BILL ANALYSIS
SB 307
Page 1
Date of Hearing: August 19, 2009
ASSEMBLY COMMITTEE ON EDUCATION
Julia Brownley, Chair
SB 307 (Alquist) - As Amended: May 26, 2009
SENATE VOTE : 40-0
SUBJECT : Regional occupational centers or programs
SUMMARY : Creates an urgency statute that requires that a
regional occupational center or program (ROC/P), established and
maintained by school districts acting as a joint powers agency
(JPA), receive its operating funds directly from the county
office of education of the county in which it is located in a
manner that is consistent with the apportionments for those
school districts that comprise the JPA and that are provided to
the county office of education pursuant to the annual Budget
Act; establishes this requirement commencing in the 2009-10
fiscal year, and makes this requirement operative in any fiscal
year when a substantially similar requirement currently in law
is not operative.
EXISTING LAW :
1)Authorizes the establishment of ROC/Ps by high school
districts, district consortia (operating as a JPA), or county
offices of education.
2)Establishes a funding formula for ROC/Ps based on per pupil
revenue limits for each ROC/P, current year average daily
attendance (ADA) or a cap on funded ADA as established
historically and in the prior year, any annual cost of living
adjustment (COLA) made to the per pupil revenue limit amounts
in the annual Budget Act, and any adjustments to the funded
cap on ADA made for growth.
3)Provides for temporary flexibility to spend the funds
appropriated for nearly all categorical programs, including
funding for ROC/Ps, in order to relieve local budget pressure
created by the current economic downturn.
FISCAL EFFECT : This bill is keyed non-fiscal, however, the
Assembly Appropriations Committee has requested that this bill
be referred to them. If this bill is passed by the Assembly
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Education Committee, it will be referred to the Committee on
Appropriations to consider the fiscal implications.
COMMENTS : ROC/Ps offer a vocational educational program for high
school students and adults, and may be operated by a district, a
consortium of districts under a joint powers agreement, or by a
county office of education. Nearly every county office of
education in California operates a single, countywide ROC/P.
California's 74 ROC/Ps have existed as part of California's
educational system for over 35 years. According to the
California Department of Education (CDE), nearly 470,000
students age 16 or older enroll in ROC/Ps each year;
approximately 30 percent of those students are adult learners.
26 of the current ROC/Ps operate as a JPA. These JPAs operate
under specific requirements, defined in Government Code, dealing
with governance, fiscal and programmatic accountability, and the
nature of the agreement between the member districts. The JPA
administers the programs, classes and day-to-day operations of
the ROC/P; ROC/P funding apportioned to each of the member
districts provides the fiscal support for the JPA.
Total revenue limit funding for ROC/Ps is comprised of three
components: an amount of base funding per unit of ADA (up to
that ROC/P's current ADA cap), an amount of funding (if
provided) to cover cost increases related to the cost of living
(COLA), and an amount of funding to cover program growth (if
provided) that is allocated among the ROC/Ps in the form of an
expansion in ADA caps. For ROC/Ps operated as a JPA, these
calculations are made for each school district that is a member
of the JPA, and this ROC/P funding is apportioned to each of
those member districts.
ROC/P funding is provided to districts as part of the Principal
Apportionment, which also includes regular revenue limit
funding, and is included in a block of funding (equal to the sum
of Principal Apportionment funding for all districts in a
county) that the CDE provides to the county office of education
(COE); COEs have historically served as clearinghouses that
distribute this funding to each of the districts in the county
according to a schedule that is also provided by the CDE. Up to
and including the 2008-09 fiscal year, funding for ROC/Ps
operating as a JPA was treated in this manner with the funds
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moving from the CDE to the COE, then being transferred to each
JPA member district, and finally being submitted by the member
districts to the JPA. This process was to be changed commencing
with the 2009-10 fiscal year as a result of SB 1197 (Alquist),
Chapter 519, Statutes of 2008; SB 1197 requires that a ROC/P
operated as a JPA receive its funding directly from the COE,
rather than the funds being transferred from the COE to the
member districts prior to the JPA receiving those funds from
each of the school districts. This new provision was enacted
January 1, 2009, and was to be operative for the 2009-10 fiscal
year.
