California Legislature—2013–14 Regular Session

Assembly Bill No. 2552

Introduced by Assembly Member Morrell

February 21, 2014

An act to amend Section 42238.02 of the Education Code, relating to school finance.

LEGISLATIVE COUNSEL’S DIGEST

AB 2552, as introduced, Morrell. School finance: local control funding formula.

Existing law establishes a public school financing system that requires state funding for county superintendents of schools, school districts, and charter schools to be calculated pursuant to a local control funding formula, as specified. Existing law requires the Superintendent of Public Instruction to annually calculate a local control funding formula grant for each school district and charter school based on data submitted by local educational agencies, as specified, in accordance with instructions specified by the Controller.

This bill would make nonsubstantive changes to these provisions.

Vote: majority. Appropriation: no. Fiscal committee: no. State-mandated local program: no.

The people of the State of California do enact as follows:

SECTION 1.  

Section 42238.02 of the Education Code, as
amended by Section 19 of Chapter 357 of the Statutes of 2013, is
amended to read:

42238.02.  

(a) The amount computed pursuant to this section
shall be known as the school district and charter school local
control funding formula.

(b) (1) For purposes of this section “unduplicated pupil” means
a pupil enrolled in a school district or a charter school who is either
classified as an English learner, eligible for a free or reduced-price
meal, or is a foster youth. A pupil shall be counted only once for
purposes of this section if any of the following apply:

(A) The pupil is classified as an English learner and is eligible
for a free or reduced-price meal.

(B) The pupil is classified as an English learner and is a foster
youth.

(C) The pupil is eligible for a free or reduced-price meal and is
classified as a foster youth.

(D) The pupil is classified as an English learner, is eligible for
a free or reduced-price meal, and is a foster youth.

(2) Under procedures and timeframes established by the
Superintendent, commencing with the 2013-14 fiscal year, a school
district or charter school shall annually submit its enrolled free
and reduced-price meal eligibility, foster youth, and English learner
pupil-level records for enrolled pupils to the Superintendent using
the California Longitudinal Pupil Achievement Data System.

(3) (A) Commencing with the 2013-14 fiscal year, a county
office of education shall review and validate certified aggregate
English learner, foster youth, and free or reduced-price meal
eligible pupil data for school districts and charter schools under
its jurisdiction to ensure the data is reported accurately. The
Superintendent shall provide each county office of education with
appropriate access to school district and charter school data reports
in the California Longitudinal Pupil Achievement Data System
for purposes of ensuring data reporting accuracy.

(B) The Controller shall include the instructions necessary to
enforce paragraph (2) in the audit guide required by Section
14502.1. The instructions shall include, but are not necessarily
limited to, procedures for determining if the English learner, foster
youth, and free or reduced-price meal eligible pupil counts are
consistent with the school district’s or charter school’s English
learner, foster youth, and free or reduced-price meal eligible pupil
records.

(4) The Superintendent shall make the calculations pursuant to
this section using the data submitted by local educational agencies,
including charter schools, through the California Longitudinal
Pupil Achievement Data System. Under timeframes and procedures
established by the Superintendent, school districts and charter
schools may review and revise their submitted data on English
learner, foster youth, and free or reduced-price meal eligible pupil
counts to ensure the accuracy of data reflected in the California
Longitudinal Pupil Achievement Data System.

(5) The Superintendent shall annually compute the percentage
of unduplicated pupils for each school district and charter school
by dividing the enrollment of unduplicated pupils in a school
district or charter school by the total enrollment in that school
district or charter school pursuant to all of the following:

(A) For the 2013-14 fiscal year, divide the sum of unduplicated
pupils for the 2013-14 fiscal year by the sum of the total pupil
enrollment for the 2013-14 fiscal year.

(B) For the 2014-15 fiscal year, divide the sum of unduplicated
pupils for the 2013-14 and 2014-15 fiscal years by the sum of the
total pupil enrollment for the 2013-14 and 2014-15 fiscal years.

(C) For the 2015-16 fiscal year and each fiscal year thereafter,
divide the sum of unduplicated pupils for the current fiscal year
and the two prior fiscal years by the sum of the total pupil
enrollment for the current fiscal year and the two prior fiscal years.

