, including, but not limited to, this
38section and Sections 42238.03, 41544, 47660, 47632, 47663,
3948310, and 48359.5, and Section 95 of the Revenue and Taxation
40Code, shall be made exclusive of the revenue received pursuant
P70   1to subparagraph (B) of paragraph (3) of subdivision (e) of Section
236 of Article XIII of the California Constitution.

3(n) A school district that does not receive an apportionment of
4state funds pursuant to this section as implemented pursuant to
5Section 42238.03, excluding funds apportioned due to the
6requirements of subdivision (d) of Section 42238.03 shall be
7considered a “basic aid school district” or an “excess tax entity.”

8(o) This section shall become operative on July 1, 2014.

9

SEC. 28.  

Section 42238.03 is added to the Education Code, to
10read:

11

42238.03.  

Commencing with the 2014-15 fiscal year and each
12fiscal year thereafter, the Superintendent shall allocate the
13appropriations in Section 14002 to each charter school and school
14district according to the following formula:

15(a) Calculate the prior year amount of funding for each school
16district and charter school, as follows:

17(1) For the 2014-15 fiscal year, the prior year funding level
18shall be the total of all of the following:

19(A) Entitlements for revenue limits in the 2013-14 fiscal year
20pursuant to Article 2 (commencing with Section 42238) and Article
212 (commencing with Section 47633) of Chapter 6 of Part 26.8 of
22Division 4, as those articles read on June 30, 2014.

23(B) Notwithstanding subparagraph (A), entitlements for revenue
24limits for fiscal years before June 30, 2014, shall be annually
25adjusted, as necessary, for average daily attendance and revenue
26offsets, as specified in paragraphs (1) to (7), inclusive, of
27subdivision (h) of Section 42238, as that section read on June 30,
282014, and the in-lieu property tax amount provided to a charter
29school pursuant to Section 47635, as that section read on June 30,
302014.

31(2) (A) Entitlements from items contained in Section 2.00, as
32adjusted pursuant to Section 12.42, of the Budget Act of 2013 for
33Items 6110-104-0001,begin delete 6110-105-0001,end delete 6110-108-0001,
346110-111-0001,begin delete 6110-119-0001, 6110-122-0001,end delete 6110-124-0001,
356110-128-0001, 6110-137-0001, 6110-144-0001, begin delete6110-156-0001,end delete
36 6110-158-0001,begin delete 6110-166-0001, 6110-167-0001,end delete 6110-181-0001,
376110-188-0001, 6110-189-0001, 6110-190-0001, 6110-193-0001,
386110-195-0001, 6110-198-0001, 6110-204-0001, 6110-208-0001,
396110-209-0001, 6110-211-0001, 6110-212-0001, 6110-227-0001,
406110-228-0001, 6110-232-0001, 6110-240-0001, 6110-242-0001,
P71   16110-243-0001, 6110-244-0001, 6110-245-0001, 6110-246-0001,
26110-247-0001, 6110-248-0001, 6110-260-0001, 6110-265-0001,
36110-267-0001, 6110-268-0001, 6360-101-0001, and 2013-14
4fiscal year funding for the Class Size Reduction Program pursuant
5to Chapter 6.10 (commencing with Section 52120) of Part 28 of
6Division 4, as it read on January 1, 2014.

7(B) Entitlements pursuant to Section 47634.1, as that section
8read on January 1, 2014, shall be adjusted for growth in average
9daily attendance.

10(3) For the 2015-16 fiscal year and each fiscal year thereafter,
11the prior year amount shall be the amount each school district or
12charter school received in the prior year pursuant to this section.

13(b) Calculate an adjustment to the amount in subdivision (a) as
14follows:

15(1) Subtract the amount in subdivision (a) from the amount
16computed for each school district or charter school under the local
17control funding formula entitlements in subdivision (i) of Section
1842238.02. School districts and charter schools with a negative
19difference shall be deemed to have a zero difference.

20(2) Each school district’s and charter school’s total need as
21calculated pursuant to paragraph (1) shall be divided by the sum
22of all school districts’ and charter schools’ total need to determine
23the school district’s or charter school’s respective proportions of
24total need.

25(3) Each school district’s and charter school’s proportion of
26total need shall be multiplied by any available appropriations for
27this purpose, and added to the school district’s or charter school’s
28funding amounts as calculated pursuant to subdivision (a).

29(4) If the total amount of funds available for allocation pursuant
30to this subdivision are sufficient to fully fund the amounts
31computed pursuant to paragraph (1), the local control funding
32formula grant computed pursuant to subdivision (c) of Section
3342238.02 shall be adjusted such that any available appropriations
34for this purpose in that fiscal year are expended pursuant to the
35local control funding formula.

36(c) begin insert(1)end insertbegin insertend insert Upon a determination that a school district or charter
37school equals or exceeds the local control funding formula target
38computed pursuant to subdivision (i) of Section 42238.02, as
39determined by the calculation of a zero difference pursuant to
40paragraph (1) of subdivision (b) of this section, this section shall
P72   1not apply and the school district or charter school shall receive an
2allocation equal to the amount calculated under Section 42238.02
3in that fiscal year and future fiscal years.

begin insert

4(2) In any fiscal year before paragraph (1) applies, the district
5superintendent of schools or charter school administrator shall
6develop, and present at least twice per fiscal year to the parents
7of pupils and the governing board of the school district or
8governing body of the charter school, information that enhances
9their understanding of and familiarity with the local control
10funding formula and the local control and accountability plan.
11When presenting this information, the district superintendent of
12schools or charter school administrator, at a minimum and
13consistent with Section 48985, how parents can meaningfully
14participate and how the school district or charter school will
15provide meaningful opportunities for parental involvement,
16including, but not limited to, effective schoolsite councils and
17English learning advisory committees.

end insert

18(d) Notwithstanding subdivisions (b) and (c), commencing with
19the 2014-15 fiscal year, a school district or charter school shall
20receive state-aid funding pursuant to paragraph (3) of subdivision
21(b) of no less than the funding the school district or charter school
22received from programs in paragraphs (1) and (2) of subdivision
23(a).

24(e) (1) For purposes of this section, commencing with the
252014-15 fiscal year and until all school districts and charter schools
26 equal or exceed their local control funding formula target computed
27pursuant to Section 42238.02 as determined by the calculation of
28a zero difference pursuant to paragraph (1) of subdivision (b), a
29newly operational charter school shall be determined to have a
30prior year per average daily attendance funding amount equal to
31the lesser of:

32(A) The prior year funding amount per average daily attendance
33for the school district in which the charter school is physically
34located. The Superintendent shall calculate the per average daily
35attendance amount for this purpose by dividing the total local
36control funding formula entitlement received by that school district
37in the prior year by prior year average daily attendance of that
38school district. For purposes of this paragraph, a charter school
39that is physically located in more than one school district, shall
40use the calculated per average daily attendance local control
P73   1funding entitlement of the school district with the highest prior
2year per average daily attendance funding amount.

3(B) The charter school’s local control funding formula rate
4computed pursuant to subdivisions (c) to (h), inclusive, of Section
542238.02.

6(2) For charter schools funded pursuant to paragraph (1), the
7charter school shall be eligible to receive growth funding pursuant
8to subdivision (b) toward meeting the newly operational charter
9school’s local control funding formula target.

10(3) Upon a determination that all school districts or charter
11schools equal or exceed the local control funding formula target
12computed pursuant to Section 42238.02 as determined by the
13calculation of a zero difference pursuant to paragraph (1) of
14subdivision (b) for all school districts and charter schools, this
15subdivision shall not apply and the charter school shall receive an
16allocation equal to the amount calculated under Section 42238.02
17in that fiscal year and future fiscal years.

18(f) This section shall become operative on July 1, 2014.

19

SEC. 29.  

Section 42238.04 is added to the Education Code, to
20read:

21

42238.04.  

(a) Notwithstanding any other law, revenue limit
22funding for school districts and charter school block grant funding
23for charter schools for the 2013-14 fiscal year and prior fiscal
24years shall continue to be adjusted pursuant to Article 2
25(commencing with Section 42238), and Article 2 (commencing
26with Section 47633) of Chapter 6 of Part 26.8 of Division 4, as
27those articles read on June 30, 2014.

28(b) This section shall become operative on July 1, 2014.

29

SEC. 30.  

Section 42238.05 is added to the Education Code, to
30read:

31

42238.05.  

(a) For purposes of Sections 42238.02 and 42238.03,
32the fiscal year average daily attendance shall be computed pursuant
33to paragraphs (1) or (2).

34(1) The second principal apportionment regular average daily
35attendance for either the current or prior fiscal year, whichever is
36greater. However, prior fiscal year average daily attendance shall
37be adjusted for any loss or gain of average daily attendance due
38to a reorganization or transfer of territory.

39(2) A school district that elects to receive funding pursuant to
40Article 4 (commencing with Section 42280) shall compute its units
P74   1of average daily attendance for purposes of Section 42238.02 by
2subtracting the amount determined in subparagraph (B) from the
3amount determined in subparagraph (A).

4(A) The units of average daily attendance computed pursuant
5to paragraph (1).

6(B) The units of average daily attendance resulting from pupils
7attending schools funded pursuant to Article 4 (commencing with
8Section 42280).

9(b) For purposes of this article, regular average daily attendance
10shall be the base grant average daily attendance.

11(c) For purposes of this section, the Superintendent shall
12distribute total ungraded enrollment and average daily attendance
13among kindergarten and each of grades 1 to 12, inclusive, in
14proportion to the amounts of graded enrollment and average daily
15attendance, respectively, in each of these grades.

16(d) For purposes of this section, the Superintendent shall
17distribute average daily attendance generated by the difference
18between prior year average daily attendance and current year
19average daily attendance, if positive, among kindergarten and each
20of grades 1 to 12, inclusive, in proportion to the amounts of graded
21average daily attendance, respectively, in each of these grades.

22(e) This section shall only apply to average daily attendance
23generated by school districts and shall not apply average daily
24attendance generated by charter schools.

25(f) A pupil shall not be counted more than once for purposes of
26calculating average daily attendance pursuant to this section.

27(g) This section shall become operative on July 1, 2014.

28

SEC. 31.  

Section 42238.051 is added to the Education Code,
29to read:

30

42238.051.  

(a) For purposes of paragraph (1) of subdivision
31(a) of Section 42238.05, a sponsoring school district’s average
32daily attendance shall be computed as follows:

33(1) Compute the sponsoring school district’s regular average
34daily attendance in the current year, excluding the attendance of
35pupils in charter schools.

36(2) (A) Compute the regular average daily attendance used to
37calculate the second principal apportionment of the school district
38for the prior year, excluding the attendance of pupils in charter
39schools.

P75   1(B) Compute the attendance of pupils who attended one or more
2noncharter schools of the school district between July 1, and the
3last day of the second period, inclusive, in the prior year, and who
4attended a charter school sponsored by the school district between
5July 1, and the last day of the second period, inclusive, in the
6current year. For purposes of this subparagraph, a pupil enrolled
7in a grade at a charter school sponsored by the school district shall
8not be counted if the school district does not offer classes for pupils
9enrolled in that grade. The amount of the attendance counted for
10any pupil for the purpose of this subparagraph may not be greater
11than the attendance claimed for that pupil by the charter school in
12the current year.

13(C) Compute the attendance of pupils who attended a charter
14school sponsored by the school district in the prior year and who
15attended one or more noncharter schools of the school district in
16the current year. The amount of the attendance counted for any
17pupil for the purpose of this subparagraph may not be greater than
18the attendance claimed for that pupil by the school district in the
19current year.

20(D) From the amount determined pursuant to subparagraph (B),
21subtract the amount determined pursuant to subparagraph (C). If
22the result is less than zero, the amount shall be deemed to be zero.

23(E) The prior year average daily attendance determined pursuant
24to subparagraph (A) shall be reduced by the amount determined
25pursuant to subparagraph (D).

26(3) To the greater of the amounts computed pursuant to
27paragraphs (1) and (2), add the regular average daily attendance
28in the current year of all pupils attending charter schools sponsored
29by the school district that are not funded through the charter schools
30local control funding formula allocation pursuant to Section
3142238.02, as implemented by Section 42238.03.

32(b) For purposes of this section, a “sponsoring school district”
33shall mean a “sponsoring local educational agency,” as defined in
34Section 47632, as that section read on January 1, 2014.

35(c) This section shall become operative on July 1, 2014.

36

SEC. 32.  

Section 42238.052 is added to the Education Code,
37to read:

38

42238.052.  

(a) Notwithstanding any other law, the prior year
39average daily attendance for a school district determined pursuant
40to subdivision (a) of Section 42238.051 shall be increased by the
P76   1prior year second principal apportionment average daily attendance
2of a school district only for a school that meets the following
3description:

4(1) The school was a district noncharter school in any year
5before the prior year.

6(2) The school was operated as a district-approved charter school
7in the prior year.

8(3) The school is again operated as a district noncharter school
9in the current year.

10(b) An adjustment to prior year average daily attendance
11pursuant to this section may not be made for the attendance of
12pupils who were not residents of the school district in the prior
13year.

14(c) This section shall become operative on July 1, 2014.

15

SEC. 33.  

Section 42238.053 is added to the Education Code,
16to read:

17

42238.053.  

(a) The fiscal year average daily attendance
18computed under Section 42238.05 shall be increased, for each
19school district that operates a school that meets the eligibility
20requirements set forth in subdivision (b), by the number of days
21of attendance of pupils enrolled in eligible schools in the school
22district who are currently migratory children, as defined by Section
2354441, and who are residing in state-operated migrant housing
24projects between the second principal apportionment and the end
25of the regular school year, divided by the number of days school
26was actually taught in the regular day schools of the district,
27excluding Saturdays and Sundays.

28(b) For a school district to be eligible for purposes of this
29section, the following conditions shall apply:

30(1) One or more state-operated migrant housing projects are
31located within the attendance area of the school.

32(2) The maximum number of pupils enrolled in the school in
33the relevant fiscal year who are currently migratory children, as
34calculated under subdivision (a), constitutes not less than one-third
35of the total pupil enrollment of the school.

36(c) The Superintendent shall establish rules and regulations for
37the implementation of this section.

38(d) This section shall become operative on July 1, 2014.

39

SEC. 34.  

Section 42238.06 is added to the Education Code, to
40read:

P77   1

42238.06.  

(a) Commencing on July 1, 2014, except where
2context requires otherwise, all of the following shall apply:

3(1) References to “revenue limit” shall instead refer to the “local
4control funding formula.”

5(2) References to “the revenue limit calculated pursuant to
6Section 42238” shall instead refer to “the local control funding
7formula calculated pursuant to Section 42238.02, as implemented
8by Section 42238.03.”

9(3) References to “Section 42238” shall instead refer to “Section
1042238.02, as implemented pursuant to Section 42238.03.”

11(4) References to “Section 42238.1” shall instead refer to
12“Section 42238.02.”

13(5) References to “Section 42238.5” shall instead refer to
14“Section 42238.05.”

15(6) References to “general-purpose entitlement” shall instead
16refer to “local control funding formula grant funding pursuant to
17Section 42238.02, as implemented by Section 42238.03.”

18(b) This section shall become operative on July 1, 2014.

19

SEC. 35.  

Section 42238.1 of the Education Code is amended
20to read:

21

42238.1.  

(a) For the 1986-87 fiscal year and each fiscal year
22up to and including the 1998-99 fiscal year, the Superintendent
23of Public Instruction shall compute an inflation adjustment equal
24to the product of paragraphs (1) and (2):

25(1) Compute the sum of the following:

26(A) The statewide average base revenue limit per unit of average
27daily attendance for the prior fiscal year for districts of similar
28type.

29(B) The amount, if any, per unit of average daily attendance
30received by the district pursuant to Article 8 (commencing with
31Section 46200) of Chapter 2 of Part 26 for the prior fiscal year.

32(2) The percentage change in the annual average value of the
33Implicit Price Deflator for State and Local Government Purchases
34of Goods and Services for the United States, as published by the
35United States Department of Commerce for the 12-month period
36ending in the third quarter of the prior fiscal year. This percentage
37change shall be determined using the latest data available as of
38May 1 of the preceding fiscal year compared with the annual
39average value of the same deflator for the 12-month period ending
40in the third quarter of the second preceding fiscal year, using the
P78   1latest data available as of May 1 of the second preceding fiscal
2year, as reported by the Department of Finance.

3(b) For the 1999-2000 fiscal year and each fiscal year thereafter,
4the Superintendent of Public Instruction shall compute an inflation
5adjustment equal to the product of paragraphs (1) and (2):

6(1) Compute the sum of the following:

7(A) The statewide average base revenue limit per unit of average
8daily attendance for the prior fiscal year for districts of similar
9type.

10(B) The amount, if any, per unit of average daily attendance
11received by the district pursuant to Article 8 (commencing with
12Section 46200) of Chapter 2 of Part 26 for the prior fiscal year.

13(2) The percentage change in the annual average value of the
14Implicit Price Deflator for State and Local Government Purchases
15of Goods and Services for the United States, as published by the
16United States Department of Commerce for the 12-month period
17ending in the third quarter of the prior fiscal year. This percentage
18change shall be determined using the latest data available as of
19May 10 of the preceding fiscal year compared with the annual
20average value of the same deflator for the 12-month period ending
21in the third quarter of the second preceding fiscal year, using the
22latest data available as of May 10 of the preceding fiscal year, as
23report by the Department of Finance.

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

25(d) This section shall become inoperative on July 1, 2014, and,
26as of January 1, 2015, is repealed, unless a later enacted statute,
27that becomes operative on or before January 1, 2015, deletes or
28extends the dates on which it becomes inoperative and is repealed.

29

SEC. 36.  

Section 42238.2 of the Education Code is amended
30to read:

31

42238.2.  

(a) (1) Notwithstanding Section 42238.5 or any other
32provision of law, a school district that meets any of the following
33conditions shall be entitled to an adjustment to its units of average
34daily attendance pursuant to this section:

35(A) The school district experiences a decline in the number of
36units of average daily attendance in excess of 8 percent of its total
37average daily attendance as a result of the closure of a facility
38operated by a branch of the United States Armed Forces in the
39school district’s boundaries.

P79   1(B) The school district experiences a decline in the number of
2units of average daily attendance that is less than 8 percent but at
3least 5 percent of its total average daily attendance as a result of
4the closure of a facility operated by a branch of the United States
5Armed Forces in that school district’s boundaries, upon a finding
6by both the Superintendent of Public Instruction and the Director
7of Finance that both of the following conditions exist:

8(i) The school district demonstrates that at the end of a three-year
9period the school district will experience a 10-percent reduction
10in the amount of funding that the school district would otherwise
11have received from state apportionments, funding received pursuant
12to the California State Lottery Act of 1984 (Chapter 12.5
13(commencing with Section 8880) of Division 1 of Title 2 of the
14Government Code), and funding received pursuant to Title VIII
15of Public Law 103-382, as a result of the loss of pupils related to
16the closure of a facility operated by a branch of the United States
17Armed Forces.

18(ii) The fiscal crisis and management assistance team established
19pursuant to Section 42127.8 has reviewed the school district’s
20finances and has found that the school district has taken significant
21steps to reduce expenditure.