In February 2009, SB 4 X3 (Ducheny), Chapter 12, Statutes of
2009 Third Extraordinary Session [as amended in July by AB 2 X4
(Evans), Chapter 2, Statutes of 2009 Fourth Extraordinary
Session], implemented categorical flexibility for the 2008-09
through 2012-13 fiscal year; this flexibility allows recipients
to use restricted educational funding from 43 categorical
programs, including ROC/P funding, for any discretionary
educational purpose. This flexibility was achieved by deeming
those funding recipients to be in compliance with the program
and funding requirements contained in statutory, regulatory, and
provisional language associated with those programs. Funding
for these flexible programs is apportioned from the amounts
provided in the Budget Act in an amount based on the same
relative proportion that the recipient received in the 2008-09
fiscal year for those programs. As a condition of receiving
this flexibility, district governing boards and county boards of
education are required to hold public hearings on the proposed
use of the flexible funds, and are required to fully account for
all revenues and expenditures.
The fact that SB 1197 was enacted, but did not become
operational, prior to the enactment of SB 4 X3 creates a number
of potential questions and ambiguities regarding funding for
ROC/Ps operated by a JPA. For example, is the requirement
established by SB 1197, that a ROC/P operated as a JPA receives
its funding directly from the COE rather than the funds being
transferred from the COE to the member districts, operable? The
provision in SB 4 X3 that deems recipients of apportionments (in
this case the member districts or the COE acting as the funding
clearing house) to have complied with funding and program
requirements associated with ROC/P, along with the apparent
intent of the Legislature that ROC/P funds be available for
flexible and discretionary use, argue that the SB 1197
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requirement does not apply, however, there is no language in SB
4 X3 or AB 2 X4 that specifically makes the SB 1197 provision
inoperable.
A question might also be asked as to who has the authority to
make decisions over the use of the funds apportioned to JPA
member school districts for ROC/P? Since the flexibility
provision of SB 4 X3, as amended by AB 2 X4, allows recipients
of the funding to use the funds with discretion, and since
funding for JPA ROC/Ps is apportioned on a district by district
basis, the strongest case might be made that the member
districts have the authority to flexibly use these funds through
the 2012-13 fiscal year; this appears also to be consistent with
Legislative intent. At the same time, the funds are provided to
the COE in its role as a funding clearinghouse; thus if a COE
interprets the SB 1197 requirement to be operable under current
law, then that COE could move to transfer the member district's
ROC/P apportionments directly to the JPA. It also might even be
argued that a COE could choose to flexibly use these ROC/P
apportionments for its own purposes, since the COE received the
funds from the CDE and is deemed to already be in compliance
with all funding requirements associated with the program (i.e.,
the SB 1197 requirement to pass the funds along to the JPA). It
is clear that different interpretations of whether the
flexibility provisions of SB 4 X3 dominate the funding
requirement of SB 1197, combined with the fact that the funds
may never be in the possession of the school district to which
it was apportioned, create some ambiguity in current law.
Supporters of this bill state that, "SB 307 will correct an
unintended consequence of the 2009-10 budget trailer bill [SB 4
X3]," and describe this bill as "a cleanup bill" that "has no
fiscal impact and remains consistent with [SB 4 X3], by ensuring
local control and flexibility." SB 307 (with the technical
amendments discussed below) would serve to clarify the potential
ambiguities described above; however, the bill also implies a
substantive policy position that has potentially large fiscal
repercussions on school districts.
Clarifying the potential ambiguities that result from the
interaction of SB 1197 and SB 4 X3 could be accomplished in one
of two ways.
1)If the Legislature intended to protect funding for JPA ROC/Ps
from the flexibility provisions extended to school districts
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and COEs, then this bill clarifies existing law so that under
any circumstances COEs transfer the appropriated funds to JPAs
in order to continue the operation of the JPA ROC/Ps. In
other words this bill places the provisions of SB 1197 in a
dominant position over the flexibility provisions of SB 4 X3;
effectively this bill provides a protected status for JPA
operated ROC/Ps in that funding apportioned to JPA member
school districts will be spent on the ROC/P activities with no
opportunity for the member school district to put those funds
to another discretionary use.
2)If the Legislature's intent was to include funding for JPA
ROC/Ps in the flexibility provision, then this bill violates
that assumption. In other words, the flexibility provisions
of SB 4 X3 were intended to dominate SB 1197. Clarification
of this intent could be achieved by clearly notwithstanding
Education Code Section (EC) 52321 (that implements the SB 1197
requirement) while the flexibility provisions are in effect
through the end of the 2012-13 fiscal year.
