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The Mystery of California Public School Funding

By Dr. William V. Loose, Deputy Superintendent
La Canada Unified School District

It is commonly asked “why” something that should be so simple as public school funding becomes so complex. This article will briefly attempt to explain the basic public school funding mechanism and the process that ensues that tends to complicate the issues.

Prior to 1972 and Prop 13, school districts were largely dependent upon property taxes which furnished about 2/3 of public education revenues. Because of so much of the revenue being generated by the property tax, and having more local ability to raise this amount, there was "more local control" regarding the amount and extent of revenues. However, this type system also resulted in a great disparity among resources for school districts, and led to the Serrano vs Priest lawsuit which challenged the fairness of the funding inequities resulting from widely disparate property values and tax bases.

The passage of Proposition 13, in conjunction with the Serrano decision, caused a shift in support for schools from local property taxes to state general funds. Local voters can levy a uniform dollar tax per parcel of land, but they cannot increase property taxes based on value except for issuing a general obligation (G.O.) bonds for school construction or renovation. This shifted the locus of control from local school funding, to the state for California public schools.

California has approximately 1000 public school districts. Almost all public school districts receive their school funding through a “revenue limit.” The revenue limit is the amount of revenue a district can collect annually for general purposes. The funds that comprise the revenue limit are local property taxes and state aid. The revenue limit is composed of a base amount for each unit of average day attendance (ADA). The basic formula is: Revenue Limit amount, multiplied by ADA = a district’s apportionment/funding.

The State does not give the same revenue limit amount to all public schools. This is a long complicated story involving litigation (Serrrano v. Priest), and attempts through the years by the State to try to “equalize” the funding of the revenue limit between school districts. Despite these measures, the revenue limit amount that each district has is still unique to that district, and is still not equal among districts. Some of the difference is the result of Categorical Spending, which are funds designated to be spent on specific programs tied to District demographics, be they socioeconomic or otherwise.

In most years, the State tries to provide a cost of living adjustment (COLA) for school districts. This COLA is meant to help cover increasing operational costs (utilities, materials, insurance benefit and statutory benefit increases, “step and column” salary increases – ie, increases tied to increased years of service and additional training - among others). Districts also negotiate with their own unions (classified and certificated) for a general salary increase using the new money provided by the COLA.

Unfortunately, in many years, the State has insufficient funds to fully provide all the school districts with the full amount of the COLA to increase each district’s revenue limit. When this occurs, the State applies a “deficit factor.” This deficit factor is a partial deduction from the funding due to the school districts. In some years, the deficit factor has been as high as 3-4%. When multiplied by millions of dollars, this becomes a considerable amount of money that is not provided to school districts.

Another factor is declining enrollment. Approximately half the districts in California, including La Canada, are experiencing declining enrollment. Referring back to the basic funding formula presented above, if a district’s ADA number decreases each year, the amount of funds the district will be receiving also will decrease.

Part of the mystery regarding the funding for public school becomes what the true amount of new money received in a district as a result of the COLA adjustment. One would assume that if the COLA was 5.18% (original COLA estimate for 2006-07), that you could take last year’s state revenue, multiply that by 5.18% COLA increase, and you would have the total amount of new revenue. As you have surmised, this is not the case.

The reason why the actual amount received by LCUSD is less that this percentage is due to the deficit factor, declining enrollment, and other adjustments made to the revenue limit. So although at first glance based on a COLA percentage estimated increase of 5.18% you would expect LCUSD revenue would also increase by 5.18%, the actual true increase will be a smaller percentage increase of revenue.

In May, the Governor will present his “May Revise.” This presentation lays out the Governor’s proposed State Budget including proposed funding for public schools. The State Legislature is supposed to adopt the State Budget by June 15, and the Governor is supposed to sign the State Budget by June 30. In the most recent history, the State budget adoption process has continued beyond these dates into the summer. Once the State budget is adopted and signed, all districts, including LCUSD will know with certainty what the 2006-07 COLA, deficit factor (if any), and what other funding will be available for the public schools. However, despite this scenario and timeline, school districts must adopt our budgets prior to June 30. In many years, this is done before the State budget is finalized. A public hearing will be held at one of our school board meetings regarding the LCUSD budget so if you are interested in attending this meeting, please check the LCUSD Board meeting agendas for June.

Thank you for your kind attention to this article and that it hopefully has helped provide you with a baseline of information regarding public school funding.

