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Instructions for Funding Determination Form

Instructions for completing the Nonclassroom-Based Funding Determination Form Fiscal Year 2018-19.

Who Needs a Funding Determination?

A charter school whose total average daily attendance (ADA) population has less than 80 percent classroom based ADA is considered a charter school operating in a nonclassroom based (NCB) instructional setting and will need to file a funding determination for approval by the State Board of Education (SBE). Without an SBE-approved funding determination, a NCB charter school may not be eligible for funding for any of its NCB ADA.

Pursuant to EC Section 47612.5(e)(1):

  • Classroom-based instruction occurs only when charter school pupils are engaged in educational activities required of those pupils and are under the immediate supervision and control of an employee of the charter school who possesses a valid teaching certification, in accordance with EC Section 47605 (l).
  • For purposes of calculating average daily attendance (ADA) for classroom-based instruction apportionments, at least 80 percent of the instructional time offered by the charter school shall be at the school site, and the charter school shall require the attendance of all pupils for whom a classroom-based apportionment is claimed at the school site for at least 80 percent of the minimum instructional time required to be offered, pursuant to EC Section 47612.5(a)(1).

Classroom-based instruction is further defined in California Code of Regulations, Title 5 (5 CCR) Section 11963.

When a properly completed determination of funding request is reviewed by the California Department of Education (CDE), the CDE will forward its recommendation to the Advisory Commission on Charter Schools (ACCS). At a public meeting, both ACCS and CDE’s recommendations will be forwarded to the SBE for a final approval of the funding determination. The CDE will not review or process any funding determination requests that are deemed incomplete or filed past the established reporting deadlines.

Data Used to Complete the Funding Determination Form

New Charter Schools

New NCB charter schools will use its July 1 budget estimates from its first year of operation. Generally, the total revenues, expenditures, and fund balances reported on the FDF should agree with the charter school’s July 1 preliminary budget that was filed with their charter authorizer, pursuant to EC Section 47604.33(a). However, the fiscal data from the charter school’s first interim report for the first year of operation may also be used, if it is available.

Existing Charter Schools

NCB charter schools will use its audited financial data from the prior fiscal year (FY) of the final FY of its expiring funding determination. Generally, the total revenues, expenditures, and fund balance that are reported on the FDF should agree with the total revenues, expenditures, and fund balance from the charter school’s annual independent financial audit report.

The CDE may request additional information for further clarification to complete its review or to develop a reasonable basis for a recommendation. With the consent of the State Superintendent of Public Instruction, the request for additional information shall be considered a reasonable inquiry to which the charter school must respond, pursuant to EC Section 47604.3. The CDE will consider the request incomplete if the charter school does not respond to a CDE inquiry. Incomplete FDFs will not be processed by the CDE.

Funding Determination Form

The FDF has seven sections: Charter Information, Financial Information, Supplemental Information, Nonclassroom-Based Virtual or On-Line Charter Schools, Calculated Funding Determination Percentages, Mitigating Circumstances, and Certification.

Section I. Charter Information

Complete all the applicable fields in Section I. The data requested from this section are detailed in 5 CCR sections 11963.3(a)(1) to (4).

Indicate which funding determination percentage (100 percent, 85 percent, or 70 percent) the charter school is requesting, the number of years being requested, and the starting and ending FY period of the request. 5 CCR provides for a funding determination period of at least two years and a maximum of five years for existing charter schools, and two years for new charter schools.

Section II. Financial Information

The data collected in this section is used as the basis for determining the eligible funding determination percentage as provided for, pursuant to 5 CCR Section 11963.4. For assistance in definitions needed to complete this section, charter schools are directed to the definitions outlined in the California School Accounting Manual (CSAM), which is located on the CDE Definitions, Instructions, and Procedures Web page at www.cde.ca.gov/fg/ac/sa.

Section II is divided into sub-sections: Total Resources, Total Expenditures and Other Uses, Revenues over Expenditures – Surplus or (Deficit), Fund Balance, and Reserves.

A. Total Resources (5 CCR Section 11963.3 [a][5][A])

Resources are categorized into four major revenue object classifications: Federal, State, Local, and Other Financing Sources.

a. Federal Revenues (CSAM Object Codes 8100–8299 / Resource Codes 3000-5999)

Includes federal programs such as Special Education and other federally funded programs.

Report federal revenues from the Public Charter Schools Grant Program on Line A.1.a.(i). Per regulations, PCSGP revenues reported on this line are excluded from the SB 740 minimum spending criteria.

b. State Revenues (CSAM Object Codes 8010–8099 and 8300–8599)

Includes the Local Control Funding Formula (LCFF) funding (State Aid, Education Protection Account, In Lieu of Property Taxes, and any additional state aid for Minimum State Aid), Lottery Funds, AB 602 Special Education Funds, School Facilities Grant Funds, and any other state funded resources.

c. Local Revenues (CSAM Object Codes 8600–8799)

Includes interest income, donations, fundraising proceeds, and other local revenue resources. Does not include the In Lieu of Property Taxes calculated under LCFF.

d. Other Financing Sources (CSAM Object Codes 8900–8979)

Includes proceeds from property sales, loans, and other financing resources.

