BILL ANALYSIS �
AB 2008
Page 1
Date of Hearing: April 25, 2012
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Felipe Fuentes, Chair
AB 2008 (Bradford) - As Introduced: March 14, 2012
Policy Committee: Education
Vote:7-1
Urgency: No State Mandated Local Program:
No Reimbursable: No
SUMMARY
This bill revises AB 851 (Brownley), Chapter 374, Statutes of
2009, which simplified the calculation of school district
revenue limit funding (general purpose) by consolidating four
add-on formulas into two fixed adjustments, to ensure school
districts receive more funding than currently calculated under
Chapter 374. Specifically, this bill:
Modifies, beginning with the 2014-15 fiscal year (FY), the
Chapter 374 revenue limit adjustment by changing the base year
of the adjustment from the 2007-08 FY to the 2009-10 FY.
FISCAL EFFECT
1)Beginning in the 2014-15 FY, annual GF/98 loss of savings,
likely in excess of $10 million, in revenue limit funding, to
school districts due to the provisions of AB 851 related to
the MNP program. Absent this measure, school districts would
continue to receive funding based for the fixed adjustment for
the Meals for Needy Pupils (MNP) program based on 2007-08
funding levels.
2)The governor's proposed 2012-13 budget estimates a 3.17%
($1.24 billion) cost-of-living adjustment (COLA) for K-12
revenue limits. It does not, however, provide this adjustment
and instead, establishes a deficit factor, which keeps track
of the foregone COLA for revenue limit funding.
COMMENTS
AB 2008
Page 2
1)Purpose . AB 851 (Brownley), Chapter 374, Statutes of 2009,
requires, as of the 2010-11 FY, existing school district
revenue limit adjustments for the MNP program and minimum
teacher salaries to be rolled into the base revenue limit per
unit of average daily attendance for each district.
The MNP program provides funding to school districts that
enacted property tax levies to support free and reduced price
meals for pupils prior to the passage of Proposition 13. Once
Proposition 13 was passed by the voters in 1978, districts
that enacted this levy lost the funding generated by it. This
led to the state establishing a revenue limit (general
purpose) add-on adjustment. The districts that receive this
adjustment, however, may use the funds for any purpose.
Since the state has experienced a severe economic downtown,
the number of pupils eligible for subsidized meals has
dramatically increased. The increase in the number of
subsidized meals normally leads to the revenue limit
adjustment for the MNP program increasing, which means more
funding to affected school districts. AB 851, however,
prevents districts from receiving this funding increase
because this measure calculates a fixed adjustment based on
2007-08 FY levels.
This bill revises the base year of the revenue limit
adjustment for the MNP program enacted by AB 851 (Brownely),
Chapter 374, Statutes of 2009, as specified.
2)Revenue limit funding is the single largest source of support
for K-12 school districts and county offices of education,
accounting for $32.1 billion in the 2011 Budget Act. Of this
amount, $19.6 billion is GF/98 and $12.5 billion is local
property tax funding. Revenue limits were initially developed
30 years ago as a means of constraining growth in high revenue
districts. After Proposition 13, the state used the revenue
limit system to establish state funding levels.
Prior to Chapter 374, there were approximately 11 elements of
revenue limit funding, including the MNP program, and Minimum
Teacher Salary program.
Analysis Prepared by : Kimberly Rodriguez / APPR. / (916)
AB 2008
Page 3
319-2081