Feeling like a million bucks
LCF Educational Foundation hits milestone and helps school district save employee jobs.
http://www.latimes.com/news/local/glendale/news/la-gnp-foundation27may27,1,4608581.story

By Robert Chacon
News-Press
May 27, 2004

LA CAÑADA FLINTRIDGE — The La Cañada Flintridge Educational Foundation will donate a bunch of zeros this year to the public schools it supports — six, to be exact.

For the first time in its 26-year history, the foundation has raised $1 million for the La Cañada Unified School District, a quarter of which will be used to help avoid laying off teachers and other employees. The foundation has already committed $700,000 to programs it funds each year. The remaining amount will help the district offset its $1.5-million deficit, which was caused by a decrease in state funding.

Foundation members learned of the milestone Tuesday, less than a month before the annual fund drive was scheduled to finish.

"Doing this for the first time is really exciting. People are responding quite well to our mailing campaign," said Kathy Hernandez, the foundation's executive vice president, referring to a flood of donations in recent weeks that helped push the foundation over the million-dollar mark. "Every day we go to our post office box, there are a bunch of checks from parents."

The mailing campaign, which started at the beginning of the school year, encouraged parents to give $1 a day for the year. So far, 718 of the 2,250 families with students in the district's schools have given the full $365, 20% more than last year. Follow-up letters reminding parents to donate were mailed recently, Hernandez said.

The foundation typically pays for a large portion of teacher salaries and materials for the district's elementary music, drama and arts programs. It also helps cover the expense of keeping class sizes for kindergarten through third grade at a maximum of 20 students, and pays the salaries for guidance and college counselors and librarians at La Cañada High School.

This year, however, the foundation has turned into more of a life raft for the district with its promise to give every dollar it raises above its $700,000 goal to help alleviate $1.5 million in budget cuts.

Funding more vital positions such as teachers is a growing trend for California's more than 500 educational foundations, said Susan Sweeney, executive vice president of the California Consortium of Educational Foundations.

"Unfortunately, it is a sign that foundations are being counted upon in ways they had not anticipated. Many foundations see themselves as a supplemental source of funding, and now they are being asked to be a vital partner with school districts," she said.

School board members agreed.

"As the state budget continues to decline, communities look to foundations to cobble together quality education programs," board member Jinny Dalbeck said.

District and foundation leaders agreed that the first $220,000 beyond the foundation's goal will fund salaries for three high school teachers who would have been laid off. After that, 60% of the money will fund teacher salaries, 16% will fund non-teachers and the remainder will go to coaches and classroom supplies.

Donations have increased this year because residents and parents of students realize the financial straits the district is in, Hernandez said.

Vehicle Donations Benefit La Cañada Unified Schools

October 24, 2002

The La Cañada Flintridge Educational Foundation has announced a new program to support La Cañada Unified schools through used vehicle donations. Riteway Charity Services of La Crescenta will forward 100% of the net proceeds from used vehicle donations which are Foundation designated to benefit La Cañada public schools.

The process of donating a vehicle to support the Foundation is simple: All of the administrative details, including Department of Motor Vehicles paper work, bill of sale and transfer of title, are initiated by a phone call to Riteway. The donor completes one form for release of liability, and then has his name removed from the title of the vehicle.

"We retrieve cars all the time from La Cañada Flintridge," said local resident Teresa Deutsch, who owns Riteway with husband Harry and is a staunch supporter of La Cañada Unified schools. "You've got dollars sitting in your driveway which could be donated to our schools at absolutely no cost to you, whether that's a car, a truck or an R.V."

Riteway is able to collect cars from all of Southern California within 24 hours of the initiating phone call and will schedule a convenient day and time for donation pick-ups. Used vehicles are either sent to a recycling center or sold during a weekly auction, and all are assessed at fair market value which is determined in conjunction with the donor.

However, in the event that an owner values the vehicle to be donated at more than $5,000, he or she will need to hire a qualified appraiser to establish the vehicle's value. At the owner's request, Riteway can also arrange to have a qualified appraiser determine fair market value of the vehicle at a cost of $75 to the owner.

The appraiser's fee is refunded to the owner once the vehicle is donated to the Foundation. All administrative fees to process paperwork, as well as handling charges are deducted by Riteway from the gross value of the vehicle at no expense to the owner.

Riteway is licensed by the Department of Motor Vehicles (DMV) to purchase used cars and subscribes to Kelly Blue Book. Upon receipt of a vehicle, the Foundation will issue a letter of acknowledgement to the donor for income tax purposes.

"A downturn in the economy and state educational budget cuts suggest that hard times are ahead for La Cañada Schools," said Char Adams, president of the La Cañada Flintridge Educational Foundation. "Riteway offers a wonderful program not only to dispose of that used vehicle in the driveway, but also to benefit our children's education."

