BILL ANALYSIS �
AB 189
Page A
Date of Hearing: March 30, 2011
ASSEMBLY COMMITTEE ON EDUCATION
Julia Brownley, Chair
AB 189 (Eng) - As Amended: March 3, 2011
SUBJECT : Education funding
SUMMARY : Specifies that commencing with the 2011-12 fiscal year
(FY), a local educational agency (LEA) that receives funding for
four specified categorical programs shall allocate a sufficient
amount of funding for those programs. Specifically, this bill :
1)Extends categorical flexibility from FY 2012-13 to FY 2014-15
and makes corresponding changes in sections related to
categorical flexibility.
2)Requires, as a condition of receipt of categorical funds, the
governing board of a school district or board of a county
office of education to certify that a sufficient amount of
funding has been provided for the four categorical programs
identified by this bill at a regularly scheduled open public
hearing.
3)For purposes of this bill, defines a "sufficient amount" as
maintaining a sufficient level of instruction services for the
four categorical programs specified in this bill to the extent
that a LEA shall be able to reinstate full funding for the
programs upon the expiration of the funding flexibility.
4)Specifies the four categorical programs subject to the
requirements of this bill as Adult Education, California High
School Exit Exam (CAHSEE) - Instructional Support and
Services, Regional Occupational Centers and Programs (ROC/Ps),
and Supplemental Instruction (Summer School).
5)Finds and declares that the funding flexibility is for the
purpose of assisting LEAs in responding to the state's current
fiscal emergency and is intended to last only for the duration
of the fiscal emergency.
6)Expresses the intent of the Legislature that, after a LEA
makes the determination that a sufficient amount of funding
has been allocated, the LEA should ensures that there are an
adequate number of administrative and credentialed teaching
AB 189
Page B
staff to provide a baseline level of core courses during the
period that funding flexibility is authorized so that there is
sufficient staffing to fully expand programmatic offerings
upon the expiration of the funding flexibility.
7)Strikes the provision prohibiting a governing board of a
district to charge a fee for a class in English and
citizenship for foreigners or a class in an elementary
subject.
EXISTING LAW :
1)Specifies that for FY 2008-09 to FY 2012-13, specified
categorical program funds may be used for any educational
purposes.
2)Specifies that for FY 2009-10 to FY 2012-13, the
Superintendent of Public Instruction or other administering
state agency shall apportion the funds based on the same
relative proportion that a recipient received in FY 2008-09
for specified categorical programs.
3)Requires, as a condition of receipt of funds, a governing
board of a school district or a board of county office of
education, at a regularly scheduled open public hearing, to
take testimony from the public, discuss, approve or disapprove
the proposed use of funding, and make explicit for each of the
specified categorical program items, the purposes for which
the funds will be used.
4)Specifies that, for FY 2008-09 to FY 2012-13, LEAs that use
the flexibility provision shall be deemed to be in compliance
with the program and funding requirements contained in
statutory, regulatory, and provisional language.
FISCAL EFFECT : Unknown
COMMENTS : There are approximately 60 categorical programs that
serve specific goals (e.g., to assist high school students in
passing the high school exit exam) or for specific programs
(e.g., ROC/Ps, special education). There are also numerous
statutes and regulations that specify allowable use of
categorical funds and how funds are allocated. The FY 2009-10
budget had an important impact on categorical programs. The
budget agreement imposed a 20% reduction on 39 programs and gave
AB 189
Page C
LEAs that received those funds in FY 2007-08 the flexibility to
use the funds for any educational purposes from FY 2008-09
through FY 2012-13 (SBX3 4 (Ducheny), Chapter 12, Statutes of
the 2009-10 Third Extraordinary Session). This reduction and
flexibility provision is commonly known as "Tier 3" flexibility,
which essentially gives LEAs $4.5 billion in additional
unrestricted funds. Tier 1 protected four categorical programs
from cuts and flexibility while 11 categorical programs
sustained reductions but were given no flexibility under Tier 2.
For Tier 3 funds, school districts receive their allocations
for five years based on the applicable percentage the programs
received in FY 2007-08. As a result, until 2013, LEAs are not
required to justify or report average daily attendance (ADA) in
order to receive the specified categorical funds. The
Governor's FY 2011-12 budget proposes to extend the flexibility
provisions by two years.
