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  • 2. California Statistics
    • student demographics, enrollment growth, expenditures comp. with nation
  • 3. Budget Estimation
    • Expenditures – enrollment projections factors – births, in-migration, new programs, salaries, & student-teacher ratio (class size, most important)
    • Revenues – enrollment, ADA, COLA, Categorical monies, lottery
  • 4. Categorical Funds
    • Categorical Funds are restricted funds for specific purposes only, from both the state and Fed. gov’t. (Title I and Child Nutrition largest from Fed. gov’t),
    • require greater restrictions.
    • Block Grants & Mega Item concept.
    • Some encroachment for Spec. Ed., Class Size Reduction (also student transportation and food services).
  • 5. Budget Process
    • ongoing
    • public hearing required
    • most districts use line item budget for general fund
    • historical/incremental process means using the prior year as the starting point
    • Program budgeting – PPBS complex process used in past, categorical funds use program budgets more often
  • 6. Source of Income
    • 2/3 or more of district’s money comes from the state (counting redistributed property taxes is 85%+)
    • 9-13% from the Fed. Gov’t
    • The rest is local
  • 7. School Year length
    • at least 180 days for pupils, Fiscal Year = July 1-June 30
  • 8. Types of Districts in CA
    • most are elementary
    • unified
    • Secondary
    • About 1000 Districts
  • 9. CBO
    • credential not required in CA., qualifications:
    • business operations,
    • collective bargaining,
    • accounting, economics
  • 10. Funds
    • General fund is largest and most active – required for all districts includes both restricted and unrestricted revenues and expenditures (e.g. special education)
    • there are others such as cafeteria, (also bond interest and redemption, building fund, deferred maintenance, adult education, child development etc.)
  • 11. Taxation
    • consumption tax (sales tax, tobacco, gasoline, etc.)
    • Ad Valorem- “According to Value” Examples: Sales Tax- according to price/cost; Property Tax according to property/market value
  • 12. Student charges by the District
    • Student transportation to and from school (except for indigent, SPED),
    • not for textbooks and supplies or fees for extra-curricular activities.
  • 13. AB1200
    • Why passed: imposes greater fiscal accountability and control on districts and county offices of education – based on bankruptcy of some districts
    • County school superintendent reviews interim reports to check fiscal solvency
  • 14. Legislation
    • SERRANO V. PRIEST - Calif. Supreme Court Case (1976 – orig. filed in 1968) that held the CA system of funding schools unconstitutional - because its reliance on property taxes made per pupil expenditures unequal. Court ordered that property taxes and per pupil expenditures should be equalized (within a $100 band)
    • PROPOSITION 13 - An initiative proposition (1978) creating a constitutional amendment to limit property tax increases to 1% a year and limited increases on assessed value to 2% a year. Effect was to shift funding schools from local property taxes to state funding of schools (also cities/counties) Impact on schools - more dependent on the state economy
    • PROPOSITION 98 - and its amendment “Proposition 111” A constitutional amendment to establish base minimum funding for K-14. It had four provisions and 3 tests modified by Prop. 111. . Prop. 98 also modified the Gann limit. Impact on schools - guaranteed funding, also tied in to the state economy
  • 15. Audits
    • annual external audits required (also for student body funds),
    • reports financial condition, accounting methods, compliance laws
  • 16. Gann Spending Limit
    • Approved by voters, 1979, CA Constitutional Amendment
    • Limits all state agencies, including school districts, to its max level Gann limit
    • Adjusted annually for changes in population and U.S. CPI (lesser) or CA per capita personal income
    • Index was changed by Prop 111, (1990)
  • 17. Revenue Limit
    • Money (income) received by a District for general education from the state (general purpose money)
    • Is distributed on a per pupil basis (ADA)
    • Made up of state funds and local property taxes
    • Categorical Aid is in addition to the revenue limit funding
  • 18. Student Body Funds
    • frequent problems in audits
    • fund raisers to be approved by principal and student council
    • value/purpose
    • to function properly must have: minutes of meetings, constitution (purpose of organization), policies/procedures for officers, fund-raisers, expenditure approval
    • school boards have legal responsibility for regulations
    • what are legitimate fund raisers – not recommended are rummage sales, can’t raise funds for what school district should buy (e.g. textbooks), raffles are illegal
    • Food in Elem Schools – to be sold only after the noon meal
  • 19. Maintenance and Operations
    • Maintenance – repairs/replacement (grounds, buildings, equipment)
    • Operations – housekeeping/custodial to keep plants functional; work order system – advantages to keep track of hours and costs
  • 20. Facilities
    • Age of CA school buildings – over half over 30 years old
    • General Obligation Bonds- most often used method to raise funds
    • Bonds : State (requires simple majority, also for other state facilities such as prisons) and District bonds (require 55% majority), have been inadequate to meet the needs
    • state building fund - year-round schools get incentives for construction funds
  • 21. Food Services
    • contracting out not necessarily better, is a separate fund, free/reduced lunch require record keeping, (again, encroachment an issue in some SDs)
  • 22. Reserve for economic uncertainties
    • 3% for majority of districts in CA
    • Range 1-5%
    • 1% for LAUSD, 5% for small districts
  • 23. Lottery funds
    • Not major part of revenues (1-2% of district’s budget)
  • 24. Vouchers
    • recent trend – provide parents options
    • related to choice, political issue,
    • critiqued as not being in accord with democratic (not party definition) tradition of public education in America
  • 25. Budget Accounts
    • Account codes are prescribed by the state and found in the California School Accounting Manual. Account codes have 6 elements: fund/group, resource, project year, goal, function, and object/services.
    • Expenditures are shown in the series 1000-7000 – 1000’s are certified personnel, 2000’s are classified personnel, 3000’s benefits, 4000’s books and supplies, 5000’s are services and other operating expenditures, 6000’s capital outlay, 7000’s other outgo.
    • Salaries and Benefits are the largest expenditures (85 + %).
    • Revenues are placed in 8000 series.
  • 26. Budget forms and areas
    • are prescribed by the CA Dept of Educ. and are uniform across the state
  • 27. Food Sales
    • are restricted and regulated – e.g. in elementary schools may be sold after the noon meal- authorized by School Board
  • 28. Special Education costs
    • 3-7 times higher than regular education
    • student encroachment currently 20-25%
  • 29. Glossary
    • Review terms in text, FCQ #4, For example:
    • Employee Benefits
    • Revenue Limit
    • Second Period
    • Attendance / P-2