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Letter Head: Jack O'Connell, State Superintendent of Public Instruction, Phone number 916-319-0800

September 25, 2006

Dear County Superintendents of Schools, Auditors, and Treasurers:

NOTICE OF THE SPECIAL PURPOSE APPORTIONMENT
FOR THE PUPIL TRANSPORTATION AND ECONOMIC IMPACT AID PROGRAMS
FISCAL YEAR 2006-07

This apportionment, in the amount of $1,131,049,991, is made from funds provided by Items 6110-111-0001 and 6110-128-0001 of the Budget Act of 2006 (Chapter 47, Statutes of 2006) as amended by Assembly Bill 1811 (Chapter 48, Statutes of 2006). These funds support the Pupil Transportation and the Economic Impact Aid (EIA) programs.

This apportionment certifies each local educational agency’s (LEA’s) estimated 2006-07 entitlements for Pupil Transportation and EIA. These are based on what each LEA was entitled to receive in 2005-06, and, in the case of Pupil Transportation, increased by a 5.92 percent cost-of-living adjustment (COLA). Final 2006-07 entitlements will be calculated and certified in spring 2007 after receipt of the final data required for the calculations.

Payments for the Special Purpose Apportionment are made in ten installments beginning in September 2006 and ending in June 2007. The September warrant for each LEA will equal one-tenth of each LEA’s estimated entitlement to funds provided by the Budget Act of 2006 as amended by Assembly Bill 1811. The enclosed Summary of the Special Purpose Apportionment and the Monthly Payment Schedule show totals by county for Pupil Transportation and EIA funds. When making scheduled payments, the State Controller will issue one warrant to each county treasurer that will comprise the total payment for all LEAs within the county’s jurisdiction.

Notice, Summary, and Exhibits Enclosed
  1. Notice of the Special Purpose Apportionment for Pupil Transportation and EIA, Fiscal Year 2006-07
  2. Schedules of Apportionments-Computer Printout Tabulations
    Pupil Transportation
             Home-to-School Transportation-Exhibit I
             Special Education Transportation-Exhibit I-S
    Economic Impact Aid-Exhibit II        
  3. Summary of the Special Purpose Apportionment, by County
  4. Monthly Payment Schedule, by County

Pupil Transportation. With this apportionment, estimated Home-to-School Transportation and Special Education Transportation entitlements for 2006-07 are certified and funds are advanced based on actual 2005-06 entitlements which were increased by the 5.92 percent COLA for 2006-07, and adjusted to reflect certain repayments and statutory additions. The estimated 2006-07 entitlements also reflect adjustments for reorganizations that were effective as of July 1, 2006, and transfers of service that were submitted prior to September 1, 2006. Because the statewide growth rate is estimated to be less than zero and the Budget Act of 2006 did not provide funding for growth, the estimated 2006-07 entitlements do not reflect an increase for growth.

Please note the following:

  • Deferral of funds. Pursuant to provisional language in the Budget Act of 2006, $52.6 million of transportation funding for the 2006-07 program was deferred from 2006-07 to 2007-08. As a result, school districts and county offices of education will receive less than 100 percent of both the Home-to-School and Special Education Transportation entitlements in the 2006-07 Special Purpose Apportionment. The unpaid portion of the entitlements will be paid in a separate apportionment in July 2007 from the deferred funds which were appropriated in Section 37(a)(5) of Assembly Bill 1802 (Chapter 79, Statutes of 2006).
  • Exhibit I identifies the estimated 2006-07 Home-to-School Transportation entitlement for each participating school district and county office of education, and total payments through June 2007. This estimated transportation entitlement is the allowance for non-special education pupils and special education pupils who are not severely disabled or orthopedically impaired (non-SD/OI). When Home-to-School Transportation is recertified in April 2007 with data collected on the Form TRAN for fiscal year 2005-06, school districts and county offices of education will be entitled to the lesser of their 2005-06 approved home-to-school expenses or their 2005-06 home-to-school entitlement plus the 2006-07 COLA.
  • Exhibit I-S identifies the estimated 2006-07 Special Education Transportation entitlement for each participating school district and county office of education, and total payments through June 2007. This estimated transportation entitlement is the allowance for pupils who are SD/OI. When Special Education Transportation is recertified in April 2007 using 2005-06 data collected on the Form TRAN for fiscal year 2005-06, school districts and county offices of education will be entitled to the lesser of their 2005-06 approved SD/OI expenses or their 2005-06 special education entitlement plus the 2006-07 COLA.
  • School districts and county offices of education that are unable to fully expend their fiscal year 2005-06 entitlements due to the funding deferrals will not have their entitlements reduced for 2006-07. However, school districts and county offices of education must spend all 2005-06 entitlements deferred to 2006-07 as well as their fiscal year 2006-07 entitlements (excluding program funds deferred from 2006-07 to 2007-08) by the end of fiscal year 2006-07 to avoid a reduction in their fiscal year 2007-08 entitlements.

For standardized account code structure (SACS) coding, use Resource Code 7230, Transportation: Home to School, or Resource Code 7240, Transportation: Special Education (SD/OI), and Revenue Object Code 8311, Other State Apportionments–Current Year, for both home-to-school or special education transportation. For prior-year adjustments, use Revenue Object Code 8319, Other State Apportionments-Prior Year.

