BILL ANALYSIS
AB 1407
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Date of Hearing: May 6, 2009
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Kevin De Leon, Chair
AB 1407 (Huffman) - As Amended: April 27, 2009
Policy Committee: Education
Vote:9-0
Urgency: Yes State Mandated Local Program:
No Reimbursable: No
SUMMARY
This bill extends the School District of Choice (SDC) program
from July 1, 2009 until July 1, 2014. Specifically, this bill:
Requires the State Department of Education (SDE), on or before
November 1, 2010, to prepare and submit a census report to the
Legislature that evaluates interdistrict transfer options within
the state, as specified.
FISCAL EFFECT
1)Potential GF/98 increased costs of $795,000 to the state for
increased costs related to the declining enrollment
adjustment. As stated below, 52% of school districts in the
state are experiencing declining enrollment. Existing law
provides school districts with a one year hold harmless
adjustment if their enrollment is declining. For the 2007-08
fiscal year, the state provided $318 million for the declining
enrollment adjustment.
2)GF administrative costs to the SDE, likely in excess of
$150,000, to conduct a census report of the SDC program, as
specified. In 2008, SDE requested $131,000 GF and position
authority to complete the report required by SB 80 (Committee
on Budget and Fiscal Review), Chapter 174, Statutes of 2007.
This funding and position authority was not approved by the
Legislature. The report required under this measure may
require the SDE to contract for its completion; therefore,
there may be an increased cost.
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COMMENTS
1)Background . AB 19 (Quackenbush), Chapter 160, Statutes of
1993, authorized the governing board of a school district to
declare itself a "school district of choice" (willing to
accept a specified number of inter-district transfers). A
"school district of choice" is not required to accept pupils,
however, for those pupils it does accept, the district is
required to select them through a random process that is not
based on academic or athletic talent.
Unlike other school inter-district transfer statute (see
below), AB 19 does not require agreement between the two
affected school districts in order to admit transfer pupils.
If a district of pupil residence has 50,000 or less pupil
attendance, it can refuse to transfer more than one percent of
its attendance and limit the maximum number of transfers to
10% of its overall attendance for the duration of the program.
For a school district with more than 50,000 in attendance, it
can refuse to transfer more than 3% of its attendance.
Furthermore, transfer priority is given to siblings of
students already attending school in a "school district of
choice."
SB 80 extended the SDC program until July 1, 2009 and required
the SDE, on or before November 1, 2008, to submit a report to
the Legislature evaluating interdistrict transfer options
within the state with an emphasis on the SDC program. Chapter
174 required the report to contain specific elements,
including the academic achievement of pupils within school
districts of choice, the number of pupils who transferred, and
the fiscal health of school districts involved in the SDC
program. This bill extends the sunset of the SDC program
until 2014 and requires the SDE to complete a census report,
as specified.
2)Existing law also authorizes two school districts to enter
into an agreement that allows pupils to transfer between the
two districts, as specified. This agreement allows the
pupil's parent or guardian requesting the inter-district
transfer to appeal to the county board of education in the
event that either district refuses the requested transfer.
The transfer agreement also allows districts to consider child
care as a factor in approving or denying transfer requests, as
specified.
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3)SDE 2008 Report of the SDC program . SB 80 (Committee on
Budget and Fiscal Review), Chapter 174, Statutes of 2007,
required the SDE to conduct a report on the SDC program,
including those districts that are "school districts of
choice" and the original districts of residence of the pupil.
SDE surveyed 100 school districts receiving the most students
through the interdistrict transfer programs in 2006-07. The
survey data revealed that the reciprocal interdistrict
transfer option (i.e., where both districts have an agreement)
is the most prevalent form of transfers in the state.
Furthermore, the SDE states that "only 3.9% of the responding
districts actively participate in the SDC program."
Many individuals argue that SDE's report is incomplete with
respect to the number of school districts surveyed and
therefore, the data reported does not represent a clear
picture of the SDC program. As such, this bill requires SDE
to complete a census report of the SDC program by November
2010.
4)Potential fiscal implications of the SDC program . Information
provided to this committee suggests that more urban districts
have become "school districts of choice" in recent years. As
more districts become "school districts of choice," there are
financial implications for the district of residence due to a
statewide decline in enrollment.
According to the Legislative Analyst Office (LAO), 510 of 975
school districts (52%) are experiencing declining enrollment.
If school districts are experiencing declining enrollment,
they are losing revenue limit funding (general purpose)
because the amount they received is based on the number of
students they serve. The LAO further estimates that over the
next 10 years, K-12 enrollment growth will decline beginning
in 2008-09. This contrasts with the high enrollment growth in
recent years, which averaged 2.2% annually in the 1990s.
As pupils transfer out of school districts under the "school
district of choice program," the school districts that they
reside in lose revenue limit funding for those students.
Since half of the state's districts are already experiencing a
loss of revenue due declining enrollment, a school district
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losing pupils under this program argues that pupil transfers
only exacerbate the problem. Furthermore, opponents of this
program argue that the SDC program is gaining revenue limit
funding at the expense of another neighboring district. When
a school district loses revenue, it impacts their ability to
provide education programs to the remaining students because
they have less overall funding.
The relationship between declining enrollment and the SDE
program is difficult to quantify on a statewide level because
school districts are not required to report data to the state.
Analysis Prepared by : Kimberly Rodriguez / APPR. / (916)
319-2081