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California Department of Education
Official Letter
California Department of Education
Official Letter
November 23, 2020

Charter School Superintendents, County and District Superintendents, and County and District Chief Business Officers:

NONCLASSROOM-BASED CHARTER SCHOOLS DETERMINATION OF FUNDING REQUESTS FOR FISCAL YEAR 2020–21

The purpose of this letter is to provide information regarding funding determination requests for charter schools operating under a nonclassroom-based (NCB) instructional setting. Specifically, this letter contains important details about changes to the funding determination request process for fiscal year (FY) 2020–21.

California Education Code (EC) Section 47612.5(e)(1) and California Code of Regulations, Title 5 (5 CCR) Section 11963 specify the requirements for classroom-based instruction and school site conditions. A charter school is considered operating as an NCB charter school if its total average daily attendance (ADA) is less than 80 percent classroom based. An NCB charter school must submit a funding determination request to the California Department of Education (CDE) and receive approval of its funding determination request from the State Board of Education (SBE) to be eligible for funding for its NCB ADA. The request is made by completing the NCB Funding Determination Form, which is located on the CDE Nonclassroom-Based Determination of Funding web page at https://www.cde.ca.gov/sp/ch/nclrbifunddet.asp.

Important Information Specific to Fiscal Year 2020–21

Newly Operational Charter Schools

New charter schools in their first year of operation in FY 2020–21 are not required to obtain a funding determination to receive funding for FY 2020–21 since all newly operational charter schools are required to offer instruction under the distance learning model for FY 2020–21, which is not considered NCB instruction.

However, to receive funding for NCB ADA in FY 2021–22, these charter schools must submit a funding determination request by February 1, 2021. Budget data from FY 2020–21 should be used to complete the NCB Funding Determination Form, which is available on the CDE Nonclassroom-Based Determination of Funding web page at https://www.cde.ca.gov/sp/ch/nclrbifunddet.asp.

90 Day Report

In addition to submitting an NCB Funding Determination Form in their first year of operation, in their second year of operation, new NCB charter schools are required to submit unaudited actual expense reports and an NCB Funding Determination Form based on the school’s second-year budget. This information, referred to as the 90 Day Report, shall be submitted to the CDE on or before September 30, 2021, pursuant to 5 CCR Section 11963.6(a).

Existing NCB charter schools are not required to submit the 90 Day Report.

Existing Charter Schools
Nonclassroom-Based Charter Schools

To continue to receive funding for NCB ADA, existing NCB charter schools whose funding determination expires at the end of FY 2020–21 must submit a funding determination request by June 30, 2021. Actual audited data from FY 2019–20 should be used to complete the NCB Funding Determination Form, which is available on the CDE Nonclassroom-Based Determination of Funding web page at https://www.cde.ca.gov/sp/ch/nclrbifunddet.asp.

These charter schools shall receive their current funding level for two years upon the timely submission of a complete funding determination request, pursuant to Senate Bill 820 Section 75.

A list of charter schools that were nonclassroom-based as of the 2019-20 Second Principal (P-2) Apportionment certification is available at https://www.cde.ca.gov/fg/aa/pa/documents/ncbcs20.xlsx.

Classroom-Based Charter Schools

For the purposes of calculating apportionments for existing classroom-based charter schools, the CDE shall use the ADA reported in FY 2019–20 for both the P-2 Apportionment and the Annual Apportionment, pursuant to EC Section 43502(b). As such, charter schools with classroom-based ADA to NCB ADA ratios projected near the 80 percent minimum are not required to submit a funding determination request for FY 2020–21.

Charter Schools Offering Distance Learning

Pursuant to EC Section 43506(b), charter schools that were classroom-based in FY 2019–20 and that offer distance learning in FY 2020–21 shall not be required to submit a request for a determination of funding for FY 2020–21.

Approval of Funding Determination Requests by the State Board of Education

EC sections 47612.5 and 47634.2, and 5 CCR established the criteria for the review and evaluation of determination of funding requests for NCB charter schools. Normally, NCB funding determination requests are reviewed by the CDE and presented to the Advisory Commission on Charter Schools (ACCS). Both CDE and ACCS recommendations are then presented to the SBE for final approval. This remains the case for new NCB charter schools in their first year of operation in FY 2020–21 that are requesting funding for NCB ADA in FY 2021–22.

However, funding determination renewal requests from existing NCB charter schools whose funding determinations expire at the end of FY 2020–21 do not require SBE approval; therefore, these requests will not be heard by the SBE.

Frequently Asked Questions

Answers to frequently asked questions pertaining to NCB funding determinations for FY 2020–21 are available on the CDE SB 98 and SB 820 Frequently Asked Questions web page at https://www.cde.ca.gov/sp/ch/sb820faqs.asp.

Mitigating Circumstances

Pursuant to 5 CCR Section 11963.4(a), an NCB charter school may qualify for a funding determination of 70 percent, 85 percent, 100 percent, or be denied a funding determination. However, a charter school that does not meet the criteria for its requested funding determination may choose to submit mitigating circumstances (MC) for the ACCS to recommend otherwise. Pursuant to 5 CCR Section 11963.4(e), the ACCS may find a “reasonable basis” by which to make a recommendation other than one that results from the criteria specified in 5 CCR Section 11963.4(a). The criteria specified in 5 CCR Section 11963.4(a) is available to be viewed on the Thomson Reuters Westlaw California Code of Regulations web site at https://govt.westlaw.com/calregs/index.