It is clear that the fundamental question raised by this bill is
whether the Legislature, in SB 4 X3, intended that ROC/P funds,
including those apportioned for JPA member school districts, be
subject to flexibility in that those previously restricted
monies could be used by the recipient school district or COE for
any discretionary purpose? Three less significant issues should
also be raised in this analysis:
1)This bill's protection from the flexibility provisions only
bear on that part of the ROC/P budget appropriation (Item
6110-105-0001) that is apportioned to school districts that
are members of a JPA operating an ROC/P; these provisions have
no effect on ROC/Ps operated by a single school district or by
a COE. This raises a question about equitable treatment
across ROC/Ps, since non-JPA member school district or COE
operating a ROC/P would have the authority to shift the ROC/P
funding to another higher priority budget use while (under
this bill) the JPA member district would not have that same
opportunity.
2)Under this bill the only recourse that a JPA member district
would have if it desired to shift ROC/P funding to another
higher priority budget use would be to resign its position in
and remove itself from the JPA. Since SB 4 X3 requires the
CDE to apportion "an amount to recipients based on the same
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relative proportion that the recipient received in the 2008-09
fiscal year for the" program, funds for ROC/P would continue
to be apportioned to the school district even after that
school district was no longer a member of the JPA; in this way
the district could use the funds flexibly. Creating a
chilling effect on district participation in JPA ROC/Ps may
not be an optimal policy in the long run.
3)Either the situation under current law or the situation
described in 2) above could lead to litigation if a COE were
to transfer a member or former member district's ROC/P
apportionment to the JPA. This bill, as currently written,
does not clarify all of the ambiguities that may currently
exist regarding this issue.
If the Committee should choose to pass this bill, then Committee
staff recommends that the bill be amended to explicitly
notwithstand the flexibility provisions in EC 42605 as created
by SB 4 X3 and amended by AB 2 X4, rather than to rely on the
conditional trigger in the bill. The provisions of this bill
are currently triggered by any action that makes the
requirements of SB 1197 (EC 52321) inoperable; however, part of
the problem described above is that it may not be clear whether
the requirements of EC 52321 are currently inoperable. Since
the ambiguities that this bill is attempting to clarify are
generated by the interaction between the SB 1197 requirements
and the provisions of SB 4 X3, a clearer approach would be to
simply notwithstand that part of SB 4 X3 that creates the
conflict. This approach would also have the added benefit of
narrowing the solution to address only the problem at hand, and
thus avoid any unintended consequences. Thus lines three and
four on page two of the bill would be replaced by: "52322.5.
Notwithstanding EC 42605 and for the 2009-10 fiscal year to the
2012-13 fiscal year, inclusive, a regional occupational?"
If the Committee should choose not to pass this bill, then
Committee staff recommends that the Legislature move to further
clarify its intent that funding for JPA ROC/Ps be included in
the flexibility provisions of SB 4 X3, that the flexibility
provisions of SB 4 X3 were intended to dominate SB 1197, and
that ROC/P funds should be transferred by the COE to the member
districts.
Because of Legislative deadlines, any amendments to this bill
approved by the Committee on Education will be taken in the
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Assembly Appropriations Committee.
REGISTERED SUPPORT / OPPOSITION :
Support
Association of California School Administrators
California Association of Regional Occupational Centers and
Programs
California Association of School Business Officials
California County Superintendents Educational Services
Association
Capistrano-Laguna Beach Regional Occupational Program
Central County Occupational Center
Central Sierra ROP
Coastline Regional Occupational Program
Colton Redlands Yucaipa JPA-ROP
Eden Area Regional Occupational Program
Imperial Valley Regional Occupational Program
Metropolitan Education District
Mission Trails Regional Occupational Program
Mission Valley ROP
North County Regional Occupational Center, JPA
North Orange County ROP
Santa Lucia Regional Occupational Program
Solano County Office of Education
Southern California Regional Occupational Center
Tri-Valley Regional Occupational Program
West Side Regional Occupational Program
One individual
Opposition
None on file
Analysis Prepared by : Gerald Shelton / ED. / (916) 319-2087