Dear County and District Superintendents, County and District Chief Business Officials, and Charter School Administrators:

Change to Threshold for Maintaining Equipment Inventory Records

Effective January 1, 2026, Assembly Bill 629 (Chapter 62, Statutes of 2025) amends Education Code (EC) Section 35168 by increasing the threshold market value, from $500 to $1,500, for each item of equipment for which local educational agencies (LEAs) are required to maintain an inventory record. The California Department of Education will adjust the market value biennially using the cost-of-living adjustment calculated pursuant to EC Section 42238.02(d)(2).

Note that the guidance in the 2024 California School Accounting Manual (CSAM), Procedure 430, Capital Assets, references the previous $500 inventory threshold. The next edition of the CSAM will reflect the new inventory threshold information. Beginning January 1, 2026, LEAs may use the updated $1,500 threshold market value to determine inventory recordkeeping requirements.

This letter is posted on the Office of Financial Accountability and Information Services Correspondence web page at https://www.cde.ca.gov/fg/ac/co/.

If you have questions regarding this matter, please contact the Office of Financial Accountability and Information Services by email at sacsinfo@cde.ca.gov.

Sincerely,

/s/

Masha Lutsuk, Administrator
Financial Accountability and Information Services
School Fiscal Services Division