School funding shifts under budget plan

Major shift in allocation of money under state plan due to pass Friday

Sacramento --
California's neediest school children will have more money directed to them under a major shift in school funding expected to be adopted this week as part of the new state budget.

School districts with high concentrations of students who are low income, learning English as a second language or in foster care will get extra money, while the state will no longer be able to tell districts how much they have to spend on things like textbooks and small classes.

The plan will be voted on as part of the larger budget, with the Legislature expected to take action on Friday, one day before its constitutional deadline to pass a spending proposal for the fiscal year that begins July 1.

The proposed budget has $96.3 billion in spending through the general fund, the state's main checking account. And because of past budget cuts and the voter-approved tax initiative known as Proposition 30, lawmakers and the governor didn't have to contend with a budget deficit for the first time in several years.

Democratic legislative leaders stood with Gov. Jerry Brown at a Capitol press conference Tuesday, where the governor expressed his support for the Legislature's work on a range of issues in the spending plan.

The positive nod from Brown means that short of a revolt among legislative Democrats to the budget plan - not likely - the proposal should easily pass and be signed into law by the governor.

Brown said the Legislature "got something done that's truly important - a balanced budget, a change in the formula that will strengthen local school districts, help poor kids and kids that have serious language barriers. This is a real step forward."

The governor has made education funding one of his top priorities, as he persuaded voters to pass Prop. 30 largely on a promise of extra money for schools.

Lea Suzuki, The Chronicle
Elijah Miller (right) receives the talking piece from Brandon Garcia during a restorative justice exercise at Oakland's James Madison Middle School. The district could get a big funding boost.

But Brown and lawmakers had been at odds over how to direct some of the additional money to the neediest school districts in the state without taking funds away from districts in more affluent areas.

On Monday, a joint legislative committee approved a compromise deal with three main components:
-- It would increase the base amount that school districts get for each student by an average of $537, bringing the statewide average to $7,640, according to the Department of Finance.

-- Students who are low income, learning English or in the foster-care system would be funded at an even higher rate - calculated through a complex formula - as long as their school district has at least 55 percent of students in those categories. This extra cash will be known as a "concentration grant."

-- Districts will get additional per-pupil funding, a lesser amount than the concentration grant, based on the total number of needy students.

To make sure all the money is spent as intended, the Legislature will also require that the state Board of Education create regulations not only for oversight, but to look at whether the changes are having a positive impact on students.

But even with the additional funding, it will take until 2021 to reach the overall goal of restoring per-student funding to 2007 levels, before the economic downturn forced cuts to many programs. Even then, California is still expected to rank low in per-pupil funding compared with other states across the country.

Lingering damage

District officials across the Bay Area stressed that the initial increase will not repair damage done during the recession.

That means parents probably won't see smaller class sizes next school year or axed art programs restored to schools, officials said.

In San Francisco, the district will get $7,313 per student, exactly $300 more each, but also faces cost increases in benefits, pension payments and preset boosts to teacher salaries based on years of experience - expenses that will swallow up much if not all of the increase.

By 2020, however, the state estimates the district will get $11,233 per student.

"In a relative sense, it's great," said Myong Leigh, the San Francisco district's deputy superintendent. "It's the start of something hopefully approaching a rational funding system."

In Oakland, the district will get $7,502 per student in the 2013-14 school year, up from $7,171 this year - or about $12 million more overall.

"This captures the effort to restore a degree of fairness to school funding," said Troy Flint, district spokesman. "Philosophically, we agree with the focus of aligning resources with the greatest need."
By 2020, Oakland Unified is expected to get nearly $12,000 per student.

Some Bay Area suburban districts had raised concerns with the governor's previous proposals, but now say they like the plan.

More money

One was the Dublin Unified School District. Although it has few low-income and needy students, it would get more money under the new, compromise plan than it would have under the governor's original proposal.

"It's fair to say we're pleased and agree with the intent. It's a start," said Dublin Superintendent Stephen Hanke. "Compromise means nobody is really happy, but everybody is satisfied."

Another part of the plan permanently eliminates almost all state requirements for spending in specific areas, like for textbooks, teacher training or incentives for reducing class sizes. Instead, districts would get the money and officials would themselves decide where to spend it.

Most of those requirements were already suspended since 2009 because of the state's budget crisis.

That former system, in place before 2009, was "just convoluted and impossible to understand. It had so many things attached to it," said Dennis Meyers, assistant executive director of government relations for the California School Boards Association.

"We don't see these services going away locally," he said. "What we see is the state doesn't need to tell the districts how to spend the money."

The overall plan does have harsh critics, though.

Bob Blattner, a lobbyist for schools, said that the new funding formulas will still create disparities for needy kids and that the state should have gone further in transforming how California funds its schools.

"If this were just a budget item, no worries. But this could be with us for a generation," he said.

State budget

Other proposals that are part of the budget include:

-- The creation of, over four years, a "middle-class scholarship" that would give tuition and fee breaks to in-state students at the University of California and California State University systems whose families make less than $150,000 per year. When fully implemented, students whose families make less than $100,000 would receive a 40 percent reduction in tuition and fees, and students from families earning just under the top threshold would receive a 10 percent reduction. There would be varying levels of reductions between those points.

-- Taking $300 million from what the state currently provides to counties for public health services as part of the implementation of the Affordable Care Act. That number was to increase over the next few years and take virtually all the money, but the budget proposal reduces that, and it does not put any other service responsibilities on counties, which previously had been discussed. Health advocates said they were disappointed, but encouraged that the act's implementation was moving forward.