Amended in Senate April 15, 2013

Senate Bill No. 223

Introduced by Senator Liu

February 11, 2013

An act to amend, repeal, and add Section 42605 of, and to add and repeal Chapter 3 (commencing with Section 63060) of Part 35 of Division 4 of Title 2 of, the Education Code, relating to education finance, and making an appropriation therefor.

LEGISLATIVE COUNSEL’S DIGEST

SB 223, as amended, Liu. Education finance: Maximum Categorical Funding Flexibility and Accountability Program.

Existing law establishes various categorical education programs and appropriates the funding for those programs in the annual Budget Act. Existing law requires the Superintendent of Public Instruction, for the 2009-10 to the 2014-15 fiscal year, inclusive, to apportion from the amount provided in the annual Budget Act for specified categorical education programs an amount based on the same relative proportion that the local educational agency received in the 2008-09 fiscal year for those programs and authorizes those agencies, for those fiscal years, to use these funds, with specified exceptions, for any educational purpose, to the extent permitted by federal law.

Existing law, as a condition of receiving the categorical education program funds that may be used for any educational purpose, requires school districts and county offices of education, at a regularly scheduled open public hearing, to take testimony from the public, discuss, and approve or disapprove the proposed use of funding. Existing law requires a local educational agency to report expenditures, as specified, to indicate the activities for which these funds were expended and requires the State Department of Education annually to collect and provide this information to the appropriate legislative policy and budget committees and the Department of Finance. Existing law, for those fiscal years, deems local educational agencies that use these categorical education program funds for any educational purpose to be in compliance with the program and funding requirements of those categorical education programs.

This bill would establish the Maximum Categorical Funding Flexibility and Accountability Program, to be implemented from the 2015-16 fiscal year to the 2019-20 fiscal year, inclusive. The bill would extend the operation of the provisions that authorize the expenditure of funds provided for specified categorical education programs for any educational purpose by 5 fiscal years begin insert , but would delete funds appropriated for adult education programs, specialized secondary education grant programs, and regional occupational centers and programs from the scope of this provision as of July 1, 2015, and would base the amount apportioned under the provision on the same relative proportion that the local educational agency received in the 2013-14 fiscal year rather than the 2008-09 fiscal year end insert . The bill would thereby make an appropriation by allowing the expenditure of appropriated funds for additional purposes for that extended period.

To be eligible for selection for participation in this program, and in order to utilize the provisions allowing the expenditure of funds appropriated for specified categorical programs for any educational purpose for any of the fiscal years from 2015-16 to 2019-20, inclusive, a school district would be required to meet certain preconditions, including developing a plan to accelerate pupils’ progress to proficiency that includes specified goals. A school district selected by the Superintendent to participate in the program would be required to agree to demonstrate significant progress toward accelerating pupils’ progress toward proficiency in California’s academic standards over a 3-year period, a narrowing of the achievement gap in its federally recognized subgroups, fiscal solvency, positive growth on the school district’s Academic Performance Index, an increase in its graduation rate, begin delete and end delete improvement in its college entrance rate begin insert , and pupil progress in passage of common core standards end insert .

The bill would require the Superintendent, for the 2015-16 to 2019-20 fiscal years, inclusive, to apportion to the participating school districts an increase or decrease of the amounts apportioned under the provisions authorizing the expenditure of funds appropriated for specified categorical programs for any educational purpose in accordance with specified criteria. The bill would require the additional funds apportioned to school districts under this program to be expended for any purpose related to improving pupil achievement and academic instruction, except as specified.

The bill would require that a participating school district would be deemed to be in compliance with the program and funding requirements associated with the categorical education programs.

The bill would require that a participating school district would be required to submit an evaluative annual report and an annual expenditure report, including prescribed information, to the State Department of Education. The bill would require the Superintendent to contract for an interim evaluation report and a final evaluation report that identifies the success and failures of the program and makes recommendations regarding improving the program and whether the program should be continued. The provisions establishing the program would become inoperative on July 1, 2020, and would be repealed on January 1, 2021.

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

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

SECTION 1.  

The Legislature finds and declares all of the
following:

(a) California school districts are facing immeasurable
challenges begin insert , which include implementing the common core
standards in mathematics and English language arts and ensuring
that pupils from low-income backgrounds and pupils who are
English language learners are provided with supplemental
instruction and support services, while end insert managing reductions in
state funding, and need maximum flexibility in the ways they can
utilize restricted funding from the state.

