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

DETERMINATION OF FUNDING REQUESTS FOR
FISCAL YEAR 2022–23

The purpose of this letter is to provide information regarding funding determination requests for charter schools providing nonclassroom-based (NCB) instruction in excess of 20 percent of its total average daily attendance (ADA).

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. For the purposes of funding on the basis of ADA, a charter school is considered operating as an NCB charter school if its total ADA is less than 80 percent classroom based. A charter school’s status as NCB or classroom-based is not dependent upon it having or not having an approved funding determination. Rather, a charter school’s status as NCB or classroom-based is determined by its reported ADA at its Second Principal (P-2) Apportionment certification.

To be eligible for funding for its NCB ADA, a 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 California State Board of Education (SBE). The request is made by completing the NCB Funding Determination Form, which is located on the CDE NCB Determination of Funding web page at https://www.cde.ca.gov/sp/ch/nclrbifunddet.asp. Pursuant to 5 CCR Section 11963.4(a), an NCB charter school may qualify for a funding determination of 70 percent, 85 percent, or 100 percent, or may be denied a funding determination.

Existing Nonclassroom-Based Charter Schools

To continue receiving funding for NCB ADA, existing NCB charter schools whose funding determination expires at the end of fiscal year (FY) 2022–23 must submit a funding determination request by February 1, 2023. Audited data from FY 2021–22 should be used to complete the NCB Funding Determination Form.

Existing Charter Schools Without a Funding Determination

Existing charter schools that did not have a funding determination in the prior year but that are providing a combination of both classroom-based and NCB instruction for FYs 2022–23 or 2023–24 should be aware that a funding determination approved by the SBE is required to receive Local Control Funding Formula (LCFF) funding for NCB ADA if their classroom-based ADA falls below the 80 percent minimum in accordance with EC Section 47612.5(e)(1).

While there is no statutory deadline by which an existing charter school is required to submit a first-time request for a funding determination, a charter school may experience significant fiscal impacts to its LCFF funding if its funding determination request is not submitted timely. Funding determination requests will be agendized according to the table below. The deadlines below provide CDE staff adequate time to review all funding determination forms received as well as allow the requests to be heard first at the Advisory Commission on Charter Schools (ACCS) meeting occurring the month before each SBE meeting.

Existing charter schools that do not currently have an active funding determination should use current year budget data to complete the form.

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. Determination of funding requests are reviewed by the CDE and presented to the ACCS. Both the CDE and ACCS recommendations are then presented to the SBE for final approval.

Mitigating Circumstances

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 page 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. 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.

Filing Deadlines and Submission Instructions

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

• Existing NCB charter schools with an approved funding determination that will expire at the end of FY 2022–23 shall file on or before February 1, 2023.

• Existing charter schools that did not have a funding determination in the prior year and are requesting funding for FY 2022–23 or FY 2023–24 do not have a statutory deadline to submit the funding determination request. However, in order to be heard timely by the SBE, the CDE recommends that funding determination requests be filed as follows:
  • In order for its request to be heard by the March 8–9, 2023, SBE meeting, the school shall file on or before December 1, 2022.
  • In order for its request to be heard by the May 17–18, 2023, SBE meeting, the school shall file on or before February 1, 2023.

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 FundingDeterminations@cde.ca.gov by the applicable due date. A signed hard copy of the NCB Funding Determination Form is not required to be submitted.

For charter schools that had a funding determination in the prior year, determination of funding requests submitted after the applicable due date will not be accepted. These charter schools will need to obtain a waiver approved by the SBE so that an untimely determination of funding request may be heard. Information and timelines for filing a waiver are posted on the CDE Waivers web page at https://www.cde.ca.gov/re/lr/wr/index.asp.

Local Control Funding Formula Impact

There may be a significant fiscal impact to an NCB charter school’s LCFF funding if a determination of funding request is not submitted timely.

• • A charter school requesting funding for its NCB ADA for FY 2022–23 must have a funding determination request approved by the SBE by its January 2023 meeting. Otherwise, the CDE will not disburse LCFF funds to the charter school for any of its NCB ADA beginning with the First Principal (P-1) Apportionment for FY 2022–23. In order to receive disbursement of LCFF funds for NCB ADA for the P-2 Apportionment for FY 2022–23, the funding determination must be approved by the SBE by its May 2023 meeting.
• • A charter school requesting funding for its NCB ADA for FY 2023–24 must have a funding determination request approved by the SBE by its January 2024 meeting. Otherwise, the CDE will not disburse LCFF funds to the charter school for any of its NCB ADA beginning with P-1 Apportionment for FY 2023–24. In order to receive disbursement of LCFF funds for NCB ADA for the P-2 Apportionment for FY 2023–24, the funding determination must be approved by the SBE by its May 2024 meeting.

In each scenario, funding may be adjusted after a funding determination is approved. However, any funding withheld at the P-2 Apportionment will not be adjusted until the following FY, at the P-1 Apportionment. The charter school’s following FY Advance Apportionment funding will also be impacted. Other ADA-driven funding for charter schools, such as lottery funding, may also be impacted.

Additional 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.

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 FundingDeterminations@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

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