B. Total Expenditures and Other Uses (5 CCR sections 11963.3[a][5][B] to [E])

Expenditures are categorized into four major activities: Instruction and Related Services, Operations and Facilities, Administration and All Other Activities, and Other Outgo and Other Financing Uses.

1. Instruction and Related Services

Instruction-related services provide administrative, technical, and logistical support to facilitate and enhance instruction. These services exist as adjuncts for fulfilling the objectives of instruction, community services, and enterprise programs rather than as entities within themselves (e.g., supervision of instruction, library/media/technology services, development of curriculum, and school site administration).

Instruction includes the activities dealing directly with the interaction between teachers and students, without regard to the instructional location or medium (e.g., classroom instruction, independent study, home/hospital study, work study, and computer/distance-based education).

Includes services provided in direct support of students (e.g., counseling, health services, physical/occupational therapy, home-to-school, transportation, and food services).

Includes school-sponsored extra-curricular or co-curricular activities designed to provide students with experiences such as motivation and enjoyment and improvement of skills (e.g., athletics, music, debate, public and speaking).

Includes instructional materials, supplies, and equipment.

  • Salaries and benefits include those for teachers, aides, specialists, and other personnel who are employees of the charter school and provide direct instruction or related support services to students (e.g., counselors, nurses, physical/occupational therapists, librarians, psychologists, curriculum coordinators, Individualized Education Program coordinators, bus drivers, and food services personnel). Personnel costs associated with school-sponsored extra-curricular or co-curricular activities designed to provide motivation, enjoyment, and improvement of skills are also included.

(i) Certificated salaries and benefits are for all instruction and related employees who possess a valid certificate, permit, or other document equivalent to that which a teacher in other public schools would be required to hold from the Commission on Teacher Credentialing (CTC) and who work in the charter school in a position required to provide direct instruction or direct instructional support to students. “Employees” in this category also include: (1) special education teachers who possess a valid certificate, permit, or other document equivalent to that which special education teachers in non-charter public schools would be required to hold from the CTC, and who provide direct instruction or direct instructional support to students of the charter school pursuant to a contract with a public or private entity; and (2) individual employees who possess a valid certificate, permit, or other document equivalent to that which the individual would be required to possess in a non-charter public school, issued by the CTC, and who are employed by a local educational agency (LEA), provided all of the following conditions are met: (a) LEA is the employer of all the charter school’s staff, (b) governing board of the LEA is the governing authority for the charter school and, (c) LEA’s employees are assigned exclusively to work at the charter school providing direct instruction or direct instructional support to students or, to the extent that the LEA’s employees are assigned to work at the charter school on a part-time basis, the charter school pays for the services rendered by the employee providing direct instruction or direct instructional support to students on a documented, fee-for-service basis and not, on the basis of a fixed annual amount, fixed percentage of ADA revenue, or other basis that is not related to documented services actually rendered to the charter school. Under no circumstances shall certificated employees of an LEA be considered employees of a charter school for purposes of this category unless the charter school pays for the services rendered by the LEA’s employees on a documented, fee-for-service basis. For purposes of this section, “employee” also means qualified persons who provide direct instruction or direct instructional support, that are hired directly by the charter school through an employment services contract based on a documented, fee-for-service basis.

(ii) Classified salaries and benefits are those for positions that do not require a credential.

  • Books, supplies, and equipment include approved textbooks; core curricula materials; instructional or related books and reference materials; instructional or related materials and supplies; food for food services; fuel, oil, tires, and parts for buses; instructional or related vehicles/machinery; computer hardware and software; and equipment.
  • Services and Other Operating Costs

(i) Contracts for instructional services include those for teachers, aides, specialists, and other personnel who provide direct instruction to students pursuant to a contract with a public or private entity. These contracts should exclude those for special education instructors who possess a valid certificate, permit, or other document equivalent to that which special education teachers in non-charter public schools would be required to hold from the CTC, and who provide instruction to pupils of the charter school. Those special education contract amounts should be reported on Line B.1.a. Other qualified persons who provide direct instruction or direct instructional support, and who are hired directly by the charter school through an employment services contract based on a documented, fee-for-service basis should also be reported on Line B.1.a. All other contracts for instructional services should be reported on Line B.1.c.(i).

(ii) Contracts for instructional support include those for personnel providing related support services to students (e.g., nurses, physical/occupational therapists, bus drivers, food services personnel, etc.). Contracts for personnel costs associated with school-sponsored, extra-curricular or co-curricular activities providing motivation, enjoyment, and improvement of skills are also included.

(iii) All other instruction related operating costs include travel, conference, and professional development costs for instructional or related personnel; instructional or related professional or consulting service contracts; instructional or related equipment rents, leases, and repairs; instructional or related communication costs; insurance for school buses; and special education excess costs paid to another agency.

