School Beat: Local Control–Governor Brown’s New School Funding Plan

by Lisa Schiff on May 2, 2013

Governor Jerry Brown seems bent on leaving his mark on California’s finances. Luckily his recent inclinations have been generally positive towards our schools (though as has been discussed previously in this column, for our educational system to function well for our children, the funding of schools cannot come at the expense of funding for other basic social services). Proposition 30, his revenue initiative that voters approved last November, not only brings in more money, but it includes an aggressive schedule for paying down California’s debt. A second plank in his envisioned financial foundation is a new approach to funding K-12 education in California, an area most definitely in need of revision. Regardless of one’s opinion regarding the level of funding, there is universal agreement that the convoluted means for getting resources from Sacramento and into the classrooms is broken and wasteful. This proposal tackles this problem head on.

Governor Brown’s new funding plan is called the Local Control Funding Formula (LCFF), so named because one of its hallmarks is to put more discretionary authority in the hands of districts by pooling the majority of California’s restricted funds (known as categorical funds) into general purpose funds. This strategy extends and formalizes an approach Brown put into place during the early part of the Great Recession, when he allowed districts to use certain funds originally set aside for purposes such as class-size reduction to be used however those districts felt necessary. While the relaxation of restrictions was a way of addressing the decline in overall funding levels available, it also served to highlight the impossible complexity of funding streams in California. Now Governor Brown wants to make that strategy permanent, combining almost all categorical funds into general purpose funds. The philosophy behind this approach is that instead of telling districts how to spend money, they should simply be held accountable for the desired outcomes–students performing at or above grade level.

Simplifying funding streams has long been called for (see the Getting Down to Facts study, conducted during education’s dark days when Arnold Schwarzenegger reined). Brown makes tremendous progress here, though as has been pointed out by the Legislative Analyst’s Office (LAO), two of the largest categorical programs are left remaining–the Targeted Instructional Improvement Grant and the Home-to-School, despite their lack of spending restrictions and uneven application across the state. The LAO’s concern is significant and a bit unnerving. Why, in such a thorough revamping of our education funding mess is there any reason to maintain such outliers? Again as the LAO points out, just one district, Los Angeles Unified, receives almost 60% of that fund, about $460 million dollars for 2012-2013. That’s a lot of bureaucratic infrastructure to maintain for such a targeted channel, especially one that would likely be supported and not supplanted by the Governor’s overall restructuring model. Such an inconsistency brings up images of backroom deal-making, but to have come this far and not take the final steps makes no sense. The political fireworks are already starting to go off; now is the time to brave it all instead of backing down.

The simplification of categorical programs has received significant attention, but it’s the allocation component of Brown’s plan that’s got some quarters rattled, including a collection of Democratic State Senators. At the core is a fundamental conflict. Not only do we not have enough money in total for our schools, but different kids need different levels of resources to bring them all up to desired levels of skill and knowledge. California’s education funding problem is not just one of amounts of funding, but of distribution–regardless of how much money we may have available, making sure it gets to where it needs to go based on need is just as critical as ensuring sufficient levels for any given student. The exponential rise in the number of categorical programs was the result of a prolonged, piecemeal approach to this problem, one whose inefficiency we feel ever so painfully now. But, that distribution effort is a fraught exercise when there just isn’t enough to give everyone absolutely what they need.

Simplicity and clarity, always good strategies in and of themselves, are definitely called for in our current fiscal environment. By combining the categorical programs Brown sets the stage for a more transparent approach, one that is based on need and is consistent across all students. Called the Weighted Pupil Funding (WPF), this method establishes a baseline funding level for all students, which is then augmented with additional, pre-specified amounts of money to districts and schools based on the attributes of their specific students. In particular, the WPF approach provides additional resources for students who have certain characteristics: 1) English Learners (EL), Low Income (LI), or foster children; 2) K-3 students; or 3) high school students. Districts with over 50% enrollment of EL/LI students will receive an additional 35% of the base grant per student. Finally “necessarily small schools” (schools in very isolated areas), will receive a money based on how much it costs to run the overall school, as opposed to money per student and the requirements for being considered such a school will be stricter.

