BILL ANALYSIS
SENATE COMMITTEE ON EDUCATION
Gloria Romero, Chair
2009-2010 Regular Session
BILL NO: AB 184
AUTHOR: Block
AMENDED: August 2, 2010
FISCAL COMM: Yes HEARING DATE: August 11, 2010
URGENCY: Yes CONSULTANT:Lynn Lorber
NOTE : This bill has been amended to replace its contents and
this is the first time the bill is being heard in its current
form.
SUBJECT : Special Disabilities Adjustment
KEY POLICY ISSUE
Should the special disabilities adjustment be extended to the
2009-10 fiscal year, thereby preventing school districts that
already received and spent some of this funding from owing
those funds to the state?
SUMMARY
This bill, an urgency measure, extends the special
disabilities adjustment by one additional year, to the
2009-10 fiscal year.
BACKGROUND
In 1997, the Legislature reformed special education funding
(AB 602, Ch. 854) to move from a formula based on the number
of special education pupils to one based on a school
district's overall average daily attendance (thereby removing
an incentive to identify higher numbers of pupils as needing
special education to drive an increase in funding). As part
of this reform, a funding mechanism was created to provide
additional funding to special education local plan areas
(SELPAs) having a disproportionately large number of
"high-cost" special education pupils. This funding is based
on an incidence multiplier that was developed pursuant to a
study completed in 1998 by the American Institutes for
Research (AIR).
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Recognizing that these factors may change over time, the
special education funding reform (AB 602) called for the
incidence multiplier to expire after the 2002-03 fiscal year,
and called for a new study to be completed by March 2003.
AIR completed this second study, which recommended that the
incidence multiplier be updated at least every five years, if
not annually, and that the state gradually phase-out SELPAs
that have been receiving adjustment funds for the five years
prior to the release of the report, and provide full and
immediate funding to SELPAs identified as responsible for a
disproportionate number of high cost students.
The Legislature has passed six bills to extend the
calculation of the special disabilities adjustment, each for
an additional fiscal year, with the latest extending this
calculation to the 2008-09 fiscal year.
Current law requires the Superintendent of Public Instruction
to annually calculate the special disabilities adjustment for
each SELPA based on the incidence multiplier established
pursuant to the 1998 American Institutes for Research report.
(Education Code 56836.155)
ANALYSIS
This bill , an urgency measure, extends the special
disabilities adjustment by one additional year, to the
2009-10 fiscal year. Specifically, this bill:
1) Requires the Superintendent of Public Instruction (SPI)
to calculate the special disabilities adjustment of each
SELPA for the incidence of disabilities for the 2009-10
fiscal year.
2) Specifies that the special disabilities adjustment for
the 2009-10 fiscal year is to be excluded from the
SELPA's base special education funding (per unit of
average daily attendance).
3) Requires the SPI to calculate the special disabilities
adjustment for the 2009-10 fiscal year and adjust this
funding for each SELPA regardless of when this bill
becomes operative.
4) Includes an urgency clause.
STAFF COMMENTS
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1) Need for the bill . According to the author, the state
budget last year included funds for the 2009-10 SDA and
the California Department of Education (CDE) had been
sending school districts their SDA funding this past
year. In June 2010, CDE announced that it did not have
the authority for its distribution in the 2009-10 fiscal
year and without emergency legislation it would alert
the State Controller to offset 2010-11 special education
apportionments for school districts that received and
spent 2009-10 special disabilities adjustment funds.
2) How did we get here ? The CDE has annually calculated
and allocated the special disabilities adjustment,
beginning with the 1998-99 fiscal year. This funding is
sent to SELPAs as part of the overall special education
funding, and is made in monthly payments. CDE began
sending monthly payments to SELPAs for the 2009-10
fiscal year in February 2010 (as part of the First
Principal Apportionment, also known as P1), under the
assumption that the special disabilities adjustment
would continue to be included in the overall special
education funding (for those SELPAs that are eligible
for the special disabilities adjustment). However,
while the 2009 Budget Act included an appropriation for
the special disabilities adjustment (as part of overall
special education funding), statutory authority to
allocate those funds for the 2009-10 fiscal year was not
included in budget trailer bill language, as had been
the case in prior years. As part of the P1 notification
to SELPAs, CDE included a link to the calculations used
to determine the 2009-10 P1, which specifically states
that authority to use the special disabilities
adjustment in the calculation of overall special
education funding was not extended to the 2009-10 fiscal
year and that CDE will not include incidence multipliers
or special disabilities adjustment funding in its Second
Principal Apportionment (P2) calculation if the statute
is not extended. At the point of the P2 calculation
(June 2010), school districts within SELPAs that
received these funds had already included the special
disabilities adjustment funding in their budgets and
expended some of those funds.
3) For prior fiscal year . This bill provides for the
special disabilities adjustment only for the 2009-10
fiscal year. Will the problem addressed by this bill
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recur for the current fiscal year? Should this bill be
amended to clearly state that SELPAs should not expect
to continue to receive special disabilities adjustment
funding in the future?
4) Not all SELPAs are eligible . Thirty-two SELPAs (out of
122) are currently eligible to receive the special
disabilities adjustment, based on the formula in current
law. While this adjustment is calculated annually, it
is based on a formula that is 12 years old.
5) Related budget action . The Budget Conference Committee
recently reached a compromise relative to the special
disabilities adjustment, which provides for the
continuation of this funding through the 2010-11 fiscal
year. The compromise recognizes the usefulness of this
bill in ensuring CDE can allocate the remaining 2009-10
funds if the budget continues to be delayed. The
compromise also provides federal funding for a study to
determine options for the replacement of the special
disabilities adjustment, and repeals the existing
adjustment funding formula on July 1, 2011.
6) Fiscal impact . The 2009-10 special disabilities
adjustment amount totals $69.85 million, which was
appropriated but not allocated for the 2009-10 fiscal
year. Because these funds were appropriated, this bill
would not result in additional costs to the state.
7) Prior legislation .
SB 1564 (Schiff, Ch. 330, 1998) established
the special disabilities adjustment through the
2002-03 fiscal year.
AB 97 (Nation, Ch. 21, 2004) extended the
special disabilities adjustment to the 2003-04
fiscal year.
AB 2525 (Committee on Education, Ch. 896,
2004) extended the special disabilities adjustment
to the 2004-05 fiscal year.
SB 63 (Committee on Budget and Fiscal
Review, Ch. 73, 2005) extended the special
disabilities adjustment to the 2005-06 fiscal year.
AB 1802 (Committee on Budget, Ch. 79, 2006)
extended the special disabilities adjustment to the
2006-07 fiscal year.
SB 80 (Committee on Budget and Fiscal
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Review, Ch. 174, 2007) extended the special
disabilities adjustment to the 2007-08 fiscal year.
AB 519 (Committee on Budget, Ch. 757, 2008)
extended the special disabilities adjustment to the
2008-09 fiscal year.
SUPPORT
San Diego Unified School District
OPPOSITION
None received.