BILL NUMBER: SB 1396	AMENDED
	BILL TEXT

	AMENDED IN SENATE  APRIL 14, 2010

INTRODUCED BY   Senator Lowenthal
    (   Coauthors:   Assembly Members 
 Bonnie Lowenthal   and Villines   ) 

                        FEBRUARY 19, 2010

   An act to add and repeal Chapter 3 (commencing with Section 63060)
of Part 35 of Division 4 of Title 2 of the Education Code, relating
to education funding.


	LEGISLATIVE COUNSEL'S DIGEST


   SB 1396, as amended, Lowenthal. Education funding: maximum
categorical education flexibility pilot program.
   Existing law establishes various categorical education programs
and appropriates the funding for those programs in the annual Budget
Act. Existing law requires the Superintendent of Public Instruction,
for the 2008-09 to 2012-13 fiscal years, inclusive, to apportion from
the amount provided in the annual Budget Act for specified
categorical education programs an amount based on the same relative
proportion that the local educational agency received in the 2008-09
fiscal year for those programs and authorizes school districts, for
those fiscal years, to use these funds, with specified exceptions,
for any educational purpose, to the extent permitted by federal law.
Existing law, for those fiscal years, deems local educational
agencies that use these categorical education program funds for any
educational purpose to be in compliance with the program and funding
requirements of those categorical education programs.
   Existing law, as a condition of receiving the categorical
education program funds that may be used for any educational purpose,
requires school districts and county offices of education, at a
regularly scheduled, open, public hearing, to take testimony from the
public, discuss, and approve or disapprove the proposed use of
funding. Existing law requires a local educational agency to report
expenditures, as specified, to indicate the activities for which
these funds were expended and requires the department annually to
collect and provide this information to the appropriate legislative
policy and budget committees and the Department of Finance.
   This bill would establish the 3-year Maximum Categorical Education
Flexibility Pilot Program in which 3 school districts would be
selected to participate. To be eligible for selection, a school
district would be required to meet certain preconditions, including
developing a plan or initiative to accelerate pupils' progress to
proficiency that includes  measurable metrics to improve
pupil performance, closing the achievement gap, increasing college
entrance rates, and increasing career readiness  
specified goals . A school district selected to participate
would be required to agree to demonstrate significant progress toward
accelerating pupils' progress toward proficiency on California's
academic standards over the 3-year pilot project period, a narrowing
of the achievement gap in its federally recognized subgroups, fiscal
solvency, positive growth on the district API, improvement in its
college entrance rate, and an increase in its graduation rate.
   The bill would require the Superintendent to apportion to the
participating school districts a categorical education block grant
based on the funding those school districts received in the 2009-10
fiscal year for specified programs, including the Economic Impact Aid
Program, the Class Size Reduction Program, Child Nutrition Programs,
and Transportation Programs.
   A participating school district would be allowed to use the block
grant funds for any purpose related to improving pupil achievement
and academic instruction and would be required to implement an open
and transparent process that allows public input when discussing and
deciding on the expenditure of categorical education block grant
funds. A participating school district would be deemed to be in
compliance with the program and funding requirements associated with
the categorical education programs included in the block grant  ,
except that a participating school district that receives funding
for economic impact aid would be required to continue to designate
staff to coordinate   services and programs for English
learners, including the home language survey, and to continue in
existence parent advisory committees and schoolsite councils  .
   A participating school district would be required to submit an
evaluative annual report to the department, the state board, the
Governor, and the Legislature and to submit to the department an
annual expenditure report.  The Legislative Analyst's Office
would be required to conduct a final evaluation report that
identifies the success and failures of the pilot program and makes
recommendations regarding improving the pilot program and whether the
program should be continued. 
   Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: no.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:

