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object(Timber\Post)#3742 (44) { ["ImageClass"]=> string(12) "Timber\Image" ["PostClass"]=> string(11) "Timber\Post" ["TermClass"]=> string(11) "Timber\Term" ["object_type"]=> string(4) "post" ["custom"]=> array(5) { ["_wp_attached_file"]=> string(15) "AI_1110MWAI.pdf" ["wpmf_size"]=> string(7) "9267384" ["wpmf_filetype"]=> string(3) "pdf" ["wpmf_order"]=> string(1) "0" ["searchwp_content"]=> string(9459) "SCHOOL FINANCE REFORM MARGARET WESTON Californians are very concerned about funding for their K–12 public schools. They consistently say that K–12 education should be protected from spending cuts over and above any other area of the state budget.1 But California’s system of school finance is in trouble. Many studies have found it to be inequitable, with wide variation in per-pupil funding. Prominent critics charge that schools do not receive enough resources from the state to enable all students to meet California’s aca- demic standards. And the system is governed by such a complex array of laws and formulas that only a few experts truly understand how it works. This At Issue will describe California’s school finance system, review its key challenges, offer principles for reform, and outline pathways toward a more equitable, adequately funded, and transparent system. Supported with funding from The William and Flora Hewlett Foundation BETTMANN/CORBIS California’s school finance system is in dire need of reform. AT ISSUE: [ SCHOOL FINANCE REFORM ] PPIC 4 The majority of Proposition 98 funds support the largest K–12 funding category, known as “revenue limits,” which pays for basic school operations.9 Every school district has a base revenue limit—a dollar amount per pupil, funded through the district’s share of local property taxes. If a district’s property taxes cannot fund the base amount, the state covers the gap. Proposition 98 funds also support state categorical programs.10 Unlike revenues for basic operations, these program funds must be spent on specific activities such as special education, textbooks, and professional development for teachers.11 Revenues not governed by Proposition 98 comprise less than 30 percent of all K–12 funds. The majority of these revenues come from federal categorical programs, such as Title I, and local sources, such as parcel taxes or donations. Critiques of the System As noted above, critiques of California’s current school finance system focus on three overarching problems: inequitable funding, inadequate resources, and too much complexity. The per-pupil funding for similar districts serving similar students varies greatly. And districts with higher per-pupil costs—for example, those with more English learners or economically disadvantaged students—do not necessarily receive enough additional resources to address their students’ needs.12 Critics also note that the state does not provide enough resources for all st udents to meet the state’s academic performance standards. For example, in one measure of resources, pupil-staff ratios, California ranks last or almost last among all states, trailing similarly large, diverse states such as Florida, New York, and Texas (Table 1).13 Finally, critics agree that the system is all but impossible to comprehend—from the complicated formulas determining the Proposition 98 funding guarantee to the many categorical programs, each with its own formula and rules. The system is so complex that the state cannot determine how revenues are distributed among its school districts and no more than a handful of experts fully understand it.14 PRINCIPLES FOR REFORM California’s school finance system is the product of four decades of state policy proposals and preferences; these piecemeal changes have left it without a unifying structure.15 This section offers five guiding principles for a new approach to school finance. These principles provide a framework for allocating new revenues and creating a more efficient school finance system. Meet Resource Needs Some students are more expensive to educate than others. English learners and