BILL ANALYSIS
AB 2366
Page 1
Date of Hearing: May 19, 2010
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Felipe Fuentes, Chair
AB 2366 (Brownley) - As Amended: April 27, 2010
Policy Committee: Education
Vote:6-3
Urgency: No State Mandated Local Program:
No Reimbursable: No
SUMMARY
This bill is a clean-up measure to AB 851 (Brownley), Chapter
374, Statutes of 2009, which simplified the calculation of
school district revenue limit funding (general purpose) by
consolidating four add-on formulas into two fixed adjustments.
Specifically, this bill:
1)Defers implementation of a school district revenue limit
adjustment related to the Meals for Needy Pupils (MNP) program
from the 2010-11 fiscal year (FY), established by Chapter 374,
to the 2013-14 FY.
2)Extends authorization for the MNP program from July 1, 2010 to
July 1, 2013.
FISCAL EFFECT
GF/98 loss of savings, of approximately $16 million in revenue
limit funding, to school districts due to the provisions of AB
851 related to the MNP program. Absent this measure,
implementation of AB 851 would lead to the state allocating less
revenue limit funding to school districts because the
calculation for the fixed adjustment for the MNP program is
based on 2008-09 funding levels.
The 2009 Budget Act reduces revenue limit funding by a total of
3% ($1.2 billion GF/98), including a 2.5% ($943.8 million GF/98)
reduction in the current year (2008-09 fiscal year) that is
carried forward. SB 4xxx (Committee on Fiscal Review), Chapter
AB 2366
Page 2
12, Statutes of 2009, also eliminated the revenue limit COLA
(.7% or $247 million) provided to school districts and county
offices of education in the 2008 Budget Act.
COMMENTS
1)Purpose . AB 851 (Brownley), Chapter 374, Statutes of 2009,
requires, as of the 2010-11 FY, existing school district
revenue limit adjustments for the MNP program and minimum
teacher salaries to be rolled into the base revenue limit per
unit of average daily attendance for each district.
The MNP program provides funding to school districts that
enacted property tax levies to support free and reduced price
meals for pupils prior to the passage of Proposition 13. Once
Proposition 13 was passed by the voters in 1978, districts
that enacted this levy lost the funding generated by it. This
led to the state establishing a revenue limit (general
purpose) add-on adjustment. The districts that receive this
adjustment, however, may use the funds for any purpose.
Since the state has experienced a severe economic downtown,
the number of pupils eligible for subsidized meals has
dramatically increased. The increase in the number of
subsidized meals normally leads to the revenue limit
adjustment for the MNP program increasing, which means more
funding to affected school districts. AB 851, however,
prevents districts from receiving this funding increase
because this measure calculates a fixed adjustment based on
2007-08 FY levels.
According to an analysis by School Services of California, 300
school districts will not receive approximately $16 million
GF/98 in revenue limit funding due to the provisions of AB
851. This bill defers the implementation of the revenue limit
adjustments for the MNP program enacted by AB 851 (Brownely),
Chapter 374, Statutes of 2009, until the 2013-14 FY.
2)Revenue limit funding is the single largest source of support
for K-12 school districts and county offices of education,
accounting for $34.3 billion in the 2009 Budget Act. Of this
amount, $21.3 billion is GF/98 and $13 billion is local
property tax funding. Revenue limits were initially developed
30 years ago as a means of constraining growth in high revenue
AB 2366
Page 3
districts. After Proposition 13, the state used the revenue
limit system to establish state funding levels.
Prior to Chapter 374, there were approximately 11 elements of
revenue limit funding, including the MNP program, and Minimum
Teacher Salary program.
Analysis Prepared by : Kimberly Rodriguez / APPR. / (916)
319-2081