|Budget Issue:||Governor proposes providing categorical funding to new schools established in 2008-09, 2009-10, or 2010-11. Specifically, the budget proposal includes $20 million in one-time funds and $29 million in ongoing funds.|
|Program:||California Department of Education|
|Finding or Recommendation:||Clarify eligibility and usage parameters before allocating categorical funds for new schools.|
Governor Proposes Additional Categorical Funding for New Schools. As part of the 2009-10 budget package, the Legislature provided five years of flexibility for roughly 40 K-12 categorical funds and “froze” district funding allocations for those programs at 2008-09 levels. The legislation also included a provision to allow new district schools and charter schools created between 2008-09 and 2012-13 to apply for participation in these categorical programs, with funding contingent on subsequent budget action. The Governor proposes to provide $20 million in one-time funds (applicable to the 2008-09 and 2009-10 fiscal years) and $29 million in ongoing funds to allow new schools to “opt in” to the frozen categorical programs.
Recommend Clarifying Eligibility and Usage Parameters Before Allocating Categorical Funds for New Schools. We believe it is premature to allocate categorical funds for new schools. We recommend the Legislature wait until certain key questions have been resolved. From our initial review of the data, we believe many of the schools that have applied for funding for 2008-09 and 2009-10 may not meet eligibility requirements. As such, we think the Governor has overestimated the amount of funding necessary to meet the Legislature’s intent to fund new schools. Furthermore, the parameters regarding how new schools may use these categorical funds are still unclear. For example, the legislation does not specify whether these schools must meet original categorical program requirements, if so, for how long, and how program compliance will be monitored.