special education students usually need additional resources to achieve state standards. Some high school students take specialized classes with expensive lab equipment. Students living in rural areas often have extensive transportation needs.16 An equitable school AT ISSUE: [ SCHOOL FINANCE REFORM ] PPIC 5 LACY ATKINS/SAN FRANCISCO CHRONICLE/CORBIS TA B L E 1. CALIFORNIA’S PUPIL-STAFF R ATIOS ARE AMONG THE HIGHEST IN THE NATION SOURCE: National Center for Education Statistics, Common Core Data, 2007–2008. NOTE: Rankings based on all 50 states. The “all other states” categor y includes all states except California, Florida, New York, and Texas. The District of Columbia is excluded. California 20.8 49 809.2 49 5,038.5 50 433.1 47 Florida 15.8 37 433.3 30 912.0 36 333.3 37 New York 13.1 9 463.1 37 876.8 32 294.6 28 Texas 14.5 26 249.7 29 922.8 37 231.7 9 All other states 15.1 440.0 782.8 312.3 Students per teacher Rank Rank Rank Students per counselor Students per librarian Rank Students per school administrator AT ISSUE: [ SCHOOL FINANCE REFORM ] PPIC 6 PPIC EXPERTS Margaret Weston Research Associate 916-440-1134 weston@ppic.org Expertise • K–12 education – School finance – Categorical programs Education M.P.P. (2008), public policy, University of Michigan; M.A. (2006), teaching, Johns Hopkins University Hans Johnson Director of Research Thomas C. Sutton Chair in Policy Research 415-291-4460 johnson@ppic.org Expertise • Immigration and migration • Population issues and demographics – Population growth – Population projections – Regional population • Housing • Education projections and workforce skills Education Ph.D. (1997), demography, and M.A. (1989), biostatistics, University of California, Berkeley Heather Rose Adjunct Fellow 530-752-1407 hmrose@ucdavis.edu Expertise • K–12 education – School finance – Teachers’ salaries – Academic standards and accountability – Student achievement and earnings Education Ph.D. (2001) and M.A. (1997), economics, University of California, San Diego Kim Rueben Adjunct Fellow 202-261-5662 krueben@ui.urban.org Expertise • K–12 education – Education finance – School quality and resource allocation – Teacher labor markets – School capital finances • State and local finance – Ta x e s – Municipal bond markets – School bond elections • Political and fiscal institutions – Tax limitation measures – Balanced budget rules – Fiscal initiatives Education Ph.D. (1997), economics, Massachusetts Institute of Technology; M.S. (1988), economics, London School of Economics and Political Science AT ISSUE: [ SCHOOL FINANCE REFORM ] PPIC 16 Jon Sonstelie Adjunct Fellow 805-893-2242 jon@econ.ucsb.edu Expertise • Education – School finance • Urban economics – Housing markets – Residential location • Local public finance Education Ph.D. (1974), economics, Northwestern University RELATED PPIC PUBLICATIONS Stephen Lipscomb, “Special Education Finance in California: A Decade After Reform” (August 2009) Heather Rose, Ria Sengupta, Jon Sonstelie, and Ray Reinhard, “Funding Formulas for California Schools: Simulations and Supporting Data” (January 2008) Margaret Weston, “Funding California Schools: The Revenue Limit System” (March 2010) Margaret Weston, Jon Sonstelie, and Heather Rose, “California School Finance Revenue Manual” (June 2009) AT ISSUE: [ SCHOOL FINANCE REFORM ] PPIC 17 PPIC BOARD OF DIRECTORS Walter B. Hewlett, ChairDirectorCenter for Computer Assisted Research in the Humanities Mark BaldassarePresident and CEOPublic Policy Institute of California Ruben BarralesPresident and CEOSan Diego Chamber of Commerce Maria BlancoExecutive DirectorChief Justice Earl Warren Institute onRace, Ethnicity and DiversityUniversity of California, BerkeleySchool of Law John E. Br ysonRetired Chairman and CEOEdison International Gary K. HartFormer State Senator and Secretary of EducationState of California Robert M. HertzbergPartnerMayer Brown LLP Donna LucasChief Executive OfficerLucas Public Affairs David Mas MasumotoAuthor and farmer Steven A. MerksamerSenior PartnerNielsen, Merksamer, Parrinello, Mueller & Naylor, LLP Constance L. RiceCo-DirectorThe