[Email notice of this letter was sent on July 19, 2019 to the PASE and CDEfisc email distribution lists.]
July 19, 2019
Dear County Superintendents of Schools:
2019–20 Advance Principal Apportionment
The California Department of Education (CDE) certified the 2019–20 Advance Principal Apportionment (Advance) on July 19, 2019, pursuant to California Education Code (EC) Section 41330. The statewide total was $39,593,565,617. At the end of each month from July 2019 through January 2020, county treasurers will receive warrants that reflect state aid for Advance programs for local educational agencies (LEA). County superintendents of schools should advise school districts and charter schools immediately of this apportionment.
The 2019–20 Advance is apportioned on the basis of an LEA’s Second Principal Apportionment (P-2) funding from the preceding fiscal year pursuant to EC Section 41330 and funding appropriations provided in the 2019–20 Budget Act and Senate Bill (SB) 75, Chapter 51, Statutes of 2019.
A summary of the Advance calculations is described below. This letter, as well as Excel files that provide funding and monthly payment amounts, are available on the CDE website at https://www.cde.ca.gov/fg/aa/pa/pa1920.asp. Additionally, the CDE has posted the 2019–20 Funding Rates and Information web page at https://www.cde.ca.gov/fg/aa/pa/ratesandinfo.asp.
2019–20 Advance Calculations by Program
The following provides specific details regarding the calculation of funding for each program, including the Local Control Funding Formula (LCFF). Because this apportionment is merely a means to begin allocating funds in accordance with EC Section 41330, it should not be used by LEAs for budgeting.
Local Control Funding Formula State Aid – County Offices of Education
The estimated 2019–20 LCFF State Aid for each county office of education (COE) is based on funding from the 2018–19 P-2 certification and reflects the following adjustments:
- The 2018–19 Target Entitlement, with exception of the add-on funding component, was increased by the 3.26 percent cost-of-living-adjustment (COLA) if the COE’s LCFF Entitlement was based on the LCFF Target as of 2018–19 P-2. For all other COEs the 2018–19 P-2 LCFF Entitlement was unadjusted for COLA.
- Additional funding for Local Control and Accountability Plan (LCAP) support for COEs funded on the Target formula as of 2016–17 P-2, pursuant to EC Section 2575.1, is included in the Advance state aid amount and reflects the 3.26 percent COLA. Additional state aid for Differentiated Assistance pursuant to EC Section 2575.2 is equal to the 2018–19 P-2 amount because statute does not provide COLA for this funding.
- The 2018–19 P-2 local revenue amount was used to determine the COE’s Advance state aid and excludes any one-time Redevelopment Agency (RDA) Asset Liquidation funds reported as part of the COE’s 2018–19 P-2 property taxes.
- The Education Protection Account (EPA) Entitlement, which is an offset to state aid, has been recalculated to reflect the 2019–20 funding estimate of $7.9 billion. See the EPA section below for additional detail.
Local Control Funding Formula State Aid – School Districts and Charter Schools
Pursuant to EC Section 42238.03, a determination was made that less than 10 percent of school districts were apportioned funding below their LCFF Target entitlement as of the Second Principal Apportionment in the 2018–19 fiscal year. As a result, all school districts and charter schools are allocated funding equal to their LCFF entitlement (EC Section 42238.02) in the Advance. The estimated 2019–20 LCFF State Aid for each school district and charter school is based on funding from the 2018–19 P-2 certification and reflects the following adjustments:
- The 2018–19 Target Entitlement, with the exception of the add-on funding components, was increased by the 3.26 percent COLA.
- For those school districts and charter schools receiving an Economic Recovery Target (ERT) payment, the full ERT payment originally calculated for the 2020-21 fiscal year was included as an add-on to the LCFF entitlement pursuant to EC Section 42238.025.
- 2018–19 class size penalties (reflected in the miscellaneous adjustments and minimum state aid adjustments lines of the School District Transition funding exhibit) have been excluded from the Advance.
- The 2018–19 P-2 local revenue amount was used to determine the school district’s Advance state aid and excludes any one-time RDA Asset Liquidation funds reported as part of the district’s 2018–19 P-2 property taxes.
- The 2018-19 P-2 charter school in-lieu of property taxes was adjusted for State Board of Education (SBE) authorized charter schools pursuant to EC Section 47605 to reflect a recent change to EC Section 47632. In-lieu is excluded from the LCFF state aid calculation for SBE authorized charter schools unless the sponsor was deemed a basic aid school district in 2018-19 P-2.
- The EPA Entitlement, which is an offset to state aid, has been recalculated to reflect the 2019–20 funding estimate of $7.9 billion. See the EPA section below for additional detail.
