BILL ANALYSIS Ó
SENATE COMMITTEE ON EDUCATION
Senator Liu, Chair
2015 - 2016 Regular
Bill No: SB 191
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|Author: |Block |
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|Version: |February 10, 2015 |Hearing |March 18, 2015 |
| | |Date: | |
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|Urgency: |No |Fiscal: |Yes |
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|Consultant: |Lenin Del Castillo |
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Subject: School transportation: apportionments
SUMMARY
This bill would provide for school districts to be funded at
a minimum of 50 percent of approved transportation costs by
the 2021-22 fiscal year, thereby providing equalization
funding for school districts that are reimbursed at less
than 50 percent. The equalization adjustments would occur
over a seven-year period beginning in 2015-16. In addition,
this bill provides that school transportation funding
receive an annual cost-of-living adjustment (COLA) from the
2015-16 fiscal year through the 2021-22 fiscal year.
BACKGROUND
Current law authorizes school districts and county offices
of education to provide transportation services to regular
education students attending their schools at the discretion
of their governing board. Additionally, current law
requires school districts to provide transportation services
for special education students whose individualized
education programs require such services.
(Education Code § 39800 and § 41850 et. seq.)
Federal law requires local educational agencies to transport
the following three groups of students: (a) students with
disabilities; (b) students attending federally sanctioned
schools; and (c) homeless students. School districts
generally use one of two types of funding for pupil
transportation: general purpose or categorical funds.
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General purpose funds can be spent on anything from teacher
salaries to utility bills. Categorical funds must be spent
on specific purposes, e.g., the Home-to-School
Transportation (HTST) program in which school districts
utilize the funds received to provide transportation
services to special education and regular education
students.
In 2013, the Local Control Funding Formula (LCFF) was
enacted. The LCFF replaces almost all sources of state
funding, including most categorical programs. The LCFF
establishes a per-pupil funding target that is adjusted for
differences in grade level, but otherwise is uniform across
the state. The LCFF also provides supplemental funding for
districts that serve students who are low-income, English
language learners, or foster youth. However, one
categorical program not rolled into the LCFF is the HTST
program. This program retained its separate funding stream;
such that any district that received HTST funding in 2012-13
continues to receive that same amount of funding in addition
to its LCFF allocation each year. However, the HTST, unlike
in prior years, would not be eligible for future
cost-of-living adjustments (COLAs). And state law continues
to require that districts spend HTST funding on pupil
transportation.
ANALYSIS
This bill:
1. Requires the Superintendent of Public Instruction, for
the 2015-16 through 2021-22 fiscal years, to apportion
to each school district, county office of education,
entity providing services under a joint powers
agreement, or regional occupational center or program
that provides pupil transportation services either 100
percent of its school transportation apportionment for
the 2014-15 fiscal year, as adjusted for a
cost-of-living-adjustment (COLA); or the following
amount, whichever is greater:
A. For the 2015-16 fiscal year, 41 percent of
its approved
transportation costs for the prior fiscal year.
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B. For the 2016-17 fiscal year, 42.5 percent of
its approved
transportation costs for the prior fiscal year.
C. For the 2017-18 fiscal year, 44 percent of
its approved
transportation costs for the prior fiscal year.
D. For the 2018-19 fiscal year, 45.5 percent of
its approved
transportation costs for the prior fiscal year.
E. For the 2019-20 fiscal year, 47 percent of
its approved
transportation costs for the prior fiscal year.
F. For the 2020-21 fiscal year, 48.5 percent of
its approved
transportation costs for the prior fiscal year.
G. For the 2021-22 fiscal year, 50 percent of
its approved
transportation costs for the prior fiscal year.
2. Requires for the 2013-14 fiscal year school
transportation apportionment amount described above
shall be adjusted by the percentage change in the
annual average value of the Implicit Price Deflator for
State and Local Government Purchases of Goods and
Services for the United States, as published by the
United States Department of Commerce for the 12-month
period ending in the third quarter of the prior fiscal
year. This percentage change shall be determined using
the latest data available as of May 10 of the preceding
fiscal year compared with the annual average value of
the same deflator for the 12-month period ending in the
third quarter of the second preceding fiscal year,
using the latest data available as of May 10 of the
preceding fiscal year, as reported by the Department of
Finance.
STAFF COMMENTS
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1. Need for the bill. According to the author's office,
the Home-to-School Transportation (HTST) program has
long been inequitable and in need of improvement where
the current statewide average reimbursement rate is 35
percent of approved costs. The funding distribution is
so uneven that some school districts see less than 10
percent reimbursement, while others receive over 80
percent of their approved costs. Based on data from
the Legislative Analyst's Office (LAO) report on the
Home-to-School Transportation (HTST) program in 2014,
school districts spent over $1.4 billion transporting
students but received less than $492 million from the
state to pay these costs resulting in encroachment on
general purpose revenues that would otherwise go into
instructional programs. This funding deficit is an
unequal burden that hits rural and growing school
districts much harder than more densely populated and
flat enrollment school districts.
