LAO 2003-04 Budget Analysis: Education

Legislative Analyst's Office

Analysis of the 2003-04 Budget Bill

Commission on Teacher Credentialing (6360)

The Commission on Teacher Credentialing (CTC) was created in 1970 to establish and maintain high standards for the preparation and licensing of public school teachers and administrators. The CTC issues permits and credentials to all classroom teachers, student services specialists, school administrators, and child care instructors and administrators. In total, it issues more than 100 different types of documents.

The Governor's budget includes a total of $67 million for CTC. This is $8.7 million, or 11 percent, less than CTC's revised current-year budget (assuming passage of AB 8x [Oropeza]). Of CTC's proposed 2003-04 budget, $40 million is from the General Fund (Proposition 98). These funds are designated for four CTC-administered local assistance programs. Three of these programs serve interns, preinterns, and paraprofessionals and the other program supports teacher assignment monitoring. The Governor's budget proposes defunding the California Mathematics Initiative for Teaching.

Major General Fund Budget Proposals

Figure 1 (see next page) lists the Governor's major General Fund budget proposals. The budget would reduce total General Fund spending by $5.6 million, or 12 percent, from the revised current-year level. The intern program would receive a $1.1 million, or 5 percent, augmentation in the budget year. Funding for the preintern program and paraprofessional program, on the other hand, would decline by 35 percent and 9 percent, respectively. The Governor proposes to eliminate the California Mathematics Initiative. This program was intended to provide financial assistance to individuals to encourage them to teach mathematics, but it has been undersubscribed since its inception in 1998. It was to sunset on June 30, 2004.

Figure 1

Commission on Teacher Credentialing General Fund Budget Summary

(Dollars in Millions)


Revised 2002-03a

Proposed 2003-04

Change From 2002-03



Local Assistance—Proposition 98

Internship Teaching Program





Preinternship Teaching Program





Paraprofessional Teacher Training Program





Teacher misassignment monitoring




California Mathematics Initiative for Teaching









a Assuming passage of AB 8x (Oropeza).

b Of this amount, $17.3 million is Proposition 98 (General Fund) and $4.2 million is reappropriated from the Proposition 98 Reversion Account.

c Of this amount, $11.8 million is Proposition 98 (General Fund) and $4.2 million is reappropriated from the Proposition 98 Reversion Account.

New Federal Accountability Provisions Further Raise Stakes

In 2002, the federal government enacted the No Child Left Behind (NCLB) Act, which includes new accountability provisions relating to both teachers and paraprofessionals. In 2001-02, the federal government also increased California's total Title II Teacher Quality allocation to $332 million—a $105 million increase over the prior year. The new federal accountability provisions and funding augmentations generate even greater incentives for California to improve the quality of its teachers and paraprofessionals. Because CTC's local assistance programs are all designed to improve the quality of beginning teachers and paraprofessionals, CTC could play a role in helping the state meet the new federal requirements.

New Federal Teacher Accountability Provisions Create Added Incentives to Ensure All Beginning Teachers Are Qualified. The NCLB Act includes three new teacher accountability provisions: (1) all teachers funded with federal Title I monies and hired after the first day of the 2002-03 school year are to be "highly qualified," (2) all public school teachers are to be highly qualified by the end of the 2005-06 school year, and (3) states are to demonstrate increases in the percentage of teachers who receive high quality professional development. If these objectives are not met, states jeopardize their federal funding for K-12 education programs. These new accountability provisions therefore place even greater onus on the state to produce, hire, and retain highly qualified teachers. The state currently is working to develop its definition of highly qualified teacher.

New Federal Accountability Provisions Also Create Incentives to Ensure Paraprofessionals Are Qualified. Similar to the new teacher accountability provisions, the NCLB Act also includes two added accountability provisions relating to paraprofessionals. The act requires: (1) all paraprofessionals funded with federal Title I monies and hired after January 2002 to be highly qualified, and (2) all existing paraprofessionals funded with federal Title I monies to be highly qualified by the end of the 2005-06 school year. As with the new teacher provisions, these provisions generate even greater impetus for the state to ensure paraprofessionals are highly qualified.

Improve Coherence, Maximize Flexibility, and Increase Accountability Among CTC's Local Assistance Programs

We recommend the Legislature enact legislation that would create greater coherence and consistency among the Commission on Teacher Credentialing's (CTC) intern, preintern, and paraprofessional programs by equalizing per participant funding rates and establishing a consistent matching requirement. We also recommend the Legislature allow CTC maximum flexibility to shift funds among these three programs. Lastly, we recommend the Legislature require CTC to report annually on the effectiveness of its programs in helping districts meet the new federal requirements of having highly qualified teachers in every public school classroom by the end of the 2005-06 school year.

Currently, CTC administers three major local assistance programs—the intern, preintern, and paraprofessional programs. Figure 2 (see next page) provides a brief description of each of these programs, shows the statutorily set maximum per participant funding rates, and identifies the number of participants CTC is serving in the current year. The funding the state provides for these three programs is supplemental to the funding it provides directly for teacher education programs and K-12 professional development and support programs.

Figure 2

Summary of CTC's Major Local Assistance Programs



Funding Per Participant

Estimated Participants 2002-03

Internship Teaching

Provides training and on-site support for new teachers who have already demonstrated subject matter competency but have not yet obtained their full teaching credential.



Preinternship Teaching

Provides subject-matter test preparation as well as training in classroom management and basic pedagogy for new teachers who have not yet demonstrated subject matter competency.



Paraprofessional Teacher Training

Provides academic scholarships to teachers' aides and assistants for the purpose of completing college coursework and obtaining teaching credentials.



