Dear County Superintendents of Schools:
2018–19 Advance Principal Apportionment
Towards the end of July, county treasurers will receive a warrant that reflects state aid for programs included in the 2018–19 Advance Principal Apportionment (Advance) for local educational agencies (LEA). The California Department of Education (CDE) certified the Advance on July 20, 2018, pursuant to California Education Code (EC) Section 41330. The statewide total was $38,946,148,465. County superintendents of schools should advise school districts and charter schools immediately of this apportionment.
The 2018–19 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 2018–19 Budget Act and related trailer bills (Assembly Bill 1808, Chapter 32, Statutes of 2018, and Assembly Bill 1825, Chapter 39, Statutes of 2018).
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/pa1819.asp. Additionally, the CDE has posted 2018–19 funding rates and updated the Local Control Funding Formula (LCFF) Gap and cost of living adjustment (COLA) percentages on the Funding Rates and Information web page at https://www.cde.ca.gov/fg/aa/pa/ratesandinfo.asp.
2018–19 Advance Calculations by Program
The following provides specific details regarding the calculation of funding for each program, including the 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.
LCFF State Aid – County Offices of Education
The estimated 2018–19 LCFF State Aid for each county office of education (COE) is based on funding from the 2017–18 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 2.71 percent statutory COLA if the COE’s LCFF Entitlement was based on the LCFF Target as of 2017–18 P-2. For all other COEs the 2017–18 P-2 LCFF Entitlement was unadjusted for COLA.
- Additional funding for 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 2.71 percent statutory COLA.
- An estimate for the additional LCFF state aid based on the number of districts identified for differentiated assistance on the 2017 LCFF Assistance Status Report, and the size of those districts, as determined pursuant to EC Section 2575.2 using 2016–17 Annual average daily attendance (ADA). The CDE will update the calculation at the 2018–19 First Principal Apportionment Certification using a two year average allowance based on the districts identified on the 2017 and the 2018 LCFF Assistance Status Reports.
- The 2017–18 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 2017–18 P-2 property taxes.
- The Education Protection Account (EPA) Entitlement, which is an offset to state aid, has been recalculated to reflect the 2018–19 funding estimate of $7.3 billion. See the EPA section below for additional detail.
LCFF State Aid – School Districts and Charter Schools
The estimated 2018–19 LCFF State Aid for each school district and charter school is based on funding from the 2017–18 P-2 certification and reflects the following adjustments:
- The 2017–18 Target Entitlement, with the exception of the add-on funding component, was increased by the 3.70 percent Super COLA. School districts and charter schools funded equal to the Target formula as of the 2017–18 P-2 certification are funded at their Target in the Advance.
- The 2017–18 Floor Entitlement was recalculated to include Gap funding provided in 2017–18.
- A new 2018–19 estimated Need, which is the difference between the Target and Floor, was derived from the revised Target and revised Floor calculations.
- The 2018–19 Budget includes a Gap appropriation equal to the amount of remaining statewide LCFF Need; therefore the Advance calculates Gap funding equal to the amount calculated in Step 3 for each school district and charter school.
- For those school districts and charter schools receiving an Economic Recovery Target payment, the additional 2018–19 payment was included. Note: pursuant to EC Section 42238.025, LEAs will receive the full ERT entitlement in 2019-20, the first year school districts and charter schools are apportioned funding pursuant to Section 42238.02.
- 2017–18 class size penalties (reflected in the miscellaneous adjustments and minimum state aid adjustments lines of the School District Transition funding exhibit) have been zeroed out in the Advance.
- The 2017–18 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 2017–18 P-2 property taxes. (Charter in-lieu was not adjusted for the Advance).
- The EPA Entitlement, which is an offset to state aid, has been recalculated to reflect the 2018–19 funding estimate of $7.3 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 2018–19 EPA revenue estimate of approximately $7.3 billion, the CDE calculated estimated EPA entitlements using a factor of 28.13512027 percent based on the 2017–18 P-2 statewide total of revenue limits and charter school block grant funding and 2017–18 P-2 local revenue data, adjusted to exclude one-time RDA Asset Liquidation funds. If an LEA’s 2017–18 P-2 EPA entitlement was based on $200 per ADA (the minimum), the 2018–19 estimated EPA entitlement was not recalculated for the Advance.
While the funding is not allocated through the Principal Apportionment, estimated 2018–19 EPA amounts are provided on the Advance Apportionment Summary available on the CDE’s website at https://www.cde.ca.gov/fg/aa/pa/iassf18adv.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 3.70 percent Super COLA.
Adults in Correctional Facilities (AICF)
LEAs that participate in the AICF program receive funding on a reimbursement basis. The 2018–19 Budget Act provides $15,331,000, which will be used to fund the 2017–18 program. Advance funding for the AICF program is equal to the 2017–18 P-2 state aid amounts for each LEA adjusted for the 2017–18 1.56 percent COLA.
Special Education – Assembly Bill (AB) 602 Program
The 2018–19 Budget Act provides $ 2,792,469,000 for the AB 602 program. The estimated 2018–19 state aid for each Special Education Local Plan Area (SELPA) is based on funding from the 2017–18 P-2 certification and reflects the following:
- A factor of 1.0165340178 was applied to each SELPA’s adjusted 2017–18 state aid amount.
- The 2017–18 P-2 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 2017–18 P-2 property taxes.
In the 2013–14 fiscal year, program specialist and regionalized services (PS/RS) funding was rolled into each SELPA's base funding rate. This calculation was affected by the recent trailer bill passed as part of the Budget. Section 100 of Assembly Bill (AB) 1808 (Chapter 32, Statutes of 2018), added EC Section 56836.24, and directs CDE to calculate funding for PS/RS for each SELPA based on the statewide average PS/RS rate. As a result the AB 602 statewide target rate and each SELPA’s base rate will be recalculated to back out PS/RS. These changes will be reflected in the 2018–19 First Principal Apportionment certification.
Special Education – Infant (Ages Two Years and Younger) Program
The 2018–19 Budget Act provides $77,838,000 for the Infant program. The Advance is equal to the 2017–18 P-2 amounts for each LEA, adjusted for the 2018–19 2.71 percent statutory COLA.
Transfer of Funds for County Served District Funded ADA
Funding for the Transfer of Funds for County Served District Funded ADA is equal to the 2017–18 P-2 amounts.
Other State Aid
Other State Aid captures pass-through payments made to LEAs for legislative priorities. Currently, these appropriations can be found in Assembly Bill 104 (Chapter 13, Statutes of 2015), and Senate Bill 828 (Chapter 29, Statutes of 2016).
Monthly payments for the Advance are available on CDE’s website at the county summary level and by LEA. For cash planning, the Principal Apportionment payment calculation schedule is available on the CDE’s website 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_2018.pdf.
If you need assistance, or have any further questions, please contact the Principal Apportionment Section by phone at 916-324-4541 or by email at PASE@cde.ca.gov.
Caryn Moore, Director
School Fiscal Services Division