Advancement Project Thomas C. SuttonRetired Chairman and CEOPacific Life Insurance Company This publication was supported with funding from The William and Flora Hewlett Foundation. © November 2010 Public Policy Institute of California. All rights reser ved. San Francisco, CA The Public Policy Institute of California is dedicated to informing and improving public policy in California through independent, objective, nonpartisan research on major economic, social, and political issues. PPIC is a private operating foundation. It does not take or support positions on any ballot measures or on any local, state, or federal legislation, nor does it endorse, support, or oppose any political parties or candidates for public office. Research publications reflect the views of the authors and do not necessarily reflect the views of the staff, officers, or Board of Directors of the Public Policy Institute of California. Short sections of text, not to exceed three paragraphs, may be quoted without written permission provided that full attribution is given to the source and the above copyright notice is included. AT ISSUE: [ SCHOOL FINANCE REFORM ] PPIC 18 PUBLIC POLICY INSTITUTE OF CALIFORNIA • 500 WASHINGTON STREET, SUITE 600 • SAN FRANCISCO, CA 94111 P 415.291.4400 • F 415.291.4401 • www.ppic.org PPIC SACRAMENTO CENTER • SENATOR OFFICE BUILDING • 1121 L STREET, SUITE 801 • SACRAMENTO, CA 9 5 814 P 916.4 4 0.1120 • F 916.4 4 0.1121 ADDITIONAL RESOURCES REL ATED TO EDUCATION ARE AVAIL ABLE AT WWW.PPIC.ORG" } ["___content":protected]=> string(108) "

AI 1110MWAI

" ["_permalink":protected]=> string(67) "https://www.ppic.org/publication/school-finance-reform/ai_1110mwai/" ["_next":protected]=> array(0) { } ["_prev":protected]=> array(0) { } ["_css_class":protected]=> NULL ["id"]=> int(8766) ["ID"]=> int(8766) ["post_author"]=> string(1) "1" ["post_content"]=> string(0) "" ["post_date"]=> string(19) "2017-05-20 02:40:38" ["post_excerpt"]=> string(0) "" ["post_parent"]=> int(4093) ["post_status"]=> string(7) "inherit" ["post_title"]=> string(11) "AI 1110MWAI" ["post_type"]=> string(10) "attachment" ["slug"]=> string(11) "ai_1110mwai" ["__type":protected]=> NULL ["_wp_attached_file"]=> string(15) "AI_1110MWAI.pdf" ["wpmf_size"]=> string(7) "9267384" ["wpmf_filetype"]=> string(3) "pdf" ["wpmf_order"]=> string(1) "0" ["searchwp_content"]=> string(9459) "SCHOOL FINANCE REFORM MARGARET WESTON Californians are very concerned about funding for their K–12 public schools. They consistently say that K–12 education should be protected from spending cuts over and above any other area of the state budget.1 But California’s system of school finance is in trouble. Many studies have found it to be inequitable, with wide variation in per-pupil funding. Prominent critics charge that schools do not receive enough resources from the state to enable all students to meet California’s aca- demic standards. And the system is governed by such a complex array of laws and formulas that only a few experts truly understand how it works. This At Issue will describe California’s school finance system, review its key challenges, offer principles for reform, and outline pathways toward a more equitable, adequately funded, and transparent system. Supported with funding from The William and Flora Hewlett Foundation BETTMANN/CORBIS California’s school finance system is in dire need of reform. AT ISSUE: [ SCHOOL FINANCE REFORM ] PPIC 4 The majority of Proposition 98 funds support the largest K–12 funding category, known as “revenue limits,” which pays for basic school operations.9 Every school district has a base revenue limit—a dollar amount per pupil, funded through the district’s share of local property taxes. If a district’s property taxes cannot fund the base amount, the state covers the gap. Proposition 98 funds also support state categorical programs.10 Unlike revenues for basic operations, these program funds must be spent on specific activities such as special education, textbooks, and professional development for teachers.11 Revenues not governed by Proposition 98 comprise less than 30 percent