The 39 Tier 3 programs include: Adult Education, Advanced
Placement Programs, American Indian Early Childhood Education
Centers, American Indian Education Centers, Arts and Music Block
Grant, California Association of Student Councils, CAHSEE -
Instructional Support, California School Age Families Education,
Certificated Staff Mentoring, Charter School Categorical Block
Grant, Child Oral Health Assessments, Civic Education, Class
Size Reduction (9th Grade), Community Day Schools,
Community-Based English Tutoring Program, County Office of
Education: Williams Audit, Deferred Maintenance, Educational
Technology - CTAP, Gifted and Talented, Instructional Materials
Block Grant, Mathematics and Reading Professional Development,
National Board Certification Incentives, Peer Assistance and
Review, Physical Education Teacher Incentive Program, Principal
Training Program, Professional Development Block Grant, Public
School Accountability Act, Pupil Retention Block Grant, Regional
Occupational Centers and Programs, Sanctions - High Priority
Schools Grant Program, School and Library Improvement Block
Grant, School Safety Block Grant (8-12), School Safety
Competitive Grants, Specialized Secondary Program Grants,
Supplemental Instruction (Summer School), Supplemental School
Counseling Program, Targeted Instructional Improvement Block
Grant, Teacher Credentialing Block Grant, and Teacher Dismissal
Apportionments.
This bill requires a LEA that receives any of the four specified
Tier 3 funds to allocate a sufficient amount of funding for
those programs that will enable the LEA to reinstate full
AB 189
Page D
funding for the programs when the flexibility provisions end.
What this means is that flexibility is reduced for four programs
under Tier 3. The four programs are Adult Education, CAHSEE -
Instructional Support and Services, ROC/Ps, and Supplemental
Instruction (Summer School). This bill is sponsored by the
California Council for Adult Education. The author states that
while "categorical flexibility has enabled school districts to
remain solvent during a time of unprecedented budget cuts?this
flexibility is resulting in the dismantling of our state's core
categorical programs like adult education, which will be
virtually impossible to restore once categorical flexibility
ends." According to the author, adult education cuts represent
the largest single diversion of any single categorical program
within Tier 3. The bill, however, covers more than just adult
education programs. It is unclear how or why the other three
programs were selected. The following briefly describes the
four programs addressed by this bill:
Adult Education : The FY 2011-12 budget proposes $634.7 million
for adult education. Adult education is provided by a number of
delivery systems, including community colleges, public
libraries, nonprofit and faith-based organizations, prisons, and
county offices of education, but the largest providers are
school districts. In 2007-08, adult education programs enrolled
1.2 million adult learners in almost 300 adult schools
throughout California. Prior to the implementation of
flexibility in 2009-10, school districts' funding levels were
based on what they received in 1977-78 and grew by a cap of 2.5%
from the previous year's funding level. The revenue limit in
2007-08 for each unit of ADA (comprised of 525 hours of
accumulated seat time) was $2,645.30.
Adult education schools offer the following ten programs: Adult
Basic Education, English as a Second Language (ESL), High School
Diploma or Adult Secondary Education, including General
Education Development certification, Citizenship Preparation,
Career Technical Education, Adults with Disabilities, Health and
Safety, Parent Education, Home Economics, and Older Adult.
CAHSEE - Instructional Support and Services : This program is
intended to provide remediation for students who have not passed
one or both portions of the CAHSEE. The funds can be used for
individual or small group instruction, hiring of additional
teachers, purchasing, scoring, and reviewing diagnostic
assessments, counseling, and other supports. According to the
AB 189
Page E
CDE, almost 275,000 students obtained CAHSEE remediation during
the 2007-08 school year. The FY 2011-12 budget proposes $58.3
million for this program.
ROC/Ps : The objective of ROC/Ps is to provide work-based
learning opportunities for pupils that will prepare them to
enter the workforce. ROC/Ps teach specific occupational skills
and general employment skills in 15 industry sectors, as
outlined in the Career Technical Education standards adopted by
the State Board of Education. ROC/Ps are established as
regional programs or centers that have a link to business and
industry through advisory committees. The FY 2011-12 budget
proposes $384.6 million for this program.
Supplemental Instruction (Summer School) : Supplemental
Instruction funds are used for remedial instruction programs for
students who are not demonstrating sufficient progress toward
passing the CAHSEE, students in grades two through nine who are
retained or recommended for retention, and students with low
standardized test scores or are at risk of retention. Classes
may be offered during the summer, before or after school, on
Saturday, or during intersession. The FY 2011-12 budget
proposes $336.2 million for this program.