Education Protection Account
EPA revenues, as authorized by Section 36 of Article XIII of the California Constitution, are generated by an increase in the personal income tax rates for upper-income taxpayers. All LEAs will receive quarterly EPA payments through the 2030–31 fiscal year, which will be paid outside of the Principal Apportionment. For most LEAs, EPA funding offsets state aid allocated through the Principal Apportionment.
Using a revised 2019–20 EPA revenue estimate of approximately $7.9 billion, the CDE calculated estimated EPA entitlements using a factor of 31.38804098 percent based on the 2018–19 P-2 statewide total of revenue limits and charter school block grant funding and 2018–19 P-2 local revenue data, adjusted to exclude one-time RDA Asset Liquidation funds and in-lieu of property taxes attributed to charter schools authorized by the SBE. If an LEA’s 2018–19 P-2 EPA entitlement was based on $200 per ADA (the minimum), the 2019–20 estimated EPA entitlement was not recalculated for the Advance.
While the funding is not allocated through the Principal Apportionment, estimated 2019–20 EPA amounts are provided on the Advance Apportionment Summary available on the CDE’s website at http://www.cde.ca.gov/fg/aa/pa/iassf19adv.asp for your convenience. For additional information on EPA calculations, letters of apportionment, payment schedules, spending restrictions, frequently asked questions, SACS financial reporting and more, please refer to CDE’s EPA web page at https://www.cde.ca.gov/fg/aa/pa/epa.asp.
Basic Aid “Choice”, Court-Ordered Voluntary Pupil Transfer, and Charter Supplement
Funding for Basic Aid “Choice”, Court-Ordered Voluntary Pupil Transfer, and Charter Supplement were adjusted for the 3.26 percent COLA.
Adults in Correctional Facilities
LEAs that participate in the Adults in Correctional Facilities (AICF) program receive funding on a reimbursement basis. The 2019–20 Budget Act provides $15,746,000, which will be used to fund the 2018–19 program. Advance funding for the AICF program is equal to the 2018–19 P-2 state aid amounts for each LEA adjusted for the 2018–19 2.71 percent COLA.
Special Education – Assembly Bill 602 Program
The 2019–20 Budget Act provides $2,980,375,000 for the Assembly Bill (AB) 602 program. The estimated 2019–20 state aid for each Special Education Local Plan Area (SELPA) is based on funding from the 2018–19 P-2 certification and reflects the following:
- The 2018–19 Special Education Property Tax amount was used to determine the SELPA’s Advance state aid and excludes any one-time RDA Asset Liquidation funds reported as part of the county’s 2018–19 P-2 property taxes.
- A factor of 1.0124941524 was applied to each SELPA’s adjusted 2018–19 state aid amount.
The 2019–20 Budget provides for an additional $152.6 million to increase the funding rates for low-funded SELPAs to the statewide target rate of $557.27 per unit of average daily attendance (ADA). The Advance calculation does not include this additional funding. The CDE will include the equalization funding in a SELPA’s AB 602 entitlement at the 2019–20 First Principal Apportionment (P-1) Certification, to be calculated pursuant to EC Section 56836.08 as amended by SB 75 (Chapter 51, Statutes of 2019).
Special Education – Infant (Ages Two Years and Younger) Program
The 2019–20 Budget Act provides $80,671,000, for the Infant program. The Advance is equal to the 2018–19 P-2 amounts for each LEA, adjusted for the 3.26 percent COLA.
Transfer of Funds for County Served District Funded Average Daily Attendance
Funding for the Transfer of Funds for County Served District Funded ADA is equal to the 2018–19 P-2 amounts.
EC Section 2576, as modified by AB 2235 (Chapter 99, Statutes of 2018), requires CDE to transfer funds from the district of residence to the COE for all District Funded County Program ADA. The CDE will implement this change with the 2019–20 P-1 certification.
Other State Aid
Other State Aid captures pass-through payments made to LEAs for legislative priorities. Currently, these appropriations can be found in AB 104 (Chapter 13, Statutes of 2015), and SB 828 (Chapter 29, Statutes of 2016).
Monthly payments for the Advance (July 2019 – January 2020) are available on the CDE’s website at the county summary level and by LEA. For cash planning, LEAs should refer to the Principal Apportionment Payment Schedule web page at https://www.cde.ca.gov/fg/aa/pa/papayschedule.asp. The State Controller’s website provides monthly payment information, including offset amounts at https://www.sco.ca.gov/ard_payments_k12.html and estimated payment dates at https://www.sco.ca.gov/Files-ARD-Payments/sched_2019.pdf.
If you have any questions regarding this information, please contact the Principal Apportionment Section, by email at firstname.lastname@example.org or by phone at 916-324-4541.
Elizabeth Dearstyne, Associate Director
Principal Apportionment Section