  SECTION 1.  The Legislature finds and declares all of the
following:
   (a) California school districts are facing immeasurable challenges
managing reductions in state funding and need maximum flexibility in
the ways they can utilize restricted funding from the state.
   (b) The pilot project enacted by this act would give three school
districts maximum flexibility by creating a new categorical program
block grant that would include all the funding for categorical
education programs received by the district and allow that funding to
be used for any purpose related to improving pupil achievement and
academic instruction.
   (c) The pilot project will demonstrate to state policymakers that
state money for categorical education programs can be managed more
efficiently and effectively by school districts to meet the academic
needs of all pupils and result in progress in closing the achievement
gap.
   (d) Maximum categorical program flexibility will enhance a school
district's ability to support academic and career goals for all
pupils and provide systematic, differentiated instruction and
interventions to accelerate pupils' progress to proficiency.
   (e) The pilot program will allow the state to evaluate the
benefits of maximum categorical program flexibility and ensure that
flexibility, when used correctly, will result in gains in pupil
achievement.
  SEC. 2.  Chapter 3 (commencing with Section 63060) is added to Part
35 of Division 4 of Title 2 of the Education Code, to read:
      CHAPTER 3.  MAXIMUM CATEGORICAL EDUCATION FLEXIBILITY PILOT
PROGRAM


   63060.  The Maximum Categorical Education Flexibility Pilot
Program is hereby established. The pilot project shall be implemented
during the 2011-12, 2012-13, and 2013-14 fiscal years. The
Superintendent  shall   may  select three
school districts to participate in the pilot project.
   63061.   (a)    In order to be eligible to apply
for selection, a school district shall meet the following
preconditions: 
   (a) 
    (1)  The school district has a plan or initiative  ,
developed in conjunction with parents and teachers,  to
accelerate pupils' progress to proficiency. The plan shall include
measurable metrics to improve pupil performance, close the
achievement gap, increase college entrance rates, and increase career
readiness. 
   (b) 
    (2)  The governing board of the school district has
approved the plan and developed corresponding policies in support of
the plan. 
   (c) 
    (3)  The  annual  evaluation of the performance
of the superintendent of the school district is linked to 
pupil performance goals   the pupil performance goals
specified in subdivision (a)  . 
   (d) 
    (4)  The school district can demonstrate a pattern of
stability between management and the bargaining units. 
   (e) 
    (5)  There is community support for the plan. 
   (6) At least one-half of the permanent teachers and one-half of
the surveyed parents or legal guardians in the district support
participation in the pilot program, and that support is demonstrated
in writing.  
   (7) The standards-based curriculum for English learners is
cognitively complex, coherent, well articulated, meaningful, and will
enable English learners to learn English quickly and fluently so
that they may participate fully in the grade-level curriculum. At a
minimum, the program shall provide all of the following: 
   (A) Support for English learners who are new to the district.
 
   (B) An English language development program that is comprehensive
and standards aligned and that has all of the following
characteristics:  
   (i) Actively develops all domains of language.  
   (ii) Addresses varying levels of English fluency.  
   (iii) Develops age-appropriate and context-appropriate language,
including an emphasis on academic English.  
   (iv) Includes opportunities for English learners to interact with
native English speaking peers.  
   (v) Creates a supportive learning environment for language
learning.  
   (vi) Recognizes the role of primary language development. 

   (C) Full access to a challenging curriculum.  
   (D) High-quality instruction and materials. 
   (E) An inclusive and affirming school climate.  
   (F) Valid, comprehensive, and useful assessments.  
   (G) Strong family partnerships.  
   (H) A qualified educator workforce.  
   (b) At a minimum, the Superintendent shall consider the quality
and rigor of the preconditions outlined in subdivision (a). 