Surveys : With the flexibility provisions, LEAs are not required
to report how much funds were diverted and which programs they
were transferred to. As a result, there is no data available to
discern the extent to which LEAs diverted categorical funds for
other educational needs or the number of programs that have been
dismantled. The Legislative Analyst's Office (LAO) has
conducted two surveys, in the fall of 2009 and 2010, in an
effort to ascertain the effects of flexibility and other
resources in helping LEAs balance their budgets. The survey
results were based on 382 completed surveys out of the 1,000
school districts; the respondents represent 58% of the state's
ADA. Highlights from the LAO's February 2011 report include the
following:
Compared with FY 2009-10, a higher percentage of
districts in FY 2010-11 are diverting Tier 3 program funds
or discontinuing Tier 3 programs.
Every major Tier 3 categorical program has sustained
fund shifts, with more than 70% of districts report
diverting funds from Grade 9 Class Size Reduction, Music
AB 189
Page F
and Art, Adult Education, Supplemental Instruction, Gifted
and Talented Education, and Professional Development.
More districts are discontinuing programs in FY 2010-11
compared with FY 2009-10. For the four programs affected
by this bill, the report shows that in FY 2010-11: 7% of
survey respondents discontinued adult education programs,
5% discontinued CAHSEE - Instructional Support and
Services, 1% closed ROC/Ps, and 13% discontinued
Supplemental Instruction (summer school) programs.
The LAO recommends expanding flexibility in FY 2011-12
to Tier 1 programs, including K-3 Class size Reduction,
Home-to-School Transportation, and After School Education
and Safety Program.
The LAO is currently finalizing a report specifically on adult
education and the impact of flexibility on this program. The
LAO is projecting its release in a couple of months.
Discussion : When the Legislature approved the flexibility
provision, it intended to give LEAs discretion to make local
decisions. Some have argued that the Legislature did not intend
or expect programs to be dismantled.
Why these four programs? It is unclear why the Legislature
should treat four programs under Tier 3 differently. If the
Legislature believes that these four programs should not be
dismantled, the Legislature can move these programs to Tier 2,
which offers no flexibility. Alternatively, the Legislature can
provide limited flexibility by prohibiting the dismantling of
any program. Regardless, all Tier 3 programs should be treated
similarly.
How will this bill be implemented in FY 2011-12? By the time
this bill is signed into law, half the school and fiscal year is
over. Will LEAs be required to make modifications to the budget
and programs mid-year? If a district has already eliminated any
of these four programs, does that mean that they have to
resurrect them mid-year? How will they do that if the funds are
already allocated?
What happens to districts that are already on the brink of
bankruptcy and take over by the state?
The CDE recently reported 13 districts with negative
AB 189
Page G
certifications following first interim status report for FY
2010-11 while 97 districts have a qualified certification<1>.
What does "sufficient funds" really mean? What is the
threshold? Can any amount below 50% be considered sufficient?
The author and sponsor state that it will be determined on a
district by district basis. According to the author and
sponsor, even though current law requires a public discussion of
proposed transfer of funds, some LEAs claim compliance at the
meeting where they adopt the budget and do not offer the
community a real opportunity to voice opinions as intended by
law. The sponsor argues that this bill will force LEAs to hold
public meetings to determine a "sufficient" level of funding.
The sponsor also recognizes that the definition of "sufficient"
may vary from one locality to another.
It is not unreasonable to require LEAs to hold independent
meetings that will allow the community to express their opinions
prior to the transfer of Tier 3 funds. Existing law already
requires a public meeting. Perhaps that provision should be
strengthened by specifying that the meeting must be a separate
meeting from the meeting where the governing board adopts the
budget. Additionally, dismantling a program is drastic as each
program serves a purpose and has constituency. If a governing
board intends to shut down a program, it should be required to
provide full disclosure by noticing a proposed elimination of a
program at the meeting to discuss proposed transfer of Tier 3
funds or another meeting that is not the meeting to adopt the
budget. In lieu of the requirement that a substantial amount be
provided to four Tier 3 programs, staff recommends the
following:
1)Require the public meeting where a governing board solicits
input on proposed Tier 3 transfer of funds to be a separate
meeting from the meeting to adopt a budget.