Riteway Charity Services is located at 2505 Foothill Blvd., Ste. E, in La Crescenta. To donate unwanted vehicles that will benefit La Cañada Unified schools through the LCF Educational Foundation, please call (888) 250-4490. The Foundation is a non-profit organization which supports enrichment programs for students in grades K-12.

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Educational Foundations: A Necessity of a Great Public Education 

By Sheryl Mee MacPhee
The Quarterly, Fall 2001 

When I attended public elementary school in the east San Gabriel Valley in the 1960’s and 1970’s, there were may opportunities for us to learn more than just reading, writing and “rithmetic. Our school offered an active drama club and vocal chorus for all grades, and we were instructed in a wide array of performing arts, fine arts and music. Not only did we have a lot of fun, but we were also learning as well, about things like rhythm and tempo, public speaking and imagination, and although we didn’t realize it at the time, mathematics, critical thinking, communication and teamwork. As a parent, it is important to me now that my children be given the same opportunity for enrichment in their public schools in South Pasadena.

But the arts and enrichment programs that were so commonplace in California public schools in the 60’s are nonexistent in today’s education climate. In 1978, voters passed the landmark property tax law Proposition 13, and the California state fund distribution for public schools changed. Gone were the nonessential and enrichment classes like music and art instruction at the elementary schools. Across the state, public school districts slashed music, art and band curriculums and field trips. As public schools struggled to provide students with a good education with substantially less state funds, it was back to basics for the children .... reading, writing and ‘rithmetic only. 

Bob weaver, currently a member of the South Pasadena Board of Education, was a parent with two children in South Pasadena’s public schools in 1980, when he witnessed the forced elimination of the elementary schools’ vocal music curriculum. Weaver and a group of concerned parents quickly formed the South Pasadena Educational Foundation (SPEF), a non-profit, volunteer fundraising group that would seek to fill the gaps in the educational budget produced by Proposition 13. Its first year, SPEF raised an impressive $35,000, and did what the state couldn’t: return the vocal music curriculum to the city’s elementary schools for the next six years. 

South Pasadena parents and residents weren’t the only visionaries when it came to their schools’ future health. In 1978 and 1980, respectively, concerned parents in La Cañada Flintridge and San Marino were also forming non-profit groups to provide additional funding to their school districts. Pasadena, a forerunner in the foundation front, initiated their foundation in 1971 as a result of a district-expressed need for teacher small grants. These “local educational foundations” (LEFs) join approximately 400 additional California LEFs initiated since Proposition 13 passed. All of them share the same commitment: broadening support for public education and local schools by raising funds for district-wide use.

Since their inception, the foundations have raised funds to support a myriad of academic programs and materials, including additional teachers’ salaries, music and arts education, teacher grants, foreign language instruction and high school mentoring/career programs. Many of the LEFs, including the groups in South Pasadena and La Cañada, work “in partnership” with their local district administrators to determine where the funds are needed most. 

In 1998, SPEF's Board of Directors and district administrators determined that the city’s three elementary schools would greatly benefit from the addition of a permanent performing arts and music curriculum and foreign language classes at the South Pasadena Middle School. Educational research has consistently confirmed that early exposure to music, arts and foreign languages has a positive impact on all aspects of learning, providing multiple ways for students to exercise intellect. 

The result was SPEF's PALETTE Campaign, an acronym for “Performing Arts and Language Expression Teaching Through Enrichment.” Through a series of targeted fundraisers, including phone banks, mailers and their annual “Parti Gras – A Taste of south Pasadena” event, SPEF volunteers raised the necessary funds to hire the teachers and support the curricula – now entering its fourth year. Earlier this year, SPEF added the South Pasadena High School to its funding initiative, developing a program specifically to expand class offerings in the music and arts, and enhancing its guidance counseling program. To fund all these programs, SPEF raised $320,000 this past year, and gave the largest gift to their district in the foundation’s history. 

Fully funding academic and enrichment curriculum so that they become the proprietary programs of the educational foundation is also the focus of the La Cañada Flintridge Educational Foundation (LCFEF). “Although we obtain suggestions from our district administrators for new items, our focus this year is on programs that we completely fund,” said LCFEF board member Char Adams. “We can’t just hand off the money and not see it working to our best interest,: said Adams. “We have to be accountable to our supporters.” Among the various programs that LCFEF has continuously provided are K-12 fine arts, additional teachers salaries, a high school college counselor and “Institutes for the 21st Century,” a business and professional mentoring program for high school students in grades 7-12. This past year, LCFEF gave their district $680,000 to fund these and other programs and curriculum. 