22(C) The school district experiences a decline in the number of
23units of average daily attendance in excess of 5 percent of its total
24average daily attendance and the Director of Finance determines
25that the school district is likely, within eight years of that decline,
26to maintain a number of units of average daily attendance that is
27equivalent to the number of units of average daily attendance
28maintained by the school district prior to the decline.
29Notwithstanding subdivision (b), loan repayments shall commence
30no later than the fourth year after the base year or at a later time,
31as determined by the Director of Finance.

32(2) For purposes of this section, the year preceding a decline
33shall be the base year.

34(b) In the second year after the base year, the district average
35daily attendance pursuant to Section 42238.5 may, if the district
36chooses, be increased by 75 percent of the difference between the
37base year units of average daily attendance and the units of average
38daily attendance in the first year of decline. In the third year after
39the base year, the district average daily attendance pursuant to
40Section 42238.5 may, if the district chooses, be increased by 50
P80   1percent of the difference between the base year units of average
2daily attendance and the units of average daily attendance in the
3first year of decline. The amount of money represented by these
4increases shall be considered a loan to the school district. Loan
5repayments shall commence no later than the fourth year after the
6base year.

7(c) (1) The Superintendent of Public Instruction, in consultation
8with a school district subject to this section, shall determine a
9schedule for repayment of the total amount loaned pursuant to this
10section which may not exceed 10 years. Payments shall include
11interest charged at a rate based on the most current investment rate
12of the Pooled Money Investment Account in the General Fund as
13of the date of the disbursement of funds to the school district.

14(2) Upon written notification by the Superintendent of Public
15Instruction that the school district has not made one or more of the
16payments required by the schedule established pursuant to
17paragraph (1), the Controller shall withhold from Section A of the
18State School Fund the defaulted payment which shall not exceed
19the amount of any apportionment entitlement of the district to
20moneys in Section A of the State School Fund. In that regard, the
21Controller shall withhold the amount of any payment made under
22this subdivision, including reimbursement of the Controller’s
23administrative costs as determined under a schedule approved by
24the California Debt Advisory Commission, from subsequent
25apportionments to the school district from Section A of the State
26School Fund.

27(3) Any apportionments made by the Controller pursuant to
28paragraph (2) shall be deemed to be an allocation to the school
29district for purposes of subdivision (b) of Section 8 of Article XVI
30of the California Constitution, and for purposes of Chapter 2
31(commencing with Section 41200) of Part 24.

32(d) In no event shall the adjustment provided by this section
33cause the apportionment to a school district to exceed the amount
34that would otherwise be calculated for apportionment to the district
35pursuant to Sections 42238 and 42238.1.

36(e) This section does not apply to a school district that
37experiences a decline in enrollment as a result of a school district
38reorganization pursuant to Chapter 3 (commencing with Section
3935500) of Part 21 or any other law.

P81   1(f) This section shall become inoperative on July 1, 2014, and,
2as of January 1, 2015, is repealed, unless a later enacted statute,
3that becomes operative on or before January 1, 2015, deletes or
4extends the dates on which it becomes inoperative and is repealed.

5

SEC. 37.  

Section 42238.3 of the Education Code is amended
6to read:

7

42238.3.  

(a) For each year during the loan repayment period
8provided for in Section 42238.2, any district utilizing the
9adjustment pursuant to Section 42238.2 may adjust its revenue
10limit computed pursuant to Section 42238 to the statewide average
11revenue limit per unit of average daily attendance for its size and
12type of district in proportion to the percentage of the loan that the
13school district has repaid up to and including the year in which the
14revenue limit adjustment is made.

15(b) This section does not apply to a school district that
16experiences a decline in enrollment as a result of a school district
17reorganization pursuant to Chapter 3 (commencing with Section
1835500) of Part 21 or any other law.

19(c) This section shall become inoperative on July 1, 2014, and,
20as of January 1, 2015, is repealed, unless a later enacted statute,
21that becomes operative on or before January 1, 2015, deletes or
22extends the dates on which it becomes inoperative and is repealed.

23

SEC. 38.  

Section 42238.4 of the Education Code is amended
24to read:

25

42238.4.  

(a) For the 1995-96 fiscal year, the county
26superintendent of schools shall compute an equalization adjustment
27for each school district in the county, so that no district’s base
28revenue limit per unit of average daily attendance is less than the
29prior fiscal year statewide average base revenue limit for the
30appropriate size and type of district listed in subdivision (b) plus
31the inflation adjustment specified in Section 42238.1 for the current
32fiscal year for the appropriate type of district.

33For purposes of this section, the district base revenue limit and
34the statewide average base revenue limit shall not include any
35amounts attributable to Section 45023.4, 46200, or 46201.

36(b) Subdivision (a) shall apply to the following school districts,
37which shall be grouped according to size and type as follows:


38

 

 District

ADA   

Elementary   

less than 101

Elementary   

more than 100

High School   

less than 301

High School   

more than 300

Unified   

less than 1,501

Unified   

more than 1,500

P82   6

 

7(c) The Superintendent shall compute a revenue limit
8equalization adjustment for each school district’s base revenue
9limit per unit of average daily attendance as follows:

10(1) Add the products of the amount computed for each school
11district by the county superintendent pursuant to subdivision (a)
12and the average daily attendance used to calculate the district’s
13revenue limit for the current fiscal year as adjusted for the deficit
14factor in Section 42238.145.

15(2) Divide the amount appropriated for purposes of this section
16for the current fiscal year by the amount computed pursuant to
17paragraph (1).

18(3) Multiply the amount computed for the school district
19pursuant to subdivision (a) by the amount computed pursuant to
20paragraph (2).

21(d) For the purposes of this section, the 1994-95 statewide
22average base revenue limits determined for the purposes of
23subdivision (a) and the fraction computed pursuant to paragraph
24(2) of subdivision (c) by the Superintendent for the 1995-96 second
25principal apportionment shall be final, and shall not be calculated
26as subsequent apportionments. In no event shall the fraction
27computed pursuant to paragraph (2) of subdivision (c) exceed 1.00.
28For the purposes of determining the size of a district used in
29subdivision (b), the Superintendent shall use a school district’s
30revenue limit average daily attendance for the 1994-95 fiscal year
31determined pursuant to Section 42238.5 and Article 4 (commencing
32with Section 42280).

33(e) This section shall only be operative if the Director of Finance
34certifies that a settlement agreement in California Teachers
35Association v. Gould (Sacramento County Superior Court Case
36CV 373415) is effective. No funds shall be disbursed under this
37section for this purpose before August 1, 1996, and any
38apportionment or allocation of funds appropriated for purposes of
39this section shall be accounted for in the 1995-96 fiscal year.

P83   1(f) Appropriations for the 1995-96 fiscal year as a result of the
2implementation of this section shall be deemed “General Fund
3revenues appropriated for school districts,” as defined in
4subdivision (c) of Section 41202, for the 1995-96 fiscal year and
5“total allocations to school districts and community college districts
6from General Fund proceeds of taxes appropriated to Article
7XIII B,” as defined in subdivision (e) of Section 41202, for that
8fiscal year, for purposes of Section 8 of Article XVI of the
9California Constitution.

10(g) This section shall become inoperative on July 1, 2014, and,
11as of January 1, 2015, is repealed, unless a later enacted statute,
12that becomes operative on or before January 1, 2015, deletes or
13extends the dates on which it becomes inoperative and is repealed.

14

SEC. 39.  

Section 42238.41 of the Education Code is amended
15to read:

16

42238.41.  

(a) For the 1996-97 fiscal year, the county
17superintendent of schools, in conjunction with the Superintendent
18of Public Instruction, shall compute an equalization adjustment
19for each school district in the county, so that no district’s 1995-96
20base revenue limit per unit of average daily attendance is less than
21the 1995-96 fiscal year statewide average base revenue limit for
22the appropriate size and type of district listed in subdivision (b).

23For purposes of this section, the district base revenue limit and
24the statewide average base revenue limit shall not include any
25amounts attributable to Section 45023.4, 46200, or 46201.

26(b) Subdivision (a) shall apply to the following school districts,
27which shall be grouped according to size and type as follows:


28

 

 District

ADA 

Elementary   

less than 101

Elementary    

more than 100

High School   

less than 301

High School   

more than 300

Unified   

less than 1,501

Unified   

more than 1,500

P83  36

 

37(c) The Superintendent of Public Instruction shall compute a
38revenue limit equalization adjustment for each school district’s
39base revenue limit per unit of average daily attendance as follows:

P84   1(1) Add the products of the amount computed for each school
2district by the county superintendent pursuant to subdivision (a)
3and the average daily attendance used to calculate the district’s
4revenue limit for the current fiscal year as adjusted for the deficit
5factor in Section 42238.145.

6(2) Divide the amount appropriated for purposes of this section
7for the current fiscal year by the amount computed pursuant to
8paragraph (1).

9(3) Multiply the amount computed for the school district
10pursuant to subdivision (a) by the amount computed pursuant to
11paragraph (2).

12(d) For the purposes of this section, the 1995-96 statewide
13average base revenue limits determined for the purposes of
14subdivision (a) and the fraction computed pursuant to paragraph
15(2) of subdivision (c) by the Superintendent of Public Instruction
16for the 1995-96 second principal apportionment shall be final, and
17shall not be recalculated at subsequent apportionments. In no event
18shall the fraction computed pursuant to paragraph (2) of subdivision
19(c) exceed 1.00. For the purposes of determining the size of a
20district used in subdivision (b), county superintendents of schools,
21in conjunction with the Superintendent of Public Instruction, shall
22 use a school district’s revenue limit average daily attendance for
23the 1995-96 fiscal year as determined pursuant to Section 42238.5
24and Article 4 (commencing with Section 42280).

25(e) This section shall become inoperative on July 1, 2014, and,
26as of January 1, 2015, is repealed, unless a later enacted statute,
27that becomes operative on or before January 1, 2015, deletes or
28extends the dates on which it becomes inoperative and is repealed.

29

SEC. 40.  

Section 42238.42 of the Education Code is amended
30to read:

31

42238.42.  

(a) In the event that the amount required to be
32appropriated for the purpose of the state’s minimum funding
33obligation to school districts and community college districts
34pursuant to Section 8 of Article XVI of the California Constitution
35for the 1996-97 fiscal year, as determined in paragraph (1) of
36subdivision (b), exceeds the amount appropriated for that purpose
37for the 1996-97 fiscal year, as determined pursuant to paragraph
38(2) of subdivision (b), the amount computed pursuant to subdivision
39(d), is hereby appropriated from the General Fund to the
40Superintendent of Public Instruction for the purposes of equalizing
P85   1the revenue limits of school districts pursuant to subdivision (e)
2and Section 42238.43 and for the purpose of reducing the deficit
3factor applied to the revenue limits of county superintendents of
4schools pursuant to Section 2558.45 and reducing the deficit factor
5applied to the revenue limits of the school districts pursuant to
6Section 42238.145.

7(b) To determine the amounts available for the purposes of this
8section, the Department of Finance shall make the following
9computations:

10(1) At the first principal apportionment for the 1997-98 fiscal
11year, compute the level of General Fund revenues that meets the
12state’s minimum funding obligation to school districts and
13community college districts pursuant to Section 8 of Article XVI
14of the California Constitution for the 1996-97 fiscal year based
15upon the most current determination of data as defined in
16subdivision (a) of Section 41206 of the Education Code.

17(2) Subtract from the amount determined in paragraph (1) an
18amount equal to the total amount of General Fund revenues that
19have been appropriated for the purpose of meeting the state’s
20minimum funding obligation for the 1996-97 fiscal year to school
21districts and community college districts pursuant to Section 8 of
22Article XVI of the California Constitution as of February 1, 1998.

23(3) If the amount computed in paragraph (2) is greater than zero,
24that amount is the total amount available for the purposes of this
25section.

26(c) To determine the portion of the amount computed in
27subdivision (a) to set aside for community college districts pursuant
28to this section, the Department of Finance shall make the following
29computations:

30(1) Add the total General Fund allocations to school districts
31and community college districts for the purposes of meeting the
32state’s minimum funding obligation to school districts and
33community college districts pursuant to Section 8 of Article XVI
34of the California Constitution for the 1996-97 fiscal year to the
35total statewide amount of “allocated local proceeds of taxes,” as
36defined in subdivisions (g) and (h) of Section 41202, allocated to
37school districts and community college districts for the 1996-97
38fiscal year.

39(2) Divide the sum of the General Fund allocations made to
40community college districts for the purposes of meeting the state’s
P86   1minimum funding obligation to community college districts
2pursuant to Section 8 of Article XVI of the California Constitution
3for the 1996-97 fiscal year and the total statewide amount of
4“allocated local proceeds of taxes,” as defined in subdivision (h)
5of Section 41202, allocated to community college districts for the
61996-97 fiscal year by the sum computed pursuant to paragraph
7(1).

8(3) Multiply the amount computed pursuant to subdivision (b)
9by the percentage determined in paragraph (2). Community college
10districts shall be entitled to receive an amount equal to the amount
11computed pursuant to this paragraph and that amount shall be set
12aside from the General Fund for appropriation to community
13college districts by the Legislature.

14(d) The amount of the appropriation made pursuant to
15subdivision (a) of this section shall be computed by subtracting
16the amount computed in paragraph (3) of subdivision (c) from the
17amount computed pursuant to subdivision (b). The Director of the
18Department of Finance shall certify to the Controller the amount
19of the appropriation computed pursuant to this subdivision and
20under no circumstances shall funds be released by the Controller
21for purposes of this section before that certification is received by
22the Controller.

23(e) The Superintendent of Public Instruction shall allocate 50
24percent of the amount computed pursuant to subdivision (d) to
25school districts for the purpose of making equalization adjustments
26to the base revenue limit of school districts for the 1996-97 fiscal
27year, as follows:

28(1) The Superintendent of Public Instruction shall perform the
29computations set forth in Section 42238.43 for the purpose of
30equalization adjustments to the base revenue limits of school
31districts for the 1996-97 fiscal year to determine the amount to
32allocate to each school district pursuant to this paragraph.

33(2) The Superintendent of Public Instruction shall repeat the
34process of computing equalization adjustments to the base revenue
35limits of school districts for the 1996-97 fiscal year pursuant to
36Section 42238.43 until the total amount of funds available for that
37purpose pursuant to this subdivision is allocated to school districts.

38(3) If the total amount of funds available for allocation pursuant
39to this subdivision is insufficient to fully fund the amounts
40computed pursuant to paragraph (1) or the amount computed
P87   1pursuant to any of the iterations made pursuant to paragraph (2),
2the allocations computed pursuant to those paragraphs shall be
3reduced proportionately.

4(f) The Superintendent of Public Instruction shall allocate 50
5percent of the amount computed pursuant to subdivision (d) to
6county superintendents of schools for the purpose of reducing the
71996-97 and 1997-98 deficit factors applied to the revenue limits
8of county superintendent of schools and school districts pursuant
9to Sections 2558.45 and 42238.145, respectively. The amount of
10the allocation made to each school district and county
11superintendent of schools for the purpose of reducing their
12 respective deficit factors shall be computed in proportion to their
13respective shares of the total statewide amount of the revenue
14limits after adjustment for deficit factors for school districts and
15county superintendents of schools.

16(g) In no event shall this section be construed to require an
17appropriation that would cause the aggregate amount required to
18be appropriated from the General Fund for the 1996-97 fiscal year
19pursuant to Section 8 of Article XVI of the California Constitution
20to be exceeded.

21(h) This section shall become inoperative on July 1, 2014, and,
22as of January 1, 2015, is repealed, unless a later enacted statute,
23that becomes operative on or before January 1, 2015, deletes or
24extends the dates on which it becomes inoperative and is repealed.

25

SEC. 41.  

Section 42238.43 of the Education Code is amended
26to read:

27

42238.43.  

(a) (1) For the 1996-97 fiscal year, the county
28superintendent of schools, in conjunction with the Superintendent
29of Public Instruction, shall compute an equalization adjustment
30for each school district in the county, so that no district’s base
31revenue limit per unit of average daily attendance is less than the
321996-97 fiscal year statewide average base revenue limit for the
33appropriate size and type of district listed in subdivision (b).

34(2) For purposes of this section, the district base revenue limit
35and the statewide average base revenue limit shall not include any
36amounts attributable to Section 45023.4, 46200, or 46201.

37(b) Subdivision (a) shall apply to the following school districts,
38which shall be grouped according to size and type as follows:


39

 

 District

 

ADA 

Elementary   

 

less than 101

Elementary   

 

more than 100

High School   

 

less than 301

High School   

 

more than 300

Unified   

 

less than 1,501

Unified   

 

more than 1,500

P88   7

 

8(c) The equalization adjustment computed pursuant to this
9section shall only be funded from amounts appropriated for that
10purpose pursuant to Section 42238.42.

11(d) (1) For the purposes of the computation made pursuant to
12paragraph (1) of subdivision (e) of Section 42238.42, the 1996-97
13statewide average base revenue limits determined for the purposes
14of subdivision (a) and the fraction, if any, computed pursuant to
15paragraph (3) of subdivision (e) of Section 42238.42 by the
16Superintendent of Public Instruction for the 1996-97 second
17principal apportionment shall be final, and shall not be calculated
18 as subsequent apportionments. In no event shall the fraction
19computed pursuant to paragraph (3) of subdivision (e) of Section
2042238.42 exceed 1.00. If any iterations are required pursuant to
21paragraph (2) of Section 42238.42, the Superintendent of Public
22Instruction shall recompute the 1996-97 statewide average base
23revenue limit to include any adjustments made by the immediately
24preceding iteration.

25(2) (A) For the purposes of determining the size of a school
26district under subdivision (b), the Superintendent of Public
27Instruction shall use a school district’s revenue limit average daily
28attendance for the 1996-97 fiscal year as determined pursuant to
29Section 42238.5 and Article 4 (commencing with Section 42280).

30(B) Notwithstanding subparagraph (A), for the purposes of
31determining the size of a school district under subdivision (b) with
32respect to any elementary, high, or unified school district that was
33funded in the 1996-97 school year as a large elementary, high, or
34unified school district, as determined pursuant to subdivision (a)
35of Section 42238.5, the school district’s actual revenue limit
36average daily attendance for the 1996-97 school year may be used.
37The actual revenue limit average daily attendance for the 1996-97
38school year shall be used to calculate the 1996-97 revenue limit
39of a school district exercising the authority granted under this
40subparagraph. The governing board of a school district to which
P89   1this subparagraph is applicable may exercise the authority granted
2under this subparagraph by enacting a resolution to that effect and
3transmitting a copy of that resolution to the Superintendent of
4Public Instruction on or before a date designated by the
5Superintendent of Public Instruction for that school year. After the
6Superintendent of Public Instruction receives the resolution, the
7superintendent shall make the necessary adjustments to the school
8district’s revenue limit calculation.

9(e) This section shall become inoperative on July 1, 2014, and,
10as of January 1, 2015, is repealed, unless a later enacted statute,
11that becomes operative on or before January 1, 2015, deletes or
12extends the dates on which it becomes inoperative and is repealed.

13

SEC. 42.  

Section 42238.44 of the Education Code is amended
14to read:

15

42238.44.  

(a) This section shall be known and may be cited
16as, the Fairness in Education Funding Act.

