Summary of LAO Findings and Recommendations on the 2011-12 Budget

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Budget Issue
LAO Finding Or

Last Updated
Career Technical Education Clean Technology Partnership Academies Reject Governor's May proposal to provide $3.2 million in Proposition 98 General Fund for Clean Technology Partnership Academies (CTPA) in lieu of funding from the Renewable Resource Trust Fund (RRTF). Though the RRTF is scheduled to sunset in December, the fund will likely have a balance sufficient to support implementation costs for the CTPA program in 2011-12. 5-26-11
See Detail  Accountability Student and teacher data systems Reject Governor's May Revision proposal to eliminate funding for CALPADS and CALTIDES. Recommend funding CALPADS at slightly less than CDE-requested level and funding CALTIDES at CDE-requested level. 5-24-11
See Detail  Special Education AB 3632 mental health services: realignment of funding and services Adopt Governor's May Revision proposal to repeal the AB 3632 mandate and shift funding and responsibility to schools in 2011-12. 5-24-11
Accountability Federal Title I set aside carryover Recommend adopting Governor's May proposal to distribute $21.3 million in carryover to all Title I school districts based on their low-income student counts. This approach is permissible under federal law and will provide some fiscal relief for all Title I districts. Data also suggest that anticipated 2011-12 funding will be sufficient to cover associated 2011-12 costs. (These funds are primarily used for a district Corrective Action program.) 5-24-11
Accountability Quality Education Investment Act (QEIA) carryover Recommend rejecting the Governor's May proposal to set aside about $40 million in unused 2010-11 QEIA funding for use by QEIA schools in 2014-15, the final year of the program. Instead, recommend recognizing the savings now and reappropriating the funds in 2011-12 for other Proposition 98 purposes. The state used this latter approach in 2010-11 (recognizing QEIA savings from 2008-09 and reappropriating the funds for other Proposition 98 purposes). 5-24-11
See Detail  Education Mandates Governor's May proposal to reform K-14 mandates Adopt Governor's May proposal to eliminate half of all K-14 mandates and reduce total claims by roughly $96 million. In addition to significantly reducing costs, the proposal would (1) provide a clear framework for identifying which types of activities are worth requiring of all districts, (2) set the groundwork for a system that is more transparent and equitable as well as less cumbersome for districts, and (3) allow policy committees to decide how to treat specific mandates moving forward. 5-24-11
See Detail  Proposition 98 Governor's May Revision Proposition 98 budget proposal Summary of LAO initial assessment of Governor's May Revision Proposition 98 proposal. 5-24-11
See Detail  CalSTRS Unfunded liabilities grow, system says. Billions more of annual funding eventually needed. Provides update concerning CalSTRS' newly released June 30, 2010 actuarial valuation, including context concerning possible future budgetary effects for the state, school districts, and/or community college districts. 4-01-11
See Detail  Proposition 98 Overview of Proposition 98 conference issues Build Proposition 98 package that reconciles differences between the houses, addresses all identified shortfalls, and achieves same overall level of Proposition 98 savings. 2-25-11
State Operations Elimination of the Office of the Secretary of Education (OSE) Recommend the Legislature approve the Governor's January proposal to eliminate OSE. This would provide General Fund savings of $400,000 in 2010-11 and $1.9 million in 2011-12. In addition to achieving savings, the administration's proposal would help streamline a fractured K-12 governance system that lacks clear lines of accountability. 2-08-11
See Detail  Education Mandates Overview of the budget for K-12 mandates Summary of Governor's K-12 mandate proposal and LAO recommended approach. 2-08-11
See Detail  Finance and Flexibility Aligning state operations with new finance system Recommend refocusing the California Department of Education's (CDE) mission to better match a more flexible K-12 finance system. Rather than focus on compliance monitoring, we recommend the CDE devote its resources to data collection, accountability, and dissemination of best practices. 2-08-11
See Detail  Finance and Flexibility Flexibility options available to school districts in the budget year Recommend providing several additional flexibility options to school districts in 2011-12. Specifically, recommend removing strings tied to K-3 Class Size Reduction, Home-to-School Transportation, and after school programs; linking flex funding to average daily attendance; eliminating certain mandated education activities; easing restrictions on contracting out for noninstructional services; and easing restrictions on pay rates and priority for substitute teaching positions. 2-08-11
See Detail  California Department of Education Long-term improvements to the K-12 finance system Recommend making lasting improvements to the state's K-12 finance system. Given the flexibility package adopted in 2009 is not especially responsive to students' needs and with flexibility provisions set to sunset in 2013-14, we recommend the state begin consolidating all K-12 funding into revenue limits and a few block grants. In general, the state should minimize the number of block grants in order to protect services for at-risk students while maximizing flexibility for districts. 2-08-11
See Detail  Cash management K-12 inter-year payment deferrals Summary of the state's increased use of deferrals in recent years, the advantages and disadvantages of deferrals, and other major factors the Legislature should consider as it decides whether to approve additional K-12 deferrals. 2-08-11
See Detail  Economic Impact Aid (EIA) Governor's proposed reduction Reject Governor's January budget proposal to reduce EIA by $54 million because Governor incorrectly assumes the program will have participation-related savings. Participation trends suggest little, if any, budget-year savings likely to materialize. 2-08-11
See Detail  Proposition 98 Governor's January Proposition 98 budget proposal Summary of LAO initial assessment of Governor's January Proposition 98 budget proposal. 2-08-11