BILL ANALYSIS
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|SENATE RULES COMMITTEE | SB 1136|
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THIRD READING
Bill No: SB 1136
Author: Cox (R)
Amended: 6/1/10
Vote: 27 - Urgency
SENATE EDUCATION COMMITTEE : 8-0, 4/14/10
AYES: Romero, Huff, Alquist, Hancock, Liu, Price,
Simitian, Wyland
NO VOTE RECORDED: Maldonado
SENATE APPROPRIATIONS COMMITTEE : 10-0, 5/27/10
AYES: Kehoe, Alquist, Corbett, Denham, Leno, Price,
Walters, Wolk, Wyland, Yee
NO VOTE RECORDED: Cox
SUBJECT : Education finance: revenue limit apportionment
deferrals
SOURCE : Author
DIGEST : This bill limits the amount of revenue limit
funding that can be deferred -- not to exceed the level of
the school districts required reserve for economic
uncertainty -- if a school district meets specified
criteria.
ANALYSIS : Existing law (ABX8 14 [Assembly Budget
Committee], Chapter 10, Statutes of 2010), relating to
Local Educational Agencies (LEA's) and the deferral of
apportionment funding:
CONTINUED
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1. Specifies that LEA's shall have up to a total of $2.5
billion in statewide revenue limit apportionment funding
deferred during the 2010-11 school year; with a maximum
of three deferrals during the fiscal year. The first
possible deferral is scheduled for July 2010. However,
the latest any funding deferral can take place would be
March 2011; in this instance the deferral would be paid
by April 29, 2011.
2. Requires that by March 31, 2010, the State Treasurer,
State Controller and the Director of the Department of
Finance determine and jointly provide a written
declaration to the Legislature and the California
Department of Education (CDE) about the amount and
timing of K-12 apportionment deferrals in 2010-11. The
CDE is required to convey this information to school
districts, county offices of education and charter
schools.
3. Authorizes limited exemptions from the deferral for
LEA's where the county superintendent of school
certifies to the State Superintendent of Public
Instruction (SPI) and the Director of Finance by May 15,
2008, that the deferral would result in the LEA
qualifying for an emergency apportionment.
Existing law specifies that various state payments to local
governments may be deferred up to three times during
2010-11, with no more than one billion dollars being
deferred at any point in time. In addition, current law
exempts counties with a population less than 50,000 or a
city within a county with a population less 50,000 from any
deferral of funding.
This bill:
1. Limits the amount of revenue limit apportionment funding
that can be deferred to not exceed a school district's
required reserve for economic uncertainties, if a school
district meets specified criteria.
2. Specifies that the limitation on the deferral is
activated if the school district meet either of the
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following criteria:
A. The school district's average daily attendance
(ADA), excluding charter school ADA, for the prior
year second apportionment is equal or less than
five hundred.
B. The district's apportionment deferral shall not
exceed, at any time during a fiscal year, $225
multiplied by the 2009-10 second principal
apportionment average daily attendance; and
restricts application to intra-year deferrals.
FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes
Local: No
According to the Senate Appropriations Committee analysis:
Fiscal Impact (in thousands)
Major Provisions 2010-11 2011-12
2012-13 Fund
Interest loss Approximately $150 to $200,
depending General
on the applicable interest rate
SUPPORT : (Verified 6/1/10)
California School Board Association
California Teachers Association
Camino Union School District
Central Valley Education Coalition
Leggett Valley Unified School District
Mendocino Unified School District
Pioneer Union School District
Riverside County Schools Advocacy Association
Shandon Joint Unified School District
Small School Districts' Association
ARGUMENTS IN SUPPORT : According to the author's office,
small school districts do not have internal borrowable
resources similar to larger school districts. Small school
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districts do not have the same internal resources for cash
flow borrowing nor do their counties. Consequently, to
meet the deferral these school districts must make further
reductions to their educational programs in order to have
borrowable resources to meet the cash flow requirements of
paying contracts and salaries during the time of deferral.
PQ:do 6/1/10 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
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