17(b) (1) For the 2004-05 fiscal year, the Superintendent of Public
18Instruction shall compute an equalization adjustment for each
19school district, so that the 2003-04 base revenue limit per unit of
20average daily attendance of a district is not less than the 2003-04
21base revenue limit per unit of average daily attendance above which
22fall not more than 10 percent of the total statewide units of average
23daily attendance for each category of school district set forth in
24subdivision (c).

25(2) For purposes of this section, the district base revenue limit
26and the statewide average base revenue limit shall not include any
27amounts attributable to Section 45023.4, 46200, or 46201.

28(c) Subdivision (b) shall apply to the following school districts,
29which shall be grouped according to size and type as follows:


30

 

 District

ADA   

Elementary   

less than 101

Elementary   

more than 100

High School   

less than 301

High School   

more than 300

Unified   

less than 1,501

Unified   

more than 1,500

P89  38

 

P90   1(d) The Superintendent of Public Instruction shall compute a
2revenue limit equalization adjustment for each school district’s
3base revenue limit per unit of average daily attendance as follows:

4(1) Multiply the amount computed for each school district
5pursuant to subdivision (b) by the average daily attendance used
6to calculate the revenue limit for the 2004-05 fiscal year of a
7district.

8(2) Divide the amount appropriated for purposes of this section
9for the 2004-05 fiscal year by the statewide sum of the amount
10computed pursuant to paragraph (1).

11(3) Multiply the amount computed for the school district
12pursuant to paragraph (1) of subdivision (b) by the amount
13computed pursuant to paragraph (2).

14(e) (1) For the purposes of this section, the 2003-04 statewide
1590th percentile base revenue limit determined pursuant to paragraph
16(1) of subdivision (b), and the fraction computed pursuant to
17paragraph (2) of subdivision (d) for the 2003-04 second principal
18apportionment, shall be final, and shall not be recalculated at
19subsequent apportionments. The fraction computed pursuant to
20paragraph (2) of subdivision (d) shall not, under any circumstances,
21exceed 1.00. For purposes of determining the size of a school
22district pursuant to subdivision (c), county superintendents of
23schools, in conjunction with the Superintendent of Public
24Instruction, shall use school district revenue limit average daily
25attendance for the 2003-04 fiscal year as determined pursuant to
26Section 42238.5 and Article 4 (commencing with Section 42280).

27(2) For the purposes of calculating the size of a school district
28pursuant to subdivision (c), the Superintendent of Public Instruction
29shall include units of average daily attendance of any charter school
30for which the school district is the chartering agency.

31(3) For the purposes of computing the target amounts pursuant
32to subdivision (b), the Superintendent of Public Instruction shall
33count all charter school average daily attendance toward the
34average daily attendance of the school district that is the chartering
35agency.

36(f) This section shall become inoperative on July 1, 2014, and,
37as of January 1, 2015, is repealed, unless a later enacted statute,
38that becomes operative on or before January 1, 2015, deletes or
39extends the dates on which it becomes inoperative and is repealed.

P91   1

SEC. 43.  

Section 42238.445 of the Education Code is amended
2to read:

3

42238.445.  

(a) (1) For the 2002-03 fiscal year, the
4Superintendent of Public Instruction shall compute an equalization
5adjustment for each school district by determining the amount that
6would be necessary to assure that no district’s 2001-02 base
7revenue limit per unit of average daily attendance is less than the
82001-02 base revenue limit per unit of average daily attendance
9above which fall not more than 10 percent of the total statewide
10units of average daily attendance for each category of school
11district set forth in subdivision (b).

12(2) For purposes of this section, the district base revenue limit
13and the statewide average base revenue limit shall not include any
14amounts attributable to Section 45023.4, 46200, or 46201.

15(b) Subdivision (a) shall apply to the following school districts,
16which shall be grouped according to size and type as follows:


17

 

 District

ADA   

Elementary   

less than 101

Elementary   

more than 100

High School   

less than 301

High School   

more than 300

Unified   

less than 1,501

Unified   

more than 1,500

P91  25

 

26(c) The Superintendent of Public Instruction shall determine
27and allocate, on a one-time basis, an amount for each school district
28as follows:

29(1) Multiply the amount computed for each school district
30pursuant to subdivision (a) by the average daily attendance used
31to calculate the district’s revenue limit for the 2002-03 fiscal year.

32(2) Divide forty-two million dollars ($42,000,000) appropriated
33 pursuant to Provision 2 of Item 6110-223-0001 of Section 2.00 of
34the Budget Act of 2002 by the statewide sum of the amount
35computed pursuant to paragraph (1).

36(3) Multiply the amount computed for the school district
37pursuant to paragraph (1) by the amount computed pursuant to
38paragraph (2).

39(d) (1) For the purposes of this section, the 2001-02 statewide
4090th percentile base revenue limit determined pursuant to paragraph
P92   1(1) of subdivision (a), and the fraction computed pursuant to
2paragraph (2) of subdivision (c) for the 2001-02 second principal
3apportionment, shall be final, and shall not be recalculated at
4subsequent apportionments. The fraction computed pursuant to
5paragraph (2) of subdivision (c) shall not, under any circumstances,
6exceed 1.00. For purposes of determining the size of a school
7district pursuant to subdivision (b), county superintendents of
8 schools, in conjunction with the Superintendent of Public
9Instruction, shall use school district revenue limit average daily
10attendance for the 2001-02 fiscal year as determined pursuant to
11Section 42238.5 and Article 4 (commencing with Section 42280).

12(2) For the purposes of calculating the size of a school district
13pursuant to subdivision (b), the Superintendent of Public Instruction
14shall include units of average daily attendance of any charter school
15for which the school district is the chartering agency.

16(3) For the purposes of computing the target amounts pursuant
17to subdivision (a), the Superintendent of Public Instruction shall
18count all charter school average daily attendance toward the
19average daily attendance of the school district that is the chartering
20agency.

21(e) Allocations pursuant to this section do not represent
22adjustments to school district base revenue limits.

23(f) This section shall become inoperative on July 1, 2014, and,
24as of January 1, 2015, is repealed, unless a later enacted statute,
25that becomes operative on or before January 1, 2015, deletes or
26extends the dates on which it becomes inoperative and is repealed.

27

SEC. 44.  

Section 42238.45 of the Education Code is amended
28to read:

29

42238.45.  

(a) (1) For the 2001-02 fiscal year, the
30Superintendent of Public Instruction shall compute an adjustment
31for each school district, so that no district’s 2000-01 base revenue
32limit per unit of average daily attendance is less than the 2000-01
33base revenue limit per unit of average daily attendance above which
34fall not more than 10 percent of the total statewide units of average
35daily attendance for each category of school district set forth in
36subdivision (b).

37(2) For purposes of this section, the district base revenue limit
38and the statewide average base revenue limit shall not include any
39amounts attributable to Section 45023.4, 46200, or 46201.

P93   1(b) Subdivision (a) shall apply to the following school districts,
2which shall be grouped according to size and type as follows:


3

 

 District

ADA   

Elementary   

less than 101

Elementary   

more than 100

High School   

less than 301

High School   

more than 300

Unified   

less than 1,501

Unified   

more than 1,500

P93  11

 

12(c) For the 2001-02 fiscal year, the Superintendent of Public
13Instruction shall determine and allocate on a one-time basis for
14each school district amounts as follows:

15(1) Multiply the amount computed for each school district
16pursuant to subdivision (a) by the average daily attendance used
17to calculate the district’s revenue limit for the 2001-02 fiscal year.

18(2) Divide forty million dollars ($40,000,000) appropriated for
19purposes of this section for the 2001-02 fiscal year by the statewide
20sum of the amount computed pursuant to paragraph (1).

21(3) Multiply the amount computed for the school district
22pursuant to paragraph (1) of subdivision (a) by the amount
23computed pursuant to paragraph (2).

24(d) (1) For the purposes of calculating the size of a school
25district pursuant to subdivision (b), the Superintendent of Public
26Instruction shall include units of average daily attendance of any
27charter school for which the school district is the chartering agency.

28(2) For the purposes of computing the target amounts pursuant
29to subdivision (a), the Superintendent of Public Instruction shall
30count all charter school average daily attendance toward the
31average daily attendance of the school district that is the chartering
32agency.

33(e) Allocations for purposes of this section do not represent
34adjustments to school district base revenue limits.

35(f) This section shall become inoperative on July 1, 2014, and,
36as of January 1, 2015, is repealed, unless a later enacted statute,
37that becomes operative on or before January 1, 2015, deletes or
38extends the dates on which it becomes inoperative and is repealed.

39

SEC. 45.  

Section 42238.46 of the Education Code is amended
40to read:

P94   1

42238.46.  

(a) For the 2003-04 fiscal year, the Superintendent
2of Public Instruction shall compute an equalization adjustment for
3each school district so that no district’s 2002-03 adjusted base
4revenue limit per unit of average daily attendance is less than the
52002-03 fiscal year adjusted base revenue limit above which fall
6not more that 8.25 percent of the total statewide units of average
7daily attendance for the appropriate size and type of district listed
8in subdivision (b).

9For purposes of this section, the district adjusted base revenue
10limit and the statewide average adjusted base revenue limit may
11not include any amounts attributable to Section 45023.4, 46200,
12or 46201.

13(b) Subdivision (a) applies to the following school districts,
14which shall be grouped according to size and type as follows:


15

 

 District

ADA   

Elementary   

less than 101

Elementary   

more than 100

High School   

less than 301

High School   

more than 300

Unified   

less than 1,501

Unified   

more than 1,500

P94  23

 

24(c) The Superintendent of Public Instruction shall compute a
25revenue limit equalization adjustment for each school district’s
26adjusted base revenue limit per unit of average daily attendance
27as follows:

28(1) Add the products of the amount computed for each school
29district by the county superintendent pursuant to subdivision (a)
30and the average daily attendance used to calculate the district’s
31revenue limit for the current fiscal year.

32(2) Divide the amount appropriated for purposes of this section
33for the current fiscal year by the amount computed pursuant to
34paragraph (1).

35(3) Multiply the amount computed for the school district
36pursuant to subdivision (a) by the amount computed pursuant to
37paragraph (2).

38(d) (1) For purposes of this section only, prior to computing
39the equalization adjustment pursuant to this section, the
40Superintendent of Public Instruction shall calculate an adjusted
P95   1base revenue limit for each district by revising the 2002-03 base
2revenue limit of the district to eliminate that portion of the one-time
3adjustment to its base revenue limit related to excused absences
4made pursuant to Section 42238.8.

5(2) For the purposes of this section, the 2002-03 statewide
6average adjusted base revenue limits determined for the purposes
7of subdivision (a) and the fraction computed pursuant to paragraph
8(2) of subdivision (c) by the Superintendent of Public Instruction
9for the 2002-03 second principal apportionment shall be final, and
10shall not be recalculated at subsequent apportionments. In no event
11shall the fraction computed pursuant to paragraph (2) of subdivision
12(c) exceed 1.00. For the purposes of determining the size of a
13district used in subdivision (b), county superintendents of schools,
14in conjunction with the Superintendent of Public Instruction, shall
15use a school district’s revenue limit average daily attendance for
16the 2002-03 fiscal year as determined pursuant to Section 42238.5
17and Article 4 (commencing with Section 42280).

18(3) For the purposes of calculating the size of a school district
19pursuant to subdivision (b), the Superintendent of Public Instruction
20shall include units of average daily attendance of any charter school
21for which the school district is the chartering agency.

22(4) For the purposes of computing the target amounts pursuant
23to subdivision (a), the Superintendent of Public Instruction shall
24count all charter school average daily attendance towards the
25average daily attendance of the school district that is the chartering
26agency.

27(e) This section shall become inoperative on July 1, 2014, and,
28as of January 1, 2015, is repealed, unless a later enacted statute,
29that becomes operative on or before January 1, 2015, deletes or
30extends the dates on which it becomes inoperative and is repealed.

31

SEC. 46.  

Section 42238.48 of the Education Code is amended
32to read:

33

42238.48.  

(a) (1) For the 2006-07 fiscal year, the
34Superintendent shall compute an equalization adjustment for each
35school district, so that the 2005-06 base revenue limit per unit
36average daily attendance of a school district is not less than the
372005-06 base revenue limit per unit of average daily attendance
38above which fall not more than 10 percent of the total statewide
39units of average daily attendance for each category of school
40district set forth in subdivision (b).

P96   1(2) For purposes of this section, the base revenue limit shall not
2include any amounts attributable to Section 45023.4, 46200, or
346201.

4(b) Subdivision (a) shall apply to the following school districts,
5which shall be grouped according to size and type as follows:


6

 

 District

ADA   

Elementary   

less than 101

Elementary   

more than 100

High School   

less than 301

High School   

more than 300

Unified   

less than 1,501

Unified   

more than 1,500

P96  14

 

15(c) The Superintendent shall compute a revenue limit
16equalization adjustment for each school district’s base revenue
17limit per unit of average daily attendance as follows:

18(1) Multiply the amount computed for each school district
19pursuant to subdivision (a) by the average daily attendance used
20to calculate the revenue limit for the 2006-07 fiscal year of a school
21district.

22(2) Divide the amount appropriated for purposes of this section
23for the 2006-07 fiscal year by the statewide sum of the amount
24computed pursuant to paragraph (1).

25(3) Multiply the amount computed for the school district
26pursuant to paragraph (1) of subdivision (a) by the amount
27computed pursuant to paragraph (2).

28(d) (1) For the purposes of this section, the 2005-06 statewide
2990th percentile base revenue limit determined pursuant to paragraph
30(1) of subdivision (a), and the fraction computed pursuant to
31paragraph (2) of subdivision (c) for the 2005-06 second principal
32apportionment, shall be final, and shall not be recalculated at
33subsequent apportionments. The fraction computed pursuant to
34paragraph (2) of subdivision (c) shall not exceed 1.00. For purposes
35of determining the size of a school district pursuant to subdivision
36(b), county superintendents of schools, in conjunction with the
37Superintendent, shall use school district revenue limit average
38daily attendance for the 2005-06 fiscal year as determined pursuant
39to Section 42238.5 and Article 4 (commencing with Section
4042280).

P97   1(2) For the purposes of calculating the size of a school district
2pursuant to subdivision (b), the Superintendent shall include units
3of average daily attendance of any charter school for which the
4school district is the sponsoring local educational agency.

5(3) For the purposes of computing the target amounts pursuant
6to subdivision (a), the Superintendent shall count all charter school
7average daily attendance toward the average daily attendance of
8the school district that is the sponsoring local educational agency.

9(e) This section shall become inoperative on July 1, 2014, and,
10as of January 1, 2015, is repealed, unless a later enacted statute,
11that becomes operative on or before January 1, 2015, deletes or
12extends the dates on which it becomes inoperative and is repealed.

13

SEC. 47.  

Section 42238.485 of the Education Code is amended
14to read:

15

42238.485.  

(a) For the 2010-11 fiscal year, the Superintendent
16shall compute an adjustment for each school district by dividing
17each school district’s 2007-08 fiscal year average daily attendance
18into the sum of the following:

19(1) Funding for Meals for Needy Pupils programs received by
20the school district for the 2007-08 fiscal year pursuant to Section
2142241.2, as it read on January 1, 2009.

22(2) Funding incentives to increase beginning teachers’ salaries
23received by the school district for the 2007-08 fiscal year pursuant
24to Sections 45023.1 and 45023.4, as those sections read on January
251, 2009.

26(b) For purposes of this section, average daily attendance shall
27be computed pursuant to Section 42238.5.

28(c) Notwithstanding any other provision of this section, no
29funding specified in this section shall be added to the adjustment
30computed pursuant to subdivision (a) if that funding is currently
31included in a school district’s base revenue limit calculated
32pursuant to Section 42238.

33(d) This section shall become inoperative on July 1, 2014, and,
34as of January 1, 2015, is repealed, unless a later enacted statute,
35that becomes operative on or before January 1, 2015, deletes or
36extends the dates on which it becomes inoperative and is repealed.

37

SEC. 48.  

Section 42238.49 of the Education Code is amended
38to read:

39

42238.49.  

(a) (1) For the 2011-12 fiscal year, the
40Superintendent shall compute an equalization adjustment for each
P98   1school district, so that the 2010-11 base revenue limit per unit of
2average daily attendance of a school district is not less than the
32010-11 base revenue limit per unit of average daily attendance
4above which fall not more than 10 percent of the total statewide
5units of average daily attendance for each category of school
6district set forth in subdivision (b).

7(2) For purposes of this section, the base revenue limit shall not
8include any amounts attributable to Section 45023.4, 46200, or
946201.

10(b) Subdivision (a) shall apply to the following school districts,
11which shall be grouped according to size and type as follows:


12

 

 District

  ADA

Elementary   

less than 101

Elementary   

more than 100

High School   

less than 301

High School   

more than 300

Unified   

less than 1,501

Unified   

more than 1,500

P98  20

 

21(c) The Superintendent shall compute a revenue limit
22equalization adjustment for each school district’s base revenue
23limit per unit of average daily attendance as follows:

24(1) Multiply the amount computed for each school district
25pursuant to subdivision (a) by the average daily attendance used
26to calculate the revenue limit for the 2011-12 fiscal year of a school
27district.

28(2) Divide the amount appropriated from the Supplemental
29Education Payment Account for purposes of this section for the
302011-12 fiscal year by the statewide sum of the amounts computed
31pursuant to paragraph (1).

32(3) Multiply the amount computed for the school district
33pursuant to paragraph (1) of subdivision (a) by the amount
34computed pursuant to paragraph (2).

35(d) (1) For the purposes of this section, the 2010-11 statewide
3690th percentile base revenue limit determined pursuant to paragraph
37(1) of subdivision (a), and the fraction computed pursuant to
38paragraph (2) of subdivision (c) for the 2010-11 second principal
39apportionment, shall be final, and shall not be recalculated at
40subsequent apportionments. The fraction computed pursuant to
P99   1paragraph (2) of subdivision (c) shall not exceed 1.00. For purposes
2of determining the size of a school district pursuant to subdivision
3(b), county superintendents of schools, in conjunction with the
4Superintendent, shall use school district revenue limit average
5daily attendance for the 2010-11 fiscal year as determined pursuant
6to Section 42238.5 and Article 4 (commencing with Section
742280).

8(2) For the purposes of calculating the size of a school district
9pursuant to subdivision (b), the Superintendent shall include units
10of average daily attendance of any charter school for which the
11school district is the sponsoring local educational agency.

12(3) For the purposes of computing the target amounts pursuant
13to subdivision (a), the Superintendent shall count all charter school
14average daily attendance toward the average daily attendance of
15the school district that is the sponsoring local educational agency.

16(e) This section shall become inoperative on July 1, 2014, and,
17 as of January 1, 2015, is repealed, unless a later enacted statute,
18that becomes operative on or before January 1, 2015, deletes or
19extends the dates on which it becomes inoperative and is repealed.

20

SEC. 49.  

Section 42238.5 of the Education Code is amended
21to read:

22

42238.5.  

(a) For purposes of Section 42238, the fiscal year
23average daily attendance shall be computed pursuant to paragraph
24(1) or (2).

25(1) The second principal apportionment regular average daily
26attendance for either the current or prior fiscal year, whichever is
27greater. However, prior fiscal year average daily attendance shall
28be adjusted for any loss or gain of average daily attendance due
29to a reorganization or transfer of territory, or, commencing in the
301993-94 fiscal year, and each fiscal year thereafter, for any change
31in average daily attendance for pupils who are concurrently enrolled
32in adult programs and classes pursuant to Section 52616.17.

