BILL ANALYSIS                                                                                                                                                                                                    Ó



                                                                     AB 480


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          Date of Hearing:  May 13, 2015


                           ASSEMBLY COMMITTEE ON EDUCATION


                              Patrick O'Donnell, Chair


          AB 480  
          (Harper) - As Amended March 26, 2015


          SUBJECT:  School districts:  reorganization:  study of benefits  
          and impacts of unification


          SUMMARY:  Requires the Legislative Analyst's Office (LAO) to  
          conduct a study of the potential benefits and impacts of school  
          district unification.  Specifically, this bill: 


          1)Requires the LAO to conduct a study of the potential benefits  
            and impacts of school district unification.  



          2)Requires the study to include discussion of all of the  
            following topics:



             a)   the benefits of school district unification for purposes  
               of matriculation



             b)   the benefits of having a uniform school calendar for all  
               grade levels








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             c)   the benefits of combined maintenance and operation of  
               schools within a unified school district



             d)   the benefits of school district unification for purposes  
               of facilities management



             e)   the impact of school district unification on overall  
               costs, including the impacts on certificated salary  
               schedules, classified salaries and positions, and  
               certificated administrative positions



             f)   the impact on the application of the Local Control  
               Funding Formula



             g)   the short-term and long-term benefits of school district  
               unification over periods of 5, 10, and 15 years



          EXISTING LAW:  





          1)Prescribes procedures for school district reorganization,  
            depending on the type of reorganization (transfer of  
            territory, unification, etc.) and the method by which the  








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            reorganization was initiated (petition, school board  
            resolution, etc.).



          2)Requires each county to establish a County Committee on School  
            District Organization (CCSDO), made up of county school board  
            members or their designees.



          3)Establishes a process whereby locally developed reorganization  
            petitions dealing with a transfer of territory are reviewed by  
            the CCSDO for approval or disapproval in a public hearing, and  
            allows for the county committee decision on a petition dealing  
            with a transfer of territory to be appealed to the SBE for  
            review and consideration.



          4)Establishes a process whereby locally developed reorganization  
            petitions dealing with all other district organizational  
            issues are reviewed by the county committee in public hearing  
            and submitted with a recommendation to the SBE, and requires  
            the SBE to hear such petitions in public hearing, receive a  
            recommendation from California Department of Education (CDE)  
            staff, and formally approve or disapprove those petitions.



          5)Subjects these petitions to review under California  
            Environmental Quality Act (CEQA).



          6)Requires the return of approved petitions to the local  
            jurisdiction, where the county superintendent of schools is  
            required to call for an election at which the petition is put  
            to a vote of the affected electorate.








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          7)Authorizes a CCSDO to approve petitions to create new school  
            districts without having to submit the proposal to the State  
            Board of Education when the governing boards of the affected  
            districts consent and the county superintendent(s) with  
            jurisdiction over the affected districts approve, and where  
            there is an agreement to share the costs of complying with the  
            requirements of the CEQA.



          FISCAL EFFECT:  This bill has been keyed non-fiscal by the  
          Office of Legislative Counsel.


          COMMENTS:  



          Need for the bill.  The author's office states that the intent  
          of this bill is to examine ways in which school districts can  
          reduce costs through unification.  The author's office offers as  
          examples of possible cost savings bulk ordering, textbook  
          purchasing, administrative services, food services, and  
          credential and assignment monitoring.  The author's office also  
          notes that unification might reduce the need for administrative  
          staff and the election of governing board members, and that  
          unification might provide more uniformity in curriculum across  
          schools.  


          2011 LAO study answers some questions raised by this bill.  The  
          Supplemental Report of the 2010-11 Budget Act directed the LAO  
          to study school district consolidation and determine whether the  
          state should more actively promote consolidating small districts  
          into larger districts. 









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          This report addressed the merits of consolidation, spending  
          patterns, student performance, incentives and disincentives to  
          consolidate, and concluded that "neither the academic research  
          nor our own review offers persuasive evidence that consolidating  
          small districts would necessarily result in substantial savings  
          or notably better outcomes for students."  


          The report noted that the state has about half as many districts  
          as it did fifty years ago (963 in 2009-10 compared to 2,091 in  
          1950-51), largely as a result of state policies to encourage  
          consolidation. The LAO noted that throughout the 1950's and  
          1960's the state provided a number of fiscal incentives for  
          consolidation, including increasing the funding rates for  
          unified districts and funding transportation costs associated  
          with unifications.


          The LAO found that small districts currently tend not to pursue  
          consolidation because the state provides fiscal incentives for  
          districts to remain small and disincentives for consolidation.  
          The report found that these incentives are strongest in very  
          small school districts, which on average receive more than twice  
          as much funding per pupil compared to middle and large sized  
          districts. The LAO also found that "certain state laws,  
          including those related to environmental reviews and district  
          staffing, coupled with community preferences for small  
          districts, serve as disincentives for districts to consolidate."  
           The report recommended eliminating fiscal advantages provided  
          for districts to remain small.


          The LAO has indicated to staff that it does not view additional  
          analysis of this topic a priority, and does not have more to  
          report on this topic.  In view of the work that the LAO has  
          already done, and their lack of further comment on the issue,  
          staff recommends that the bill be amended to make an agency  
          other than the LAO responsible for this report.  The Fiscal  








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          Crisis Management Assistance Team (FCMAT), which is charged with  
          providing management and fiscal advice and assistance to school  
          districts, may be the more appropriate agency to conduct this  
          study.


          Unification under the LCFF.  The Local Control Funding Formula  
          (LCFF) enacted in 2013 changed the allocation of K-12 funding by  
          creating base, supplemental, and concentration grants in place  
          of most previously existing K-12 funding streams, including  
          revenue limits and most state categorical programs. Base grants  
          vary by grade span, supplemental grants are allocated based on  
          the number of "unduplicated pupils" who are low income, English  
          learners, and in foster care, and concentration grants are  
          provided to school districts with unduplicated students  
          comprising more than 55% of their enrollment.


          The LAO report was completed before the LCFF was enacted, and  
          the new funding system may alter some of the factors involved  
          school district unification.  This may pose some interesting  
          questions for research, especially with regard to fiscal  
          incentives and disincentives for unification.


          Recommended amendments.  Staff recommends the following  
          amendments to address issues discussed above:


             1.   Change the agency responsible for producing the study  
               from the LAO to the FCMAT.

             2.   Focus the requirements of the study around two topics  
               involved in school district unification:  management and  
               finance.  Related amendments are recommended to focus the  
               topics outlined in the bill around issues the FCMAT can  
               adequately address given the data available to it.










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             3.   Make the implementation of the bill contingent upon  
               appropriation of funding for this purpose.

          REGISTERED SUPPORT / OPPOSITION:




          Support


          None on file




          Opposition


          None on file




          Analysis Prepared by:Tanya Lieberman / ED. / (916) 319-2087