What are the limits on the transfer of funds to and from each of the block grants?
Funds may be transferred to any of the six block grants.
Funds may be transferred from four of the six block grants as
follows:
- School Safety Consolidated Competitive Grant
- Professional Development Block Grant
- Targeted Instructional Improvement Block Grant
- School and Library Improvement Block Grant
Funds may not be transferred from two block grants:
- Pupil Retention Block Grant
- Teacher Credentialing Block Grant
The following limits apply to block grants to which transfers in and transfers out apply:
- Up to 15 percent of the amount allocated for a fiscal year by the State to a local educational agency for a block grant that permits transfers out can be transferred to any other categorical program or block grant for which the local educational agency is eligible for funding, including programs whose funding is not part of a block grant established by Assembly Bill 825.
- The total funding received for any fiscal year by a program or block grant to which funds are transferred may not exceed 120 percent of the amount of state funding allocated to the local educational agency for that program or block grant for the same fiscal year.
- Prior to the expenditure of transferred funds, the local educational agency's governing board is required to hold a noticed public meeting to discuss the matter.
- Local educational agencies must track transfers in and transfers out of the block grants. Assembly Bill 831, Chapter 118, Statutes of 2005 was recently enacted, striking the requirement in AB 825 that Object Code 8998 be used to track the transfers. Please use Object Code 8995 to track the transfers in and out of the block grants.
- May, up to 15 percent of the total received by a
local educational agency for a fiscal year for any block grant,
be transferred during the fiscal year to another block grant
or program for which the local educational agency is eligible,
or may up to 15 percent of the total be transferred out for
each program in each block grant?
Funding by program within each block grant is no longer separately identifiable. Consistent with this, up to 15 percent of the total amount allocated by the State to a local educational agency in a fiscal year for each of the School Safety Consolidated Competitive Grant, Professional Development Block Grant, Targeted Instructional Improvement Block Grant, and School and Library Improvement Block Grant may be transferred from the block grant to another block grant or program for which the local educational agency is eligible. The amount of funds that can be received in transfers is limited.
- Will the programs that were included in the Control
Section 12.40 mega-item transfer provisions and now are included
in the block grants continue to be subject to the mega-item
transfer provisions in addition to the transfer provisions of
the block grants?
No. The programs that were included in the Control Section 12.40 transfer provisions in the annual Budget Acts and now are included in the block grants are not subject to the mega-item transfer provisions. The programs that have been included in the block grants have new budget items that correspond to the new block grants in the Budget Act of 2005. Neither the programs' former budget items nor the budget items for the new block grants are listed in the Control Section 12.40 mega-item transfer provisions in the Budget Act of 2005.
- Will local educational agencies receive annual adjustments
to their block grant funding for pupil growth and cost of living?
If yes, at what rates?
Local educational agencies will receive annual adjustments to their block grant allocations for five of the six new block grants established by Assembly Bill 825. With the exception of the School Safety Consolidated Competitive Grant, local educational agencies are to receive annual adjustments equal to the cost of living adjustment on district base revenue limits, and annual adjustments for growth.
With respect to the growth adjustments, local educational agencies are to receive annual growth adjustments on their allocations from the Pupil Retention Block Grant, Teacher Credentialing Block Grant, Professional Development Block Grant, and Targeted Instructional Improvement Block Grant based on the statewide increase in average daily attendance. Annual growth on allocations from the School and Library Improvement Block Grant are to be based on the statewide increase in California Basic Education Data System enrollment.
- Did basic aid districts identify any programs that
were included in the Assembly Bill 825 block grants as the recipient
of their categorical funding cuts in 2003-04, pursuant to Section
38 of Chapter 227, Statutes of 2003? If yes, what will the impact
of these reductions be on basic aid districts' block grant funding
given that the base year for establishing local educational
agency eligibility and funding entitlements for the block grants
is typically 2003-04?
