Tightening school finance rules

School buses line up outside of Garfield Elementary School in Oakland at the end of the day for pickup on September 6, 2019. Photo by Anne Wernikoff for CalMatters

By Ricardo Cano


AB 1835 would close a loophole in California’s school finance law, the Local Control Funding Formula, by requiring school districts to report any unspent dollars intended for students who are low-income, foster youth or English learners. Under the legislation, schools would be required to spend these earmarked supplemental and concentration dollars on disadvantaged students regardless of whether those funds roll over into the following school year.


A coalition of civil rights groups and some state lawmakers, including the bill’s author, Democratic Assemblymember Shirley Weber of San Diego, have long pushed the state to tweak the state’s 2013 school finance law that completely overhauled how schools get funded. Advocates have argued that while the new funding formula made necessary improvements to the state’s antiquated school funding laws, it lacks accountability and transparency over how schools spend funds meant for needy students.


The California School Business Officials Association and some local districts oppose the bill, saying it would hamstring local leaders’ abilities to deal with school budget outlooks worsened by the pandemic.


Under the formula, school districts receive extra per-pupil funding if they have higher concentrations of disadvantaged students. But for years, advocates and some lawmakers questioned whether schools were appropriately spending that extra money on services and staff meant to serve the intended student groups. Former Gov. Jerry Brown resisted changes to the funding formula after signing it into law, urging patience. But a critical 2019 state audit confirmed many of bill supporters’ suspicions and made several recommendations included in this legislation.


Newsom said he supported the legislation but did not sign it because of concerns “that is cannot be implemented in a manner that is smooth or timely.” The governor said he planned to include language in his January budget that would implement parts of the bill, although did not specify further. “We all share the same goal,” his veto letter reads, “and it is critical that we act quickly to ensure that funding meant to support our state’s most vulnerable students is used for that purpose.”