Economic Impact Aid. Recent and pending legislation, effective in fiscal year 2006-07, have revised the formula and augmented the funding for the EIA program. The Budget Act of 2006 (Chapter 47, Statutes of 2006) as amended by Assembly Bill 1811 (Chapter 48, Statutes of 2006) augmented the funding for the EIA program by approximately $350 million in addition to providing $36.5 million for a 5.92 percent COLA. Block-grant funded charter schools are to receive a portion of the augmentation, through a transfer of funds to the budget act item for the Charter School Categorical Block Grant, to ensure that the charter school block grant EIA funding rate is equivalent to the average per-pupil funding provided to school districts.

Assembly Bill 1802 (Chapter 79, Statutes of 2006) revised the funding formula for EIA for both school districts and charter schools, and requires the use of different data in the new formula. Senate Bill 1131 (Chapter 371, Statutes of 2006) made further revisions affecting charter schools and small, rural school districts.

Under the new EIA formula, each district will receive funding based on its EIA eligible pupil count. A district’s EIA eligible pupil count is the sum of the following:

  • Number of economically disadvantaged (ED) pupils. For most districts, the ED count will be the district’s Title I formula child count used in its current year Title I entitlement calculation less its count of pupils in families whose income is above the federal poverty level. The Title I counts are primarily based on U.S. census poverty data. The ED counts for small, rural districts (districts with less than 600 enrollment and given a small, rural “locale” code by the National Center for Education Statistics) will be the district’s prior year free meal count adjusted to provide an estimate of its Title I formula child count.
  • Number of English learners (EL), as reported in the prior year R30-LC Language Census.
  • A calculated number for each district that has a combined ED and EL pupil count (or concentration) greater than 50 percent of the district’s total pupil enrollment, as reported in the prior year California Basic Educational Data System (CBEDS).

In 2006-07, districts also are to receive a share of the $350 million funding augmentation. The share will be calculated as a per-pupil supplement to each district’s 2006-07 base entitlement per EIA eligible pupil.

This apportionment certifies estimated entitlements which are based on what each LEA was entitled to receive in 2005-06. Estimated EIA entitlements are shown in Exhibit II. By December 2006, estimated entitlements for EIA will be recalculated and recertified to reflect each district’s 2006-07 base entitlement under the new formula prior to the addition of the per-pupil supplement. In spring 2007, final entitlements will be calculated and certified to include each district’s per-pupil supplement. The per-pupil supplement is equal to $600 minus the district’s 2006-07 base entitlement divided by its 2006-07 count of EIA eligible pupils. Funding will be prorated if there are insufficient funds to provide all eligible districts with the difference between $600 and their base funding rate. There is no guarantee that a district will receive more EIA funding in 2006-07 than it received in 2005-06.

Estimated and final entitlements will be posted on the California Department of Education Web site at http://www.cde.ca.gov/fg/aa/ca/eia.asp.

Beginning in 2006-07, EIA funding may no longer be transferred out of the EIA program as part of the categorical flexibility permitted by Section 12.40 of the Budget Act. However, the ability to transfer funds to EIA from other approved sources remains, provided that the total funding after the transfers does not exceed 115 percent of the district’s 2006-07 EIA apportionment.

There is no restriction on the amount of EIA funds that may be carried over from year to year. For SACS coding, use Resource Code 7090, Economic Impact Aid (EIA), and Revenue Object Code 8311, Other State Apportionments-Current Year.

EIA and Pupil Transportation for Charter Schools. Charter schools, with few exceptions, are funded through the charter school funding model (California Education Code, commencing with Section 47633). This funding model provides categorical block grant funds in lieu of various categorical programs, including EIA. These block grant funds are allocated as part of the Principal Apportionment process. As such, enrollment and EL counts for charter schools participating in the block grant funding model are excluded from district totals when computing entitlements for EIA.

Beginning in 2006-07, the Pupil Transportation program is included on the list of programs for which charter schools may not apply separately due to participation in the Charter School Categorical Block Grant. Essentially, charter schools will receive funding for the Pupil Transportation program through the block grant. LEAs and charter schools may wish to consider this in their discussions about how to provide transportation services to charter school pupils.

Additional Information/Questions. County superintendents should immediately notify LEAs in their county of the information included in this apportionment. In addition, this letter, along with the summary, monthly payment schedule, and exhibits, will be posted on the California Department of Education Web site at http://www.cde.ca.gov/fg/aa/ca.

If you have any questions regarding this apportionment or the EIA program, please contact Ross Valentine, Consultant, Categorical Programs Unit, at (916) 327-4405 or by e-mail at rvalenti@cde.ca.gov. If you have any questions regarding the Pupil Transportation program, please contact Sue Cervantes, Fiscal Analyst, Categorical Programs Unit, at (916) 327-4406 or by e-mail at sucervantes@cde.ca.gov or Cynthia Wong, Staff Services Manager, at (916) 323-1314 or by e-mail at cwong@cde.ca.gov.

Sincerely,

JACK O’CONNELL

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