A charter school choosing to submit a request to consider MC is required to complete Section VI of the NCB Funding Determination Form. In previous years, the CDE had a separate form for providing MC. The separate MC form is no longer available and has been consolidated into the NCB Funding Determination Form. MC explanations must include, if any, documented data regarding the individual and specific circumstances; factors that are unique about the charter school; an explanation of why the charter school failed to meet the 5 CCR requirements for funding; and an explanation of the specific actions taken by the charter school to meet the funding criteria. The CDE may request additional information from the charter school in support of its MC submission.

Existing NCB charter schools whose funding determination expires at the end of FY 2020–21 are not required to provide MC to continue receiving their current level of funding.

Filing Deadlines and Submission Instructions

The due dates to file a determination of funding request with the CDE are as follows:

  • New NCB charter schools in their first year of operation in FY 2020-21 shall file on or before February 1, 2021, to receive funding for its NCB ADA in FY 2021–22.
  • New NCB charter schools in their first year of operation in FY 2020-21 shall also file the 90 Day Report, which consists of unaudited actual expense reports and a completed NCB Funding Determination Form based on the school’s second-year budget on or before September 30, 2021.
  • Existing NCB charter schools with an approved funding determination that will expire at the end of FY 2020–21 shall file on or before June 30, 2021.

Information and instructions for completing the NCB Funding Determination Form are available on the CDE Nonclassroom-Based Determination of Funding web page at https://www.cde.ca.gov/sp/ch/nclrbifunddet.asp.

The CDE will consider a filing as timely and complete when the completed and signed electronic copy of the funding determination request is received by email at Charter-SB740@cde.ca.gov by the applicable due dates. A signed hard copy of the NCB Funding Determination Form is not required to be submitted.

Untimely Submissions

Newly Operational Charter Schools

For new NCB charter schools in their first year of operation in FY 2020–21 that are requesting funding for NCB ADA in FY 2021–22, determination of funding requests received (not postmarked) after the applicable due date will not be accepted. These charter schools will be required to obtain a waiver approved by the SBE in order to submit a determination of funding request that is not filed timely. Information and timelines for obtaining a waiver are posted at the CDE Waivers web page at https://www.cde.ca.gov/re/lr/wr/index.asp.

Existing Charter Schools

Existing NCB charter schools whose NCB funding determinations expire at the end of FY 2020–21 and who submit a request to renew their funding determination after the June 30, 2021, deadline shall receive 85 percent funding for two years for their NCB ADA. Failure to submit a complete funding determination request to the CDE shall result in the school receiving zero funding for its NCB ADA until the complete funding determination request is submitted. It is not required for these schools to obtain a waiver from the SBE to submit a late request.

Local Control Funding Formula Impact

There may be a significant fiscal impact to an NCB charter school’s Local Control Funding Formula (LCFF) funding if a determination of funding request is not submitted timely. While the timing will differ based on whether the school is a new or an existing NCB charter school, the fiscal impact will be the same and LCFF funding will be jeopardized.

  • A new NCB charter school in its first year of operation in FY 2020–21 that is requesting funding for NCB instruction in FY 2021–22 must have a funding determination request approved by the SBE by its January 2022 meeting. If the school fails to do so, beginning with the First Principal (P-1) Apportionment for the FY 2021–22, the CDE will not disburse LCFF funds to the new charter school for any of its NCB ADA.
  • An existing NCB charter school with an approved funding determination that will expire at the end of FY 2020–21 shall file on or before June 30, 2021, to receive its current level of funding, or shall file on or before January 31, 2022, to receive 85 percent funding. If the school fails to do so, beginning with the P-1 for the FY 2021–22, the CDE will not disburse LCFF funds to the charter school for any of its NCB ADA. In order to receive disbursement of LCFF funds for NCB ADA for P-2, the funding determination request must be submitted to the CDE by May 31, 2022.
  • An existing NCB charter school that needs a funding determination for FY 2020–21 must have a funding determination approved by the SBE by its January 2021 meeting. If the school fails to do so, beginning with the P-1 for the FY 2020–21, the CDE will not disburse LCFF funds to the charter school for any of its NCB ADA. In order to receive disbursement of LCFF funds for NCB ADA for P-2, the funding determination request must be approved by the SBE by its May 2021 meeting.

In all three scenarios, funding may be adjusted after a funding determination request is approved; however, any funding withheld at P-2 will not be adjusted until the following FY P-1 certified in February. The charter school’s following FY Advance Apportionment funding will also be impacted. Other ADA-driven funding for the charter school, such as lottery funding, may also be impacted. More information about the Principal Apportionment processes and timelines can be found on the CDE Fiscal Calendars web page at https://www.cde.ca.gov/re/ca/fc.

Further questions regarding the implications to LCFF funding should be directed to the School Fiscal Services Division by email at PASE@cde.ca.gov.

Contact Information

Please direct all questions regarding the funding determination submission process or the completion of the NCB Funding Determination Form to the Charter Schools Division by phone at 916-322-6029 or by email at Charter-SB740@cde.ca.gov.

Please direct all questions pertaining to LCFF funding to the School Fiscal Services Division by email at PASE@cde.ca.gov.

Sincerely,

/s/

Stephanie Farland, Director
Charter Schools Division

SF:jy

Last Reviewed: Monday, November 23, 2020
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