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History of California School Finance
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Senate Bill 90
Impact Upon California School Districts of Senate Bill 90 of 1972 and Assembly Bill 1267 of 1973. A Report to the California Legislature as Required by Assembly Concurrent Resolution No. 54.In 1972, the Legislature established revenue limits for California public schools. These revenue limits placed a ceiling on the amount of tax money each district could receive per pupil. The 1972-73 general purpose spending level became the base amount in determining each district's annual revenue limit. This was the beginning of the shift from local to state control of school finance. -
Serrano v. Priest
Serrano v. Priest The Beginning Problem with Property Values tied to School Funding. Before 1972, property taxes accounted for 2/3 of revenue for education and per pupil resources varied widely, ranging from $274 - $1223...depending on property values. -
Assembly Bill 65
California Schools Beyond Serrano: A Report on Assembly Bill 65 of 1977. To try to equalize revenue, legislation was passed to have an annual inflation adjustment that was scaled. This was called the "Squeeze Factor"AB 65 also established the Early Childhood Education Program, predecessor to the School Improvement Program (SIP) and several other categorical programs. -
Assembly Bill 8
Property Taxes:Why Some Local GovernmentsGet More Than Others
In response to Proposition 13, the Legislature established a formula for dividing property taxes among cities, counties, and school districts. This shielded schools from some of the measure's effects. In the process, the state replaced the lost property taxes and effectively took control of school district funding. -
Proposition 13
California Propistion 13 (1978)This constitutional amendment approved by California voters in 1978 limits property tax rates to 1% of a property's assessed value. Increases in assessed value per year are capped at 2% or the percentage growth in the Consumer Price Index (CPI) , whichever is less. According to this law, new taxes, such as a parcel tax, must be approved by two-thirds of local voters. -
Gann Limit (Proposition 4)
Appropriation / GANN Limits In 1979 voters approved Proposition 4, a constitutional limit on government spending at every level in the state, including school districts. No agency's expenditures can exceed its Gann limit, which is adjusted annually for changes in population and the lesser of either the national Consumer Price Index (CPI) or California's per capita personal income. (The index was changed by Proposition 111 in 1990 -
Appropriation / GANN Limits
Senate Bill 813 (1983) Senate Bill (SB) 813 in 1983 provided additional money to school districts through equalization of revenue limits and new categorical programs, more rigorous graduation requirements, longer school day/year, and higher beginning teachers' salaries. It also established statewide model curriculum standards. -
Senate Bill 813 (1983)
AB-1428 California State Lottery: education finance.In November 1984, voters approved a constitutional amendment authorizing the California State Lottery. The provisions guarantee that a minimum of 34% of total lottery receipts be distributed to public schools, colleges, and universities. The money is to supplement, not replace, support for education; it must be used "exclusively for the education of pupils and students and no funds shall be spent for acquisition of real property, construction of facilities, financing of research or any other non -
Propostion 98
California Proposition 98 (1988)This constitutional amendment, approved in November 1988, guarantees a minimum funding level from state and property taxes for K-14 public schools in a complex formula based on state tax revenues. Proposition 98 also requires each school to prepare and publicize an annual School Accountability Report Card (SARC) that covers at least 13 required topics, including test scores, dropout rates, and teacher qualifications. A two-thirds vote of the Legislature and a signature from the governor are requ -
Proposition 111
Proposition 111 -- Will California Remain An Anti-Tax Model For The Country?Included in this constitutional amendment was a change in the inflation index for the Gann limit calculation, effectively raising the limit. Additionally, the minimum funding guarantee for education (Proposition 98) was changed to reflect the growth of California's overall economy. Proposition 111 accomplished this by shifting the adjustment for inflation from the growth of per capita personal income, which historically has tended to be a lower amount, to the growth in state per capita General F -
Class Size Reduction, K-3 (Senate Bill 1777)
Repository archive entry for the Class Size Reduction (K-3) program in the Programs No Longer Administered by the California Department of Education (CDE) Section of the CDE Web site.In 1996, the Legislature passed the Class Size Reduction (CSR) Program, which provided incentives for school districts to reduce K-3 classes to a pupil-teacher ratio of no more than 20 to 1. This legislation provided annual incentive funding of $650 for each student in a smaller class and an option of $325 for students in a staggered session in which the pupil-teacher ratio is no more than 20 to 1 for half the day. These incentives were later increased to $800 full day and $400 half day per stud -
AB 602, SELPA
Special Education AB 602 ApportionmentChanged the state formula forspecial education funding in 1997.
