Throughout the school year, and especially during the annual independent audits of the K-3 Class Size Reduction (CSR) program, there has been confusion regarding implementation of the grade level priorities. Questions arise regarding at what level failure to adhere to those priorities constitutes a loss of funding - and to what degree. The following will clarify the grade level priority provisions of the CSR program.
Education Code Section 52124(b) establishes the order in which the grade levels at a school site must be reduced when implementing the CSR program. If only one grade level is being reduced at a school site, it must be first grade. If only two grade levels are being reduced, they must be first and second grades. The "first priority" grades are first and second grades, while the "second priority" grades are third and kindergarten.
Education Code Section 52124(d) requires participants to certify their actual participation in the program (e.g., submit Form J-7CSR), and requires the State Controller to recover overpaid CSR funds by reducing the next monthly principal apportionment payment. This section specifically refers to the recovery (loss) of funds for each class that exceeds 20. It does not direct the Controller to recover funds for entire grade levels.
What this means in practical terms is that, should a class in any grade (K-3) exceed 20.44, CSR funding will be lost for that class only. Funding will not be lost for any other qualified CSR classes, regardless of grade level.
This does not mean, however, that districts can ignore the grade level implementation priorities. For example, as noted in Education Code Section 52124(b) above, at a school site, all classes in first grade must be reduced before any classes in second grade, and so forth. Therefore, districts cannot leave one or more classes in first grade unreduced, or identify a class as an "over flow" class, and still receive CSR funding for classes in other grade levels. The exception to this is contained in Section 15131(a) of Title 5 of the California Code of Regulations, which states:
"(a) Education Code Section 52124(b)(2) shall not be interpreted as precluding a school district from qualifying for funding for classes at grade 2 at a schoolsite if that school district unintentionally fails to meet the class size reduction requirement for all of its classes at grade 1 at that schoolsite. Similarly, Education Code Section 52124(b)(3) shall not be interpreted as precluding a school district from qualifying for funding for classes in kindergarten or grade 3 at a schoolsite if that school district unintentionally fails to meet the class size reduction requirement for all of its classes at grades 1 and 2 at that schoolsite." (Emphasis added.)
Therefore, first or second grade classes that have never been reduced or that are allowed to grow beyond the bounds of "unintentional" will affect the grade level implementation priorities, and as such, could cause the loss of funding for CSR classes in the lower priority grades. (Note: this applies only to first and second grades. Third grade and kindergarten are the second priority grades, and as such, are not required to be fully reduced in one before reducing classes in the other.)