33(2) Any school district that elects to receive funding pursuant
34to Article 4 (commencing with Section 42280) shall compute its
35units of average daily attendance for purposes of Section 42238
36by subtracting the amount determined in subparagraph (B) from
37the amount determined in subparagraph (A).

38(A) The units of average daily attendance computed pursuant
39to paragraph (1).

P100  1(B) The units of average daily attendance resulting from pupils
2attending schools funded pursuant to Article 4 (commencing with
3Section 42280).

4(b) For purposes of this article, regular average daily attendance
5shall be the base revenue limit average daily attendance, excluding
6summer school average daily attendance.

7(c) For purposes of this section, for the 1998-99 fiscal year
8only, the prior year average daily attendance shall be the 1997-98
9regular average daily attendance, excluding absences excused
10pursuant to subdivision (b) of Section 46010, as that subdivision
11read on July 1, 1996.

12(d) This section shall become inoperative on July 1, 2014, and,
13as of January 1, 2015, is repealed, unless a later enacted statute,
14that becomes operative on or before January 1, 2015, deletes or
15extends the dates on which it becomes inoperative and is repealed.

16

SEC. 50.  

Section 42238.51 of the Education Code is amended
17to read:

18

42238.51.  

(a) For purposes of paragraph (1) of subdivision
19(a) of Section 42238.5, a sponsoring school district’s average daily
20attendance shall be computed as follows:

21(1) Compute the sponsoring school district’s regular average
22daily attendance in the current year, excluding the attendance of
23pupils in charter schools.

24(2) (A) Compute the regular average daily attendance used to
25calculate the second principal apportionment of the school district
26for the prior year, excluding the attendance of pupils in charter
27schools.

28(B) Compute the attendance of pupils who attended one or more
29noncharter schools of the school district between July 1, and the
30last day of the second period, inclusive, in the prior year, and who
31attended a charter school sponsored by the school district between
32July 1, and the last day of the second period, inclusive, in the
33current year. For the purposes of this paragraph, a pupil enrolled
34in a grade at a charter school sponsored by the school district shall
35not be counted if the school district does not offer classes for pupils
36enrolled in that grade. The amount of the attendance counted for
37any pupil for the purpose of this subparagraph may not be greater
38than the attendance claimed for that pupil by the charter school in
39the current year.

P101  1(C) Compute the attendance of pupils who attended a charter
2school sponsored by the school district in the prior year and who
3attended one or more noncharter schools of the school district in
4the current year. The amount of the attendance counted for any
5pupil for the purpose of this subparagraph may not be greater than
6the attendance claimed for that pupil by the school district in the
7current year.

8(D) From the amount determined pursuant to subparagraph (B),
9subtract the amount determined pursuant to subparagraph (C). If
10the result is less than zero, the amount shall be deemed to be zero.

11(E) The prior year average daily attendance determined pursuant
12to subparagraph (A) shall be reduced by the amount determined
13pursuant to subparagraph (D).

14(3) To the greater of the amounts computed pursuant to
15paragraphs (1) and (2), add the regular average daily attendance
16in the current year of all pupils attending charter schools sponsored
17by the district that are not funded pursuant to Article 2
18(commencing with Section 47633) of Chapter 6 of Part 26.

19(b) For the purposes of this section, a “sponsoring school
20district” shall mean a “sponsoring local educational agency,” as
21defined in Section 47632.

22(c) This section shall become inoperative on July 1, 2014, and,
23as of January 1, 2015, is repealed, unless a later enacted statute,
24that becomes operative on or before January 1, 2015, deletes or
25extends the dates on which it becomes inoperative and is repealed.

26

SEC. 51.  

Section 42238.52 of the Education Code is amended
27to read:

28

42238.52.  

(a) Notwithstanding any other provision of law, the
29prior year average daily attendance for a school district determined
30pursuant to subdivision (b) of Section 42238.51 shall be increased
31by the prior year second principal apportionment average daily
32attendance of district residents only of any school that meets the
33following description:

34(1) The school was a district noncharter school in any year prior
35to the prior year.

36(2) The school was operated as a district-approved charter school
37in the prior year.

38(3) The school is again operated as a district noncharter school
39in the current year.

P102  1(b) An adjustment to prior year average daily attendance
2pursuant to this section may not be made for the attendance of
3pupils who were not residents of the school district in the prior
4year.

5(c) This section applies to the 2000-01 fiscal year and
6subsequent fiscal years.

7(d) This section shall become inoperative on July 1, 2014, and,
8as of January 1, 2015, is repealed, unless a later enacted statute,
9that becomes operative on or before January 1, 2015, deletes or
10extends the dates on which it becomes inoperative and is repealed.

11

SEC. 52.  

Section 42238.53 of the Education Code is amended
12to read:

13

42238.53.  

(a) Sections 42238.51 and 42238.52 do not apply
14to resident pupils in charter schools operating under the districtwide
15charter of a district that has converted all of its schools to charter
16status pursuant to Section 47606 and has elected not to be funded
17pursuant to Article 2 (commencing with Section 47633) of Chapter
186 of Part 26.

19(b) For the purposes of this section, “resident pupils” means
20pupils who reside in, and are otherwise eligible to attend, a school
21in the specified district.

22(c) This section shall become inoperative on July 1, 2014, and,
23as of January 1, 2015, is repealed, unless a later enacted statute,
24that becomes operative on or before January 1, 2015, deletes or
25extends the dates on which it becomes inoperative and is repealed.

26

SEC. 53.  

Section 42238.6 of the Education Code is amended
27to read:

28

42238.6.  

(a) The fiscal year average daily attendance computed
29under Section 42238.5 shall be increased, for each school district
30that operates any school that meets the eligibility requirements set
31forth in subdivision (b), by the number of child days of attendance
32of pupils enrolled in eligible schools in the district who are
33currently migratory children, as defined by Section 54441, and
34who are residing in state-operated migrant housing projects
35between the second principal apportionment and the end of the
36regular school year, divided by the number of days school was
37actually taught in the regular day schools of the district, excluding
38Saturdays and Sundays.

39(b) For a school to be eligible for the purposes of this section,
40the following conditions shall apply:

P103  1(1) One or more state-operated migrant housing projects are
2located within the attendance area of the school.

3(2) The maximum number of pupils enrolled in the school in
4the relevant fiscal year who are currently migratory children, as
5calculated under subdivision (a), constitutes not less than one-third
6of the total pupil enrollment of the school.

7(c) The Superintendent of Public Instruction shall establish rules
8and regulations for the implementation of this section.

9(d) This section shall become inoperative on July 1, 2014, and,
10as of January 1, 2015, is repealed, unless a later enacted statute,
11that becomes operative on or before January 1, 2015, deletes or
12extends the dates on which it becomes inoperative and is repealed.

13

SEC. 54.  

Section 42238.7 of the Education Code is amended
14to read:

15

42238.7.  

(a) The governing board of each school district, as
16a condition of apportionment, shall report to the Superintendent
17of Public Instruction, not later than May 1, 1998, and September
181, 1998, respectively, the portion of the attendance in the schools
19and classes maintained by the district that was reported for each
20of the 1996-97 and 1997-98 school years pursuant to Section
2141601 that consisted of absences excused pursuant to subdivision
22(b) of Section 46010 and to Section 46015, as those sections read
23on July 1, 1996.

24(b) This section shall become inoperative on July 1, 2014, and,
25as of January 1, 2015, is repealed, unless a later enacted statute,
26that becomes operative on or before January 1, 2015, deletes or
27extends the dates on which it becomes inoperative and is repealed.

28

SEC. 55.  

Section 42238.75 of the Education Code is amended
29to read:

30

42238.75.  

Notwithstanding any other provision of law:

31(a) All completed audits, including those on appeal, of school
32districts, charter schools, and county offices of education funded
33by Item 8860-025-0001 of Section 2.00 of Chapter 50 of the
34Statutes of 1999, Item 8860-025-0001 of Section 2.00 of Chapter
3552 of the Statutes of 2000, and Item 8860-025-0001 of Section
362.00 of Chapter 106 of the Statutes of 2001, and any findings of
37those audits, are withdrawn, and no loss of apportionment arising
38from the findings of those audits shall be realized.

39(b) All audits funded by Item 8860-025-0001 of Section 2.00
40of Chapter 50 of the Statutes of 1999, Item 8860-025-0001 of
P104  1Section 2.00 of Chapter 52 of the Statutes of 2000, and Item
28860-025-0001 of Section 2.00 of Chapter 106 of the Statutes of
32001, shall be discontinued.

4(c) The Controller shall notify all school districts, charter
5schools, and county offices of education that it is no longer
6necessary to retain records supporting pupil attendance and excused
7absences used for purposes of calculating average daily attendance
8during the 1996-97 fiscal year.

9(d) This section shall become inoperative on July 1, 2014, and,
10as of January 1, 2015, is repealed, unless a later enacted statute,
11that becomes operative on or before January 1, 2015, deletes or
12extends the dates on which it becomes inoperative and is repealed.

13

SEC. 56.  

Section 42238.8 of the Education Code is amended
14to read:

15

42238.8.  

(a) Effective July 1, 1998, the Superintendent of
16Public Instruction shall make a one-time adjustment to the revenue
17limit per unit of average daily attendance of each school district.
18This one-time adjustment shall apply for the 1998-99 fiscal year,
19and for each fiscal year thereafter, but not for any year prior to
201998-99, and shall be accomplished by revision of the prior fiscal
21year revenue limit per unit of average daily attendance, as follows:

22(1) Determine a revised revenue limit per unit of average daily
23attendance for the 1996-97 fiscal year as follows:

24(A) For each school district that had its revenue limit funding
25for the 1996-97 fiscal year calculated on the basis of its 1996-97
26average daily attendance pursuant to paragraph (1) of subdivision
27(a) of Section 42238.5, the revised revenue limit per unit of average
28daily attendance shall equal the adjusted total base revenue limit
29determined pursuant to paragraph (2) divided by the adjusted
30average daily attendance determined pursuant to subparagraph (A)
31of paragraph (3).

32(B) For each school district that had its revenue limit funding
33for the 1996-97 fiscal year calculated on the basis of its 1995-96
34average daily attendance pursuant to paragraph (1) of subdivision
35(a) of Section 42238.5, the revised revenue limit per unit of average
36daily attendance shall equal the adjusted total base revenue limit
37determined pursuant to paragraph (2) divided by the adjusted
38average daily attendance determined pursuant to subparagraphs
39(B), (C), and (D) of paragraph (3).

P105  1(2) Determine the amount of the 1996-97 total base revenue
2limit funding received pursuant to Section 42238 for growth and
3nongrowth average daily attendance, including, as nongrowth
4average daily attendance, attendance in necessary small schools
5in the year determined to be the greater pursuant to paragraph (1)
6of subdivision (a) of Section 42238.5 for the 1996-97 fiscal year,
7but excluding attendance in nonpublic, nonsectarian schools,
8county office operated special education, and county community
9school programs.

10(3) (A) Reduce the average daily attendance figure used to
11make the determination set forth in paragraph (2) by the amount
12of average daily attendance included in that figure for excused
13absences pursuant to subdivision (b) of Section 46010 as that
14subdivision read on July 1, 1996.

15(B) Determine the second principal apportionment average daily
16attendance for the 1996-97 fiscal year, including attendance in
17necessary small schools and attendance for excused absences
18pursuant to subdivision (b) of Section 46010 as it read on July 1,
191996, but excluding attendance, including attendance for excused
20absences, in nonpublic, nonsectarian schools, county-operated
21special education programs, and county community schools.

22(C) Determine the second principal apportionment average daily
23attendance for the 1996-97 fiscal year, including attendance in
24necessary small schools, but excluding attendance in nonpublic,
25nonsectarian schools, county-operated special education programs,
26and county community schools and for excused absences pursuant
27to subdivision (b) of Section 46010 as it read on July 1, 1996.

28(D) Calculate the adjusted revenue limit average daily attendance
29by multiplying the average daily attendance figure used to make
30the determination set forth in paragraph (2) by the quotient of the
31amount determined pursuant to subparagraph (C) divided by the
32amount determined pursuant to subparagraph (B).

33(4) Recalculate the 1997-98 fiscal year revenue limit per unit
34of average daily attendance to reflect the revision in the 1996-97
35revenue limit per unit of average daily attendance determined
36pursuant to paragraph (1).

37(b) The calculations made pursuant to paragraphs (1) and (4)
38of subdivision (a) shall not be used for apportionment purposes
39for either of the fiscal years referred to in those paragraphs or for
40adjustments for those years.

P106  1(c) If the governing board of any school district demonstrates
2to the satisfaction of the Superintendent of Public Instruction that,
3because of extraordinary circumstances beyond the control of the
4school district, the amount of absences excused in one or more
5district programs in fiscal year 1996-97 pursuant to subdivision
6(b) of Section 46010 as it read on July 1, 1996, was significantly
7lower than it would ordinarily have been in comparison to the
8amount of actual attendance in fiscal year 1996-97, the
9Superintendent of Public Instruction shall make a compensating
10adjustment, consistent with the provisions of Section 2 of the
11Education Code, in the calculation set forth in this section.

12(d) This section shall become inoperative on July 1, 2014, and,
13as of January 1, 2015, is repealed, unless a later enacted statute,
14that becomes operative on or before January 1, 2015, deletes or
15extends the dates on which it becomes inoperative and is repealed.

16

SEC. 57.  

Section 42238.9 of the Education Code is amended
17to read:

18

42238.9.  

(a) The amount per unit of average daily attendance
19subtracted pursuant to Section 56712 for revenue limits for pupils
20in special classes and centers shall be the district’s total revenue
21limit for the current fiscal year computed pursuant to Section
2242238, including funds received pursuant to Article 4 (commencing
23with Section 42280), but excluding the total amount of funds
24received pursuant to Sections 46200 to 46206, inclusive, and
25Section 45023.4, as that section read on July 1, 1986, divided by
26the district’s current year average daily attendance pursuant to
27Section 42238.5. The amount per unit of average daily attendance
28that is excluded in this calculation for each school district shall be
29increased for the 1998-99 fiscal year by the quotient for that district
30of the amount determined pursuant to subparagraph (B) of
31paragraph (3) of subdivision (a) of Section 42238.8 divided by the
32amount determined pursuant to subparagraph (C) of paragraph (3)
33of subdivision (a) of Section 42238.8.

34(b) This section shall become inoperative on July 1, 2014, and,
35as of January 1, 2015, is repealed, unless a later enacted statute,
36that becomes operative on or before January 1, 2015, deletes or
37extends the dates on which it becomes inoperative and is repealed.

38

SEC. 58.  

Section 42238.95 of the Education Code is amended
39to read:

P107  1

42238.95.  

(a) The amount per unit of average daily attendance
2for pupils in special classes and centers that shall be apportioned
3to each county office of education shall be equal to the amount
4determined for the district of residence pursuant to Section 42238.9,
5increased by the quotient equal to the amount determined pursuant
6to paragraph (1) divided by the amount determined pursuant to
7paragraph (2). This subdivision only applies to average daily
8attendance served by employees of the county office of education.

9(1) Determine the second principal apportionment average daily
10attendance for special education for the county office of education
11for the 1996-97 fiscal year, including attendance for excused
12absences, divided by the corresponding average daily attendance
13excluding attendance for excused absences pursuant to subdivision
14(b) of Section 46010 as it read on July 1, 1996, reported pursuant
15to Section 41601 for the 1996-97 fiscal year.

16(2) Determine the second principal apportionment average daily
17attendance for the 1996-97 fiscal year, including attendance for
18excused absences, for all of the school districts within the county,
19excluding average daily attendance for county office special
20education and county community school programs and nonpublic
21nonsectarian schools, divided by the corresponding average daily
22attendance, excluding attendance for excused absences determined
23pursuant to subdivision (b) of Section 46010 as it read on July 1,
241996, and reported pursuant to Section 41601 for the 1996-97
25fiscal year.

26(b) A county office of education shall provide the data required
27to perform the calculation specified in paragraph (1) of subdivision
28(a) to the Superintendent of Public Instruction in order to be eligible
29for the adjustment pursuant to subdivision (a).

30(c) This section shall become inoperative on July 1, 2014, and,
31as of January 1, 2015, is repealed, unless a later enacted statute,
32that becomes operative on or before January 1, 2015, deletes or
33extends the dates on which it becomes inoperative and is repealed.

34

SEC. 59.  

Section 42238.11 of the Education Code is amended
35to read:

36

42238.11.  

Notwithstanding any other provision of law, for the
371994-95 fiscal year the county superintendent of schools shall
38reduce the total revenue limit for each school district in the
39jurisdiction of the county superintendent of schools by the amount
40of the decreased employer contributions to the Public Employees’
P108  1Retirement System resulting from the enactment of Chapter 330
2of the Statutes of 1982, adjusted for any changes in those
3contributions resulting from subsequent changes in employer
4contribution rates, excluding rate changes due to the direct transfer
5of the state-mandated portion of the employer contributions to the
6Public Employees’ Retirement System, through the 1994-95 fiscal
7year. The reduction shall be calculated for each school district as
8follows:

9(a) Determine the amount of employer contributions that would
10have been made in the 1994-95 fiscal year if the applicable Public
11Employees’ Retirement System employer contribution rate in effect
12immediately prior to the enactment of Chapter 330 of the Statutes
13of 1982 were in effect during the 1994-95 fiscal year.

14For purposes of this calculation, no school district shall have a
15contribution rate higher than 13.020 percent.

16(b) Subtract from the amount determined in subdivision (a) the
17actual amount of employer contributions made to the Public
18Employees’ Retirement System in the 1994-95 fiscal year.

19(c) For the purposes of this section, employer contributions to
20the Public Employees’ Retirement System for any of the following
21positions shall be excluded from the calculation specified above:

22(1) Positions or portions of positions supported by federal funds
23that are subject to supplanting restrictions.

24(2) Positions supported by funds received pursuant to Section
2542243.6.

26(3) Positions supported, to the extent of employer contributions
27not exceeding twenty-five thousand dollars ($25,000) by any single
28educational agency, from a non-General Fund revenue source
29determined to be properly excludable from this section by the
30Superintendent of Public Instruction with the approval of the
31Director of Finance.

32(d) For accounting purposes, the reduction made by this
33provision may be reflected as an expenditure from appropriate
34sources of revenue as directed by the Superintendent of Public
35Instruction.

36(e) The amount of the reduction made by this section shall not
37be adjusted by the deficit factor calculated pursuant to Section
3842238.145.

39It is the intent of the Legislature to make adjustments to school
40district revenue limits for the 1994-95 fiscal year to reflect savings
P109  1that these districts will realize in the contributions to the Public
2Employees’ Retirement System due to a reduced contribution rate
3for the 1994-95 fiscal year.

4This section shall become inoperative on July 1, 2014, and, as
5of January 1, 2015, is repealed, unless a later enacted statute, that
6becomes operative on or before January 1, 2015, deletes or extends
7the dates on which it becomes inoperative and is repealed.

8

SEC. 60.  

Section 42238.12 of the Education Code is amended
9to read:

10

42238.12.  