   (c) Nothing in this section shall be construed as imposing new
mandates on school districts. 
   63062.  A school district selected to participate in the pilot
project shall agree to demonstrate all of the following:
   (a) Significant progress toward accelerating pupils' progress
toward proficiency on California's academic standards over a
three-year period  , as measured by the annual assessments
administered pursuant to Article 4 (commencing with Section 60640) of
Chapter 5 of Part 33 and any other local, state, or national
assessments  .
   (b) A narrowing of the achievement gap in the district's federally
recognized subgroups  ,   as measured by the annual
assessments administered pursuant to Article 4 (commencing with
Section 60640) of Chapter 5 of Part 33 and any other local, state, or
national assessments  .
   (c) Fiscal solvency  , as measured by the standards and
criteria adopted by the state board pursuant to Section 33127 and
implementing regulations  .
   (d) Positive growth, as measured by the district's API score 
, the annual assessments administered pursuant to Article 4
(commencing with Section 60640) of Chapter 5 of Part 33, and any
other local, state, or national assessments  .
   (e) An increase in the district's graduation rate  , as
measured by the California Longitudinal Pupil Achievement Data System
and the school district level data system  .
   (f) Improvement in the district's college entrance rate  , as
measured by the National Student Clearinghouse or other
state-approved pupil data tracking system  . 
   (g) The number of pupils who enter technical school after
graduation, as measured by the National Student Clearinghouse or
other state-approved pupil data tracking system. 
   63063.  The Superintendent shall apportion to the school districts
selected for participation in the pilot project a categorical
education block grant that is based on the funding those school
districts received in the 2009-10 fiscal year for the budget items
listed in paragraph (2) of subdivision (a) of Section 42605 and
 budget items   Items  6110-111-0001,
6110-119-0001, 6110-128-0001, 6110-130-0001, 6110-158-0001,
6110-166-0001, 6110-196-0001, 6110-201-0001, 6110-202-0001,
6110-203-0001,  6110-220-0001,  6110-224-0001, and
6110-234-0001  of Section 2.00 of the annual Budget Act .
The amount of the categorical education block grant shall be adjusted
for cost of living and growth in fiscal years that state funding is
appropriated for those purposes.
   63064.  (a) Notwithstanding any other law, a participating school
district may use the categorical education block grant funds that it
receives pursuant to  subdivision (c)   Section
63063  for any purpose related to improving pupil achievement
and academic instruction  , except as provided in subdivision (b)
 . 
   (b) With respect to funds received pursuant to Item 6110-128-0001
of Section 2.00 of the annual Budget Act, a participating school
district shall use these funds to supplement the base program
provided to English learners and economically disadvantaged pupils,
as those terms are defined in Section 54026.  
   (c) It is not the intent of the Legislature to waive requirements
of any educational programs enacted through the initiative process.
 
   (b) 
    (d)  A participating school district shall implement an
open and transparent process that allows public input  at a
regularly scheduled meeting of the governing board  when
discussing and deciding on the expenditure of categorical education
block grant funds.
   63065.   (a)    Notwithstanding any other law,
for the 2011-12, 2012-13, and 2013-14 fiscal years, a participating
school district shall be deemed to be in compliance with the program
and funding requirements contained in statutory, regulatory, and
provisional language associated with the items listed in subdivision
(c) of this section and paragraph (2) of subdivision (a) of Section
42605. 
   (b) Notwithstanding subdivision (a), a participating school
district that receives funds pursuant to Item 6110-128-0001 of
Section 2.00 of the annual Budget Act shall continue to designate
staff to coordinate services and programs, including the home
language survey, for English learners and shall continue in existence
parent advisory committees and schoolsite councils, as required
pursuant to Section 62002.5. 
   63066.  (a) A participating school district shall submit an
evaluative annual report to the department, the state board, the
Governor, and the Legislature that details the progress made during
the immediately prior school year towards the goals set forth in
 subdivision (c)   Section 63031, including
details of the academic progress made by pupil subgroups  .
   (b) A participating school district also shall submit to the
department an annual expenditure report  ,   detailing
the expenditure of specific categorical program funds and the
purposes for which those funds were expended  . 
   (c) The Legislative Analyst's Office shall conduct a final
evaluation report that identifies the success and failures of the
pilot program and makes recommendations regarding improving the pilot
program and whether the program should be continued. 
   64067.  This  section  chapter  shall
become inoperative on July 1, 2014, and, as of January 1, 2015, is
repealed, unless a later enacted statute, that becomes operative on
or before January 1, 2015, deletes or extends the dates on which it
becomes inoperative and is repealed.