In San Marino, the San Marino Schools Foundation (SMSF) takes a different tack on raising funds for the $550,000 they give to support the city’s four public schools each year. According to SMSF Executive Director Colleen Fitzspatrick, SMSF gives donated funds to their district as an “unrestricted gift,” instead of targeting specific programs, and leaves spending of the money entirely up to district administrators. “The people who established the foundation 21 years ago felt very strongly that it was appropriate to have the school district and the school district and the school board dictate how our funds are spent,” said Fitzpatrick. In addition to their yearly $550,000 gift, SMSF also is conducting an ambitious capital campaign-raising $3 million in three years to fund furnishings and equipment for new classrooms. They are succeeding-nearly $1.5 million has been raised so far, with two years remaining in the campaign. 

But to raise these necessary funds, LEFs are shying away from the traditional bake sales and raffle tickets. South Pasadena, La Cañada Flintridge and Pasadena all hold festive community-wide fundraisers, complete with dinner, auctions and music, that provide residents and parents an opportunity to socialize and support the foundations’ programs. San Marino prefers to utilize direct mail and brochures, and contacts individuals and businesses directly for contributions. Their summer “Concerts in the Park” series at Lacy Park is not so much a fundraiser, but a “friend-raiser,” used to build community awareness of their foundations, according to SMSF”s Fitzpatrick. Additional fundraising tactics for the non-profits include jog-a-thons, summer school class offerings, newsletters and intensive phone banks.

 “So much of what goes on in a community is tied to the health and vitality of its schools,” says SPEF Co-President Michele Downing. “Part of our mission statement is to involve our community in our activities and fundraising so they become invested in the programs that SPEF funds.” 

And LEFs have no difficulty asking local businesses to participate and “become invested” in the schools as well. Indeed, perusing a list of business donors to LEFs reads like a local business directory-retail stores, doctors, professionals, and corporations large and small. Adds SPEF Co-President Jerry Markle, “We rely on our local businesses for on-going support, but also count on the larger banks, supermarkets and corporations to ensure we meet our annual goal. They are a vital part of our community.” The Pasadena Educational Foundation has been very successful obtaining donations from local businesses, with large amounts received from Avery Dennison, Bank of America and Parsons Corporation. 

This community-wide fundraising is crucial to the individual districts when you consider that the upscale middle class communities of South Pasadena, San Marino and La Cañada receive less per pupil in state funding than the state average. As LCFEF mentions in their annual report, “While the community of La Cañada Flintridge may be considered affluent as measured by the value of its residential property, our schools are seriously under financed.” Therefore, LEFs feel it’s vital to ask all residents of the city to support the public schools, whether they have children in them or not.

 The support the districts receive in terms of donated funds, volunteers and community commitment is quantitative as well. According to the API (Academic Performance Index), all three of the high schools are ranked in the top 10 percent of all California public high schools in 2000. LCFEF’s annual report also states that the three high schools are ranked in the top 50 (out of 800) public high schools in California, based on the 1999 API (California Department of Education data).

 But for all the success the foundations have had in raising funds throughout the years, they still face hurdles. For SPEF, that challenge is to inform the entire community about the long-term impact their donations have on the public schools. “We’d like to inform our parents and community about SPEF and the programs we provide, ultimately increasing our donor base,” said Downing.

 In La Cañada Flintridge, LCFEF Co-president Rose Chan also hopes to reach out to her entire community and get more people supportive of their foundation. “We take our good education for granted,” said Chan. “Our goal is to communicate that our first priority is our schools, and we hope to convince people to continue to give as they previously have.” 

From kindergarten to twelfth grade, educational foundations offer public school districts a plethora of enhancements. Whether raising funds for arts and music programs, language arts, technology or high school career counseling, the foundations fill a necessary gap in school funding and the school districts would not be as successful without them. 

Public school parents who grew up in the 60s and 70s experienced a very different education than the ones our children have now. Intensive instruction in music, drama, fine arts and other non-core curricula were all commonplace in California public schools thirty years age. These education essentials, plus all the other learning ingredients that existed in pre-Proposition 13 public education, are a vital part of our children’s learning experience, and what parents want and expect today for their children. Educational Foundations ar our way of ensuring that the education our children receive will be as well-rounded  and all encompassing as the education we remember from our youth.

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Note: All articles and information on these pages are taken from local La Cañada Newspapers; La Cañada Flintridge Valley Sun and the La Cañada Flintridge Outlook. No credit is to be given to the LCFEF for this information.

 
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