(a) For the 1995-96 fiscal year and each fiscal year
11thereafter, the county superintendent of schools shall adjust the
12total revenue limit for each school district in the jurisdiction of the
13county superintendent of schools by the amount of increased or
14decreased employer contributions to the Public Employees’
15Retirement System resulting from the enactment of Chapter 330
16of the Statutes of 1982, adjusted for any changes in those
17contributions resulting from subsequent changes in employer
18contribution rates, excluding rate changes due to the direct transfer
19of the state-mandated portion of the employer contributions to the
20Public Employees’ Retirement System, through the current fiscal
21year. The adjustment shall be calculated for each school district,
22as follows:

23(1) (A) Determine the amount of employer contributions that
24would have been made in the current fiscal year if the applicable
25Public Employees’ Retirement System employer contribution rate
26in effect immediately before the enactment of Chapter 330 of the
27Statutes of 1982 were in effect during the current fiscal year.

28(B) For purposes of this calculation, no school district shall have
29a contribution rate higher than 13.020 percent.

30(2) Determine the actual amount of employer contributions
31made to the Public Employees’ Retirement System in the current
32fiscal year.

33(3) If the amount determined in paragraph (1) for a school
34district is greater than the amount determined in paragraph (2), the
35total revenue limit computed for that school district shall be
36decreased by the amount of the difference between those
37paragraphs; or, if the amount determined in paragraph (1) for a
38school district is less than the amount determined in paragraph (2),
39the total revenue limit for that school district shall be increased by
40the amount of the difference between those paragraphs.

P110  1(4) For the purpose of this section, employer contributions to
2the Public Employees’ Retirement System for any of the following
3positions shall be excluded from the calculation specified above:

4(A) Positions or portions of positions supported by federal funds
5that are subject to supplanting restrictions.

6(B) Positions supported by funds received pursuant to Section
741540 that are established in order to satisfy court-ordered
8desegregation requirements.

9(C) Positions supported, to the extent of employers’
10contributions not exceeding twenty-five thousand dollars ($25,000)
11by any single educational agency, from a non-General Fund
12revenue source determined to be properly excludable from this
13section by the Superintendent with the approval of the Director of
14Finance. Commencing in the 2002-03 fiscal year, only positions
15supported from a non-General Fund revenue source determined
16to be properly excludable as identified for a particular local
17educational agency or pursuant to a blanket waiver by the
18Superintendent and the Director of Finance, before the 2002-03
19fiscal year, may be excluded pursuant to this paragraph.

20(5) For accounting purposes, any reduction to school district
21revenue limits made by this provision may be reflected as an
22expenditure from appropriate sources of revenue as directed by
23the Superintendent.

24(6) The amount of the increase or decrease to the revenue limits
25of school districts computed pursuant to paragraph (3) for the
261995-96 to 2002-03 fiscal years, inclusive, may not be adjusted
27by the deficit factor applied to the revenue limit of each school
28district pursuant to Section 42238.145.

29(7) For the 2003-04 fiscal year and any fiscal year thereafter,
30the revenue limit reduction specified in Section 42238.146 may
31not be applied to the amount of the increase or decrease to the
32revenue limits of school districts computed pursuant to paragraph
33(3).

34(b) The calculations set forth in paragraphs (1) to (3), inclusive,
35of subdivision (a) exclude employer contributions for employees
36of charter schools funded pursuant to Article 2 (commencing with
37Section 47633) of Chapter 6 of Part 26.8.

38(c) Funding appropriated through the Budget Act of 2001 or
39 legislation amending the Budget Act of 2001 for the purpose of
40limiting the reductions to revenue limits calculated pursuant to
P111  1this section and to Section 2558 for the 2001-02 fiscal year shall
2be allocated on a one-time basis in the following manner:

3(1) Each school district and county office of education subject
4to a reduced apportionment pursuant to this section or to Section
52558 shall receive a share of the amount described in paragraph
6(3) that is proportionate to the reduction in their apportionment
7pursuant to this section or to Section 2558 for the 2001-02 fiscal
8year as compared to the statewide total reduction that would occur
9absent this paragraph.

10(2) For the 2001-02 fiscal year, instead of the alternative
11calculation authorized by paragraph (1), San Francisco Unified
12School District shall receive an amount equal to five dollars and
1357 cents ($5.57) multiplied by its second principal apportionment
14average daily attendance for the 2001-02 fiscal year.

15(3) Notwithstanding any other law, total allocations pursuant
16to this subdivision may not exceed thirty-five million dollars
17($35,000,000).

18(d) Thirty-five million dollars ($35,000,000) is hereby
19appropriated from the General Fund for transfer to Section A of
20the State School Fund for local assistance for the purpose of
21limiting the reductions to revenue limits calculated pursuant to
22this section and to Section 2558 for the 2003-04 fiscal year.
23Funding from this appropriation shall be allocated in the following
24manner:

25(1) Each school district and county office of education subject
26to a reduced apportionment pursuant to this section or to Section
272558 shall receive a share of the amount appropriated in this
28subdivision that is proportionate to the reduction in their
29apportionment pursuant to this section or to Section 2558 for the
302003-04 fiscal year as compared to the statewide total reduction
31that would occur absent this paragraph.

32(2) For the 2003-04 fiscal year, instead of the alternative
33calculation authorized by paragraph (1), the San Francisco Unified
34School District shall receive an amount equal to five dollars and
3557 cents ($5.57) multiplied by its second principal apportionment
36average daily attendance for the 2003-04 fiscal year.

37(3) Notwithstanding any other law, total allocations pursuant
38to this subdivision may not exceed thirty-five million dollars
39($35,000,000) for the 2003-04 fiscal year.

P112  1(4) For the purposes of making the computations required by
2Section 8 of Article XVI of the California Constitution, the
3appropriation made by this section shall be deemed to be “General
4Fund revenues appropriated for school districts,” as defined in
5subdivision (c) of Section 41202, for the 2003-04 fiscal year and
6included within the “total allocations to school districts and
7community college districts from General Fund proceeds of taxes
8appropriated pursuant to Article XIII B,” as defined in subdivision
9(e) of Section 41202, for the 2003-04 fiscal year.

10(e) For the 2004-05 fiscal year, and each fiscal year thereafter,
11apportionment reductions pursuant to this section and to Section
122558 shall be limited as follows:

13(1) Each school district and county office of education subject
14to a reduced apportionment pursuant to this section or to Section
152558 shall receive a share of the amount described in paragraph
16(3) that is proportionate to the reduction in their apportionment
17pursuant to this section or to Section 2558 for the 2004-05 fiscal
18year as compared to the statewide total reduction as would occur
19absent this paragraph.

20(2) Instead of the alternative calculation authorized by paragraph
21(1), the San Francisco Unified School District shall receive funding
22equal to the amount of funding per unit of average daily attendance
23specified in paragraph (2) of subdivision (c) as increased annually
24by cost-of-living adjustments specified in Section 42238.1,
25multiplied by its second principal apportionment average daily
26attendance for that fiscal year.

27(3) Notwithstanding any other law, total limitations pursuant to
28this subdivision may not annually exceed thirty-five million dollars
29($35,000,000) as annually increased by the cost-of-living
30adjustments specified in Section 42238.1, multiplied by the annual
31statewide percentage growth in total average daily attendance,
32measured at the second principal apportionment.

33(f) This section shall become inoperative on July 1, 2014, and,
34as of January 1, 2015, is repealed, unless a later enacted statute,
35that becomes operative on or before January 1, 2015, deletes or
36extends the dates on which it becomes inoperative and is repealed.

37

SEC. 61.  

Section 42238.13 of the Education Code is amended
38to read:

39

42238.13.  

(a) Notwithstanding any other provision of law, for
40any elementary school district that meets all of the criteria specified
P113  1in subdivision (b), the base revenue limit for the 1988-89 fiscal
2year and each subsequent fiscal year computed pursuant to Section
342238 shall be computed as though the 1987-88 base revenue limit
4per unit of average daily attendance was two thousand nine hundred
5sixty-five dollars ($2,965). The county superintendent shall
6compute the revenue limit on that basis.

7(b) The revenue limit computation described in subdivision (a)
8shall apply to any elementary school district that meets all of the
9following criteria:

10(1) The minority enrollment in the district in the 1987-88 school
11year was greater than 98 percent.

12(2) The AFDC enrollment in the district in the 1987-88 school
13year was greater than 32 percent.

14(3) The district ranked in all of the following categories in the
151986-87 California Assessment Program as follows:

16(A) Lowest 3 percent for third grade reading.

17(B) Lowest 2 percent for sixth grade reading.

18(C) Lowest 1 percent for eighth grade reading.

19(D) Lowest 1 percent for sixth grade mathematics.

20(E) Lowest 1 percent for eighth grade mathematics.

21(F) Lowest 1 percent for history/social science.

22(G) Lowest 1 percent for science.

23(4) The district’s 1987-88 base revenue limit was 2 percent
24below the statewide average for elementary districts and 7 percent
25below the county average for elementary districts.

26(5) The district is under a court order as of the effective date of
27this act.

28(c) This section shall become inoperative on July 1, 2014, and,
29as of January 1, 2015, is repealed, unless a later enacted statute,
30that becomes operative on or before January 1, 2015, deletes or
31extends the dates on which it becomes inoperative and is repealed.

32

SEC. 62.  

Section 42238.14 of the Education Code is amended
33to read:

34

42238.14.  

(a) For the purposes of this article, the revenue limit
35for the 1993-94 fiscal year for each school district determined
36pursuant to this article and adjusted pursuant to Section 42238.16
37shall be reduced by a 8.14 percent deficit factor.

38(b) This section shall become inoperative on July 1, 2014, and,
39as of January 1, 2015, is repealed, unless a later enacted statute,
P114  1that becomes operative on or before January 1, 2015, deletes or
2extends the dates on which it becomes inoperative and is repealed.

3

SEC. 63.  

Section 42238.145 of the Education Code is amended
4to read:

5

42238.145.  

For the purposes of this article, the revenue limit
6for each school district shall be reduced by a deficit factor, as
7follows:

8(a) (1) For the 1994-95 fiscal year, the revenue limit for each
9school district determined pursuant to this article shall be reduced
10by an 11.01 percent deficit factor.

11(2) For the 1995-96 fiscal year, the revenue limit for each school
12district determined pursuant to this article shall be reduced by a
1310.12 percent deficit factor.

14(3) For the 1996-97 and 1997-98 fiscal years, the revenue limit
15for each school district determined pursuant to this article shall be
16reduced by a 9.967 percent deficit factor, as adjusted pursuant to
17Section 42238.42.

18(4) For the 1999-2000 fiscal year, the revenue limit for each
19school district determined pursuant to this article shall be reduced
20by a 6.996 percent deficit factor.

21(b) (1) The revenue limit for the 1994-95 fiscal year for each
22school district shall be determined as if the revenue limit for each
23school district had been determined for the 1993-94 fiscal year
24without being reduced by the deficit factor required pursuant to
25Section 42238.14.

26(2) When computing the revenue limit for each school district
27for the 1995-96 or any subsequent fiscal year pursuant to this
28article, the revenue limit shall be determined as if the revenue limit
29for that school district had been determined for the previous fiscal
30year without being reduced by the deficit factor specified in this
31section.

32This section shall become inoperative on July 1, 2014, and, as
33of January 1, 2015, is repealed, unless a later enacted statute, that
34becomes operative on or before January 1, 2015, deletes or extends
35the dates on which it becomes inoperative and is repealed.

36

SEC. 64.  

Section 42238.146 of the Education Code is amended
37to read:

38

42238.146.  

(a) (1) For the 2003-04 fiscal year, the revenue
39limit for each school district determined pursuant to this article
40shall be reduced by a 1.198 percent deficit factor.

P115  1(2) For the 2004-05 fiscal year, the revenue limit for each school
2district determined pursuant to this article shall be reduced by a
30.323 percent deficit factor.

4(3) For the 2003-04 and 2004-05 fiscal years, the revenue limit
5for each school district determined pursuant to this article shall be
6further reduced by a 1.826 percent deficit factor.

7(4) For the 2005-06 fiscal year, the revenue limit for each school
8district determined pursuant to this article shall be reduced by a
90.892 percent deficit factor.

10(5) For the 2008-09 fiscal year, the revenue limit for each school
11district determined pursuant to this article shall be reduced by a
127.844 percent deficit factor.

13(6) For the 2009-10 fiscal year, the revenue limit for each school
14district determined pursuant to this article shall be reduced by a
1518.355 percent deficit factor.

16(7) For the 2010-11 fiscal year, the revenue limit for each school
17district determined pursuant to this article shall be reduced by a
1817.963 percent deficit factor.

19(8) For the 2011-12 fiscal year, the revenue limit for each school
20district determined pursuant to this article shall be reduced by a
2120.404 percent deficit factor.

22(9) For the 2012-13 fiscal year, the revenue limit for each school
23district determined pursuant to this article shall be reduced by a
2422.272 percent deficit factor.

25(b) In computing the revenue limit for each school district for
26the 2006-07 fiscal year pursuant to this article, the revenue limit
27shall be determined as if the revenue limit for that school district
28had been determined for the 2003-04, 2004-05, and 2005-06 fiscal
29years without being reduced by the deficit factors specified in
30subdivision (a).

31(c) In computing the revenue limit for each school district for
32the 2010-11 fiscal year pursuant to this article, the revenue limit
33shall be determined as if the revenue limit for that school district
34had been determined for the 2009-10 fiscal year without being
35reduced by the deficit factors specified in subdivision (a).

36(d) In computing the revenue limit for each school district for
37the 2011-12 fiscal year pursuant to this article, the revenue limit
38shall be determined as if the revenue limit for that school district
39had been determined for the 2010-11 fiscal year without being
40reduced by the deficit factors specified in subdivision (a).

P116  1(e) In computing the revenue limit for each school district for
2the 2012-13 fiscal year pursuant to this article, the revenue limit
3shall be determined as if the revenue limit for that school district
4had been determined for the 2011-12 fiscal year without being
5reduced by the deficit factors specified in subdivision (a).

6(f) In computing the revenue limit for each school district for
7the 2013-14 fiscal year pursuant to this article, the revenue limit
8shall be determined as if the revenue limit for that school district
9had been determined for the 2012-13 fiscal year without being
10reduced by the deficit factors specified in subdivision (a).

11(g) This section shall become inoperative on July 1, 2014, and,
12as of January 1, 2015, is repealed, unless a later enacted statute,
13that becomes operative on or before January 1, 2015, deletes or
14extends the dates on which it becomes inoperative and is repealed.

15

SEC. 65.  

Section 42238.17 of the Education Code is amended
16to read:

17

42238.17.  

Notwithstanding any other provision of law, for any
18school district that was reorganized effective July 1, 1992, as a
19unified school district and that is congruent to a school district that
20was reorganized as an elementary school district effective July 1,
211990, the Superintendent of Public Instruction shall compute
22apportionments using the following data:

23(a) For the purposes of paragraph (1) of subdivision (d) of
24Section 42238 for the 1990-91 and 1991-92 fiscal years, the
25superintendent shall use the actual number of units of average daily
26attendance for the 1990-91 fiscal year second principal
27apportionments.

28(b) For the purposes of paragraph (1) of subdivision (d) of
29Section 42238, for the 1992-93 fiscal year and each fiscal year
30thereafter, the superintendent shall use the actual number of units
31of average daily attendance for the 1992-93 fiscal year second
32principal apportionment.

33This section shall become inoperative on July 1, 2014, and, as
34of January 1, 2015, is repealed, unless a later enacted statute, that
35becomes operative on or before January 1, 2015, deletes or extends
36the dates on which it becomes inoperative and is repealed.

37

SEC. 66.  

Section 42238.18 of the Education Code is amended
38to read:

39

42238.18.  

(a) Notwithstanding any other provision of law,
40only those pupils enrolled in county office of education programs
P117  1while detained in a juvenile hall, juvenile home, day center,
2juvenile ranch, juvenile camp, or regional youth educational facility
3established pursuant to Article 23 (commencing with Section 850),
4Article 24 (commencing with Section 880), and Article 24.5
5(commencing with Section 894) of Chapter 2 of Part 1 of Division
62 of the Welfare and Institutions Code shall be counted as juvenile
7court school pupils. For purposes of apportionments, those pupils
8in a group home housing 25 or more children placed pursuant to
9Sections 362, 727, and 730 of the Welfare and Institutions Code
10or in any group home housing 25 or more children and operating
11one or more additional sites under a central administration for
12children placed pursuant to Section 362, 727, or 730 of the Welfare
13and Institutions Code shall be reported as county group home and
14institutions pupils to the Superintendent and shall be counted as
15juvenile court school pupils for purposes of apportionments.

16(b) Notwithstanding any other provision of law, any county
17superintendent of schools operating juvenile court schools, county
18group home and institutions schools, or community schools, or
19any combination of these schools shall maintain an account in their
20general fund to be known as the juvenile court and community
21school account, and shall deposit all funds derived from the
22operation of juvenile court, county group home and institutions
23schools, and community schools into that account. Expenditures
24from the juvenile court and community school account shall be
25limited to the following:

26(1) Those expenditures defined as direct costs of instructional
27programs by the California State School Accounting Manual,
28except that facility costs, including the costs of renting, leasing,
29purchasing, remodeling, constructing, or improving buildings and
30the costs of purchasing or improving land, shall be allowed as an
31instructional cost in the juvenile court and community school fund.
32Deferred maintenance contributions made pursuant to Section
3317584 may also be allowed as an instructional cost of juvenile
34court and county community school programs, provided the
35contribution does not exceed the program’s proportionate share
36of total county school service fund expenditures as defined in
37Section 17584, and provided the funds are used for deferred
38maintenance of juvenile court and county community school
39facilities.

P118  1(2) Expenditures that are defined as documented direct support
2costs by the California State School Accounting Manual.

3(3) Expenditures that are defined as allocated direct support
4costs by the California State School Accounting Manual.

5(4) Other expenditures for support and indirect charges.
6However, these charges may not exceed 10 percent of the sum of
7the expenditures in paragraphs (1), (2), and (3).

8Expenditures that represent contract payments to other agencies
9for the operation of juvenile court and community school programs
10shall be included in the juvenile court and community school
11account and the contract costs distributed to the cost categories
12defined in paragraphs (1), (2), (3), and (4). At the end of any given
13school year the net ending balance in the juvenile court and
14community school account may be distributed to a reserved account
15for economic contingencies or to a reserved account for capital
16outlay, provided that the combined total transferred does not exceed
1715 percent of the current year’s authorized expenditures as specified
18above and also provided that funds placed in the reserved accounts
19shall only be expended for juvenile court, county group home and
20institutions, or community school programs. The net ending
21balance, except for those funds placed in a capital outlay fund,
22shall not exceed the greater of 15 percent of the previous year’s
23expenditures or twenty-five thousand dollars ($25,000). A county
24may accumulate over a period of two or more given school years
25a net ending balance in the capital outlay reserved account of more
26than 15 percent of the current fiscal year’s expenditures under
27provisions of a resolution of the governing board. Funds in the
28capital outlay reserve are to be used for capital outlay only. The
29Superintendent shall require an annual certification by county
30superintendents of schools beginning in the 1989-90 fiscal year
31that juvenile court, county group home and institutions, and
32community school funds have been expended as provided in this
33section and shall withhold from the subsequent year’s
34apportionment an amount equal to any excess ending balance or
35excess transfers, as provided in this subdivision, in the juvenile
36court and community school account.

