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An Overview of theLocal Control Funding Formula

An Overview of theLocal Control Funding Formula

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Published by Kathryn Black
An Overview of the Local Control Funding Formula
Mac Taylor, Legislative Analyst
July 29, 201
An Overview of the Local Control Funding Formula
Mac Taylor, Legislative Analyst
July 29, 201

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Published by: Kathryn Black on Jul 30, 2013
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09/10/2013

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A Ovevie o teLocal Cotol Fig Fola
MAC TAylor legislATive AnAlysT July 29, 2013
Exective Sa
Chapter 47, Statutes o 2013 (AB 97, Committee on Budget)—enacted as part o the 2013‑14budget package—made major changes both to the way the state allocates unding to school districtsand the way the state supports and intervenes in underperorming districts. Te legislation was theculmination o more than a decade o research and policy work on Caliornia’s K‑12 unding system.Tis report describes the major components o the legislation, with the rst hal o the reportdescribing the state’s new unding ormula and the second hal describing the state’s new system o district support and intervention. Troughout the report, we ocus primarily on how the legislationaects school districts, but we also mention some o the main eects on charter schools. (Tis reportdoes not cover the new unding ormula or county oces o education [COEs], which diers insignicant ways rom the new district ormula.) Te report answers many o the questions that havebeen raised in the aermath o passage regarding the nal decisions made by the Legislature and theGovernor in craing new K‑12 unding and accountability systems or Caliornia.
Contents
T Frmula .....................................................................................................................2
Cmp ........................................................................................................................... 2spdig Rrici ............................................................................................................ 6C  Frmula ...................................................................................................................... 8Diribuial efc  Frmula .......................................................................................... 8
traparcy ad Accuabiliy Udr nw sym ..................................................10
Diric Dvlpmad Adpi  LCAP ....................................................................10Coe Rviw  Diric LCAP .............................................................................................13suppr ad Irvi .....................................................................................................13
Majr Dcii Lay Ahad ...........................................................................................18Cclui ......................................................................................................................19
 
ThE FOrmuLA
same rates previously used to set charter schoolgrade‑span unding rates). Tese grade‑spandierences are intended to recognize the generally higher costs o education at higher grade levels.
 Adjusts Early Elementary and High School Base Rates.
Te LCFF includes certain adjustmentsto the K‑3 and high school base rates. Teseadjustments eectively increase the base ratesor these two grade spans. Te K‑3 adjustmentincreases the K‑3 base rate by 10.4 percent (orinitially $712 per ADA)—or an adjusted, initialK‑3 base rate o $7,557. Tis adjustment is intendedto cover costs associated with class size reduction(CSR) in the early grades. (Te $712 per‑pupiladjustment refects the average K‑3 CSR rate underthe previous unding rules.) Te high schooladjustment increases the grades 9‑12 base rate by 2.6 percent (or initially $216 per ADA)—or anadjusted, initial high school base rate o $8,505.Tis adjustment is not designated or any particularactivity, but the genesis o the adjustment related
C
omponents
One o the main components o Chapter 47 isthe creation o the local control unding ormula(LCFF). Te LCFF has several components, asdescribed below. (Except where otherwise noted,the components that apply to school districts alsoapply to charter schools.)
Sets Uniorm, Grade-Span Base Rates.
Underthe new ormula, districts receive the bulk o their unding based on average daily attendance(ADA) in our grade spans. Figure 1 displays theour LCFF grade‑span base rates as specied inChapter 47. Each year, beginning in 2013‑14, thesetarget base rates are to be updated or cost‑o‑livingadjustments (COLAs). Te dierences amongthe target grade‑span rates refect the dierencesamong existing unding levels across the gradespans. Specically, the new base‑rate dierentialsare linked to the dierentials in 2012‑13 statewideaverage revenue limit rates by district type (the
Figure 1
Overview of Local Control Funding Formula
a
Formula ComponentRates/Rules
Target base rates (per ADA)
b
• K-3: $6,845• 4-6: $6,947• 7-8: $7,1549-12: $8,289Base rate adjustmentsK-3: 10.4 percent obase rate.• 9-12: 2.6 percent o base rate.Supplemental unding or certain student subgroups(per EL/LI student and oster youth)20 percent o adjusted base rate.Concentration undingEach EL/LI student above 55 percent oenrollmentgenerates an additional 50 percent o adjusted base rate.Add-onsTargeted Instructional Improvement Block Grant, Home-to-School Transportation, Economic Recovery Target.
a
Applies to school districts and charter schools.
b
Reects target rates as specifed in statute. Does not include 1.57 percent cost-o-living adjustment provided in 2013-14.ADA = average daily attendance; EL = English learner; and LI = low-income (defned as a student receiving a ree or reduced price meal).
2LegislativeAnalyst’sOfce
www.a.ca.
An LAO RepORt
 
