July 2, 2007
Dear Charter School Administrators, County and District Superintendents, County and District Chief Business Officials:
REQUIRED FUNDING DETERMINATIONS FOR NONCLASSROOM-BASED CHARTER SCHOOLS (IMPLEMENTATION OF SENATE BILL (SB) 740), FISCAL YEAR 2007-08
This letter is a reminder to charter schools that 2007-08 SB 740 Funding Determination forms and instructions are posted on our Web site at.
Funding Determination forms for new schools in their first year of operation are due in our office on or before December 1, 2007. Funding Determination forms for continuing schools are due in our office on or before February 1, 2008.
A funding determination is required of all charter schools whose enrollment, not under the immediate supervision of an employee of the charter school at a school site, exceeds 20 percent of the school's average daily attendance (a.d.a.) at the P-2 apportionment period, pursuant to SB 740 (Chapter 892, Statutes of 2001). Failure to submit a funding determination meeting the dates above will result in no funding for the charter school’s nonclassroom-based programs.
SB 740 made significant changes to the funding process. A charter school is prohibited from receiving any funding for nonclassroom-based instruction, unless the State Board of Education (SBE) determines its eligibility for funding. The law also provides the SBE with the authority to adjust the apportionment of charter schools for a.d.a. generated through nonclassroom-based instruction. The law states that funding reductions shall be 30 percent of qualifying charter schools' nonclassroom-based a.d.a. unless the SBE determines that a greater or lesser percentage is appropriate for a particular charter school. The SBE may also make multi-year funding determinations of up to five years in length. The SBE, upon the recommendation of the Advisory Commission on Charter Schools (ACCS), determines whether a nonclassroom-based charter school receives a multi-year funding determination and for how long that determination is in effect. New nonclassroom-based charter schools must apply in their first year.
The SBE has adopted regulations that implement the provisions of SB 740 (now included in the Audit Guide for charter schools) and delineate which charter schools are required to participate in the funding determination process. The regulations define classroom-based instruction as occurring when all of the following four conditions are met:
- The charter school's pupils are engaged in education activities required of those pupils, and the pupils are under the immediate supervision and control of an employee of the charter school who is authorized to provide instruction to the pupils within the meaning of Education Code (EC) Section 47605( l ) (Outside Source).
- The charter school requires its pupils to be in attendance at the school site at least 80 percent of the instructional time required pursuant to EC Section 47612.5(a)(1) (Outside Source).
- The charter's school site is a facility that is used principally for classroom instruction (see below).
- At least 80 percent of the annual instructional minutes offered at the charter school are at the school site.
Furthermore the regulations define "at the school site" as satisfied if the facility in which the pupils receive instruction meets any of the following conditions:
- The facility is owned, rented, or leased by the charter school principally for classroom instruction.
- The facility is provided to the charter school by a school district pursuant to EC Section 47614 (Outside Source) principally for classroom instruction.
- The facility is provided to the charter school free-of-charge principally for classroom instruction pursuant to a written agreement.
However, in no instance may a school site be an individual's personal residence.
Any charter school that does not meet all of the requirements for classroom-based instruction and at least one of the school site conditions is considered to offer nonclassroom-based instruction and must submit a determination of funding request form. If a charter school offers nonclassroom-based instruction, as defined, and does not submit this form, the school will lose some or all of its state funding for its nonclassroom-based a.d.a. in the current year.
Please read the SB 740 instructions carefully. These instructions are intended to ensure that schools appropriately and fully report all of their instruction and instruction-related expenditures. The 2007-08 funding determination forms can be accessed at the previously mentioned web site and emailed to charters@cde.ca.gov or faxed to 916-322-1465. The original form should be sent in the mail to the following address and must meet all timelines referenced in this letter.
California Department of Education
Charter Schools Division
1430 N Street, Suite 5401
Sacramento, CA 95814
We recommend that charter schools submit funding determination forms to our office as early as possible for prudent budgeting purposes.
Please note that new SB 740 regulations went into effect in December 2005. These regulations establish an alternative to the existing method for determining the pupil-teacher ratio for nonclassroom-based charter schools by allowing charter schools the option of using a statewide average pupil-teacher ratio of 25:1; clarify the multi-year funding determination option; make clarifying changes to the determination of funding request forms and calculations; incorporate facilities mitigation within "instructional costs" and the base calculation; define a “full-time certificated employee”; clarify certificated instructional support staff and treatment of contracted staff used by the charter school for the calculation; make technical changes that includes removal of language no longer in effect; and establishes policy for determination of funding requests for nonclassroom-based virtual or on-line charter schools. A copy of these regulations can be found at the CDE Web site page titled Nonclassroom-based Instruction and Senate Bill 740 . Pupil-teacher ratio calculations required on the SB 740 forms should be based on guidance found at the following CDE Web site titled Instructions for Ratio Calculations . Note that these instructions only allow certificated teachers to be counted for pupil-teacher ratio purposes who directly provide instruction to pupils.
The SB 740 regulations also provide that “a charter school may submit a request for funding determination up to one year prior to the fiscal year in which the request will initially be effective.“ The CDE and the ACCS strongly encourage charter schools to seek “forward funding” so that schools will know in advance of the school year the level of funding approved by the SBE for budget planning purposes. In summary, all schools whose determination of funding expires at the end of the 2007-08 school year and whose next funding determination due date is February 1, 2009, are encouraged to apply for a determination of funding this year in an effort to seek “forward funding” for the school.
Please note, if one or more mitigating circumstances are cited as the reason for not meeting the percentage criteria required for 100 percent funding, all documentation supporting the request should accompany the funding determination request form. It is the school's responsibility to provide documentation that demonstrates that the mitigating circumstance for full funding is compelling.
For questions regarding the SB 740 funding determination process or whether a charter school should submit a funding determination form, please contact Keith Edmonds, Consultant, Charter Schools Division at 916-327-4628, Oluwole Olukoya, Consultant, Charter Schools Division at (916) 327-5929, or Gary Page, Consultant, Charter Schools Division at (916) 445-7689.
Sincerely,
Marta Reyes, Director
Charter Schools Division
1430 N Street
Sacramento, CA 95814