Proposition’s Funding Formulas Overcompensate Some Schools

In 1998, voters in California approved Proposition 1A, authorizing $9.2 billion in state bond funding for school and college facilities. With 62.5% approval, Proposition 1A reflects a growing recognition of the need to invest in California school facilities. Some of these funds soon could find their way to a school in your neighborhood. However, the extent to which funds are available will depend on state allocation policies.

Are local school districts entitled to obtain funding for both modernizing and replacing the same old portable classroom buildings? Is funding available to replace classrooms constructed--with state funding--as little as three years ago? Is funding available to replace classrooms leased with state funds? Is hardship funding available for even those districts projected to receive significant local revenues? My instincts tell me that “no” is the appropriate answer; however, facts indicate that under current state policies the answer is “yes.”

Under Proposition 1A, state funds are allocated primarily on the basis of “per-student” grants. State law establishes eligibility for funding based on school capacities. If there is an average of 28 students per elementary classroom, a local district is eligible for funding to construct new classrooms to house an “excess” of three students (the state funds up to one new classroom for each 25 excess elementary students). This sensible policy gives incentive to districts to build new classrooms and reduce student-teacher ratios.

Funding to modernize older schools is also allocated on a per-student basis. The number of students currently enrolled in eligible classrooms (25 years old, or 20 years old for portable classrooms) is multiplied by a fixed grant amount per student. Under the prior example, eligible classrooms are assigned 28 students per classroom to determine modernization funding eligibility.

The problem is that three of the 28 students are counted for both new construction and modernization. This provides districts with at least $2,263 per student to modernize classrooms and at least $5,240 per student (for three of the students) to construct new classrooms. This double counting is pervasive throughout the state and leads to an over-allocation of between $2,263 and $3,134 per student for each student that is double counted.

An even worse double-counting problem exists related to portable classrooms. In most school districts, a considerable number of portable classrooms are excluded from state calculations. Excluded classrooms are assigned zero capacity. This is an effective public policy tool because it empowers districts to replace portable classrooms with permanent classrooms. However, it might turn out to be ineffective in one regard: existing portable classrooms may be replaced with identical portable classrooms funded by the state. An excluded classroom provides eligibility for state funding to construct new classrooms for 25 (or 27) students. Furthermore, if the classroom is 20 years old, a district may also obtain modernization funding to reconstruct the same classroom even if the district will also receive state funding to construct a new replacement classroom. This double counting will allocate an extra $84,618 per classroom (or more) to some districts.

A similar double-counting issue arises in a different context. Before Proposition 1A, districts were required to utilize portable classrooms for 30 percent of classroom space at some state-funded schools. Currently, at a minimum, portables in excess of 20 percent of classroom buildings are excluded from state calculations. The reduction creates eligibility to replace portable classrooms which previously were paid for by the state, as recently as a few years ago. This provides for double funding of as much as 10 percent of classrooms at many school sites.

More double-counting problems exist in the areas of class-size reduction, multi-track year-round schools, financial hardship funding and other esoteric areas. Double funding some school districts will cause state funding to be expended more quickly than anticipated, which could result in lack of available funding for Orange County school districts.

Pending legislation fails to completely address the double-counting problem. Legislation should be drafted to eliminate double counting, provide an incentive for districts to replace--not modernize--deteriorating portable buildings, and maximize the ability of the state funding program to provide funds on a long-term basis through additional state bond issues. Implementing effective policies will stretch bond dollars and provide the increased level of trust needed to generate public support for future state and local bond issues.