This bill would bring severely underfunded districts up
to a 50 percent reimbursement rate; while also
providing for a cost-of-living-adjustment (COLA) for
transportation funds for all school districts. The
author's office also indicates that applying a COLA can
ensure districts will not be negatively impacted as
costs of service rise.
2. 2014 Budget Act. The 2014 Budget Act provides
approximately $496 million in Proposition 98 General
Fund for the HTST program, which includes both
allocations for home-to-school transportation and
allocations for some pupils with disabilities,
specifically "severely disabled and orthopedically
impaired" pupils.
3. Legislative Analyst Office Report. In 2013, the LAO
was requested to consider new approaches that could
address historical inequities and include incentives
for efficient and effective pupil transportation
services. The report was issued February 2014 and
included a description and assessment of three options:
(1) funding pupil transportation services within the
new Local Control Funding Formula (LCFF), (2) creating
a new, targeted program to help districts facing
extraordinarily high transportation costs, and (3)
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creating a broad-based program whereby the state pays a
share of each district's transportation costs.
To assist the Legislature's deliberations, the LAO
identified three options for funding pupil
transportation moving forward. The options primarily
differ in the degree to which they account for
transportation costs separately from the other costs
districts face. These three options are to (1) fund
transportation costs within the LCFF; (2) fund only
extraordinary transportation costs; or (3) fund a share
of all transportation costs. Although the basic
approach for each option differs, all contain some key
advantages. Most notably, all three options provide a
means to phase out the use of allocations linked to
historical factors and apply the same funding rules to
all local education agencies, addressing key problems
with the state's existing approach. In addition, all of
the options would encourage efficiency by requiring
local budgets to cover a notable share of total costs.
Finally, all three options would be relatively simple
to implement and easy for districts and the public to
understand.
4. Problems with the existing program are not new. The
Bureau of State Audits (BSA) released a report on the
HTST program in 2007, acknowledging many problems with
the existing program funding formula. Some of the
findings include:
A. The current funding mechanism prevents some
school districts that did not receive
Home-to-School Transportation (HTST) program funds
in the immediately preceding fiscal year from
receiving these funds because of the basis of
allocation.
B. Allocation increases are not always
consistent with student population growth. Some
school districts have experienced dramatic
increases in student population over the years;
however, their allocations have not always
increased at the same rate.
C. Most school districts had to use other
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funding sources to pay for some transportation
costs and many reported it had varying levels of
fiscal impact on other programs.
5. How much funding exposure would this bill create?
According to information provided by the author, the
total amount of funding to implement this measure is
approximately $249 million over the seven year
implementation period, or an average increase per year
of approximately $35.6 million.
6. California has long provided state funding to school
districts for student transportation. Before 1984, a
law formally prescribed allocations for transportation
to elementary and high school districts. Legislation
passed in 1983 required that Education allocate the
HTST program funds based on the same amount as the
school district's prior year's allocation, increased by
the amount provided in the Budget Act, if its approved
cost for that year was at least 95 percent of its
Home-to-School program allocation for the same year.
Otherwise, this legislation required an amount equal to
the school district's certified percentage of the prior
year's transportation costs plus 5 percent, the sum
increased by the amount provided in the Budget Act.
Legislation enacted in 1991 amended previous laws and
created the current funding formula. This legislation
required that, beginning with fiscal year 1993-94, each
school district receive a student transportation
allowance equal to the lesser of its prior year
Home-to-School program allocation or actual approved
transportation expenditures from that year, increased
by the growth in average daily attendance rate and
cost-of-living adjustments as specified in the Budget
Act.
7. Related and prior legislation
SB 1137 (Torres, 2014), nearly identical to this
measure, would have provided for school districts to be
funded at a minimum of 50 percent of approved
transportation costs by the 2020-21 fiscal year,
thereby providing equalization funding for school
districts that are reimbursed at less than 50 percent.
SB 1137 passed this Committee on April 9, 2014 but
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failed passage in the Assembly Appropriations
Committee.
SB 1166 (Vidak, 2014), required school districts to
receive state reimbursement for the full cost of
home-to-school transportation of pupils. Commencing
with the 2014-15 fiscal year, these costs shall be
reimbursed through an appropriation in the annual
Budget Act. SB 1166 failed passage in this Committee
on April 9, 2014.
SUPPORT
Antelope Valley Schools Transportation Agency
California Association of School Business Officials
California Association of School Transportation Officials
California Association of Suburban School Districts
California School Boards Association (sponsor)
California School Employees Association
Central Valley Education Coalition
Elk Grove Unified School District
Kern County Superintendent of Schools
Mid-Placer Public Schools Transportation Agency
Pajaro Valley Unified School District
Riverdale Joint Unified School District
Rural County Representatives of California
San Jose Unified School District
School Transportation Coalition
Small School Districts' Association
Southwest Transportation Agency
West County Transportation
Wilsona School District
OPPOSITION
California Charter Schools Association
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