One Step Forward, One Step Back in Addressing School Funding Inequities?

Political momentum is building toward a fundamental restructuring of California’s K-12 school finance system — yet significant details remain unresolved. The question confronting policymakers is not how much funding to provide schools, but how to allocate state dollars. Governor Brown’s proposed Local Control Funding Formula (LCFF), the subject of a recently released CBP chartbook, would increase base-level funding for the vast majority of school districts while also providing additional resources to districts that have students with greater needs. Although alternative LCFF proposals offered by the Legislature would likely increase the base-level funding for all districts, this might be done by reducing state support for higher-need school districts.

The LCFF would streamline state education funding and establish a target general purpose base grant — on a per student basis — for all school districts. The Governor’s proposal would set this target base grant at a level equal to the 2007-08 statewide average for school district general purpose funding. This means that once the LCFF is fully implemented, it would restore reductions made to general purpose funding since the Great Recession for the vast majority of schools. However, the LCFF would not restore cuts made since 2007-08 to the approximately 10 percent of school districts whose 2012-13 funding is already higher than the target base (i.e., the 2007-08 statewide average). Representatives of these districts have raised objections to the Governor’s proposal because they would not receive as much funding from LCFF grants as they might under current formulas.

Legislative proposals that would alter the LCFF – in part to address these districts’ concerns — have been taken up as part of this week’s Budget Conference Committee. Senate Bill 69, supported by Senate leadership, would eliminate the LCFF “concentration grants” — the dollars allocated to districts with high concentrations of disadvantaged students — and shift some of the freed-up dollars to increase the base grants for all school districts. In the Assembly, the Budget Committee has approved a set of LCFF principles that contain “Economic Recovery Targets” (ERTs). ERTs would restore 2007-08 funding levels, plus foregone cost-of-living adjustments, for all school districts not restored under the LCFF. To achieve this goal, however, policymakers likely would have to reduce the amount of funding allocated for disadvantaged students under the LCFF, extend the amount of time it would take to fully implement the formula, or both. Moreover, establishing ERTs would create a complex, two-tiered finance system that would undermine the LCFF’s efforts to make school finance in California both more transparent and more equitable.

Legislators have voiced reasonable concerns about establishing an LCFF target base grant that does not reflect the cost of adequately educating all students. Increasing the LCFF target base grant is a worthy goal. However, raising the base grant either by reducing the funding proposed for disadvantaged students or by lengthening the time it would take to fully implement the LCFF would water down school finance reform and — even worse — could perpetuate current funding inequities.

Critics of the LCFF argue that it unfairly creates “winners” and “losers.” However, unless the LCFF provides school districts the resources needed to help disadvantaged students reach the state’s high academic standards, California could end up continuing to shortchange those who are “losers” in the state’s current system.

— Jonathan Kaplan