K thru 12 Education
Total K-12 Funding

Total expenditures from all sources for K-12 education programs in 2008-09 are projected to be $71.9 billion ($42 billion General Fund). Of this amount, $68 billion is state, federal and local property tax funding accounted for in the State Budget. Notable funding changes are described below.


ATTENDANCE
 As a result of a steady decline in birth rates throughout the 1990s, attendance growth in public schools is declining (see Figure K12-01). For 2007-08, K-12 average daily attendance (ADA) is estimated to be 5,947,000, a decrease of 6,400 from the 2006-07 fiscal year. For 2008-09, K-12 ADA will decrease by an additional 31,000 to 5,916,000.


PER-PUPIL SPENDING
 Total per-pupil expenditures from all sources are projected to be $12,042 in 2007-08 and $12,152 in 2008-09, including funds provided for prior year settle-up obligations (see Figure K12-02). This is an indicator of the relative level of spending in California for support of K-12 education programs and not the actual level of funding allocated to each school for a pupil.


COST-OF-LIVING ADJUSTMENTS
 The Budget includes $244.3 million for a 0.68-percent cost-of-living adjustment (COLA) for school apportionments. Of this amount, $239.8 million is for school district revenue limits and $4.5 million is for county office of education revenue limits. No COLA is provided for categorical programs.


PROPOSITION 98 GUARANTEE
 The voter-approved constitutional amendment, Proposition 98, guarantees minimum funding levels for K-12 schools and community colleges. The guarantee, which went into effect in the 1988-89 fiscal year, determines funding levels according to a multitude of factors including the level of funding in 1986-87, General Fund revenues, per capita personal income and school attendance growth or decline.

Proposition 98 originally mandated funding at the greater of two calculations or Tests (Test 1 or Test 2). In 1990, Proposition 111 (SCA1) was adopted to allow for a third funding test in low revenue years. As a result, three calculations or tests determine funding for school districts and community colleges (K-14). The calculation or test that is used depends on how the economy and General Fund revenues grow from year to year (See Figure K12-03).

For fiscal year 2006-07, the Proposition 98 Guarantee was $55.2 billion, of which the General Fund share was $41.4 billion. Local property taxes covered the balance.

Proposition 98 General Fund appropriations for 2007-08 are now $41.6 billion. Total Proposition 98 funding for 2007-08 is $56.6 billion.

The Proposition 98 Guarantee for 2008-09 is projected to grow to $58.1 billion of which $41.9 billion would be from the General Fund. With this additional investment, K-12 Proposition 98 per-pupil funding is $8,784 in 2008-09, up from $8,509 in 2007-08.


PROPERTY TAXES
 The Budget reflects $14.4 billion in school district and county office of education property tax revenues in 2008-09, an increase of $1.0 billion over 2007-08. In general, increases in local property tax revenues decrease the amount of state General Fund costs for revenue limit apportionments. These estimates include the impact of redevelopment agency (RDA) pass-through provisions enacted with the Budget Act.

A recent report by the State Controller's Office found that RDAs have not been passing through the full amount of property tax increment revenues to local taxing jurisdictions, including local education agencies, required under current law. As a result, legislation is included with the Budget requiring RDAs to report all payments and obligations to local taxing jurisdictions for fiscal years 2003-04 through 2008-09 to the county auditor for verification. RDAs are required to remit any outstanding obligations to local taxing jurisdictions, except that monies owed to schools that offset state costs for apportionments are to be deposited in the county Educational Revenue Augmentation Fund. This transfer is estimated to be $98 million in 2008-09.

This legislation also requires a one-time shift of $350 million from RDAs to the county Educational Revenue Augmentation Fund in 2008-09. The shift will generate a commensurate amount of Proposition 98 General Fund savings. Each RDA will shift an amount proportionate to its individual share of statewide RDA tax increment revenues. RDAs with insufficient liquidity to fund the shift may borrow from their low-moderate income housing funds, from their organizing city or county, or from a joint powers agency.
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CHAPTER HIGHLIGHTS for K thru 12 Education Back to Top

image of black pointing arrowTotal K-12 Funding
 Other Budget Adjustments
PRINTABLE BUDGET DOCUMENTS Back to Top
Enacted Budget Summary - K thru 12 Education (pdf * - 222K) -
Provides the entire K thru 12 Education Chapter in pdf format.
ADDITIONAL INFORMATION Back to Top
Enacted Budget Detail - K thru 12 Education
Displays Enacted Budget Detail information for K thru 12 Education.