(c) Commencing with the 2013-14 fiscal year and each fiscal
year thereafter, the Superintendent shall annually calculate a local
control funding formula grant for each school district and charter
school in the state pursuant to this section.

(d) The Superintendent shall compute a grade span adjusted
base grant equal to the total of the following amounts:

(1) For the 2013-14 fiscal year, a base grant of:

(A) Six thousand eight hundred forty-five dollars ($6,845) for
average daily attendance in kindergarten and grades 1 to 3,
inclusive.

(B) Six thousand nine hundred forty-seven dollars ($6,947) for
average daily attendance in grades 4 to 6, inclusive.

(C) Seven thousand one hundred fifty-four dollars ($7,154) for
average daily attendance in grades 7 and 8.

(D) Eight thousand two hundred eighty-nine dollars ($8,289)
for average daily attendance in grades 9 to 12, inclusive.

(2) In each year the grade span adjusted base grants in paragraph
(1) shall be adjusted by the percentage change in the annual average
value of the Implicit Price Deflator for State and Local Government
Purchases of Goods and Services for the United States, as published
by the United States Department of Commerce for the 12-month
period ending in the third quarter of the prior fiscal year. This
percentage change shall be determined using the latest data
available as of May 10 of the preceding fiscal year compared with
the annual average value of the same deflator for the 12-month
period ending in the third quarter of the second preceding fiscal
year, using the latest data available as of May 10 of the preceding
fiscal year, as reported by the Department of Finance.

(3) (A) The Superintendent shall compute an additional
adjustment to the kindergarten and grades 1 to 3, inclusive, base
begin delete grant end delete begin insert grant, end insert as adjusted for inflation pursuant to paragraph begin delete (2) end delete begin insert (2), end insert
equal to 10.4 percent. The additional grant shall be calculated by
multiplying the kindergarten and grades 1 to 3, inclusive, base
grant, as adjusted by paragraph (2), by 10.4 percent.

(B) Until paragraph (4) of subdivision (b) of Section 42238.03
is effective, as a condition of the receipt of funds in this paragraph,
a school district shall make progress toward maintaining an average
class enrollment of not more than 24 pupils for each schoolsite in
kindergarten and grades 1 to 3, inclusive, unless a collectively
bargained alternative annual average class enrollment for each
schoolsite in those grades is agreed to by the school district,
pursuant to the following calculation:

(i) Determine a school district’s average class enrollment for
each schoolsite for kindergarten and grades 1 to 3, inclusive, in
the prior year. For the 2013-14 fiscal year, this amount shall be
the average class enrollment for each schoolsite for kindergarten
and grades 1 to 3, inclusive, in the 2012-13 fiscal year.

(ii) Determine a school district’s proportion of total need
pursuant to paragraph (2) of subdivision (b) of Section 42238.03.

(iii) Determine the percentage of the need calculated in clause
(ii) that is met by funding provided to the school district pursuant
to paragraph (3) of subdivision (b) of Section 42238.03.

(iv) Determine the difference between the amount computed
pursuant to clause (i) and an average class enrollment of not more
than 24 pupils.

(v) Calculate a current year average class enrollment adjustment
for each schoolsite for kindergarten and grades 1 to 3, inclusive,
equal to the adjustment calculated in clause (iv) multiplied by the
percentage determined pursuant to clause (iii).

(C) School districts that have an average class enrollment for
each schoolsite for kindergarten and grades 1 to 3, inclusive, of
24 pupils or less for each schoolsite in the 2012-13 fiscal year,
shall be exempt from the requirements of subparagraph (B) so long
as the school district continues to maintain an average class
enrollment for each schoolsite for kindergarten and grades 1 to 3,
inclusive, of not more than 24 pupils, unless a collectively
bargained alternative ratio is agreed to by the school district.

(D) Upon full implementation of the local control funding
formula, as a condition of the receipt of funds in this paragraph,
begin delete all end delete begin insert a end insert school begin delete districts end delete begin insert district end insert shall maintain an average class
enrollment for each schoolsite for kindergarten and grades 1 to 3,
inclusive, of not more than 24 pupils for each schoolsite in
kindergarten and grades 1 to 3, inclusive, unless a collectively
bargained alternative ratio is agreed to by the school district.