of all K–12 funds. The majority of these revenues come from federal categorical programs, such as Title I, and local sources, such as parcel taxes or donations. Critiques of the System As noted above, critiques of California’s current school finance system focus on three overarching problems: inequitable funding, inadequate resources, and too much complexity. The per-pupil funding for similar districts serving similar students varies greatly. And districts with higher per-pupil costs—for example, those with more English learners or economically disadvantaged students—do not necessarily receive enough additional resources to address their students’ needs.12 Critics also note that the state does not provide enough resources for all st udents to meet the state’s academic performance standards. For example, in one measure of resources, pupil-staff ratios, California ranks last or almost last among all states, trailing similarly large, diverse states such as Florida, New York, and Texas (Table 1).13 Finally, critics agree that the system is all but impossible to comprehend—from the complicated formulas determining the Proposition 98 funding guarantee to the many categorical programs, each with its own formula and rules. The system is so complex that the state cannot determine how revenues are distributed among its school districts and no more than a handful of experts fully understand it.14 PRINCIPLES FOR REFORM California’s school finance system is the product of four decades of state policy proposals and preferences; these piecemeal changes have left it without a unifying structure.15 This section offers five guiding principles for a new approach to school finance. These principles provide a framework for allocating new revenues and creating a more efficient school finance system. Meet Resource Needs Some students are more expensive to educate than others. English learners and special education students usually need additional resources to achieve state standards. Some high school students take specialized classes with expensive lab equipment. Students living in rural areas often have extensive transportation needs.16 An equitable school AT ISSUE: [ SCHOOL FINANCE REFORM ] PPIC 5 LACY ATKINS/SAN FRANCISCO CHRONICLE/CORBIS TA B L E 1. CALIFORNIA’S PUPIL-STAFF R ATIOS ARE AMONG THE HIGHEST IN THE NATION SOURCE: National Center for Education Statistics, Common Core Data, 2007–2008. NOTE: Rankings based on all 50 states. The “all other states” categor y includes all states except California, Florida, New York, and Texas. The District of Columbia is excluded. California 20.8 49 809.2 49 5,038.5 50 433.1 47 Florida 15.8 37 433.3 30 912.0 36 333.3 37 New York 13.1 9 463.1 37 876.8 32 294.6 28 Texas 14.5 26 249.7 29 922.8 37 231.7 9 All other states 15.1 440.0 782.8 312.3 Students per teacher Rank Rank Rank Students per counselor Students per librarian Rank Students per school administrator AT ISSUE: [ SCHOOL FINANCE REFORM ] PPIC 6 PPIC EXPERTS Margaret Weston Research Associate 916-440-1134 weston@ppic.org Expertise • K–12 education – School finance – Categorical programs Education M.P.P. (2008), public policy, University of Michigan; M.A. (2006), teaching, Johns Hopkins University Hans Johnson Director of Research Thomas C. Sutton Chair in Policy Research 415-291-4460 johnson@ppic.org Expertise • Immigration and migration • Population issues and demographics – Population growth – Population projections – Regional population • Housing • Education projections and workforce skills Education Ph.D. (1997), demography, and M.A. (1989), biostatistics, University of California, Berkeley Heather Rose Adjunct Fellow 530-752-1407 hmrose@ucdavis.edu Expertise • K–12 education – School finance – Teachers’ salaries – Academic standards and accountability – Student achievement and earnings Education Ph.D. (2001) and M.A. (1997), economics, University of California, San Diego Kim Rueben Adjunct Fellow 202-261-5662 krueben@ui.urban.org Expertise • K–12 education – Education finance – School quality and resource allocation – Teacher labor markets – School capital finances • State and local finance – Ta x e s – Municipal bond markets – School bond elections • Political and fiscal institutions – Tax limitation measures – Balanced budget rules – Fiscal initiatives Education Ph.D. (1997), economics, Massachusetts Institute of Technology; M.S. (1988), economics, London School of Economics and Political Science AT ISSUE: [ SCHOOL FINANCE REFORM ] PPIC 16 Jon Sonstelie Adjunct Fellow 805-893-2242 jon@econ.ucsb.edu Expertise • Education – School finance • Urban economics – Housing markets – Residential location • Local public finance Education Ph.D. (1974), economics, Northwestern University RELATED PPIC PUBLICATIONS Stephen Lipscomb, “Special Education Finance in California: A Decade After Reform” (August 2009) Heather Rose, Ria Sengupta, Jon Sonstelie, and Ray Reinhard, “Funding Formulas for California Schools: Simulations and Supporting Data” (January 2008) Margaret Weston, “Funding California Schools: The Revenue Limit System” (March 2010) Margaret Weston, Jon Sonstelie, and Heather Rose, “California School Finance Revenue Manual” (June 2009) AT ISSUE: [ SCHOOL FINANCE REFORM ] PPIC 17 PPIC BOARD OF DIRECTORS Walter B. Hewlett, ChairDirectorCenter for Computer Assisted Research in the Humanities Mark BaldassarePresident and CEOPublic Policy Institute of California Ruben BarralesPresident and CEOSan Diego Chamber of Commerce Maria BlancoExecutive DirectorChief Justice Earl Warren Institute onRace, Ethnicity and DiversityUniversity of California, BerkeleySchool of Law John E. Br ysonRetired Chairman and CEOEdison International Gary K. HartFormer State Senator and Secretary of EducationState of California Robert M. HertzbergPartnerMayer Brown LLP Donna LucasChief Executive OfficerLucas Public Affairs David Mas MasumotoAuthor and farmer Steven A. MerksamerSenior PartnerNielsen, Merksamer, Parrinello, Mueller & Naylor, LLP Constance L. RiceCo-DirectorThe Advancement Project Thomas C. SuttonRetired Chairman and CEOPacific Life Insurance Company This publication was supported with funding from The William and Flora Hewlett Foundation. © November 2010 Public Policy Institute of California. All rights reser ved. San Francisco, CA The Public Policy Institute of California is dedicated to informing and improving public policy in California through independent, objective, nonpartisan research on major economic, social, and political issues. PPIC is a private operating foundation. It does not take or support positions on any ballot measures or on any local, state, or federal legislation, nor does it endorse, support, or oppose any political parties or candidates for public office. Research publications reflect the views of the authors and do not necessarily reflect the views of the staff, officers, or Board of Directors of the Public Policy Institute of California. Short sections of text, not to exceed three paragraphs, may be quoted without written permission provided that full attribution is given to the source and the above copyright notice is included. AT ISSUE: [ SCHOOL FINANCE REFORM ] PPIC 18 PUBLIC POLICY INSTITUTE OF CALIFORNIA • 500 WASHINGTON STREET, SUITE 600 • SAN FRANCISCO, CA 94111 P 415.291.4400 • F 415.291.4401 • www.ppic.org PPIC SACRAMENTO CENTER • SENATOR OFFICE BUILDING • 1121 L STREET, SUITE 801 • SACRAMENTO, CA 9 5 814 P 916.4 4 0.1120 • F 916.4 4 0.1121 ADDITIONAL RESOURCES REL ATED TO EDUCATION ARE AVAIL ABLE AT WWW.PPIC.ORG" ["post_date_gmt"]=> string(19) "2017-05-20 09:40:38" ["comment_status"]=> string(4) "open" ["ping_status"]=> string(6) "closed" ["post_password"]=> string(0) "" ["post_name"]=> string(11) "ai_1110mwai" ["to_ping"]=> string(0) "" ["pinged"]=> string(0) "" ["post_modified"]=> string(19) "2017-05-20 02:40:38" ["post_modified_gmt"]=> string(19) "2017-05-20 09:40:38" ["post_content_filtered"]=> string(0) "" ["guid"]=> string(53) "http://148.62.4.17/wp-content/uploads/AI_1110MWAI.pdf" ["menu_order"]=> int(0) ["post_mime_type"]=> string(15) "application/pdf" ["comment_count"]=> string(1) "0" ["filter"]=> string(3) "raw" ["status"]=> string(7) "inherit" ["attachment_authors"]=> bool(false) }