(b) However, the current tiers of categorical program
appropriations, coupled with lack of accountability, provide no
assurances that categorical funding will be used for purposes related
to improving pupil achievement and academic instruction.

(c) Merging the concept of funding flexibility with locally
governed planning processes with the goal of improving pupil
achievement and academic instruction will allow state money for
categorical education programs to be managed more efficiently
and effectively by school districts to meet the academic needs of
all pupils and result in progress in closing the achievement gap.

(d) Maximum categorical program flexibility will enhance a
school district’s ability to support academic and career goals for
all pupils and provide systematic, differentiated instruction and
interventions to accelerate pupils’ progress to proficiency.

(e) Allowing the state to evaluate the benefits of maximum
categorical program flexibility, and ensuring that program
flexibility is used correctly, will result in gains in pupil
achievement.

SEC. 2.  

Section 42605 of the Education Code, as amended by
Section 2 of Chapter 668 of the Statutes of 2012, is amended to
read:

42605.  

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

SEC. 3.  

Section 42605 is added to the Education Code, to read:

42605.  

(a) (1) Unless otherwise prohibited under federal law
or otherwise specified in subdivisions (d) and (e), for the 2015-16
fiscal year to the 2019-20 fiscal year, inclusive, recipients of funds
from the items listed in paragraph (2) may use funding received,
pursuant to subdivision (b), from any of these items listed in
paragraph (2) that are contained in Section 2.00 of the annual
Budget Act, for any educational purpose.

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

(b) (1) For the 2015-16 fiscal year to the 2019-20 fiscal year,
inclusive, the Superintendent or other administering state agency,
as appropriate, shall apportion from the amounts provided in the
annual Budget Act for the items enumerated in paragraph (2) of
subdivision (a) an amount to recipients based on the same relative
proportion that the recipient received in the begin delete 2008-09 end delete begin insert 2013-14 end insert
fiscal year for the programs funded through the items enumerated
in paragraph (2) of subdivision (a).

(2) This section and Section 42 of Chapter 12 of the Third
Extraordinary Session of the Statutes of 2009 do not authorize a
school district that receives funding on behalf of a charter school
pursuant to Sections 47634.1 and 47651 to redirect this funding
for another purpose unless otherwise authorized in law or pursuant
to an agreement between a charter school and its chartering
authority. Notwithstanding paragraph (1), for the 2015-16 fiscal
year to the 2019-20 fiscal year, inclusive, a school district that
receives funding on behalf of a charter school pursuant to Sections
47634.1 and 47651 shall continue to distribute the funds to those
charter schools based on the relative proportion that the school
district distributed in the begin delete 2007-08 end delete begin insert 2012-13 end insert fiscal year, and shall
adjust those amounts to reflect changes in charter school attendance
in the district. The amounts allocated shall be adjusted for any
greater or lesser amount appropriated for the items enumerated in
paragraph (2) of subdivision (a). For a charter school that began
operation in the begin delete 2008-09 end delete begin insert 2013-14 end insert fiscal year, if a school district
received funding on behalf of that charter school pursuant to
Sections 47634.1 and 47651, the school district shall continue to
distribute the funds to that charter school based on the relative
proportion that the school district distributed in the begin delete 2008-09 end delete
begin insert 2013-14 end insert fiscal year and shall adjust the amount of those funds to
reflect changes in charter school attendance in the district. The
amounts allocated shall be adjusted for any greater or lesser amount
appropriated for the items enumerated in paragraph (2) of
subdivision (a).

(3) Notwithstanding paragraph (1), for the 2015-16 fiscal year
to the 2019-20 fiscal year, inclusive, the Superintendent shall
apportion from the amounts appropriated by Item 6110-211-0001
of Section 2.00 of the annual Budget Act an amount to a charter
school in accordance with the per-pupil methodology prescribed
in subdivision (c) of Section 47634.1.

(4) Notwithstanding paragraph (1), for the 2015-16 fiscal year
to the 2019-20 fiscal year, inclusive, the Superintendent shall
apportion from the amounts provided in the annual Budget Act an
amount to a school district, charter school, and county office of
education based on the same relative proportion that the local
educational agency received in the begin delete 2007-08 end delete begin insert 2012-13 end insert fiscal year
for the programs funded through the following items contained in
Section 2.00 of the annual Budget Act: 6110-104-0001,
begin delete 6110-105-0001, 6110-156-0001, end delete 6110-190-0001, Schedule (3) of
6110-193-0001, 6110-198-0001, 6110-232-0001, and Schedule
(2) of 6110-240-0001.

