Video: Implementing California’s School Funding Formula

The success of California’s new funding formula hinges on whether school districts can improve achievement for students, especially those who are high need. New PPIC research focuses on the issues raised so far by implementation of the new formula—a process that will take eight years.

Last week, Laura Hill, PPIC senior fellow and one of the reports’ co-authors, provided an overview of PPIC’s findings in Sacramento. Her presentation was followed by a panel discussion that looked at the challenges and opportunities presented by the new funding formula. Panelists were Carolyn Chu of the Legislative Analyst’s Office; Jonathan Raymond, president of the Stuart Foundation and former superintendent of the Sacramento City Unified School District; PPIC research associate Paul Warren; and Riverside County school superintendent Kenneth Young. Patrick Murphy, PPIC research director moderated.

The PPIC reports are listed below:

Implementing California’s School Funding Formula: Will High-Need Students Benefit?

Implementing Local Accountability in California’s Schools: The First Year of Planning

Low-Income Students and School Meal Programs in California

Governor Proposes Minor Changes to K-12 Funding Levels

The governor released the May revision of his 2014-15 budget yesterday. All told, the news was good. Revenues were modestly better than forecast in January—up about $850 million in the coming fiscal year. But due to the complexities of Proposition 98—the constitutional funding guarantee for schools and community colleges—the amount proposed for K-12 education fell slightly.

The governor’s plan for schools is mostly unchanged, however. The chart below illustrates per-pupil funding levels proposed in the May revision. Schools would receive about $8,800 for each student—an increase of $780 from 2013–14. The current estimate of per-pupil funding in 2013-14 is up slightly from the level estimated in January, providing a healthy $430 per student more than in 2012–13.

Most of the new funding in 2014–15 goes to pay for the new Local Control Funding Formula. As in the January budget proposal, the budget includes $4.5 billion, or about $750 per student, for the new funding formula. The three-part formula distributes funding using a base grant (that differs by grade span), a supplemental grant for disadvantaged students (low-income, English Learner, and foster care students), and a concentration grant for districts that serve above-average proportions of disadvantaged students.

The budget also provides $27 million to help districts administer new state tests. With the transition to the Common Core State Standards, new computer-based assessments are currently being field tested in California. Students take the new tests on computers linked to the internet, and the additional funding would help schools develop higher speed internet connections.

One final note: Governor Brown proposes to establish a Proposition 98 reserve in the future to protect against volatility in General Fund revenues. His proposed constitutional amendment creates a rainy day fund that would help buffer schools from the extreme boom and bust cycle of state revenues.

In addition, the governor appears to have established an approach to K-12 budgeting that helps protect state and school district finances from uncertainties in the estimating process. Because revenues—and school funding levels—are estimated a year in advance, the amount of resources available to schools changes throughout the year as the revenue picture becomes clear. To reduce risks to state and district budgets, the administration: ·

  • Makes relatively conservative revenue forecasts. Moderating the administration’s revenue estimates helps prevent the state from spending more than Proposition 98 requires. If actual revenues are higher than assumed, it makes the additional Proposition 98 funds available on a one-time basis to retire debts or pay for other one-time costs. ·
  • Builds more flexibility into annual K-12 budgets. The administration, for instance, proposes to spend about $1.5 billion in ongoing 2014–15 funds to retire one-time K–12 debts that were created during the recession. These one-time expenditures help protect district budgets, because debt repayment can be downsized if Proposition 98 funding does not reach its expected level, while district base budgets are left intact.

This approach requires restraint on the part of state policymakers and local educators. But the dividends—repaid debts and one-time funding for things like computer infrastructure—are also becoming more evident.

Helping English Learners Succeed

Sacramento is paying considerable attention to California’s English Learners, who make up nearly 25 percent of the state’s public school students. A major overhaul last year of the way schools are funded now assigns more money for every student identified as an English Learner. This year, some policymakers would like to remove restrictions on bilingual education. Other legislation would seek a statewide policy about how to reclassify English Learner students as proficient in English—a process that varies widely across school districts.

PPIC Research Fellow Laura Hill and PPIC Bren Fellow Julian Betts addressed this topic in their recent report titled Pathways to Fluency: Examining the Link between Language Reclassification Policies and Student Success. The report, which was presented a public event in Sacramento last week, explores academic achievement among students who have been reclassified under the different policies in place at the Los Angeles and San Diego school districts.

