BILL ANALYSIS �
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THIRD READING
Bill No: AB 1811
Author: Bonilla (D)
Amended: 7/2/12 in Senate
Vote: 21
SENATE EDUCATION COMMITTEE : 8-1, 6/20/12
AYES: Lowenthal, Alquist, Blakeslee, Hancock, Liu, Price,
Simitian, Vargas
NOES: Huff
NO VOTE RECORDED: Runner, Vacancy
SENATE APPROPRIATIONS COMMITTEE : Senate Rule 28.8
ASSEMBLY FLOOR : 48-24, 5/10/12 - See last page for vote
SUBJECT : Charter schools: funding
SOURCE : Author
DIGEST : This bill, commencing with the 201314 fiscal
year, requires the general-purpose entitlement of a charter
high school that is established on or after January 1,
2013, through the conversion of an existing public high
school within a unified school district to be calculated
based on the amount of the actual unrestricted revenues
expended per unit of average daily attendance for that
school in the year before its conversion to, and operation
as, a charter school, adjusted as specified, and each
subsequent fiscal year, based on the prior fiscal year
allocation, adjusted as specified, including for any state
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general-purpose increases or decreases.
ANALYSIS : School district revenue limits are comprised
of state general aid and local general purpose property tax
revenues. For purposes of revenue limit equalization,
existing law classifies school districts as elementary
districts, high school districts, or unified school
districts. The revenue limits of unified districts are
typically less per pupil than high school districts, but
more per pupil than elementary school districts, reflecting
the fact that unified districts serve all grades.
Existing law provides for a general purpose entitlement for
charter schools. The general purpose entitlement
constitutes a charter school's base general purpose funding
and is based on statewide averages of school district
general purpose (revenue limit) funding per pupil.
Specifically, charter school funding is calculated as
follows:
1. For pupils in grades K-5: The statewide average revenue
limit funding per unit of Average Daily Attendance (ADA)
received by elementary school districts.
2. For pupils in grades 6 through 8: The statewide average
revenue limit funding per unit of ADA received by
unified school districts.
3. For pupils in grades 9 through 12: The statewide
average revenue limit funding per unit of ADA received
by high school districts. (Education Code Section
47633)
This bill, commencing with the 2013-14 fiscal year,
requires the general-purpose entitlement of a charter high
school that is established on or after January 1, 2013,
through the conversion of an existing public high school
within a unified school district to be calculated based on
the amount of the actual unrestricted revenues expended per
unit of average daily attendance for that school in the
year before its conversion to, and operation as, a charter
school, adjusted as specified, and each subsequent fiscal
year, based on the prior fiscal year allocation, adjusted
as specified, including for any state general-purpose
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increases or decreases.
Comments
Historical perspective . Historically, funding for charter
high schools has been based on statewide averages for high
school districts. At the same time, funding for unified
school districts is lower than it is for high school
districts because the Legislature has recognized that
lower-costing elementary schools in the district help to
offset the district's higher-costing high schools. Prior
to 2005, this cost differential meant that conversion
charter high schools in unified school districts were
entitled to a higher level of funding per ADA, paid out of
district funds, than the district's revenue limit.
In 2005, SB 319 (Migden), Chapter 355, Statutes of 2005,
solved the shortfall problem by establishing a new basis
for funding high schools converted to charter status in
unified school districts. Under the bill, a charter
school's general purpose entitlement per ADA was based on
the level of general purpose funding provided to the school
by the district in the year prior to conversion. The bill
also required base amounts to be increased for cost of
living adjustments and other revenue limit adjustments
received by the district but provided no means for
decreases when the district's revenue limit funding was
reduced. However, the formula established by the bill
resulted in conversion charter high schools in unified
school districts to be funded at a lower rate than startup
charter high schools.
SB 191 (Wright), Chapter 305, Statutes of 2009, remedied
the inequity in funding levels between conversion and start
up charter high schools in unified districts by funding
conversion charter high schools established in a unified
district after January 1, 2010, at the statewide average
charter school block grant level. While the bill remedied
the funding disparity between conversions and start-ups, it
reinstated district shortfalls previously removed by the
bill, thus creating a negative impact of approximately $900
per ADA for the district.
FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes
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Local: No
SUPPORT : (Verified 8/6/12)
Association of California School Administrators
California Federation of Teachers
California School Boards Association
California School Employees Association
Mount Diablo Unified School District Advisory Committee for
Special Education
OPPOSITION : (Verified 8/6/12)
California Association of Charter Schools Advocates
Los Angeles Unified School District
ARGUMENTS IN SUPPORT : This bill addresses the funding
differential that occurs when an existing high school in a
unified school district that is not a basic aid district,
is converted to a charter high school. This bill requires
a conversion charter high school in a unified school
district to receive a rate that is based on the revenue the
school district received in the year prior to its
conversion. The author's office maintains that the current
funding model creates significant financial issues for
unified districts because the charter school general
purpose entitlement per ADA is greater than the district's
revenue limit per ADA. Since the charter school's general
purpose entitlement is funded from the school district's
revenue limit, the unified school district generally ends
up making up the shortfall. For example, information
provided by the author's office indicates that the revenue
limit for the Mt. Diablo Unified School District is $5,207,
but the district must transfer $6,148 per ADA to a proposed
charter school, a difference of $941 per ADA.
ARGUMENTS IN OPPOSITION : Opponents argue that under this
bill, a conversion charter high school is likely to receive
a rate that is substantially lower than the statewide
charter high school rate that it would otherwise receive.
This differential will disadvantage conversion charter high
schools in these districts because, unlike the district,
the school does not have elementary and middle schools with
which it can offset its shortage in revenue. Opponents
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also note that charter schools have additional expenses
that are not calculated in a blended unified rate.
Opponents also submit that certifying a rate based on the
prior year's revenue directed to that school will be
difficult to verify and implement because school-site
accounting is not currently required of school districts.
ASSEMBLY FLOOR : 48-24, 5/10/12
AYES: Alejo, Allen, Ammiano, Atkins, Beall, Block,
Blumenfield, Bonilla, Bradford, Brownley, Butler, Campos,
Carter, Cedillo, Chesbro, Davis, Dickinson, Eng, Feuer,
Fong, Fuentes, Galgiani, Gatto, Gordon, Hall, Hayashi,
Roger Hern�ndez, Hill, Huber, Hueso, Huffman, Lara,
Bonnie Lowenthal, Ma, Mendoza, Mitchell, Monning, Pan,
Perea, Portantino, Skinner, Solorio, Swanson, Torres,
Wieckowski, Williams, Yamada, John A. P�rez
NOES: Achadjian, Bill Berryhill, Conway, Donnelly, Beth
Gaines, Garrick, Gorell, Grove, Hagman, Halderman,
Harkey, Jones, Knight, Logue, Mansoor, Miller, Morrell,
Nestande, Nielsen, Norby, Silva, Smyth, Valadao, Wagner
NO VOTE RECORDED: Buchanan, Charles Calderon, Cook,
Fletcher, Furutani, Jeffries, Olsen, V. Manuel P�rez
PQ:k 8/15/12 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
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