(5) For purposes of paragraph (4), if a direct-funded charter
school began operation in the begin delete 2008-09 end delete begin insert 2013-14 end insert fiscal year, the
amount that the charter school was entitled to receive from the
items enumerated in paragraph (4) for the begin delete 2008-09 end delete begin insert 2013-14 end insert fiscal
year, as certified by the Superintendent in March begin delete 2009, end delete begin insert 2014, end insert is
deemed to have been received in the begin delete 2007-08 end delete begin insert 2012-13 end insert fiscal year.

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

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

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

(3) Using the Standardized Account Code Structure reporting
process, a local educational agency shall report expenditures of
funds pursuant to the authority of this section by using the
appropriate function codes to indicate the activities for which these
funds are expended. The department shall collect and provide this
information to the Department of Finance and the appropriate
policy and budget committees of the Legislature by April 15, 2016,
and annually thereafter on April 15 until, and including, April 15,
2021.

(d) For the 2015-16 fiscal year to the 2019-20 fiscal year,
inclusive, local educational agencies that use the flexibility
provision of this section shall be deemed to be in compliance with
the program and funding requirements contained in statutory,
regulatory, and provisional language associated with the items
listed in paragraph (2) of subdivision (a) if the Superintendent
approves the participation of the local educational agency in the
Maximum Categorical Funding Flexibility and Accountability
Program pursuant to Chapter 3 (commencing with Section 63060)
of Part 35 of Division 4.

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

begin delete

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

end delete begin delete

(2)

end delete

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

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

begin delete

(3)

end delete

begin insert (2) end insert  For Item 6110-195-0001 of Section 2.00 of the annual
Budget Act, the item shall exclude moneys that are required to
fund awards for teachers that have previously met the requirements
necessary to obtain these awards, until the award is paid in full.

begin delete

(4)

end delete

begin insert (3) end insert  For Item 6110-266-0001 of Section 2.00 of the annual
Budget Act, a county office of education shall conduct at least one
site visit to each of the required schoolsites pursuant to Section
1240 and shall fulfill all of the duties set forth in Sections 1240
and 44258.9.

begin delete

(5)

end delete

begin insert (4) end insert  For Item 6110-198-0001 of Section 2.00 of the annual
Budget Act, a school district or county office of education that
operates the child care component of the Cal-SAFE program shall
comply with paragraphs (5) and (6) of subdivision (c) of Section
54746.

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

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

SEC. 4.  

Chapter 3 (commencing with Section 63060) is added
to Part 35 of Division 4 of Title 2 of the Education Code, to read:

 

Chapter  3. Maximum Categorical Funding Flexibility
and Accountability Program

 

63060.  

(a) The Maximum Categorical Funding Flexibility and
Accountability Program is hereby established. The program shall
be implemented from the 2015-16 fiscal year to the 2019-20 fiscal
year, inclusive. The Superintendent shall select school districts to
participate in the program that meet the preconditions of Section
63061 and agree to demonstrable goals as specified in Section
63062. A school district may apply to the Superintendent for
selection to participate in the program.

(b) As used in this chapter, a “participating school district” is
a school district selected by the Superintendent to participate in
the Maximum Categorical Funding Flexibility and Accountability
Program established by this chapter.

63061.  

(a) In order to be deemed in compliance with the
program and funding requirements contained in statutory,
regulatory, and provisional language associated with the items
listed in paragraph (2) of subdivision (a) of Section 42605 for any
of the fiscal years from 2015-16 to 2019-20, inclusive, a school
district shall meet all of the following preconditions:

(1) The school district has a plan, developed in conjunction with
parents and teachers, to accelerate pupils’ progress to academic
proficiency. The plan shall include both of the following:

(A) Measurable metrics to improve pupil performance, close
the achievement gap, increase college entrance rates, and increase
career readiness.

(B) An explanation of the manner in which the objectives of
each categorical program funded under the items listed in paragraph
(2) of subdivision (a) of Section 42605 will be met.

(2) The governing board of the school district, at a regularly
scheduled public meeting of the board, has approved the plan and
developed corresponding policies in support of the plan.

(3) The annual evaluation of the performance of the
superintendent of the school district is linked to the pupil
performance goals specified in paragraph (1).

(4) The school district demonstrates a pattern of stability
between management and the bargaining units.

(5) There is community support for the plan.

(6) The school district has surveyed parents and legal guardians
in the district to gauge support for participation in the program.
At least one-half of the permanent teachers and one-half of the
surveyed parents or legal guardians in the school district support
participation in the program, and that support is demonstrated in
writing.

