BILL ANALYSIS �
AB 2362
Page 1
ASSEMBLY THIRD READING
AB 2362 (Conway)
As Amended May 2, 2012
2/3 vote. Urgency
EDUCATION 10-0 APPROPRIATIONS 17-0
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|Ayes:|Brownley, Norby, Ammiano, |Ayes:|Fuentes, Harkey, |
| |Buchanan, Carter, Eng, | |Blumenfield, Bradford, |
| |Grove, Halderman, Wagner, | |Charles Calderon, Campos, |
| |Williams | |Davis, Donnelly, Gatto, |
| | | |Ammiano, Hill, Lara, |
| | | |Mitchell, Nielsen, Norby, |
| | | |Solorio, Wagner |
|-----+--------------------------+-----+--------------------------|
| | | | |
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SUMMARY : Changes the Necessary Small School (NSS) funding
formula as it relates to the average daily attendance (ADA) and
instructors in grades 7 and 8. Specifically, this bill :
1)Allows school districts to include 7th and 8th grade ADA and
7th and 8th grade instructors in the formula for calculating
high school NSS funding in 2012-13, if the district did so in
2011-12.
2)States the intent of the Legislature that the Superintendent
of Public Instruction (SPI) provide the Legislature with a
report by February 1, 2013, recommending revisions to the
definition of necessary small schools and reforms to the
formula for funding them.
FISCAL EFFECT: According to the Assembly Appropriations
Committee, loss of foregone General Fund (Proposition 98)
savings of approximately $2.5 million in NSS funding by allowing
three school districts to continue claiming ADA for pupils in
grades 7 and 8, as specified.
COMMENTS : In 2011, the California Department of Education
(CDE) determined that four school districts receiving funding
for necessary small high schools had been misreporting grade 7
and 8 ADA as grade 9 through 12 ADA and receiving funding on
that basis. Existing law does not allow 7th and 8th grade ADA
AB 2362
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to be included in the formula for funding necessary small high
schools. Accordingly, the CDE determined those districts could
no longer be provided NSS funding for the grade 7 and 8 ADA,
unless those pupils attended a necessary small elementary
school.
This would have resulted in a loss of funding for those schools.
Therefore, a one-time remedy was provided in the current year
by AB 32 X1 (Blumenfield), Chapter 15, Statutes of 2011-12 First
Extraordinary Session, a budget trailer bill. That bill allows
the schools to retain their NSS funding for grades 7 and 8 at
the high school rate in the current year only. The remedy
applies only to the current fiscal year pending a review of and
recommendations for revising NSS funding by the CDE. However,
that review has not taken place.
The CDE has subsequently determined that only three schools are
involved. They are:
1)Baker Jr. High School, Baker Valley Unified School District
(San Bernardino County).
2)Butte Valley Middle School, Butte Valley Unified School
District (Siskiyou County).
3)Scott Valley Jr. High School, Scott Valley Unified School
District (Siskiyou County).
The following chart details the three districts and the amount
of funding they received based on grades 7 and 8 ADA.
--------------------------------------------------------
| District | County | School | Total NSS |
| | | | Funding |
|--------------+----------+--------------+---------------|
|Baker Valley |San |Baker Jr. |$515,549 |
|Unified |Bernardino|High | |
| | | | |
|--------------+----------+--------------+---------------|
|Butte Valley |Siskiyou |Butte Valley |$759,082 |
|Unified | |Middle | |
|--------------+----------+--------------+---------------|
|Scott Valley |Siskiyou |Scott Valley |$1.24 million |
|Unified | |Junior High | |
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Source: SDE
LAO report . In May 2011 the Legislative Analyst's Office (LAO)
released a report on small school districts entitled, "How Small
Is Too Small: An Analysis of School District Consolidation."
While the report is primarily about school districts, it also
includes some findings related to small schools and the NSS
funding formula. Under the heading "Some NSS Are of
Questionable Necessity," the LAO report states:
Presumably, the goal of the NSS supplement is to
enable exceptionally small schools to operate in
remote areas of the state so that children do not have
to spend excessive time in transit. These funds,
however, also are subsidizing very small schools that
qualify not because they are geographically isolated,
but simply because the local community has chosen to
maintain a small single-school district. Because the
current statutory definition of whether a school is
'necessarily small' does not require looking beyond
district boundaries, single-school districts can
qualify for the additional funding even if there is
another public school just down the street-provided
that school is in another district.
This report prompted the discussions about conducting a broader
review of the NSS funding formula with possible recommendations
for reform. As indicated, however, that review has not taken
place. This bill states the intent of the Legislature for the
SPI to submit a report by February 1, 2013, with recommendations
regarding the definition on necessary small schools and the NSS
funding formula.
Analysis Prepared by : Rick Pratt / ED. / (916) 319-2087
FN: 0003880