(E) The average class enrollment requirement for each schoolsite
for kindergarten and grades 1 to 3, inclusive, established pursuant
to this paragraph shall not be subject to waiver by the state board
pursuant to Section begin delete 33050 end delete begin insert 33050, end insert or by the Superintendent.

(F) The Controller shall include the instructions necessary to
enforce this paragraph in the audit guide required by Section
14502.1. The instructions shall include, but are not necessarily
limited to, procedures for determining if the average class
enrollment for each schoolsite for kindergarten and grades 1 to 3,
inclusive, exceeds 24 pupils, or an alternative average class
enrollment for each schoolsite pursuant to a collectively bargained
alternative ratio. The procedures for determining average class
enrollment for each schoolsite shall include criteria for employing
sampling.

(4) The Superintendent shall compute an additional adjustment
to the base grant for grades 9 to 12, inclusive, as adjusted for
inflation pursuant to paragraph (2), equal to 2.6 percent. The
additional grant shall be calculated by multiplying the base grant
for grades 9 to 12, inclusive, as adjusted by paragraph (2), by 2.6
percent.

(e) The Superintendent shall compute a supplemental grant
add-on equal to 20 percent of the base grants as specified in
subparagraphs (A) to (D), inclusive, of paragraph (1) of subdivision
(d), as adjusted by paragraphs (2) to (4), inclusive, of subdivision
(d), for each school district’s or charter school’s percentage of
unduplicated pupils calculated pursuant to paragraph (5) of
subdivision (b). The supplemental grant shall be calculated by
multiplying the base grants as specified in subparagraphs (A) to
(D), inclusive, of paragraph (1), as adjusted by paragraphs (2) to
(4), inclusive, of subdivision (d), by 20 percent and by the
percentage of unduplicated pupils calculated pursuant to paragraph
(5) of subdivision (b) in that school district or charter school. The
supplemental grant shall be expended in accordance with the
regulations adopted pursuant to Section 42238.07.

(f) (1) The Superintendent shall compute a concentration grant
add-on equal to 50 percent of the base grants as specified in
subparagraphs (A) to (D), inclusive, of paragraph (1) of subdivision
(d), as adjusted by paragraphs (2) to (4), inclusive, of subdivision
(d), for each school district’s or charter school’s percentage of
unduplicated begin delete pupils end delete begin insert pupils, end insert calculated pursuant to paragraph (5)
of subdivision begin delete (b) end delete begin insert (b), end insert in excess of 55 percent of the school
district’s or charter school’s total enrollment. The concentration
grant shall be calculated by multiplying the base grants as specified
in subparagraphs (A) to (D), inclusive, of paragraph (1) of
subdivision (d), as adjusted by paragraphs (2) to (4), inclusive, of
subdivision (d), by 50 percent and by the percentage of
unduplicated begin delete pupils end delete begin insert pupils, end insert calculated pursuant to paragraph (5)
of subdivision begin delete (b) end delete begin insert (b), end insert in excess of 55 percent of the total
enrollment in that school district or charter school.

(2) For a charter school physically located in only one school
district, the percentage of unduplicated begin delete pupils end delete begin insert pupils, end insert calculated
pursuant to paragraph (5) of subdivision begin delete (b) end delete begin insert (b), end insert in excess of 55
percent used to calculate concentration grants shall not exceed the
percentage of unduplicated begin delete pupils end delete begin insert pupils, end insert calculated pursuant to
paragraph (5) of subdivision begin delete (b) end delete begin insert (b), end insert in excess of 55 percent of the
school district in which the charter school is physically located.
For a charter school physically located in more than one school
district, the charter school’s percentage of unduplicated begin delete pupils end delete
begin insert pupils, end insert calculated pursuant to paragraph (5) of subdivision begin delete (b) end delete begin insert (b), end insert
in excess of 55 percent used to calculate concentration grants shall
not exceed that of the school district with the highest percentage
of unduplicated begin delete pupils end delete begin insert pupils, end insert calculated pursuant to paragraph (5)
of subdivision begin delete (b) end delete begin insert (b), end insert in excess of 55 percent of the school districts
in which the charter school has a school facility. The concentration
grant shall be expended in accordance with the regulations adopted
pursuant to Section 42238.07.