Existing Anomaly—Per Participant Funding Rates Vary. As Figure 2 shows, the per participant funding rates vary among the intern, preintern, and paraprofessional programs. Although many policymakers would consider preinterns to have the greatest needs (because they are teachers of record who have not yet demonstrated subject matter competency), the state currently provides less funding per preintern than intern and paraprofessional.

Existing Anomaly—Only Intern Program Has Matching Requirement. Another anomaly is that only the intern program has a local matching requirement that statutorily requires school districts to pay half the costs associated with supporting interns. Given the direct localized benefits that accrue to school districts in having preintern and paraprofessional programs, it is unclear why matching requirements do not exist for these other programs.

Establishing Coherence and Consistency. Given the lack of sufficient justification for different funding rates and matching requirements, we recommend the Legislature enact legislation that would streamline CTC's programs. Specifically, we recommend the Legislature establish a single per participant funding rate for the intern, preintern, and paraprofessional programs. We recommend the Legislature set the rate at $2,000 and require a dollar-for-dollar school district match (which could be met using federal Title II monies). Although revising the per participant funding rate to $2,500 is an option, we recommend the lower rate because it would enable the state to serve almost 4,000 additional teachers and paraprofessionals in 2003-04 (please see Figure 3). Moreover, the new matching requirement would result in total funding of $4,000 per preintern and paraprofessional, which is a significant increase over the current per participant state funding rates.

Figure 3

Comparing Participation Levels at Various Per Participant Funding Rates



Number of Participants


Current Funding Rates

$2,500 Funding Rate

$2,000 Funding Rate

Internship Teaching Program




Preinternship Teaching Program




Paraprofessional Teacher Training Program








Increasing Funding Flexibility. To provide CTC with maximum flexibility to respond to teachers' needs over the next several years, we also recommend the Legislature allow CTC to shift funds among the intern, preintern, and paraprofessional programs. The CTC already has the statutory authority to shift funds from the intern program to the preintern program. This is the only flexibility, however, that it has to move funds among its programs. Flexibility to shift funds among all three programs would allow CTC to be more responsive to school districts' needs and transition as many teachers as possible into intern programs without unnecessarily constraining the size of the other two programs.

Enhancing Accountability. Because the state currently chooses to filter supplemental funding through CTC rather than provide it directly to school districts, we recommend the Legislature strengthen CTC's accountability system. Although statute currently requires CTC to report on the impact of its preintern programs on decreasing the number of emergency permits issued, it does not require CTC to compare the cost-effectiveness of its programs with those run independently by school districts. Most importantly, the Legislature should require CTC to demonstrate that: (1) its programs produce better results compared to districts that operate without CTC's assistance, and (2) the districts CTC does serve are significantly better than they otherwise would have been without CTC's assistance. We recommend the Legislature require CTC to submit a report annually on these performance outcomes.

In conclusion, we recommend the Legislature enact legislation to streamline CTC's local assistance programs. Specifically, we recommend: (1) establishing a consistent per participant funding rate of $2,000, (2) instituting a dollar-for-dollar school district match (that can be met using federal Title II monies), (3) allowing CTC to shift funds among all three programs, and (4) requiring CTC to report on its ability to reduce emergency permit rates compared with those districts that do not have CTC programs.

Leverage Federal Funds to Expand Services for Emergency Permit Holders

We recommend the Legislature designate $3.1 million in federal Title II funds to expand subject matter training programs for emergency permit holders. These programs are a high priority because: (1) many emergency permit holders are likely to need additional support to become highly qualified by 2005-06, as required by the federal accountability provisions; and (2) the funds are not needed for the program for which they were originally designated.

Title II funds may be used for a variety of teacher training purposes, but the overriding objective is to encourage states to improve teacher quality by ensuring that all public school teachers are (1) proficient in the subject areas they teach and (2) highly qualified in teaching methodologies. Although (as of this writing) California still has not developed its state definition of "highly qualified," emergency permit holders will not be considered highly qualified unless they (1) already are fully credentialed in a different subject, (2) enrolled in a program to obtain a supplemental credential, and (3) have demonstrated subject matter competency in this supplemental area.

More Than 30,000 Emergency Permit Teachers Currently Not in Structured Training Programs. Currently, the only nonfully credentialed teachers the state supports with supplemental training funds are interns and preinterns in CTC-approved programs. The state does not provide supple mental training funds for the approximately 32,500 emergency permit holders currently teaching in districts without these approved programs.

Federal Title II Funds Available to Support Emergency Permit Holders. Not only is the need sizeable, but additional federal funds are available for state-level activities aimed at improving teacher quality and enriching subject matter knowledge. The 2002-03 Budget Act and the 2003-04 budget proposal each designates $1.6 million in federal Title II funds for the Principal Training program. This program already is being fully funded by the state, so the federal funds designated in the current year have not been used and the funds designated in the budget year are not needed.

Designate Total of $3.1 Million in Federal Title II Funds for Subject Matter Programs for Emergency Permit Holders. Given the sizeable need and the available federal resources, we recommend the state designate $3.1 million in federal Title II monies for subject matter programs for emergency permit holders. The objective would be to provide emergency permit holders with supplemental services to assist them in improving their subject matter competency. So that the funds are not seen as a reward for hiring unqualified teachers, the funds should be one-time monies used on a transitional basis to help districts meet the new federal requirements. We recommend the Legislature require CTC to report on the change in emergency permit holder rates in each school district. Furthermore, as a condition of receiving the supplemental funding, districts should be required to annually reduce the number of faculty who hold emergency permits.

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