(7) The standards-based curriculum for English learners is
cognitively complex, coherent, well articulated, and meaningful,
and will enable English learners to learn English quickly and
fluently so that they may participate fully in the grade-level
curriculum. At a minimum, the program shall provide all of the
following:

(A) Support for English learners who are new to the school
district.

(B) An English language development program that is
comprehensive and standards aligned and that has all of the
following characteristics:

(i) Actively develops all domains of language.

(ii) Addresses varying levels of English fluency.

(iii) Develops age-appropriate and context-appropriate language,
including an emphasis on academic English.

(iv) Includes opportunities for English learners to interact with
native English speaking peers.

(v) Creates a supportive learning environment for language
learning.

(vi) Recognizes the role of primary language development.

(C) Full access to a challenging curriculum.

(D) High-quality instruction and materials.

(E) An inclusive and affirming school climate.

(F) Valid, reliable, comprehensive, and useful assessments.

(G) Strong family partnerships.

(H) A qualified educator workforce.

(b) At a minimum, the Superintendent shall consider the quality
and rigor of the manner in which the school districts meet the
preconditions outlined in subdivision (a).

(c) If the Superintendent determines that a school district fails
to meet the preconditions specified in subdivision (a) with respect
to some of the categorical education programs funded under the
items listed in paragraph (2) of subdivision (a) of Section 42605,
the Superintendent may select that school district as a participant,
but restrict the participation of that school district to a subset of
the categorical education programs and budget items.

(d) Nothing in this section shall be construed as imposing new
mandates on school districts.

63062.  

A school district that participates in the Maximum
Categorical Funding Flexibility and Accountability Program shall
agree to demonstrate all of the following goals:

(a) Significant progress toward accelerating pupils’ progress
toward proficiency in California’s academic standards over a
three-year period, as measured by the annual assessments
administered pursuant to Article 4 (commencing with Section
60640) of Chapter 5 of Part 33 and any other local, state, or
national assessments.

(b) A narrowing of the achievement gap in the school district’s
federally recognized subgroups, as measured by the annual
assessments administered pursuant to Article 4 (commencing with
Section 60640) of Chapter 5 of Part 33 and any other local, state,
or national assessments.

(c) Fiscal solvency, as measured by the standards and criteria
adopted by the state board pursuant to Section 33127 and
implementing regulations.

(d) Positive growth, as measured by the school district’s
Academic Performance Index score, the annual assessments
administered pursuant to Article 4 (commencing with Section
60640) of Chapter 5 of Part 33, and any other local, state, or
national assessments.

(e) An increase in the school district’s graduation rate, as
measured by the California Longitudinal Pupil Achievement Data
System and the school district level data system.

(f) Improvement in the school district’s college entrance rate,
as measured by the National Student Clearinghouse or other
state-approved pupil data tracking system.

(g) Improvement in the number of pupils who enter technical
school after graduation, as measured by the National Student
Clearinghouse or other state-approved pupil data tracking system,
or who graduate prepared to enter high-wage, high-skill
occupations.

begin insert

(h) Pupil progress in passage of common core standards.

end insert

63063.  

(a) For the 2015-16 fiscal year to the 2019-20 fiscal
year, inclusive, the Superintendent shall do all of the following:

(1) Increase or decrease the amounts apportioned pursuant to
paragraph (2) of this subdivision proportional to any increase or
decrease in the amounts appropriated in Section 2.00 of the annual
Budget Act for the budget items listed in paragraph (2) of
subdivision (a) of Section 42605.

(2) Provide an apportionment schedule to each participating
school district that separately itemizes and differentiates the amount
apportioned for each budget item listed in paragraph (2) of
subdivision (a) of Section 42605.

(3) Allocate the amounts apportioned pursuant to paragraph (2)
of subdivision (a) of Section 42605 to the school districts selected
for participation in the program on the same timeline that
apportionments related to those budget items are apportioned to
other school districts.

(b) Each apportionment made pursuant to subdivision (a) to the
school districts participating shall be in lieu of funding that those
school districts would have received from the same budget items
if not participating. A school district shall not receive duplicated
funding as a result of participation in the program.

63064.  

(a) Notwithstanding any other law, a participating
school district may use the funds that it receives pursuant to Section
63063 for any purpose related to improving pupil achievement
and academic instruction, except as provided in subdivision (b).