to the costs o providing career technical education(CE) in high school. (Te $216 adjustment refectsthe average total amount spent per pupil on CEcategorical programs under the old system.)Moving orward, the adjustment percentages willremain the same, though the dollar value o theadjustments will increase as the base rates rise dueto COLAs.
Includes Supplemental Funding or English Learners and Low-Income (EL/LI) Students.
TeLCFF provides additional unds or particularstudent groups. Under the ormula, each EL/LIstudent and oster youth in a district generates anadditional 20 percent o the qualiying student’sadjusted grade‑span base rate. For instance, an LIkindergartener generates an additional $1,511 orthe district, which is 20 percent o the adjustedK‑3 base rate o $7,557. (Because all oster youthalso meet the state’s LI denition, hereaer we donot reer to them as a separate subgroup.) For thepurposes o generating this supplemental unding(as well as the concentration unding discussedbelow), a district’s EL/LI count is based on athree‑year rolling average o EL/LI enrollment.Students who are both EL and LI are counted only once (known as an unduplicated count). For moreinormation regarding the classication o EL/LIstudent groups, see the nearby box.
Provides Concentration Funding or DistrictsWith Higher EL/LI Populations.
Districts
Classicatio o Eglis Leae/Lo-Icoe (EL/LI) Stets
Classication o EL Students.
For the purposes o the Local Control Funding Formula (LCFF),students are classied as EL based on a home language survey and the Caliornia English LanguageDevelopment est (CELD). I a parent or guardian reports on the home language survey that alanguage other than English is the student’s initial language learned or the primary language used athome, the student is required to take the CELD. I the student is determined by the school districtnot to be English procient based on CELD results, then the student is classied as EL. Each yearthereaer, an EL student is reassessed using the CELD. Once a student is determined to be Englishprocient—based on CELD results, perormance on other state assessments, teacher input, andlocal criteria—the student is reclassied as Fluent English Procient (FEP). Each school district canuse its own criteria or reclassiying EL students as FEP. Under the LCFF, no time limit is placed onhow long an EL student can generate supplemental and concentration unding or a district, but astudent reclassied as FEP who is not also LI will no longer generate additional unding.
Classication o LI Students.
For the purposes o the LCFF, LI students are those that qualiy or ree and reduced price meals (FRPM). Eligibility or FRPM is determined by school districtsthrough a variety o means. In many cases, students are determined FRPM‑eligible through anapplication process sent to students’ households. I a household’s income is below 185 percent o the ederal poverty line ($43,568 or a amily o our), the student is eligible or FRPM. In othercases, students are directly certied as FRPM‑eligible due to participation in other social serviceprograms, such as the Caliornia Work Opportunity and Responsibility to Kids program. Fosteryouth automatically are eligible or FRPM, thereore the oster amily’s income has no bearing onthe oster student’s FRPM eligibility. An LI student will generate supplemental and concentrationunding or a district until the student is no longer FRPM‑eligible.
www.a.ca.
LegislativeAnalyst’sOfce
3
An LAO RepORt

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