Three of the six block grants incorporate five programs that were the recipient of categorical funding reductions, as identified by basic aid districts in 2003-04. The programs that received reductions are Tenth Grade Counseling (Pupil Retention Block Grant); Targeted Instructional Improvement Grants and Supplemental Grants (Targeted Instructional Improvement Block Grant); and School Library Materials and School Improvement Program (School and Library Improvement Block Grant).
For the purpose of establishing block grant funding for basic aid districts, Education Code Section 41501(a) holds basic aid districts harmless by not including the funding reductions made pursuant to statute (Chapter 227, Statutes of 2003, Section 38) in the base year funding tallies, thereby making base year funding whole for each basic aid district.
- Must local educational agencies follow all requirements
of a program that was included in a block grant as the requirements
existed prior to the program's inclusion in the block grant?
In general, no.
Assembly Bill 825 repealed the statutes guiding most of the programs that were included in block grants and generally provides that block grant funds may be spent for the purpose of any program(s) that was included in the block grant. It is the California Department of Education's interpretation that recipients of block grant funds are not required to adhere to the repealed statutory program requirements of individual programs, such as reporting or specific program delivery models, but must spend the funds in a way that serves the purpose of one or more programs included in the block grants. In doing so, local educational agencies may create new program delivery models.
It is also the California Department of Education's interpretation that recipients of block grant funds are required to adhere to the statutory program requirements for individual programs whose statutes were not repealed, specifically, the Continuation High School Program in the Pupil Retention Block Grant and the Beginning Teacher Support and Assessment Program in the Teacher Credentialing Block Grant.
Assembly Bill 825 also established limits on the use of certain block grant Funds. For more information on these, please refer to the FAQs on each individual block grant.
- Will charter schools receive Categorical Education
Block Grant funding?
Yes. A charter school will receive block grant funding to the extent the charter school received funding in the base year for a program included in a block grant, and the program was not subsequently included in the Charter School Categorical Block Grant. Current law governing the Charter School Categorical Block Grant prohibits charter schools from receiving separate program funding from any program included in the Charter School Categorical Block Grant.
Charter schools currently receive funding for most of the programs included in the block grants through the Charter School Categorical Block Grant. Charter schools received separate funding in the 2003-04 base year for the School Library Materials Program, which is included in the School and Library Improvement Block Grant. Therefore, a charter school will receive funding from the School and Library Improvement Block Grant to the extent the charter school received funding in 2003-04 for the School Library Materials Program. Locally funded charter schools will receive their block grant funds through their chartering agency, and direct-funded charter schools will receive their block grant funds directly from the state.
- Have the block grants been assigned resource codes?
Yes, each block grant has been assigned a resource code as follows:
- Pupil Retention Block Grant (7390)
- School Safety Consolidated Competitive Grant (7391)
- Teacher Credentialing Block Grant (7392)
- Professional Development Block Grant (7393)
- Targeted Instructional Improvement Block Grant (7394)
- School and Library Improvement Block Grant
(7395)
- Have the block grants been assigned a Revenue Object
Code?
Yes, all six block grants should use Revenue Object Code 8590.
- May indirect costs be charged to the block grants?
If yes, at which rate?
Yes, consistent with the California Department of Education's existing indirect cost rate guidance, the block grants may be charged for indirect costs, provided the amount charged does not exceed the local educational agency's approved indirect cost rate. Further information on indirect costs can be found at the California Department of Education Web site.
- Should indirect costs be calculated on the amount
of Categorical Education Block Grant funds transferred to other
programs?
The funds transferred become funds of the programs to which they are transferred. Indirect costs should be calculated according to the rules that govern the program that receives the transfer and on which funds are spent.
- How should carryover from programs included in block grants from fiscal years prior to 2005-06 be used?
Carryover funds for programs included in the block grants from fiscal years prior to 2005-06 must be used according to the laws governing the original appropriation of such funds.
- Will the six block grants be on the Consolidated Application?
No.
- Will local educational agencies be required to apply
for block grant funds?
No, with the exception of the School Safety Consolidated Competitive Grant, local educational agencies do not have to submit applications to receive block grant funding.
