BILL ANALYSIS
SENATE COMMITTEE ON EDUCATION
Gloria Romero, Chair
2009-2010 Regular Session
BILL NO: AB 980
AUTHOR: Swanson
AMENDED: April 22, 2009
FISCAL COMM: Yes HEARING DATE: June 25, 2009
URGENCY: No CONSULTANT: James Wilson
SUBJECT : Emergency Loan Repayment: Charter Schools
SUMMARY
This bill requires a charter school located within the
geographic boundaries of a school district that is repaying
an emergency loan to pay a prorated amount of the annual
payment made by the district on the loan.
BACKGROUND
There are currently five school districts that have
outstanding balances on emergency loans from the state.
The districts, along with the loan balances as of July
2008, and the years of their expected payoff are shown
below.
1) Vallejo Unified owes $51 Million on an original loan
of $60 M, payoff in 2024.
2) Oakland Unified owes $82 M on an original loan of $100
M, payoff in 2026.
3) West Fresno Elementary owes $800K on an original $1.3
M, payoff in 2013.
4) Emery Unified owes $1 M on an original loan of $1.3 M,
payoff in 2021.
5) Richmond/West Contra Costa owes $13 M on three
consolidated loans totaling $28.5 million, payoff
expected in 2018.
The Compton Unified School District and Coachella Valley
Unified School District paid off their emergency loans in
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2001.
Current law provides for charter schools to receive general
purpose revenues, and a block grant in lieu of categorical
aid, directly from the state without going through the
school district that authorized their charter. In most
cases, the school district is required to contribute a
pro-rata share of local property tax revenues to the
charter school, but the district is not in a position to
withhold
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general purpose or categorical funding from the charter
school. Under current law, school districts are required
to repay emergency loans, but charter schools have no
obligation to contribute to the repayment.
ANALYSIS
This bill:
1) Requires a charter school located within the
geographic boundaries of a school district that is
repaying an emergency loan to pay a prorated amount of
the annual loan repayment.
2) Provides that the amount to be contributed to the loan
payment by each charter school is to be determined by:
a) Dividing the annual payment made by the
school district by the sum of the number of
pupils enrolled in the district combined with
the number of district resident pupils who are
enrolled in charter schools that are within the
geographic boundaries of the district, in order
to derive a per pupil share of the annual loan
payment.
b) Multiplying the per pupil share of the loan
payment by the number of pupils who reside within
the school district and are enrolled in the
charter school, to determine the school's share.
3) Requires the Superintendent of Public Instruction to
deduct the prorated amount determined for each charter
school from the amount of general purpose entitlement
funding provided to the charter school directly by the
state and apply the amount deducted to the outstanding
balance of the applicable emergency loan.
STAFF COMMENTS
1) Oakland Unified . According to the Assembly Education
Committee, charter schools located within the
boundaries of the Oakland Unified School District
would be required by this bill to pay approximately
$130 per student annually, based on current enrollment
in the district of 38,634 and current enrollment in
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charter schools of 7,492. All charters schools in
Oakland would contribute $973,960 annually toward the
districts $6 million annual loan payment. According
to the author, Oakland enrollments have dropped from
54,000 to 38,700 in approximately seven years. Since
that time, the number of charter schools has grown and
now house about 7,000 students.
2) Fiscal impact . According to the Assembly
Appropriations Committee, this bill has no direct
fiscal effect on the state. This bill would require
charter schools to pay approximately $122 on average
per pupil, based on
2007-08 data.
3) Related legislation . AB 2008 (Swanson) prohibited a
chartering authority from approving a charter school
that operates within the boundaries of the Oakland
Unified School District, if the district had an
outstanding balance on the emergency apportionment it
received in 2003 when the school district entered into
receivership. That measure was held in the Assembly
Appropriations Committee.
SUPPORT
Alameda Labor Council, AFL-CIO
Bay Area Parent Leadership Action Network
California Federation of Teachers
California School Boards Association
California School Employees Association
California Teachers Association
Letters from Individuals
OPPOSITION
California Charter Schools Association