37(c) Notwithstanding any other provision of law, pupils who are
38referred by the county probation department under Section 601 or
39654 of the Welfare and Institutions Code, shall be enrolled and
40eligible for apportionments in county community schools only
P119  1after an individualized review and certification of the
2appropriateness of enrollment in the county group home and
3institution’s school or county community school. The
4individualized review shall include representatives of the court,
5the county department of education, the county probation
6department, and either the school district of residence or, in cases
7in which the pupil resides in a group home or institution, the school
8district in which the group home or institution is located, and, in
9each case, the school district representative shall agree to the
10appropriateness of the proposed placement and pupils so placed
11shall have a probation officer assigned to their case.

12(d) Regardless of the operative date of the amendments to this
13section made during the 1997 portion of the 1997-98 Regular
14Session, this section, as so amended, shall be implemented as
15though it had been operative on July 1, 1996. For the purpose of
16implementing this section for the entire 1996-97 fiscal year, the
17Superintendent and other public officers shall take all necessary
18steps to effect the required adjustments and shall have authority
19to adjust allowance computations, apportionments, and
20disbursements ordered from Section A of the State School Fund
21and other public funds.

22(e) This section shall become inoperative on July 1, 2014, and,
23as of January 1, 2015, is repealed, unless a later enacted statute,
24that becomes operative on or before January 1, 2015, deletes or
25extends the dates on which it becomes inoperative and is repealed.

26

SEC. 67.  

Section 42239 of the Education Code is amended to
27read:

28

42239.  

(a) For each fiscal year the Superintendent of Public
29Instruction shall compute funding for supplemental instruction for
30each school district or charter school by multiplying the number
31of pupil hours of supplemental instruction claimed pursuant to
32Sections 37252 and 37252.2 by the pupil hour allowance specified
33in subdivision (b) or by a pupil hour allowance specified in the
34annual Budget Act in lieu of the amount computed in subdivision
35(b).

36(b) Hours of supplemental instruction shall be reimbursed at a
37rate of three dollars and fifty-three cents ($3.53) per pupil hour,
38adjusted in the 2005-06 fiscal year and subsequent fiscal years as
39specified in this section, provided that a different reimbursement
40rate may be specified for each fiscal year in the annual Budget Act
P120  1that appropriates funding for that fiscal year. This amount shall be
2increased annually by the percentage increase pursuant to
3subdivision (b) of Section 42238.1 granted to school districts or
4charter schools for base revenue limit cost-of-living increases.

5(c) (1) If appropriated funding is insufficient to pay all claims
6made in any fiscal year pursuant to Sections 37252 and 37252.2,
7the superintendent shall use any available funding appropriated
8for the purposes of reimbursing school districts pursuant to Section
937252 or 37252.2.

10(2) If appropriated funding is still insufficient to pay all claims
11made in any fiscal year pursuant to Section 37252 or 37252.2, the
12superintendent shall use any available funding appropriated for
13the purposes of reimbursing school districts for supplemental
14instruction in the prior fiscal year.

15(3) If appropriated funding is still insufficient to pay all claims
16made in any fiscal year pursuant to Section 37252 or 37252.2, the
17superintendent shall use any available funding appropriated for
18the purposes of reimbursing school districts for supplemental
19instruction in the current fiscal year.

20(4) The superintendent shall notify the Director of Finance that
21there is an insufficiency of funding appropriated for the purposes
22of Sections 37252 and 37252.2 only after the superintendent has
23exhausted all available balances of appropriations made for the
24current or prior fiscal years for the reimbursement of school
25districts for supplemental instruction.

26(d) Notwithstanding any other provision of law, neither the State
27Board of Education nor the Superintendent of Public Instruction
28may waive any provision of this section.

29(e) This section shall become inoperative on July 1, 2014, and,
30as of January 1, 2015, is repealed, unless a later enacted statute,
31that becomes operative on or before January 1, 2015, deletes or
32extends the dates on which it becomes inoperative and is repealed.

33

SEC. 68.  

Section 42240.1 of the Education Code is amended
34to read:

35

42240.1.  

(a) Any elementary school district with less than
362,501 units of average daily attendance in grades kindergarten to
376, inclusive, for the second principal apportionment in the 1978-79
38fiscal year, whose 7th and 8th grade pupils were being educated
39by a high school district pursuant to Article 5 (commencing with
40Section 37060) of Chapter 1 of Part 22 during the 1978-79 fiscal
P121  1year, shall be entitled to the revenue limit adjustment computed
2pursuant to Section 42240 beginning with the 1981-82 fiscal year.

3(b) This section shall become inoperative on July 1, 2014, and,
4as of January 1, 2015, is repealed, unless a later enacted statute,
5that becomes operative on or before January 1, 2015, deletes or
6extends the dates on which it becomes inoperative and is repealed.

7

SEC. 69.  

Section 42241.3 of the Education Code is amended
8to read:

9

42241.3.  

(a) This section applies only to the funding generated
10by the average daily attendance of pupils attending a charter school
11that has operated as a charter school since prior to July 1, 2005, if
12a unified school district has been the sponsoring local educational
13agency as defined in subdivision (i) of Section 47632, and if the
14unified school district was governed by Section 47660 as that
15section read on December 31, 2005.

16(b) For the 2005-06 fiscal year only, the revenue limit funding
17of a unified school district, other than a unified school district that
18has converted all of its schools to charter status pursuant to Section
1947606 and is operating them as charter schools, shall be increased
20or decreased to reflect half of the difference between the funding
21provided for the base revenue limit per unit of average daily
22attendance of the unified school district as set forth in Section
2342238 and the general-purpose entitlement per unit of average
24daily attendance of the charter school as set forth in Section 47633.

25(c) This section shall become inoperative on July 1, 2014, and,
26as of January 1, 2015, is repealed, unless a later enacted statute,
27that becomes operative on or before January 1, 2015, deletes or
28extends the dates on which it becomes inoperative and is repealed.

29

SEC. 70.  

Section 42241.7 of the Education Code is amended
30to read:

31

42241.7.  

(a) For the 1978-79 fiscal year, and each fiscal year
32thereafter, the revenue limit of any elementary, high, or unified
33school district authorized pursuant to Sections 42237 and 42238
34may be increased by an amount sufficient to provide additional
35revenue equal to the expenditures estimated to be incurred by the
36district in the budget year in complying with the following
37provisions of the Unemployment Insurance Code: Sections 605
38and 803, Article 6 (commencing with Section 821) of Chapter 3
39of Part 1 of Division 1, or Article 3 (commencing with Section
40976) of Chapter 4 of Part 1 of Division 1, less the actual
P122  1expenditures incurred by the district in the 1975-76 fiscal year in
2complying with the following provisions of the Unemployment
3Insurance Code: Section 605.2 and Article 6 (commencing with
4Section 821) of Chapter 3 of Part 1 of Division 1.

5(b) If, at the end of any fiscal year, the actual expenditures of
6the district specified in subdivision (a) are less than the revenue
7derived from the increase in revenue limit provided in subdivision
8(a) for that fiscal year, the difference shall be used in the following
9fiscal year exclusively for expenditures required pursuant to the
10Unemployment Insurance Code provisions specified in subdivision
11(a).

12(c) If, at the end of any fiscal year, the actual expenditures of
13the district specified in subdivision (a) exceed the revenue derived
14from the increase in revenue limit provided in subdivision (a) for
15that fiscal year, the difference may be added to the increase in
16revenue limit, authorized pursuant to this section, in the following
17fiscal year.

18(d) (1) For the 1994-95 to 2002-03 fiscal years, inclusive, the
19adjustment computed pursuant to this section shall not be adjusted
20by the deficit factor applied to the revenue limit of each school
21district pursuant to Section 42238.145.

22(2) For the 2003-04 fiscal year and each fiscal year thereafter,
23the revenue limit reduction specified in Section 42238.146 may
24not be applied to the adjustment computed pursuant to this section.

25(e) Expenditures for employees of charter schools funded
26pursuant to Article 2 (commencing with Section 47633) of Chapter
276 of Part 26.8 are excluded from the calculations set forth in this
28section.

29(f) This section shall become inoperative on July 1, 2014, and,
30as of January 1, 2015, is repealed, unless a later enacted statute,
31that becomes operative on or before January 1, 2015, deletes or
32extends the dates on which it becomes inoperative and is repealed.

33

SEC. 71.  

Section 42243.7 of the Education Code is amended
34to read:

35

42243.7.  

(a) For any school district that commenced operations
36on or after June 30, 1978, or for any school district that receives
37approval from the department for a new continuation education
38high school for the 1979-80 fiscal year, or any fiscal year
39thereafter, the Superintendent of Public Instruction shall compute
40an adjustment to the district revenue limit pursuant to this section.

P123  1(b) Determine the amount of foundation program that the district
2would have been entitled to pursuant to subdivision (a) of Section
341711, as that section read on July 1, 1977, if the district had
4operated during the 1977-78 fiscal year, utilizing the number of
5units of average daily attendance attending high school in the
6district in the fiscal year for which the revenue limit is being
7computed.

8(c) Determine the amount of foundation program that the district
9would have been entitled to pursuant to paragraph (1) of
10subdivision (b) of Section 41711, as that section read on July 1,
111977, if the district had operated during the 1977-78 fiscal year,
12utilizing the same number of units of average daily attendance
13used in subdivision (b) of this section.

14(d) Subtract the amount determined pursuant to subdivision (c)
15from the amount computed pursuant to subdivision (b).

16(e) The amount computed pursuant to subdivision (d), if greater
17than zero, shall be added to the revenue limit computed pursuant
18to subdivision (c) of Section 42237 or pursuant to Section 42238.
19If the amount in subdivision (d) is less than zero there is no
20adjustment.

21(f) The Superintendent of Public Instruction shall reduce by the
22amount computed pursuant to subdivision (e) the revenue limit
23computed pursuant to Section 42238 of any district discontinuing
24the operation of a continuation education school approved pursuant
25to subdivision (a).

26(g) (1) For the 1994-95 to 2002-03 fiscal years, inclusive, the
27adjustment computed pursuant to this section may not be adjusted
28by the deficit factor applied to the revenue limit of each school
29district pursuant to Section 42238.145.

30(2) For the 2003-04 fiscal year and each fiscal year thereafter,
31the revenue limit reduction specified in Section 42238.146 may
32not be applied to the adjustment computed pursuant to this section.

33(h) The adjustment computed pursuant to this section for a new
34continuation education high school may be applicable for any
35unified school district that was not fully operational during the
36first year of operation of the continuation education high school.
37The number of units of average daily attendance to be used in
38computing the adjustment shall be the number of units of average
39daily attendance generated by the continuation education high
P124  1school in the district for the first year that the district is fully
2operational in all grades.

3(i) In the 1998-99 fiscal year and each fiscal year thereafter,
4the ranges of average daily attendance resulting from the
5calculation set forth in this section pursuant to Section 41711, as
6that section read on July 1, 1977, shall be reduced by the statewide
7average percentage that absences excused pursuant to subdivision
8(b) of Section 46010, as that section read on July 1, 1996, were of
9total second principal apportionment regular average daily
10attendance for high schools in 1996-97, with the reduced ranges
11then rounded to the nearest integer.

12(j) Commencing with the 2005-06 fiscal year and
13notwithstanding any provision of law, the amount of the adjustment
14calculated pursuant to this section shall not be added to the revenue
15limit of a school district, but shall be used in determining the
16amount of the pupil retention block grant awarded a school district
17pursuant to Article 1 (commencing with Section 41500) of Chapter
183.2.

19(k) This section shall become inoperative on July 1, 2014, and,
20as of January 1, 2015, is repealed, unless a later enacted statute,
21that becomes operative on or before January 1, 2015, deletes or
22extends the dates on which it becomes inoperative and is repealed.

23

SEC. 72.  

Section 46201.2 of the Education Code is amended
24to read:

25

46201.2.  

(a) Commencing with the 2009-10 school year and
26continuing through the 2013-14 school year, a school district,
27county office of education, or charter school may reduce the
28equivalent of up to five days of instruction or the equivalent
29number of instructional minutes without incurring the penalties
30set forth in Sections 41420, 46200, 46200.5, 46201, 46201.5,
3146202, and 47612.5. A school district, county office of education,
32or charter school shall receive revenue limit funding based on the
33adjustments prescribed pursuant to Section 42238.146 whether or
34not it reduces the number of schooldays or instructional minutes.

35(b) This section shall become inoperative on July 1, 2014, and,
36as of January 1, 2015, is repealed, unless a later enacted statute,
37that becomes operative on or before January 1, 2015, deletes or
38extends the dates on which it becomes inoperative and is repealed.

39

SEC. 73.  

Section 46201.2 is added to the Education Code, to
40read:

P125  1

46201.2.  

(a) Commencing with the 2009-10 school year and
2continuing through the 2013-14 school year, a school district,
3county office of education, or charter school may reduce the
4equivalent of up to five days of instruction or the equivalent
5number of instructional minutes without incurring the penalties
6set forth in Sections 41420, 46200, 46200.5, 46201, 46201.5,
746202, and 47612.5, as those sections read on January 1, 2014. A
8school district, county office of education, or charter school shall
9receive revenue limit funding based on the adjustments prescribed
10pursuant to Section 42238.146, as it read on January 1, 2014,
11whether or not it reduces the number of schooldays or instructional
12minutes.

13(b) For the 2014-15 school year, a school district, county office
14of education, or charter school may reduce the equivalent of up to
15five days of instruction or the equivalent number of instructional
16minutes without incurring the penalties set forth in Sections 41420,
1746200, 46200.5, 46201, 46201.5, 46202, and 47612.5.

18(c) This section shall become operative on July 1, 2014.

19(d) This section shall become inoperative on July 1, 2015, and,
20as of January 1, 2016, is repealed, unless a later enacted statute,
21that becomes operative on or before January 1, 2016, deletes or
22extends the dates on which it becomes inoperative and is repealed.

23

SEC. 74.  

Section 47604.33 of the Education Code is amended
24to read:

25

47604.33.  

(a) Each charter school shall annually prepare and
26submit the following reports to its chartering authority and the
27county superintendent of schools, or only to the county
28superintendent of schools if the county board of education is the
29chartering authority:

30(1) On or before July 1, a preliminary budget. For a charter
31school in its first year of operation, the information submitted
32pursuant to subdivision (g) of Section 47605 satisfies this
33requirement.

34(2) On or before December 15, an interim financial report. This
35report shall reflect changes through October 31.

36(3) On or before March 15, a second interim financial report.
37This report shall reflect changes through January 31.

38(4) On or before September 15, a final unaudited report for the
39full prior year.

P126  1(b) The chartering authority shall use any financial information
2it obtains from the charter school, including, but not limited to,
3the reports required by this section, to assess the fiscal condition
4of the charter school pursuant to subdivision (d) of Section
547604.32.

6(c) The cost of performing the duties required by this section
7shall be funded with supervisorial oversight fees collected pursuant
8to Section 47613.

9(d) This section shall become inoperative on July 1, 2014, and,
10as of January 1, 2015, is repealed, unless a later enacted statute,
11that becomes operative on or before January 1, 2015, deletes or
12extends the dates on which it becomes inoperative and is repealed.

13

SEC. 75.  

Section 47604.33 is added to the Education Code, to
14read:

15

47604.33.  

(a) Each charter school shall annually prepare and
16submit the following reports to its chartering authority and the
17county superintendent of schools, or only to the county
18superintendent of schools if the county board of education is the
19chartering authority:

20(1) On or before July 1, a preliminary budget and a local control
21and accountability plan adopted pursuant to Section 52065. For a
22charter school in its first year of operation, the information
23submitted pursuant to subdivision (g) of Section 47605 satisfies
24this requirement.

25(2) On or before December 15, an interim financial report. This
26report shall reflect changes through October 31.

27(3) On or before March 15, a second interim financial report.
28This report shall reflect changes through January 31.

29(4) On or before September 15, a final unaudited report for the
30full prior year.

31(b) The chartering authority shall use any financial information
32it obtains from the charter school, including, but not limited to,
33the reports required by this section, to assess the fiscal condition
34of the charter school pursuant to subdivision (d) of Section
3547604.32.

36(c) The cost of performing the duties required by this section
37shall be funded with supervisorial oversight fees collected pursuant
38to Section 47613.

39(d) This section shall become operative on July 1, 2014.

P127  1

SEC. 76.  

Section 47610 of the Education Code is amended to
2read:

3

47610.  

A charter school shall comply with this part and all of
4the provisions set forth in its charter, but is otherwise exempt from
5the laws governing school districts, except all of the following:

6(a) As specified in Section 47611.

7(b) As specified in Section 41365.

8(c) All laws establishing minimum age for public school
9attendance.

10(d) The California Building Standards Code (Part 2
11(commencing with Section 101) of Title 24 of the California Code
12of Regulations), as adopted and enforced by the local building
13enforcement agency with jurisdiction over the area in which the
14charter school is located.

15(e) Charter school facilities shall comply with subdivision (d)
16by January 1, 2007.

17This section shall become inoperative on July 1, 2014, and, as
18of January 1, 2015, is repealed, unless a later enacted statute, that
19becomes operative on or before January 1, 2015, deletes or extends
20the dates on which it becomes inoperative and is repealed.

21

SEC. 77.  

Section 47610 is added to the Education Code, to
22read:

23

47610.  

(a) A charter school shall comply with this part and
24all of the provisions set forth in its charter, but is otherwise exempt
25from the laws governing school districts, except all of the
26following:

27(1) As specified in Section 47611.

28(2) As specified in Section 41365.

29(3) As specified in Section 52065.

30(4) All laws establishing minimum age for public school
31attendance.

32(5) The California Building Standards Code (Part 2
33(commencing with Section 101) of Title 24 of the California Code
34of Regulations), as adopted and enforced by the local building
35enforcement agency with jurisdiction over the area in which the
36charter school is located.

37(6) Charter school facilities shall comply with paragraph (5) of
38subdivision (a) by January 1, 2007.

39(b) This section shall become operative on July 1, 2014.

P128  1

SEC. 78.  

Section 47630.5 of the Education Code is amended
2to read:

3

47630.5.  

(a) This chapter applies to the calculation of
4operational funding for charter schools. Except as otherwise
5provided in this chapter, this chapter shall apply to all charter
6schools without regard to their sponsoring local education agency.

7(b) For the 1999-2000, 2000-01, and 2001-02 fiscal years in
8the case of a charter school that was assigned a number by the
9State Board of Education prior to June 1, 1999, the use of the
10charter school funding method established by this chapter shall be
11at the discretion of that charter school. A charter school that elects
12to have its funding determined pursuant to the method established
13by this chapter shall notify the State Department of Education by
14June 1 prior to the affected fiscal year. An election to be funded
15pursuant to the method established by this chapter is irrevocable.

16(c) Additional legal or fiscal responsibilities on the part of a
17county superintendent of schools are not imposed by this chapter,
18except as specifically provided in this chapter.

19(d) This section shall become inoperative on July 1, 2014, and,
20as of January 1, 2015, is repealed, unless a later enacted statute,
21that becomes operative on or before January 1, 2015, deletes or
22extends the dates on which it becomes inoperative and is repealed.