San Francisco folks who have been anywhere in the vicinity of a school or district budget discussion will hear a familiar ring in the description of Brown’s WPF strategy, as it is in essence the same as the Weighted Student Formula (WSF) used here in the San Francisco Unified School District (SFUSD). Introduced by the recently deceased former superintendent Arlene Ackerman, the WSF attempts to support the varying costs of educating children with different needs by having the funding they are either legally/programmatically entitled to or that has been targeted to their specific needs follow them to whatever school they happen to be at. Like WPF, WSF sets a basic foundation for educating a given SFUSD student and then adds on additional resources. Straightforward conceptually, WSF does have some weaknesses. For instance, there is the question of scale–what happens if there aren’t enough students in a certain category at a certain school to enable the hiring of specialized instructors? The students in question are entitled to those extra supports, but if their pooled resources aren’t sufficient to cover the cost of that staff person, how will that need get met and how can we be sure that the funding is really going to that student?

Similar concerns exist for the WPF proposal. Brown’s strategy is to focus the state’s attention on outcomes, not on monitoring how resources are spent and to essentially leave accountability concerns up to the community. Public education communities everywhere, and most definitely in San Francisco, are eager to play that role, but it’s a tricky one. Simplified funding mechanisms will make it easier to see how money is flowing, but ensuring that that money is being spent the way it was intended to be–and evaluating those choices–will continue to be a challenge.

This however, is still not the main area of concern raised about Brown’s plan–the nugget of it all is the base amount that will be allocated to a given student, whether or not that amount is sufficient (particularly for those students not falling into any of the extra-resourced categories), and how the plan will impact funding levels in the future. Right now, the spending per pupil varies widely across the state because of historical practices and because of the differing levels of property taxes. Brown wants to establish a single per pupil base rate beginning from a calculated average for 2012-13 that increases for all students over time until it reaches the statewide average funding levels for 2007-2007. According to the LAO report (see p. 9) the initial base rate boils down to the following:

• K-3: $6,342
• 4-6: $6,437
• 7-8: $6, 628
• 9-12: $7, 680

These rates would increase with cost of living adjustments and with the gradual reimbursement of Proposition 98 payments deferred from previous years. For SFUSD, the base rate plus the supplemental grants would result in an expected amount of $7,529 per student for 2013-2014 and “full” funding would increase to $11,171.

Again, these are averages across a district–a given student not falling into any supplemental category would have fewer dollars available for his or her specific programs. And this is what has the Senate Democrats concerned as well as the California School Board Association (CSBA). While Brown’s proposal ensures that no district would receive less per student than they would have in 2012-2013, the amount of local property taxes available to a community will count towards all of the money a district could receive from the state. By definition these are higher income communities, which are also likely to have fewer students meeting the qualifications to receive supplemental funding, so overall these districts are going to receive fewer dollars per student that a district like the SFUSD. The CSBA agrees with groups like Public Advocates that there a compelling equity argument for the Governor’s distribution proposal, but posits that the proposal sets its sights too low for overall funding levels and that the basic grant target from 2007-08 is inadequate compared to both need and what the rest of the country is doing.

CSBA’s position is simultaneously hard to refute and besides the point. Yes, we need more money–we’ve been making that argument every year in every budget cycle, we’ll be making that argument for years to come until there is a significant political shift in how we look at education, and we should keep making it until the funding arrives. But while that process unfolds, we have to take the opportunities at hand and Brown’s proposal seems like it provides more benefits than not. Adjustments could be made to streamline it even more, but lawmakers in Sacramento should see themselves as working towards the passage of this overall approach and not position themselves to react against it.

Lisa Schiff is the parent of two children in the San Francisco Unified School District and is a member of Parents for Public Schools of San Francisco.

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