2)If a governing board wishes to eliminate a program by using
all its funding for another purpose, require the governing
board to provide a notice that specifically states a program
is proposed to be eliminated, for either at the public meeting
to discuss Tier 3 transfers or at a separate meeting that is
---------------------------
<1> A negative certification means that a LEA will not meet its
financial obligation for FY 2010-11 or 2011-12. A qualified
certification means that a LEA may not meet its financial
obligation for FY 2010-11, 2011-12, and 2012-13.
AB 189
Page H
not the meeting to adopt the budget.
Data collection . Thus far, evaluations of flexibility are based
on surveys. There is no data that shows how much funds were
transferred and to which programs they were transferred to.
This is due to a change in how CDE tracks the allocation of Tier
3 funds. The CDE uses a program called the Standardized Account
Code Structure (SACS) to track revenue and expenditures. Prior
to the flexibility provision, the CDE assigned a SACS resource
code to each source of funding. Due to the flexibility
provision, CDE consolidated all of the categorical flexibility
revenue streams into one resource code. As a result, while CDE
collects data on how much LEAs are spending on each program,
there is no data that shows the source of the funds. In order
to have more precise data on how LEAs have implemented the
flexibility provisions, staff recommends requiring the CDE to
develop a mechanism to track source of funding.
Adult Education Program Fees : Education Code Section 52612
authorizes districts to charge a fee required to maintain a
class, except for three programs: Adult Basic Education, ESL,
and High School Diploma or Adult Secondary Education, including
General Education Development certification classes. This bill
proposes to eliminate the provision prohibiting fees to be
charged. According to the author, some districts have
discontinued ESL and citizenship courses due to uncertainty
whether fees can be assessed. This is because the flexibility
provisions include a provision that deems the LEA to be in
compliance with the program and funding requirements contained
in statutory, regulatory, and provisional language. It is
unclear to LEAs how to interpret that provision as it relates to
flexibility. The author states that in order to address the
growing demand in English acquisition courses, eliminating the
prohibition to charge fees will enable districts to maintain the
courses, even if a small fee is assessed for these programs.
Rather than making a permanent change, staff recommends allowing
fees to be charged only while the flexibility provisions are in
effect.
Arguments in Support . The California Council for Adult
Education states, "California Adult Schools help adult students
find jobs, learn English, earn degrees, become citizens and
become better parents. There are 5.3 million California adults
without high school diplomas and 3 million English language
learners who need access to adult education resources in order
AB 189
Page I
to work in the state's economy. As categorical flexibility cuts
deeper into adult education programs, these opportunities will
be lost, perhaps permanently."
Arguments in Opposition . The California Association of School
Business Officials (CASBO) states, "When it comes to categorical
programs, CASBO understands the importance of adult education,
career tech., and supplemental instruction. But we are also
calling on the Legislature to stay the course when it comes to
categorical flexibility in order to allow local communities to
weather this financial crisis. We are fully aware of the impact
that flexibility has had on programs throughout the state, but
we are also aware of the $18 billion in program cuts and
deferrals that have been dealt to schools in only three short
budget cycles."
Previous Related Legislation . AB 1673 (Mendoza), requires the
LAO to provide a report to the Legislature on the impact of the
flexibility provision on adult education programs. The bill was
held in the Assembly Appropriations Committee suspense file in
2010.
Related Legislation . SB 476 (Lowenthal), pending in the Senate
Education Committee, extends categorical flexibility by two
years.
SB 509 (Price), pending in the Senate Education Committee,
specifies that categorical flexibility is only available to LEAs
that provide sufficient textbooks or instructional materials, as
defined.
REGISTERED SUPPORT / OPPOSITION :
Support
California Council for Adult Education (sponsor)
Asian Law Alliance
Asian Americans for Civil Rights & Equality
Asian and Pacific Islanders California Action Network
Asian Resources, Inc.
California Association for the Gifted
California Association of Leaders for Career Preparation
California Business Education Association
California Federation of Teachers
California School Employees Association
AB 189
Page J
California Teachers of English to Speakers of Other Languages
Council of Mexican Federations
Korean Resource Center
Numerous individuals
Opposition
California Association of School Business Officials
California County Superintendents Educational Services
Association
Poway Unified School District (prior version)
Torrance Unified School District
Analysis Prepared by : Sophia Kwong Kim / ED. / (916) 319-2087