23

SEC. 79.  

Section 47631 of the Education Code is amended to
24read:

25

47631.  

(a) Article 2 (commencing with Section 47633) and
26Article 3 (commencing with Section 47636) may not apply to a
27charter granted pursuant to Section 47605.5.

28(b) Notwithstanding subdivision (a), a pupil attending a
29county-sponsored charter school who is eligible to attend that
30school solely as a result of parental request pursuant to subdivision
31(b) of Section 1981 shall be funded pursuant to this chapter.

32(c) This section shall become inoperative on July 1, 2014, and,
33as of January 1, 2015, is repealed, unless a later enacted statute,
34that becomes operative on or before January 1, 2015, deletes or
35extends the dates on which it becomes inoperative and is repealed.

36

SEC. 80.  

Section 47631 is added to the Education Code, to
37read:

38

47631.  

(a) Article 3 (commencing with Section 47636) shall
39not apply to a charter granted pursuant to Section 47605.5.

P129  1(b) Notwithstanding subdivision (a), a pupil attending a
2county-sponsored charter school who is eligible to attend that
3school solely as a result of parental request pursuant to subdivision
4(b) of Section 1981 shall be funded pursuant to the local control
5funding formula pursuant to Section 42238.02, as implemented
6by Section 42238.03.

7(c) This section shall become operative on July 1, 2014.

8

SEC. 81.  

Section 47632 of the Education Code is amended to
9read:

10

47632.  

For purposes of this chapter, the following terms shall
11be defined as follows:

12(a) “General-purpose entitlement” means an amount computed
13by the formula set forth in Section 47633 beginning in the
141999-2000 fiscal year, which is based on the statewide average
15amounts of general-purpose funding from those state and local
16sources identified in Section 47633 received by school districts of
17similar type and serving similar pupil populations.

18(b) “Categorical block grant” means an amount computed by
19the formula set forth in Section 47634 beginning in the 1999-2000
20fiscal year, which is based on the statewide average amounts of
21categorical aid from those sources identified in Section 47634
22received by school districts of similar type and serving similar
23pupil populations.

24(c) “General-purpose funding” means those funds that consist
25of state aid, local property taxes, and other revenues applied toward
26a school district’s revenue limit, pursuant to Section 42238.

27(d) “Categorical aid” means aid that consists of state or federally
28funded programs, or both, which are apportioned for specific
29purposes set forth in statute or regulation.

30(e) “Economic impact aid-eligible pupils” means those pupils
31that are included in the economic impact aid-eligible pupil count
32pursuant to Section 54023. For purposes of applying Section 54023
33to charter schools, “economically disadvantaged pupils” means
34the pupils described in paragraph (2) of subdivision (a) of Section
3554026.

36(f) “Educationally disadvantaged pupils” means those pupils
37who are eligible for subsidized meals pursuant to Section 49552
38or are identified as English learners pursuant to subdivision (a) of
39Section 306, or both.

P130  1(g) “Operational funding” means all funding except funding for
2capital outlay.

3(h) “School district of a similar type” means a school district
4that is serving similar grade levels.

5(i) “Similar pupil population” means similar numbers of pupils
6by grade level, with a similar proportion of educationally
7 disadvantaged pupils.

8(j) “Sponsoring local educational agency” means the following:

9(1) If a charter school is granted by a school district, the
10sponsoring local educational agency is the school district.

11(2) If a charter is granted by a county office of education after
12having been previously denied by a school district, the sponsoring
13local educational agency means the school district that initially
14denied the charter petition.

15(3) If a charter is granted by the state board after having been
16previously denied by a local educational agency, the sponsoring
17local educational agency means the local educational agency
18designated by the state board pursuant to paragraph (1) of
19subdivision (k) of Section 47605 or if a local educational agency
20is not designated, the local educational agency that initially denied
21the charter petition.

22(4) For pupils attending county-sponsored charter schools who
23are eligible to attend those schools solely as a result of parental
24request pursuant to subdivision (b) of Section 1981, the sponsoring
25local educational agency means the pupils’ school district of
26residence.

27(5) For pupils attending countywide charter schools pursuant
28to Section 47605.6 who reside in a basic aid school district, the
29sponsoring local educational agency means the school district of
30residence of the pupil. For purposes of this paragraph, “basic aid
31school district” means a school district that does not receive an
32apportionment of state funds pursuant to subdivision (h) of Section
3342238.

34(k) This section shall become inoperative on July 1, 2014, and,
35as of January 1, 2015, is repealed, unless a later enacted statute,
36that becomes operative on or before January 1, 2015, deletes or
37extends the dates on which it becomes inoperative and is repealed.

38

SEC. 82.  

Section 47632 is added to the Education Code, to
39read:

P131  1

47632.  

(a) For purposes of this chapter, the following terms
2shall be defined as follows:

3(1) “General-purpose entitlement” means an amount computed
4by the local control funding formula pursuant to Section 42238.02,
5as implemented by Section 42238.03.

6(2) “General-purpose funding” means those funds that consist
7of state aid, local property taxes, and other revenues applied toward
8a school district’s local control funding formula, pursuant to
9Section 42238.02, as implemented by Section 42238.03.

10(3) “Categorical aid” means aid that consists of state or federally
11funded programs, or both, which are apportioned for specific
12purposes set forth in statute or regulation.

13(4) “Educationally disadvantaged pupils” means those pupils
14who are eligible for subsidized meals pursuant to Section 49552
15or are identified as English learners pursuant to subdivision (a) of
16Section 306, or both.

17(5) “Operational funding” means all funding except funding for
18capital outlay.

19(6) “School district of a similar type” means a school district
20that is serving similar grade levels.

21(7) “Similar pupil population” means similar numbers of pupils
22by grade level, with a similar proportion of educationally
23disadvantaged pupils.

24(8) “Sponsoring local educational agency” means the following:

25(A) If a charter school is granted by a school district, the
26sponsoring local educational agency is the school district.

27(B) If a charter is granted by a county office of education after
28having been previously denied by a school district, the sponsoring
29local educational agency means the school district that initially
30denied the charter petition.

31(C) If a charter is granted by the state board after having been
32previously denied by a local educational agency, the sponsoring
33local educational agency means the local educational agency
34designated by the state board pursuant to paragraph (1) of
35subdivision (k) of Section 47605 or if a local educational agency
36is not designated, the local educational agency that initially denied
37the charter petition.

38(D) For pupils attending county-sponsored charter schools who
39are eligible to attend those schools solely as a result of parental
40request pursuant to subdivision (b) of Section 1981, the sponsoring
P132  1local educational agency means the pupils’ school district of
2residence.

3(E) For pupils attending countywide charter schools pursuant
4to Section 47605.6 who reside in a basic aid school district, the
5sponsoring local educational agency means the school district of
6residence of the pupil. For purposes of this paragraph, “basic aid
7school district” means a school district that does not receive an
8apportionment of state funds as described in subdivision (n) of
9Section 42238.02.

10(b) This section shall become operative on July 1, 2014.

11

SEC. 83.  

Section 47633 of the Education Code is amended to
12read:

13

47633.  

The Superintendent shall annually compute a
14general-purpose entitlement, funded from a combination of state
15aid and local funds, for each charter school as follows:

16(a) The Superintendent shall annually compute the statewide
17average amount of general-purpose funding per unit of average
18daily attendance received by school districts for each of four grade
19level ranges: kindergarten and grades 1, 2, and 3; grades 4, 5, and
206; grades 7 and 8; and, grades 9 to 12, inclusive. For purposes of
21making these computations, both of the following conditions shall
22apply:

23(1) Revenue limit funding attributable to pupils in kindergarten
24and grades 1 to 5, inclusive, shall equal the statewide average
25revenue limit funding per unit of average daily attendance received
26by elementary school districts; revenue limit funding attributable
27to pupils in grades 6, 7, and 8, shall equal the statewide average
28revenue limit funding per unit of average daily attendance received
29by unified school districts; and revenue limit funding attributable
30to pupils in grades 9 to 12, inclusive, shall equal the statewide
31average revenue limit funding per unit of average daily attendance
32received by high school districts.

33(2) Revenue limit funding received by school districts shall
34exclude the value of any benefit attributable to the presence of
35necessary small schools or necessary small high schools within
36the school district.

37(b) The Superintendent shall multiply each of the four amounts
38computed in subdivision (a) by the charter school’s average daily
39attendance in the corresponding grade level ranges. The resulting
40figure shall be the amount of the charter school’s general-purpose
P133  1entitlement, which shall be funded through a combination of state
2aid and local funds. From funds appropriated for this purpose
3pursuant to Section 14002, the superintendent shall apportion to
4each charter school this amount, less local funds allocated to the
5charter school pursuant to Section 47635 and any amount received
6pursuant to subparagraph (B) of paragraph (3) of subdivision (e)
7of Section 36 of Article XIII of the California Constitution.

8(c) General-purpose entitlement funding may be used for any
9public school purpose determined by the governing body of the
10charter school.

11This section shall become inoperative on July 1, 2014, and, as
12of January 1, 2015, is repealed, unless a later enacted statute, that
13becomes operative on or before January 1, 2015, deletes or extends
14the dates on which it becomes inoperative and is repealed.

15

SEC. 84.  

Section 47634.1 of the Education Code, as added by
16Section 24 of Chapter 2 of the Fourth Extraordinary Session of
17the Statutes of 2009, is amended to read:

18

47634.1.  

(a) Notwithstanding subdivision (a) of Section 47634,
19a categorical block grant for charter schools for the 2005-06 fiscal
20year shall be calculated as follows:

21(1) The Superintendent shall divide the total amount of funding
22appropriated for the purpose of this block grant in the annual
23Budget Act or another statute, less the total amount calculated in
24paragraph (2), by the statewide total of charter school average
25daily attendance, as determined at the second principal
26apportionment for the 2005-06 fiscal year.

27(2) The statewide average amount, as computed by the
28Superintendent, of funding per identified educationally
29disadvantaged pupil received by school districts in the current
30fiscal year pursuant to Article 2 (commencing with Section 54020)
31of Chapter 1 of Part 29. This amount shall be multiplied by the
32number of educationally disadvantaged pupils enrolled in the
33charter school. The resulting amount, if greater than zero, shall
34not be less than the minimum amount of Economic Impact Aid
35funding to which a school district of similar size would be entitled
36pursuant to Section 54022. For purposes of this subdivision, a
37pupil who is eligible for subsidized meals pursuant to Section
3849552 and is identified as an English learner pursuant to
39subdivision (a) of Section 306 shall count as two pupils.

P134  1(3) For each charter school, the Superintendent shall multiply
2the amount calculated in paragraph (1) by the school’s average
3daily attendance as determined at the second principal
4apportionment for the 2005-06 fiscal year.

5(4) The Superintendent shall add the amounts computed in
6paragraphs (2) and (3). The resulting amount shall be the charter
7school categorical block grant that the Superintendent shall
8apportion to each charter school from funds appropriated for this
9purpose in the annual Budget Act or another statute. The
10Superintendent shall allocate an advance payment of this grant as
11early as possible, but no later than October 31, 2005, based on
12prior year average daily attendance as determined at the second
13principal apportionment or, for a charter school in its first year of
14operation that commences instruction on or before September 30,
152005, on estimates of average daily attendance for the current fiscal
16year determined pursuant to Section 47652.

17(b) (1) For the 2006-07 fiscal year, the categorical block grant
18allocated by the Superintendent for charter schools shall be four
19hundred dollars ($400) per unit of charter school average daily
20attendance as determined at the second principal apportionment
21for the 2006-07 fiscal year. This amount shall be supplemented
22by the amount calculated in paragraph (2).

23(2) The statewide average amount, as computed by the
24Superintendent, of funding per economic impact aid-eligible pupil
25count received by school districts in the current fiscal year,
26pursuant to Article 2 (commencing with Section 54020) of Chapter
271 of Part 29, shall be multiplied by the number of economic impact
28aid-eligible pupils enrolled in the charter school. The resulting
29amount, if greater than zero, shall not be less than the minimum
30amount of Economic Impact Aid funding to which a school district
31of similar size would be entitled pursuant to Section 54022.

32(c) (1) For the 2007-08 fiscal year, the categorical block grant
33allocated by the Superintendent for charter schools shall be five
34hundred dollars ($500) per unit of charter school average daily
35attendance as determined at the second principal apportionment
36for the 2007-08 fiscal year. For each fiscal year thereafter, this
37per unit amount shall be adjusted for the cost-of-living adjustment,
38as determined pursuant to Section 42238.1, for that fiscal year.
39This amount shall be supplemented in the 2007-08 fiscal year and
P135  1each fiscal year thereafter by the amount calculated in paragraph
2(2).

3(2) The statewide average amount, as computed by the
4Superintendent, of funding per economic impact aid-eligible pupil
5count received by school districts in the current year, pursuant to
6Article 2 (commencing with Section 54020) of Chapter 1 of Part
729, shall be multiplied by the number of economic impact
8aid-eligible pupils enrolled in the charter school. The resulting
9amount, if greater than zero, shall not be less than the minimum
10amount of Economic Impact Aid funding to which a school district
11of similar size would be entitled pursuant to Section 54022.

12(d) It is the intent of the Legislature to fully fund the categorical
13block grant for charter schools as specified in this section and to
14appropriate additional funding that may be needed in order to
15compensate for unanticipated increases in average daily attendance
16and counts of economic impact aid-eligible pupils, pursuant to
17Article 2 (commencing with Section 54020) of Chapter 1 of Part
1829, in charter schools. In any fiscal year in which the department
19identifies a deficiency in the categorical block grant, the department
20shall identify the available balance for programs that count towards
21meeting the requirements of Section 8 of Article XVI of the
22California Constitution and have unobligated funds for the year.
23On or before July 1, the department shall provide the Department
24of Finance with a list of those programs and their available
25balances, and the amount of the deficiency, if any, in the categorical
26block grant. Within 45 days of the receipt of a notification of
27deficiency, the Director of Finance shall verify the amount of the
28deficiency in the categorical block grant and direct the Controller
29to transfer an amount, equal to the lesser of the amount available
30or the amount needed to fully fund the categorical block grant,
31from those programs to the categorical block grant. The Department
32of Finance shall notify the Joint Legislative Budget Committee
33within 30 days of any transfer made pursuant to this section.

34(e) Commencing October 1, 2007, the Legislative Analyst’s
35Office shall triennially convene a work group to review,
36commencing with appropriations proposed for the 2008-09 fiscal
37year, the appropriateness of the funding level provided by the
38categorical block grant established in this section.

39(f) Categorical block grant funding may be used for any purpose
40determined by the governing body of the charter school.

P136  1(g) This section shall become operative on July 1, 2013.

2(h) On or after July 1, 2014, this section shall become
3inoperative if the categorical programs funded through the
4categorical block grant described in this section are instead
5included within, or funded by, the local control funding formula
6pursuant to Section 42238.02, as implemented by Section 42238.03.

7

SEC. 85.  

Article 5 (commencing with Section 52060) is added
8to Chapter 6.1 of Part 28 of Division 4 of Title 2 of the Education
9Code
, to read:

10 

11Article 5.  Local Control and Accountability Plans
12

 

13

52060.  

(a) The governing board of each school district shall
14adopt a local control and accountability plan using a template
15adopted by the state board.

16(b) A local control and accountability plan adopted by a
17governing board of a school district shall be effective for a period
18of at least one year but no longer than five years. If a governing
19board of a school district adopts a plan that would be effective for
20a period longer than one year, the governing board must approve
21an update to the existing plan at least annually.

22(c) On or before July 1 of each fiscal year, a governing board
23of a school district shall take action on a local control and
24accountability plan for the subsequent fiscal year, either by
25adopting a new local control and accountability plan or by
26approving an update to a plan the governing board of the school
27district has previously adopted.

28(d) A governing board of a school district shall update the local
29control and accountability plan if the governing board of the school
30district determines that changes in the composition of the base
31Academic Performance Index require the school district to take
32specific actions and use strategies that are not already included in
33the plan to meet the Academic Performance Index growth target
34for each school in the school district. If the governing board of the
35school district determines that an update is necessary, the governing
36board of the school district shall approve the update by November
371 of the year in which the new base Academic Performance Index
38is released.

39(e) A governing board of a school district shall demonstrate that
40a local control and accountability plan approved by the governing
P137  1board of the school district was developed in consultation with
2teachers, principals, administrators, other school personnel, parents,
3and pupilsbegin insert, and is intended to accelerate pupil progress toward
4academic proficiencyend insert
.

5(f) A governing board of a school district shall ensure that a
6local control and accountability plan is consistent with all school
7plans submitted pursuant to Section 64001 by a school district for
8schools within the school district.

9(g) Before adopting a local control and accountability plan or
10approving an update to an existing plan, a governing board of a
11school district shall hold at least one public hearing to solicit
12recommendations and opinions of members of the public regarding
13specific actions and strategies that should be included in the plan.
14The agenda for the public hearing shall be posted at least 72 hours
15before the public hearing and shall include the location where the
16local control and accountability plan will be available for public
17inspection. This public hearing shall be held at the same meeting
18as the public hearing required by paragraph (1) of subdivision (a)
19of Section 42127.

20(h) A governing board of a school district shall notify members
21of the public, using the most efficient method possible, of the
22opportunity to submit written recommendations and opinions
23regarding specific actions and strategies that should be included
24in the local control and accountability plan. This subdivision shall
25not be interpreted to require a school district to produce printed
26notices or to send notices by mail.

27(i) A governing board of a school district shall adopt a local
28control and accountability plan in a public meeting. This meeting
29shall be held after, but not on the same day as, the public hearing
30held pursuant to subdivision (g). This meeting shall be the same
31meeting during which the governing board of the school district
32considers a budget pursuant to paragraph (2) of subdivision (a) of
33Section 42127.

34(j) A governing board of a school district may adopt a revised
35local control and accountability plan if the governing board of the
36school district is required to adopt a revised budget. A revised
37local control and accountability plan shall be adopted at the same
38meeting that a revised budget is adopted.

P138  1

52060.5.  

It is the intent of the Legislature to strengthen the
2accountability provisions proposed in this article in the following
3ways:

4(a) Ensure that supplemental funds generated by low income,
5English learner, and foster pupils are used to improve services to
6those pupils, and not to supplant existing resources dedicated to
7those pupils.

8(b) Provide authority of state entities, county entities, or both,
9to intervene in and support school districts that do not demonstrate
10improvements, across subgroups of pupils, toward achievement
11of common core academic content standards and other state
12standards and goals.

13(c) Rescind flexibility provisions for school districts that do not
14demonstrate improvements in outcomes across subgroups of pupils.

15(d) Ensure more robust data collections for purposes of state
16accountability systems and state and local oversight.

17(e) Ensure that the majority of funds allocated through any
18school funding formula are spent on services and programs with
19direct benefits to pupils.

20

52061.  

(a) Not later than five days after adoption of a local
21control and accountability plan or approval of an update to an
22existing plan pursuant to Section 52060, the governing board of a
23school district shall file the plan with the county superintendent
24of schools. The plan shall be filed on the same day that the
25governing board of the school district files the budget pursuant to
26paragraph (2) of subdivision (a) of Section 42127.