Engaging Parents in School Funding Decisions

A policy enacted last year—the Local Control Funding Formula—changes the way the state allocates money for K–12 schools. The new system is designed to address the needs of disadvantaged students. It also gives local districts more authority over spending decisions and holds them accountable for results. Beginning this year, school districts must develop accountability plans every three years describing how they will meet the goals and priorities of the new system.

Districts are required to seek input from parents while developing their accountability plans, the first of which must be adopted by July 1. The requirement to involve parents is loosely defined. At a minimum, districts must hold a public hearing prior to plan approval and convene a parent advisory committee. And districts are supposed to ensure parent representation of the groups the new formula is designed to help—English Learners, foster children, and lower-income students. But the policy does not outline how the feedback will be gathered and used.

In the latest PPIC Statewide Survey, the vast majority of Californians, including 85 percent of public school parents, consider parent involvement in the development of these plans very important.

How effective have districts’ outreach efforts been so far?

Many districts have already held meetings and forums to seek parent input, but according to our survey, 45 percent of public school parents say they have not received information from their child’s school or school district about how to become involved (52% say they have received information). This is despite nearly all saying they are at least somewhat interested in becoming involved (53% very interested, 38% somewhat interested).

Still, there is some evidence in these early stages that outreach attempts to parents of disadvantaged students are working. Latino public school parents (67% of whom took the survey in Spanish) are much more likely than whites to say they have received information about how to become involved (61% to 42%). Similarly, immigrant parents (61%) are much more likely than U.S.-born parents (43%) to say they have received information. And the share reporting that they received information grows as household income levels decline.

An overwhelming majority of parents would like their youngest child to earn a college degree or graduate degree, including at least seven in 10 Latinos (70%), immigrants (77%), and parents earning less than $80,000 annually (75% under $40,000, 82% $40,000 to under $80,000). These parent groups are also among the most likely to believe the Local Control Funding Formula will improve the academic achievement of English Learners and lower-income students. Engaging these key groups in designing ways to meet the central goal of the Local Control Funding Formula (namely, to close the achievement gap between disadvantaged students and others) is critical—especially given the educational hopes they express for their children.

Chart source: PPIC Statewide Survey: April 2014.

Survey Focuses on Historic Changes in California Schools

PPIC’s 10th annual survey on K–12 education focused on two historic changes in California schools: the transition to the Common Core math and English standards and the Local Control Funding Formula.

Sonja Petek, project manager for the survey, talked about the key findings last week at a lunchtime briefing at the Cathedral of the Blessed Sacrament in Sacramento.

As our recent report, Implementing the Common Core State Standards in California shows, Common Core is off to a challenging start so far in the state. However, the PPIC survey found that most Californians and public school parents support the standards—which have sparked controversy in other states. But most are also concerned that teachers are unprepared to implement the new standards.

While most Californians had heard at least a little about the Common Core standards, awareness of the new funding formula was much lower. After they were read a description, most Californians said they supported the Local Control Funding Formula, which gives school districts increased flexibility over spending and provides extra money for disadvantaged students.

The survey also asked whether the state should fund voluntary preschool for all 4-year-olds (73% said yes) and whether likely voters would support a local bond measure to benefit school construction bonds (55% would) or a local school parcel tax for schools (48% would).

Moving English Learners to English Fluency

English learners (ELs) who have been reclassified as fluent English speakers perform very well, sometimes even surpassing the achievements of native English speakers. Moving ELs to English fluency is a high priority for educators and policymakers. As we describe in a commentary for EdSource, school districts across the state have different standards for reclassifying these students. This means that students with the same skills may be reclassified as fluent in one district, but not in another.

PPIC surveyed school districts about their reclassification policies and found that almost all districts use at least one reclassification criterion that is more rigorous than the State Board of Education’s guidelines. We also found that districts using more rigorous reclassification policies generally had lower reclassification rates. In many cases, setting the bar higher is linked to improved student outcomes for reclassified English learners, such as higher test scores. But these outcomes are not improved by much, and in some cases, outcomes are worse.

We concluded that the benefits to reclassified students of being held to higher standards are minimal—especially in light of the high performance of reclassified students in districts using the state guidelines.

Further, standardizing district reclassification policies into one uniform policy—for now, using the State Board of Education guidelines—would ease another concern: that districts have a fiscal incentive to set standards that maintain the supplemental funding they get for each EL student. Most important, standardizing reclassification policies would speed the transition of highly able English learners.

Changes to California’s school finance, testing, and accountability systems all have the potential to change outcomes for ELs over the coming months and years. New research on setting the state’s reclassification standards should wait until the new assessments aligned to the Common Core State Standards are fully implemented.