(b) (1) With respect to funds received pursuant to Item
6110-128-0001 of Section 2.00 of the annual Budget Act, a
participating school district shall use these funds to supplement
the base program provided to English learners and economically
disadvantaged pupils, as those terms are defined in Section 54026.

(2) With respect to funds received pursuant to Item
6110-119-0001 of Section 2.00 of the annual Budget Act, a
participating school district shall use these funds to supplement
the base program provided to foster youth.

(3) With respect to funds received pursuant to Item
6110-196-0001 of Section 2.00 of the annual Budget Act, a
participating school district shall use these funds to ensure that
child care and development services continue to be provided to
subsidized low-income children.

(c) It is the intent of the Legislature that the educational needs
of pupils served by the categorical programs funded by the items
listed in paragraph (2) of subdivision (a) of Section 42605 be
served by a school district selected for participation in the pilot
project.

(d) It is not the intent of the Legislature to waive requirements
of any educational programs enacted through the initiative process.

(e) A participating school district shall implement an open and
transparent process that allows public input at no less than two
regularly scheduled meetings of the governing board of the school
district so as to notify parents, staff, and the community of
discussions and pending decisions related to the flexible use of
funds apportioned pursuant to subdivision (a) of Section 63063.
The school district shall seek input from parents, staff, and the
community regarding the option or options most suitable for the
school district and schools in the district. The governing board of
the school district shall not take action on this item at the first
meeting at which the item appears on the agenda.

63065.  

(a) Notwithstanding any other law, a participating
school district shall be deemed to be in compliance with the
program and funding requirements contained in statutory,
regulatory, and provisional language associated with the items
listed in paragraph (2) of subdivision (a) of Section 42605.

(b) Notwithstanding subdivision (a), a participating school
district that receives funds pursuant to Item 6110-128-0001 of
Section 2.00 of the annual Budget Act shall continue to designate
staff to coordinate services and programs, including the home
language survey, for English learners and shall continue in
existence parent advisory committees and schoolsite councils, as
required pursuant to Section 62002.5.

63066.  

(a) A participating school district shall submit an
evaluative annual report to the department that details the progress
made during the immediately prior school year toward the goals
set forth in Section 63062, including details of the academic
progress made by pupil subgroups.

(b) As part of the annual report pursuant to subdivision (a), a
participating school district also shall submit to the department an
annual expenditure report detailing the expenditure of specific
categorical program funds and the purposes for which those funds
were expended. The report shall do all of the following:

(1) Identify the weighting of per pupil expenditures from all
funds spent on low-socioeconomic, limited-English-proficient,
and special education pupils, as compared to other pupils in the
school district.

(2) Compare the identified weightings of per pupil expenditures
reported pursuant to paragraph (1) to the weightings of per pupil
expenditures spent in the 2009-10 fiscal year on pupils in the pupil
subgroups listed in paragraph (1).

(3) Be in a format designated by the Superintendent, using the
Standardized Account Code Structure and consistent with the
California School Accounting Manual, and shall provide the ability
to track each of the amounts apportioned pursuant to subdivision
(a) of Section 63063 with respect to resource, program, function,
and object.

(4) Be submitted by the date designated as the deadline for
submission of school district annual financial statements.

(c) The Superintendent shall provide guidance to the
participating school districts so as to ensure that the expenditure
reports submitted pursuant to subdivision (b) conform to the
requirements placed on those reports.

(d) By June 1, 2017, the Superintendent shall contract for the
completion of an independent evaluation of the program utilizing
available federal and other nonstate funding.

(1) The contracted independent evaluator shall provide the
Legislature, the Governor, the Superintendent, the state board, and
the participating school districts with both of the following:

(A) An interim report no later than 18 months after the
Superintendent apportions funding pursuant to Section 63063.

(B) By December 31, 2019, a final evaluation report that
identifies the success and failures of the program and makes
recommendations regarding improving the program and whether
the program should be continued.

(2) The evaluation shall make use of school district expenditure
reports submitted pursuant to subdivision (b), school district plans
as described in Section 63061, and any other available financial,
programmatic, and pupil outcome data currently collected and
available.

(3) Upon request by the evaluator, the department and the
participating school districts shall provide any available data that
the evaluator deems necessary to meaningfully evaluate the
program.

(4) This subdivision does not relieve a school district or any
other party from obligations under state or federal law to protect
pupil privacy.

63067.  

This chapter shall become inoperative on July 1, 2020,
and, as of January 1, 2021, is repealed, unless a later enacted
statute, that becomes operative on or before January 1, 2021,
deletes or extends the dates on which it becomes inoperative and
is repealed.