(g) The Superintendent shall compute an add-on to the total
sum of a school district’s or charter school’s base, supplemental,
and concentration grants equal to the amount of funding a school
district or charter school received from funds allocated pursuant
to the Targeted Instructional Improvement Block Grant program,
as set forth in Article 6 (commencing with Section 41540) of
Chapter 3.2, for the 2012-13 fiscal year, as that article read on
January 1, 2013. A school district or charter school shall not receive
a total funding amount from this add-on greater than the total
amount of funding received by the school district or charter school
from that program in the 2012-13 fiscal year. The amount
computed pursuant to this subdivision shall reflect the reduction
specified in paragraph (2) of subdivision (a) of Section 42238.03.

(h) The Superintendent shall compute an add-on to the total
sum of a school district’s or charter school’s base, supplemental,
and concentration grants equal to the amount of funding a school
district or charter school received from funds allocated pursuant
to the Home-to-School Transportation program, as set forth in
former Article 2 (commencing with Section 39820) of Chapter 1
of Part 23.5, former Article 10 (commencing with Section 41850)
of Chapter 5, and the Small School District Transportation
program, as set forth in former Article 4.5 (commencing with
Section 42290), for the 2012-13 fiscal year. A school district or
charter school shall not receive a total funding amount from this
add-on greater than the total amount received by the school district
or charter school for those programs in the 2012-13 fiscal year.
The amount computed pursuant to this subdivision shall reflect
the reduction specified in paragraph (2) of subdivision (a) of
Section 42238.03.

(i) (1) The sum of the local control funding formula rates
computed pursuant to subdivisions (c) to (f), inclusive, shall be
multiplied by:

(A) For school districts, the average daily attendance of the
school district in the corresponding grade level ranges computed
pursuant to Section 42238.05, excluding the average daily
attendance computed pursuant to paragraph (2) of subdivision (a)
of Section begin delete 42238.05 end delete begin insert 42238.05, end insert for purposes of the computation
specified in subdivision (d).

(B) For charter schools, the total current year average daily
attendance in the corresponding grade level ranges.

(2) The amount computed pursuant to Article 4 (commencing
with Section 42280) shall be added to the amount computed
pursuant to paragraphs (1) to (4), inclusive, of subdivision (d), as
multiplied by subparagraph (A) or (B) of paragraph (1), as
appropriate.

(j) The Superintendent shall adjust the sum of each school
district’s or charter school’s amount determined in subdivisions
(g) to (i), inclusive, pursuant to the calculation specified in Section
42238.03, less the sum of the following:

(1) (A) For school districts, the property tax revenue received
pursuant to Chapter 3.5 (commencing with Section 75) and Chapter
6 (commencing with Section 95) of Part 0.5 of Division 1 of the
Revenue and Taxation Code.

(B) For charter schools, the in-lieu property tax amount provided
to a charter school pursuant to Section 47635.

(2) The amount, if any, received pursuant to Part 18.5
(commencing with Section 38101) of Division 2 of the Revenue
and Taxation Code.

(3) The amount, if any, received pursuant to Chapter 3
(commencing with Section 16140) of Part 1 of Division 4 of Title
2 of the Government Code.

(4) Prior years’ taxes and taxes on the unsecured roll.

(5) Fifty percent of the amount received pursuant to Section
41603.

(6) The amount, if any, received pursuant to the Community
Redevelopment Law (Part 1 (commencing with Section 33000)
of Division 24 of the Health and Safety Code), less any amount
received pursuant to Section 33401 or 33676 of the Health and
Safety Code that is used for land acquisition, facility construction,
reconstruction, or remodeling, or deferred maintenance and that
is not an amount received pursuant to Section 33492.15, or
paragraph (4) of subdivision (a) of Section 33607.5, or Section
33607.7 of the Health and Safety Code that is allocated exclusively
for educational facilities.

