April 30, 2012 - This report provides an overview and assessment of the state's comprehensive system for monitoring the fiscal condition of school districts. Under this system, County Offices of Education review the fiscal condition of school districts at several points during the year and provide additional support for districts showing signs of fiscal distress. In the most serious case—when a district no longer appears able to meet its financial obligations—the state provides the district with an emergency loan and assumes administrative control. Our review indicates that the oversight system has been effective in preserving school district fiscal health and preventing districts from requiring an emergency loan. Most notably, during the more than 20 years the new system has been in effect, 8 districts have received emergency state loans whereas 26 districts required such loans in the 12 years prior to the new system. Additionally, the number of districts experiencing fiscal distress has increased in tight budget times, but without a corresponding increase in the number of emergency loans required. This suggests the system’s structure of support and intervention is serving a critical early warning function—allowing districts to get the help they need while fiscal problems tend to be smaller and more manageable. Given its effectiveness, we recommend preserving the existing system, as it has shown to be a vital tool for fostering the ongoing fiscal well-being of districts.
December 20, 2018 - Recent legislation made several changes to the state’s system for intervening in fiscally distressed school districts. These changes could have significant implications for districts moving forward. In this report, we provide background on how the state historically has intervened in fiscally distressed districts, describe and assess the recent changes the state made, and offer associated recommendations.
August 17, 2011 - Presented to Select Committee on State School Financial Takeovers
May 20, 2013 - Presented to Assembly Budget Subcommittee No. 2 on Education Finance
July 29, 2013 - The LCFF, enacted as part of the 2013-14 budget package, establishes a new uniform funding formula and a new system of academic accountability. The formula replaces revenue limits and most categorical programs with uniform base rates for all pupils and provides significantly more funding for English learner and low-income students. The new system of academic accountability requires school districts and charter schools to publicly report how they will use the funds provided under the formula, as well as establishes a new system of support and intervention support for underperforming school districts and charter schools. While the transition to the LCFF begins in 2013-14, it will take several years before all provisions are fully implemented and districts and charter schools are fully funded to formula targets. Moreover, a number of key decisions have yet to be made regarding the implementation of the new fiscal and academic accountability provisions.
August 28, 2014 - The core responsibility of the California Department of Education (CDE) is to administer federal and state education programs. Our review found the department currently is adequately positioned to fulfill this core mission. We also found, however, that the scope of CDE’s responsibilities—and the associated need for staff and funding—change frequently based on shifting state and federal policies. In order to maintain the department's capacity to meet its responsibilities, we recommend the Legislature ensure that additional responsibilities placed on CDE in the future are paired with additional resources. Similarly, should the Legislature notably reduce CDE’s responsibilities, we recommend it make a conforming reduction to associated CDE positions and funding. We also believe CDE could find ways to make its existing services more valuable to districts and integrate state and federal accountability activities. Finally, we recommend that the Legislature repeal some CDE reporting requirements that provide limited value.
February 23, 2022 - In this post, we provide background on teacher shortages and recruitment, describe the Governor’s proposals related to these issues, assess these proposals, and offer associated recommendations.
February 6, 2017 - In 2013-14, the state created the Local Control Funding Formula (LCFF) for county offices of education (COEs). With this funding, COEs are required to (1) provide alternative education to certain at-risk students and (2) oversee school districts’ budgets and academic plans. COEs may use any funding available after completing these tasks on optional activities that reflect their own priorities. We have concerns that providing funding directly to COEs for alternative education and optional activities detaches school districts from the decision making process of how to best serve their students. To address these concerns, we recommend the Legislature shift that funding to districts and allow them to contract with COEs (or other providers) for services. Because oversight of school districts’ budgets and academic plans likely is both more effective and efficient when performed at the regional rather than state level, we recommend the Legislature fund COEs directly for these activities. Because our recommendations signify major changes in the way the state funds COEs, we recommend the Legislature phase in the new funding model over several years.
(2/17/17 -- Corrected district services funding for district in county on figure 5.)
June 4, 2013 - Presented to Budget Conference Committee
February 20, 2002 - Analysis of the 2002-03 Budget Bill, Education Chapter
May 17, 2013 - In the May Revision, the administration forecasts that weaker tax collections in the coming months will erode the vast majority of the $4.5 billion of unexpected tax revenues collected since January. We do not agree with the administration's view of the state's revenue situation. As a result, our forecast now is $3.2 billion higher than the administration's May Revision total for 2011-12, 2012-13, and 2013-14 combined. While the state's fiscal condition has improved, there are many good reasons for the Legislature to adopt a cautious budgetary posture. After years of "boom and bust" budgeting, California's leaders now have the opportunity to build a budget for future years that gives the state more choices about how to build reserves in times of healthy revenue growth, prioritize future state spending, and pay off past debts. Given the improved fiscal forecast, we believe this is an ideal time for the Legislature to begin addressing its huge budgetary and retirement liabilities. In addition, given various risks to the economic outlook and the state's budgetary volatility, building larger state budget reserves in the coming years is an important priority, as doing so means there will be less necessity during future downturns to cut public spending, as occurred in recent years.
December 30, 2003 - In 2002 and 2003, the Commission on State Mandates determined that 23 sets of state laws impose state-reimbursable mandates on local governments. The commission estimated the state's cost to reimburse local agencies for these mandates is about $400 million. This report reviews the newly identified mandates, and offers recommendations as to whether each mandate should be repealed, funded, suspended, or modified.