Business directors from districts across California, including Chief Business Officer Dorothy Reconose, were brought together to discuss potential changes to state funding for public schools on April 9, Reconose said.
California bases the amount of funding for each school on the Local Control Funding Formula (LCFF), which is part of Proposition 98, a proposition dedicated to monitoring the funding and its use for public schools, according to the California Department of Education (CDE)’s website. LCFF funding includes base grants and concentration grants that are based on student demographics, according to the website.
The level of funding is determined based on the district’s average daily attendance (ADA) rate, which the district must report to the CDE three times a year, Director of Business Services Trang Vo said. The money for the funding comes from both local property taxes and the California government, making the district a state-funded district, Vo added.
“Part of Prop 98 is filled partially; it’s filled partially by local property taxes, and then the state backfills in the dollar amount,” Vo said. “For example, through the LCFF, we have a funding formula. So it’s a $1 amount per student at each grade level, and so then that’s what you’re allocated for the district. And if the local property tax money that we receive is not enough, the state then has to backfill that amount.”
The LCFF calculator takes the highest average daily attendance rate from the data the district has collected over the past three years, Reconose said. The district is only funded based on the percentage of students who attend school and not the total number of students enrolled, which causes them to lose funding due to absenteeism, she said.
“Attendance is important because we want the student to learn,” Reconose said. “We want them to be present at the school so they are learning something. But the bonus of that is it helps the district for additional funding because the students are present and learning in the classroom. When the student is not in the classroom, they miss what they’re learning that day, and we lose money.”
The CDE also monitors enrollment to catch any funding errors, Reconose said. Recently the CDE heard that some districts were bringing up the idea of becoming funded based on enrollment rather than attendance, Reconose said. The CDE then gathered district leaders who volunteered to share their opinions to investigate ideas for a change in public school funding, she added.
“They (CDE) said that they’re going to take that and then put everyone’s input,” Reconose said. “They will do an analysis to see if enrollment-based funding is more beneficial than attendance-based funding.”
Vo believes there is a 50-50 chance that California will adopt enrollment-based funding, she said. The idea has been brought up in the past and has been revisited multiple times, but was never passed, she added.
“I think that (enrollment-based funding) would help all the districts a lot, and I think that most districts right now are in a place where, as with declining enrollment and then loss of one-time funding, especially the COVID funding, we don’t have the funds to support the programs that we want to support,” Vo said. “If we switch to enrollment-based funding, this will help generate additional income for the districts to retain their most qualified and credentialed teachers, mental health therapists, and the tier one support that we really need.”
Other proposals were discussed between districts and the CDE, Reconose said. Some suggestions include raising the base funding for ADA or having the state fully fund special education, which many districts supported, she said.
“Special education is one of the highest costs that we have in our budget, and they are not fully funded,” she said. “The general fund dollars help contribute to the shortage of money that they get from the state and federal (government). If special ed is fully funded, then general fund dollars don’t have to pitch in some money. Then, in a way, it helps us also, because now we get to spend that money on something else instead of contributing it to special ed.”
California has recently tried to push various forms of legislation regarding funding, Vo said. One of these laws is Senate Bill 64, known as the school choice account, which would enable students to transfer districts, but the California Senate voted against it earlier this year, Vo said.
“I believe one of the recommendations of this bill was to be able to provide more equitable access to all students because a lot of people are thinking that if, let’s say, a student is in a school that is an underperforming school, if they are allowed or given an opportunity to go to a different school with this voucher,” Vo said. “The student would have the possibility of excelling there, instead of being put in a school where it’s a lower academic performing school.”
Bill 64 could bring funding from outside school districts into the Milpitas school district, but if students choose to leave the Milpitas school district, their funding would leave with them and be sent to the school district they are transferring to, Vo said. School districts would also have to worry about the capacity they have for teaching students who may transfer into their district, Vo added.
“Let’s say, if it’s a kindergartner, if we lose those funds, we still have to meet the state requirement of, whenever it’s kindergarten, one (teacher) to 12 (students),” Vo said. “If you have 20 students in class, hypothetically, you still need two teachers, one teacher and one aide, but now you have only 20 students and you would still need to provide that amount (of students) that one teacher and one aide. But now you’re losing four students to another district, hypothetically, if you have that school choice. So I think any dollar amount would be impactful to our district, or any districts.”
Vo believes that the California Senate will revote on Bill 64, but is unsure how government funding will play out in the future, she said.
“I think right now, with the budget, the way it sits, there’s a lot of unknowns, starting with the federal government,” Vo said. “I think that there’s a lot of school choice (being pushed) from the federal government. So I think this will probably somehow make its way back.”
Part of the reason California has not yet implemented any changes in public school funding is due to budget concerns, Reconose said. The amount of funding the CDE can and must give out to school districts is clearly laid out by legislation, she said.
“Last year, the state had some financial difficulties, so they actually depleted their reserve to fully fund the school districts,” Reconose said. “So now the state will work on rebuilding their reserves based on the performance of the tax returns and money that they collected and to make sure that they put back the reserve funds that they used up last year.”
Vo hopes that the state revenue for California is higher than anticipated, she said. This way, the state can fully fund Proposition 98 without using its reserves, she added. Vo believes that even if passed, an enrollment-based funding formula may not be effective immediately, she said.
“They (California) have to see how much they can afford to give us,” Vo said. “And so they have to do all the appropriations; they have to fund us. We (don’t) even know if it’s going to benefit us with the enrollment-based, but we have to see if they can afford it. There’s a lot of variables, and that’s the challenge. Right now, it’s so challenging with everything going on.”t