(7) The amount, if any, received pursuant to Sections 34177,
34179.5, 34179.6, 34183, and 34188 of the Health and Safety
Code.

(8) Revenue received pursuant to subparagraph (B) of paragraph
(3) of subdivision (e) of Section 36 of Article XIII of the California
Constitution.

(k) A school district shall annually transfer to each of its charter
schools funding in lieu of property taxes pursuant to Section 47635.

(l) (1) Nothing in this section shall be interpreted to authorize
a school district that receives funding on behalf of a charter school
pursuant to Section 47651 to redirect this funding for another
purpose unless otherwise authorized in law pursuant to paragraph
(2) or pursuant to an agreement between the charter school and its
chartering authority.

(2) A school district that received funding on behalf of a locally
funded charter school in the 2012-13 fiscal year pursuant to
paragraph (2) of subdivision (b) of Section 42605, Section 42606,
and subdivision (b) of Section 47634.1, as those sections read on
January 1, 2013, or a school district that was required to pass
through funding to a conversion charter school in the 2012-13
fiscal year pursuant to paragraph (2) of subdivision (b) of Section
42606, as that section read on January 1, 2013, may annually
redirect for another purpose a percentage of the amount of the
funding received on behalf of that charter school. The percentage
of funding that may be redirected shall be determined pursuant to
the following computation:

(A) (i) Determine the sum of the need fulfilled for that charter
school pursuant to paragraph (3) of subdivision (b) of Section
42238.03 in the then current fiscal year for the charter school.

(ii) Determine the sum of the need fulfilled in every fiscal year
before the then current fiscal year pursuant to paragraph (3) of
subdivision (b) of Section 42238.03 adjusted for changes in average
daily attendance pursuant to paragraph (3) of subdivision (a) of
Section 42238.03 for the charter school.

(iii) Subtract the amount computed pursuant to paragraphs (1)
to (3), inclusive, of subdivision (a) of Section 42238.03 from the
amount computed for that charter school under the local control
funding formula entitlement computed pursuant to subdivision (i)
of Section 42238.02.

(iv) Compute a percentage by dividing the sum of the amounts
computed to clauses (i) and (ii) by the amount computed pursuant
to clause (iii).

(B) Multiply the percentage computed pursuant to subparagraph
(A) by the amount of funding the school district received on behalf
of the charter school in the 2012-13 fiscal year pursuant to
paragraph (2) of subdivision (b) of Section 42605, Section 42606,
and subdivision (b) of Section 47634.1, as those sections read on
January 1, 2013.

(C) The maximum amount that may be redirected shall be the
lesser of the amount of funding the school district received on
behalf of the charter school in the 2012-13 fiscal year pursuant to
paragraph (2) of subdivision (b) of Section 42605, Section 42606,
and subdivision (b) of Section 47634.1, as those sections read on
January 1, 2013, or the amount computed pursuant to subparagraph
(B).

(3) Commencing with the 2013-14 fiscal year, a school district
operating one or more affiliated charter schools shall provide each
affiliated charter school schoolsite with no less than the amount
of funding the schoolsite received pursuant to the charter school
block grant in the 2012-13 fiscal year.

(m) Any calculations in law that are used for purposes of
determining if a local educational agency is an excess tax school
entity or basic aid school district, including, but not limited to, this
section and Sections begin delete 42238.03, end delete 41544, begin insert 42238.03, end insert 47632, 47660,
47663, 48310, and 48359.5, and Section 95 of the Revenue and
Taxation Code, shall be made exclusive of the revenue received
pursuant to subparagraph (B) of paragraph (3) of subdivision (e)
of Section 36 of Article XIII of the California Constitution.

(n) The funds apportioned pursuant to this section and Section
42238.03 shall be available to implement the activities required
pursuant to Article 4.5 (commencing with Section 52060) of
Chapter 6.1 of Part 28 of Division 4 of Title 2.

(o) A school district that does not receive an apportionment of
state funds pursuant to this section, as implemented pursuant to
Section 42238.03, excluding funds apportioned pursuant to the
requirements of subdivision (e) of Section 42238.03 shall be
considered a “basic aid school district” or an “excess tax entity.”