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California Department of Education
News Release
Release: #14-27
March 11, 2014
Contact: Communications
Phone: 916-319-0818

State Schools Chief Tom Torlakson Reports Significant
Drop in Number of Districts in Financial Jeopardy

SACRAMENTO—A new report shows that the number of California school districts in financial jeopardy has dropped sharply for the second year in a row, State Superintendent of Public Instruction Tom Torlakson announced today.

This year's First Interim Status Report, FY 2013-14 shows that a total of 49 local educational agencies (LEAs) are either in negative or qualified financial status. This is down significantly from the last report—in May 2013—that showed 92 LEAs with this status, and is down even more significantly from the same report a year ago. In the First Interim Status report of 2013, there were 124 LEAs in financial jeopardy.

"Californians have put our schools back on the path toward economic recovery after several years and billions of dollars of cuts, and they are working hard to continue down that path," Torlakson said. "Although our work won't be done until every school is in solid financial shape, this is certainly movement in the right direction."

Of the current 49 LEAs on the list, eight have a negative certification, the same number reported in May 2013. Another 41 LEAs have a qualified certification, down from 84 in May 2013. See the attached table.

Twice a year, the California Department of Education receives Notice of Interim Certifications on the financial status of the state's 1,038 LEAs, comprising school districts, county offices of education, and joint powers agencies. The certifications are classified as positive, qualified, or negative.

A positive certification means the LEA will meet its financial obligations for the current and two following fiscal years. A qualified certification is assigned when the LEA may not meet its financial obligations for the current or two following fiscal years. This certification allows the LEA's county office of education to provide assistance to the district.

A negative certification—the most serious of the classifications—is assigned when the LEA will be unable to meet its financial obligations for the remainder of the current year or for the subsequent fiscal year. This certification means the LEA's county office of education may intervene in the district's finances. The assistance or intervention by the county office of education may include assigning external consultants, requiring a district fiscal recovery plan, or disallowing certain district expenditures.

This new list is a compilation of the certifications by LEAs that were due December 15, 2013, and cover the financial and budgetary status of the LEAs for the period ending October 31, 2013. The certifications reflect whether the LEAs are able to meet their financial obligations for the remainder of the current fiscal year and subsequent two fiscal years, based on projections at that point in time.

Because these Interim Status Reports are snapshots in time, the LEAs' financial status may have changed since these certifications were collected.

# # # #


Interim Status Report

Period Total LEAs Negative Qualified Students Affected

First Interim 2013-14




1.2 million

Second Interim 2012-13




1.7 million

First Interim 2012-13




2.1 million

# # # #

Tom Torlakson — State Superintendent of Public Instruction
Communications Division, Room 5602, 916-319-0818, Fax 916-319-0100

Last Reviewed: Thursday, April 18, 2019
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