AB 602 allocates funds based on the ADA for all school districts covered by a Special Education Local
Planning Area (SELPA). This removed the incentive to identify students as special education and required
a certain staffing formula based on the type of special education student setting. -
Senate Bill 1468
SB 1468 Senate Bill - Bill AnalysisSenate Bill 1468 changes the way the Average Daily Attendance (ADA) for school districts is counted. Before 1997, ADA equaled the number of students in school plus those students who missed school but had a permissible excuse such as an illness, a doctor's appointment, or a death in the family. Instead, SB 1468 requires that schools calculate their ADA by counting only the students who are actually at school each day. In an attempt to ensure that school districts did not lose a large proportion -
Class Size Reduction, 9th grade
Morgan-Hart Class Size Reduction, Grade 9Repository archive entry for the Morgan-Hart Class Size Reduction, Grade 9 program in the Programs No Longer Administered by the California Department of Education (CDE) Section of the CDE Web site.Two years after the original K-3 Class Size Reduction (CSR), the California Legislature expanded the existing high school program to concentrate on high school freshmen. To qualify for the $135 per pupil incentive, high schools must offer one or two ninth-grade courses with an average of 20 students per teacher, with a maximum of 22 per participating class. This bill also requires that one of the courses must be in English and the other can be in mathematics, science, or social studies. Programs -
Assembly Bill 1600
AB 1600 Assembly Bill - Bill AnalysisAssembly Bill 1600 gave charter schools the option to receive funding directly from the state, instead of their local district, in the form of a block grant. This grant combines both general-purpose money and a large proportion of the categorical funds into a single per pupil amount that varies by grade level. Charter schools are also eligible for additional categorical program funding for which the school and individual students qualify. -
Proposition 39 Local General Obligation Bonds for School Construction Approved
California Proposition 39 (2000)—Long-termborrowing bylocalschool districts.Districts are authorized
to sell general obligation bonds to finance school construction projects with the approval of 55 percent of
the votersin the district, if certain specified conditionsinvolving financial and performance accountability
are met. These conditions were delineated in Proposition 39, an amendment to theCaliforniaConstitution,
which was approved by the voters in November 2000. It added the option of a lower voter-approval
threshold (55 -
AB2756—Increased Fiscal Accountability—
Criteria and Standards for Fiscal Solvency—Passed by the legislature in 2004 to require school districts
to “report out” and certify that the costs of their collective bargaining agreements can be covered in the
current year. It also added more county oversight responsibility and authority to take action if certain
conditions were found to exist, and authority for the superintendent of public instruction to suspend
authority of the COE over the financial affairs of school districts if certain conditions exist. -
Proposition 55 - Modernize School Buildings
California Proposition 55, Bonds for Schools (March 2004)—Long-term borrowing that the state uses to raise money for
various purposes,such as major capital outlay projectssuch asroads, educational facilities, prisons, parks,
water projects, and office buildings. G.O. bonds are paid off from the state’s general fund. With the
passage of Proposition 55 in March 2004, California voters have approved more than $32 billion in state
bondsto build and/or modernize school buildings(facilities). School districtsreceive funding based on the
number of pupils who -
Proposition 30 Temporary Taxes to Fund Schools
California Proposition 30, 2012
The seeds of the next school funding crisis may have already been sown; the tax increases passed in 2012, when voters approved Proposition 30, will expire in 2018, reducing the state general fund and school funding by billions. -
Local Control Funding Formula (LCFF) AB/SB 97 and SB 91
An Overview of the Local Control Funding FormulaAdoption of RegulationsLCFF sets the rules for state funding to flow to districts based on the characteristics of students in their care. Districts receive more state funds for students that are:
In higher grades
Learning English
In poverty
In foster care
Living in a community with high “concentration” of English Learners or students in poverty
The state set the new system up by providing “target base rates” for four grade spans and then making adjustments to that. -
Proposition 2 - Rainy Day Budget Stabilization Fund Act
California Proposition 2, Rainy Day Budget Stabilization Fund Act (2014)To try to smooth out some of the effects of the high volatility in state revenues, California voters passed Proposition 2 in 2014. It requires the state to spend a minimum amount each year to pay down its debts and changed the rules for the state’s rainy-day fund, the amount the state puts into its budget reserve to protect against years when revenues fall. Proposition 2 also set up a reserve system for the Proposition 98 portion of the budget, which goes to schools and community colleges, to pr