27(b) The county superintendent of schools shall do all of the
28following:

29(1) Examine if the plan adheres to the template adopted by the
30state board pursuant to Section 52066 and includes all of the
31components identified in subdivision (a) of Section 52064.

32(2) Determine if the budget for the subsequent fiscal year
33adopted by the governing board of the school district includes
34expenditures sufficient to implement the specific actions and
35strategies included in the local control and accountability plan
36adopted by the governing board of the school district, based on
37the projections of the costs included in the plan.

38(3) In making the determinations pursuant to paragraphs (1) and
39(2), consider input from teachers, principals, administrators, other
40school personnel, parents, and pupils from the school district.

begin insert

P139  1(4) The county superintendent of schools shall post all local
2control and accountability plans submitted by school districts and
3charter schools on the Internet Web site of the county office of
4education.

end insert
5

52062.  

(a) Each county superintendent of schools shall
6develop, and each county board of education shall adopt, a local
7control and accountability plan using a template adopted by the
8state board.

9(b) A local control and accountability plan adopted by a county
10board of education shall be effective for a period of at least one
11year but no longer than five years. If a county board of education
12adopts a plan that would be effective for a period longer than one
13year, the county board of education must approve an update to the
14plan at least annually.

15(c) On or before July 1 of each fiscal year, a county board of
16education shall take action on a local control and accountability
17plan for the subsequent fiscal year, either by adopting a new local
18control and accountability plan or by approving an update to a plan
19the county board of education has previously adopted.

20(d) A county superintendent of schools shall update and present
21to the county board of education for approval the local control and
22accountability plan if the county board of education determines
23that changes in the composition of the base Academic Performance
24Index require the county superintendent of schools to take specific
25actions and use strategies that are not already included in the plan
26to meet the Academic Performance Index growth target for each
27school operated by the county superintendent of schools. If the
28county board of education determines that an update is necessary,
29the county board of education shall approve the update by
30November 1 of the year in which the base Academic Performance
31Index is released.

32(e) A county superintendent of schools shall demonstrate that
33a local control and accountability plan was developed in
34consultation with teachers, principals, administrators, other school
35personnel, parents, and pupilsbegin insert, and is intended to accelerate pupil
36progress toward academic proficiencyend insert
. A county superintendent
37of schools also shall demonstrate that the superintendents of all
38school districts in the county were consulted in the development
39of the plan.

P140  1(f) A local control and accountability plan shall be consistent
2with all school plans submitted pursuant to Section 64001 by the
3county superintendent of schools for schools operated by the county
4superintendent of schools.

5(g) Before adopting a local control and accountability plan or
6approving an update to an existing plan, a county board of
7education shall hold at least one public hearing to solicit
8recommendations and opinions of members of the public regarding
9specific actions and strategies that should be included in the plan.
10The agenda for that hearing shall be posted at least 72 hours before
11the public hearing and shall include the location where the local
12control and accountability plan will be available for public
13inspection. The public hearing shall be held at the same meeting
14as the public hearing required by Section 1620.

15(h) A county board of education shall notify members of the
16public, using the most efficient method possible, of the opportunity
17to submit written recommendations and opinions regarding specific
18actions and strategies that should be included in the local control
19and accountability plan. This subdivision shall not be interpreted
20to require a county board of education to produce printed notices
21or to send notices by mail.

22(i) A county board of education shall adopt a local control and
23 accountability plan in a public meeting. This meeting shall be held
24after, but not on the same day as, the public hearing held pursuant
25to subdivision (g). The meeting shall be the same meeting during
26which a county board of education considers a budget pursuant to
27Section 1620.

28(j) A county board of education may adopt a revised local
29control and accountability plan if the county board of education
30is required to adopt a revised budget. A revised local control and
31accountability plan shall be adopted at the same meeting that a
32revised budget is adopted.

33

52063.  

(a) No later than five days after adoption of a local
34control and accountability plan or approval of an update to an
35existing plan pursuant to Section 52062 by a county board of
36education, the county superintendent of schools shall file the plan
37with the Superintendent, the county board of supervisors, and the
38county auditor. The plan shall be filed on the same day that the
39county superintendent of schools files the budget pursuant to
40subdivision (a) of Section 1622.

P141  1(b) The Superintendent shall do all of the following:

2(1) Examine if the plan adheres to the template adopted by the
3state board pursuant to Section 52066 and includes all of the
4components identified in subdivision (a) of Section 52064.

5(2) Determine if the budget for the subsequent fiscal year
6adopted by the county board of education includes expenditures
7sufficient to implement the specific actions and strategies included
8in the local control and accountability plan adopted by the county
9board of education, based on the projections of the costs included
10in the plan.

11(3) In making the determinations pursuant to paragraphs (1) and
12(2), consider input from teachers, principals, administrators, other
13school personnel, parents, and pupils in the county.

begin insert

14(c) The Superintendent shall post all local control and
15accountability plans submitted to it by county superintendents of
16schools on its Internet Web site. The Superintendent shall also
17post all local control and accountability plans submitted by school
18districts and charter schools to county superintendents of schools
19on its Internet Web site.

end insert
20

52064.  

(a) A local control and accountability plan adopted by
21a governing board of a school district or a county board of
22education shall identify goals and describe the specific actions the
23school district or county superintendent of schools will take and
24strategies that will be used to achieve all of the following:

25(1) Implement, for all pupils, the content standards adopted by
26the state board pursuant to Sections 60605.8, 60605.10, and
2760605.11.

28(2) Increase the Academic Performance Indexbegin insert and performance
29on statewide assessments pursuant to Article 4 (commencing with
30Section 60640) of Chapter 5 of Part 33, other national assessments,
31statewide assessments, and appropriate local assessments,end insert
for
32each school and for each numerically significant pupil subgroup
33pursuant to Section 52052begin insert,end insert and reduce gaps in the Academic
34Performance Index and other measures of pupil achievement
35between numerically significant pupil subgroupsbegin insert, as evidenced by
36the results of statewide assessments pursuant to Article 4
37(commencing with Section 60640) of Chapter 5 of Part 33, other
38national assessments, statewide assessments, and appropriate
39local assessmentsend insert
.

P142  1(3) begin deleteImprove end deletebegin insertSignificantly improve end insertpupil achievement of
2begin insert proficiency inend insert the content standards adopted by the state board
3pursuant to Sections 60605, 60605.2, 60605.3, 60605.8, and
460605.85, at all grade levels, as evidenced by the results of
5 statewide assessments pursuant to Article 4 (commencing with
6Section 60640) of Chapter 5 of Part 33, otherbegin insert national assessments,end insert
7 statewide assessments, and appropriate local assessments.

8(4) Increase high school graduation ratesbegin insert as measured by the
9California Longitudinal Pupil Achievement Data System and the
10school district level data systemend insert
, if a school district or a county
11superintendent of schools enrolls high school pupils, increase
12attendance rates, and reduce dropout rates.

13(5) Increase the percentage of pupils who have successfully
14completed each of the following:

15(A) Courses that satisfy the requirements for entrance to the
16University of California and the California State University.

17(B) Advanced placement courses.

18(C) Career technical education programs.

19(6) Identify and address needs of pupils, and schools
20predominantly serving pupils, who meet any of the following
21definitions:

22(A) Pupils who have been classified as an English learner
23pursuant to Section 52164.

24(B) Pupils who qualify for the free and reduced-price meal
25program pursuant to Section 49552.

26(C) Foster children as defined in Sections 300 and 601 of the
27Welfare and Institutions Code.

28(D) Pupils enrolled in a juvenile court school operated by a
29county superintendent of schools pursuant to subdivision (a) of
30Section 48645.2, if applicable.

31(7) Remedy deficiencies in any school in the school district or
32any school operated by the county board of education and improve
33school conditions in any of the areas included in paragraphs (5),
34(6), and (8) of subdivision (b) of Section 33126. This includes
35ensuring access for each pupil to the following:

36(A) Sufficient textbooks and instructional materials.

37(B) Safe, clean, and adequate school facilities.

38(C) Qualified teachers.

39(8) Provide meaningful opportunities for parent involvement,
40including, at a minimum, supporting effective schoolsite councils
P143  1or other structures at each school and advisory panels to the
2governing board of the school district or the county board of
3education or, if parents so choose, creating other processes or
4structures, such as creating the role of an ombudsman for parents,
5to address complaints and other issues raised by parents.

begin insert

6(9) Improvement in the school district’s college entrance rate,
7as measured by the National Student Clearinghouse or other
8state-approved pupil data tracking system if a school district or
9county superintendent of schools enrolls high school pupils.

end insert
begin insert

10(10) Improvement in the number of pupils who enter technical
11school after graduation, as measured by the National Student
12Clearinghouse or other state-approved pupil data tracking system,
13or who graduate prepared to enter high-wage, high-skill
14occupations if a school district or county superintendent of schools
15enrolls high school pupils.

end insert

16(b) A local control and accountability plan developed by a
17county superintendent of schools and approved by a county board
18of education shall also include, in addition to the elements included
19in subdivision (a), goals related to addressing countywide needs,
20and describe specific actions and strategies to do all of the
21following:

22(1) Conduct effective oversight of school districts pursuant to
23Article 2 (commencing with Section 1240) of Chapter 2 of Part 2
24of Division 1 of Title 1 and Chapter 6 (commencing with Section
2542100) of Part 24 of Division 3 of Title 2.

26(2) Provide support to school districts in the county, including
27support related to school district operations, educational
28technology, and professional development, and guidance to school
29districts related to curriculum and instructional practices.

30(3) Coordinate instruction for expelled pupils pursuant to Section
3148926.

32(c) A local control and accountability plan shall include an
33analysis of both the following:

34(1) Pupil achievement of those pupils enrolled in schools in a
35school district or schools operated by a county superintendent of
36schools at the time the plan is adopted by the governing board of
37the school district or the county board of education.

38(2) If a governing board of a school district or a county board
39of education previously has adopted a local control and
40accountability plan, progress made in implementing the goals
P144  1identified in the plan in effect immediately before the adoption of
2a new plan by the governing board of the school district or the
3county board of education.

4(d) For purposes of conducting the analysis required by
5subdivision (c), a governing board of a school district or a county
6superintendent of schools may consider qualitative information,
7including reviews conducted by panels of experts during visits to
8schools in the school district or schools operated by the county
9office of education.

10(e) Data reported in a local control and accountability plan shall
11be consistent with information reported on school accountability
12report cards for schools in a school district or schools operated by
13a county superintendent of schools.

14(f) begin insert(1)end insertbegin insertend insert A local control and accountability plan shall include
15projections of the costs of implementing the specific actions and
16strategies included in the plan. Expenditures that reflect these cost
17projections shall be included in the budget adopted by the
18governing board of the school district pursuant to Section 42127.

begin insert

19(2) A local control and accountability plan shall demonstrate
20fiscal solvency, as measured by the standards and criteria adopted
21by the state board pursuant to Section 33127 and implementing
22regulations.

end insert

23(g) A local control and accountability plan adopted by a
24governing board of a school district shall document all of the
25following:

26(1) For those fiscal years in which it is anticipated that the school
27 district will receive less funding than is calculated under the local
28control funding formula pursuant to Section 42238.02, as
29implemented by Section 42238.03, a projection of the total funding
30required for the specific actions the school district will take and
31strategies that will be used to implement paragraph (6) of
32subdivision (a), divided by the average daily attendance of the
33pupils for whom any of the definitions included in paragraph (6)
34of subdivision (a) apply. This amount of funding shall not be less
35than the total expenditures from the sources included in paragraphs
36(1) to (3), inclusive, of subdivision (i) of Section 42238.02 during
37the 2013-14 fiscal year for services for pupils for whom any of
38the definitions included in paragraph (6) of subdivision (a) applied
39during the 2013-14 fiscal year, divided by the average daily
40attendance of these students during the 2013-14 fiscal year.

P145  1(2) For those fiscal years in which it is anticipated that the school
2district will receive funding equal to or greater than the amount
3calculated under the local control funding formula pursuant to
4Section 42238.02, as implemented by Section 42238.03, a
5projection of the total funding required for the specific actions the
6school district will take and strategies that will be used to
7implement paragraph (6) of subdivision (a), divided by the average
8daily attendance of the pupils to whom any of the definitions
9included in paragraph (6) of subdivision (a) is applicable. This
10funding shall not be less than the supplemental grants the governing
11board of the school district projects receiving pursuant to
12subdivision (e) of Section 42238.02, divided by the average daily
13attendance of the pupils to whom any of the definitions included
14in paragraph (6) of subdivision (a) is applicable.

15(h) A local control and accountability plan adopted by a county
16board of education shall document all of the following:

17(1) For those fiscal years in which it is anticipated that the
18county office of education will receive less funding than is
19calculated under the county local control funding formula pursuant
20to Section 2574, a projection of the total funding required for the
21specific actions the county superintendent of schools will take and
22strategies that will be used to implement paragraph (6) of
23subdivision (a), divided by the average daily attendance of the
24pupils to whom any of the definitions included in paragraph (6)
25of subdivision (a) is applicable. This amount of funding shall not
26be less than the total expenditures from the sources included in
27paragraphs (1) and (2) of subdivision (e) of Section 2574 during
28the 2013-14 fiscal year for services for pupils to whom any of the
29definitions included in paragraph (6) of subdivision (a) applied
30during the 2013-14 fiscal year, divided by the average daily
31attendance of these pupils during the 2013-14 fiscal year.

32(2) For those fiscal years in which it is anticipated that the
33county office of education will receive funding equal to or greater
34than the amount calculated under the county local control funding
35formula pursuant to Section 2574, a projection of the total funding
36required for the specific actions the county superintendent of
37schools will take and strategies that will be used to implement
38paragraph (6) of subdivision (a), divided by the average daily
39attendance of the pupils to whom any of the definitions included
40in paragraph (6) of subdivision (a) is applicable. This funding shall
P146  1not be less than the supplemental grants the county board of
2education projects receiving pursuant to subdivision (c) of Section
32574, divided by the average daily attendance of the pupils to
4whom any of the definitions included in paragraph (6) of
5subdivision (a) is applicable.

6(i) A local control and accountability plan shall account for the
7funds provided to charter schools that elect to receive funding
8through the school district or the county office of education
9pursuant to Section 47651.

begin insert

10(j) A local control and accountability plan shall include
11measurable metrics to demonstrate achievement of the elements
12identified in paragraphs (1) to (10), inclusive, of subdivision (a),
13using as a baseline pupil achievement at the time the local control
14and accountability plan is adopted.

end insert
15

52065.  

(a) The governing body of a charter school that elects
16to receive its funding directly, pursuant to Section 47651, shall
17adopt a local control and accountability plan using a template
18adopted by the state board.

19(b) Notwithstanding Section 52064, a local control and
20accountability plan adopted by the governing body of a charter
21school shall identify specific steps the charter school will take and
22strategies that will be used to accomplish the goals identified in
23the charter petition granted pursuant to Sections 47605, 47605.5,
2447605.6, 47605.8, and 47606.

25(c) A local control and accountability plan adopted by a
26governing body of a charter school shall be effective for a period
27 of at least one year but no longer than five years. If the governing
28body of the charter school adopts a plan that would be effective
29for a period longer than one year, the governing body of the charter
30school must approve an update to the existing plan at least annually.

31(d) On or before July 1 of each fiscal year, a governing body of
32a charter school shall take action on a local control and
33accountability plan for the subsequent fiscal year, either by
34adopting a new local control and accountability plan or by
35approving an update to a plan the charter school has previously
36adopted. The plan shall be submitted to the charter school’s
37chartering authority and the county superintendent of schools, or
38only to the county superintendent of schools if the county board
39of education is the chartering authority, on the same day that the
P147  1charter school submits its preliminary budget pursuant to paragraph
2(1) of subdivision (a) of Section 47604.33.

begin insert
3

begin insert52065.5.end insert  

(a) On or before July 1, 2015, the Superintendent
4shall develop and the state board shall adopt a system of assistance
5and interventions that shall be implemented in either, or both, of
6the following circumstances:

7(1) If a county office of education, school district, or charter
8school requests information, and technical and programmatic
9assistance.

10(2) If a county office of education, school district, or charter
11school, over a two-year period, fails to accomplish the pupil
12achievement goals specified in its local control and accountability
13plan.

14(b) The system of assistance and interventions shall be available
15 for implementation on or before July 1, 2017, and shall include
16meaningful incentives and consequences, including, but not limited
17to, loss of local governing and policymaking authority. The system
18of assistance and interventions may also include, but is not limited
19to, development of a carefully selected and trained statewide or
20regional group of experts and practitioners, or both, to assist
21county offices of education, school district, and charter schools
22in developing the local capacity to meet the educational needs of
23all pupils.

24(c) If the system of assistance and interventions requires
25statutory changes, the Superintendent, on or before January 1,
262015, shall submit the proposed statutory changes to the
27appropriate policy and fiscal committees of the Legislature for
28consideration.

end insert
29

52066.  

(a) The state board shall adopt a template for use by
30school districts and a separate template for use by county
31superintendents of schools that includes the elements identified in
32Section 52064.

33(b) The state board shall also adopt a template for use by charter
34schools to satisfy the requirements of Section 52065.

35(c) The templates developed by the state board shall allow a
36school district, county superintendent of schools, or charter school
37to complete a single local control and accountability plan to meet
38the requirements of this article and the requirements of the federal
39Elementary and Secondary Act related to local educational agency
40plans pursuant to Section 1112 of Subpart 1 of Part A of Title I of
P148  1Public Law 107-110. The state board shall also take steps to
2minimize duplication of effort at the local level to the greatest
3extent possible.

4(d) If possible, the template identified in subdivision (a) for use
5by county superintendents of schools shall allow a county
6superintendent of schools to develop a single local control and
7accountability plan that would also satisfy the requirements of
8Section 48926.

9(e) The state board shall approve the templates identified in
10subdivisions (a) and (b) by January 30, 2015. Revisions to the
11templates shall be approved by the state board by January 1 before
12the fiscal year during which a template is to be used by a school
13district, county superintendent of schools, or charter school.

14(f) The adoption of a template by the state board shall not create
15a requirement for a governing board of a school district, a county
16board of education, or a governing body of a charter school to
17submit a local control and accountability plan to the state board,
18unless otherwise required by federal law. The Superintendent shall
19not require a local control and accountability plan to be submitted
20by a governing board of a school district or the governing body of
21a charter school. The state board may adopt a template that would
22authorize a school district or a charter school to submit to the state
23board only the sections of the local control and accountability plan
24required by federal law.

25(g) The state board may adopt emergency regulations for
26purposes of implementing this section.

27

52067.  

This article shall become operative on July 1, 2014.

28

SEC. 86.  

If the Commission on State Mandates determines
29that this act contains costs mandated by the state, reimbursement
30to local agencies and school districts for those costs shall be made
31pursuant to Part 7 (commencing with Section 17500) of Division
324 of Title 2 of the Government Code.

33begin insert

begin insertSEC. 87.end insert  

end insert

begin insertThe provisions of this bill shall become operative
34only if both of the following occur:end insert

begin insert

35(a) Senate Bill 344 of the 2013-14 Regular Session of the
36Legislature is enacted and it relates to educational accountability
37for English learner programs and services.

end insert
begin insert

38(b) Senate Bill 860 of the 2013-14 Regular Session of the
39Legislature is enacted and it relates to career technical education.

end insert


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