2. Operations and Facilities

Expenditures for activities concerned with securing and keeping open and maintaining the physical plant, grounds, and equipment necessary for school operations (e.g., custodial, maintenance, grounds keeping, and security). Category includes facility rents, leases, and utilities, and activities related to facilities acquisition and construction costs.

  • Salaries and benefits for personnel who provide plant maintenance and operational services (e.g., janitors, gardeners, custodians, grounds keepers, security personnel, and other plant services personnel).

(i) Certificated salaries and benefits are for all operations and facilities employees who possess a valid teaching certificate, permit, or other document equivalent to that which a teacher in other public schools would be required to hold from the CTC.

(ii) Classified salaries and benefits are for those employees who do not possess a certificate, permit, or other valid document from the CTC.

  • Books, supplies, and equipment include materials, supplies, and equipment that are needed to keep the physical plant and grounds open, clean, comfortable, and in working condition and a state of repair (e.g., custodial supplies, gardening and maintenance supplies, supplies for operation, repair and upkeep of equipment or buildings and grounds, and other plant services supplies and equipment).
  • Services and other operating costs include rents, leases, utilities, and repairs.
  • Facility acquisition and construction include costs of acquiring land and buildings, remodeling buildings, constructing buildings, additions to buildings, and site improvements.
  • Total operations and facilities
  • Allowable facility costs

(i) Enter actual square footage of the facility occupied by the charter school.

(ii) Enter any classroom-based prior year Second Principal (P-2) Apportionment ADA (if applicable) as reported.

(iii) Enter the prior year total student hours attended by NCB students at the school site. The equivalent ADA is equal to 868 hours.

Use time logs or other auditable documentation to support the hours NCB students participated in activities at the school site. Determine the total hours of student attendance on site for the year, which equates to the number of students times the number of hours each student attended a class or meeting on the school site. An equivalent ADA is equal to the total student hours attended by NCB students divided by 868, and is added with the total classroom-based ADA. However, the student hours attended by an individual NCB student may not exceed the equivalent of one ADA.

The portion of allowable facility costs that can be included as instruction related is limited to the lesser of the total charter’s operations and facilities costs or the total (classroom-based plus equivalent student hours) allowable ADA calculated at $1,000 per equivalent ADA.

3. Administration and All Other Activities
  • Salaries and benefits include individuals who provide general administrative services to the overall charter as a whole, or who provide community services or other services not reported elsewhere.

(i) Certificated salaries and benefits are for all administrative employees who possess a valid teaching certificate, permit, or other document equivalent to that which a teacher in other public schools would be required to hold from the CTC.

(ii) Classified salaries and benefits are for those employees who do not possess a certificate, permit, or other valid CTC document.

  • Books, supplies, and equipment include books and reference materials; supplies; vehicles; machinery; and computer hardware and software used in general administration, community services, or activities not reported elsewhere.
  • Services and other operating costs include travel, conference, and professional development costs for administrative personnel; community services personnel or other personnel reported in this category; professional or consulting service contracts; equipment rents, leases, and repairs; communication costs; and property and liability insurance costs. If any or all of these services are provided to the charter school through a contract with an educational management organization or any other public or private entity, the total contract amounts should be separately identified.

Supervisorial oversight fees include expenses related to compensating a chartering authority for costs of supervisorial oversight of a charter school and engaging in the charter renewal process. These costs are capped at actual costs, not to exceed one percent of the charter school’s revenue (three percent if a chartering authority provides substantially rent-free facilities) pursuant to EC Section 47613.

4. Other Outgo and Other Financing Uses

Include servicing debt schedules; transferring funds to LEAs or others; other outgo; and transfers to other funds within the charter school.

C. Revenues Over Expenditures – Surplus or (Deficit) (5 CCR Section 11963.3[a][5][F])

An operating surplus is reported when total resources exceed total expenditures.

An operating deficit occurs when the total expenditures exceed total resources.

D. Fund Balance (5 CCR Section 11963.3[a][5][A])

The ending fund balance is equal to the ending fund balance from the prior fiscal year plus the current FY’s operating surplus or operating deficit. The ending fund balance is further separated into reserve components in Lines E.a thru E.e.

E. Reserves (5 CCR Section 11963.3[a][5][F])

  • Designated for Economic Uncertainties. Enter the amount set aside by the charter school as reserves for economic uncertainties
  • Facilities Acquisition or Capital Projects. Enter the amount set aside by the charter school for the purchase of a facility or leasehold capital improvements
  • Reserves required by Charter Authorizer. Enter the amount set aside for additional reserves agreed to with the chartering authority
  • Other Reserves. Enter all other reserves set aside for other purposes.
  • Unassigned/Unappropriated Fund Balance. Unobligated reserves that have not been set aside in line E.a thru E.d.

For DEU or Capital Project reserves reported on lines E.a. or E.b.in excess of the greater of $50,000 or five percent of total expenditures, a written explanation must be provided on why reserves are maintained at those levels.

Section III. Supplemental Information

  1. The ratio of ADA for independent study pupils to full-time equivalent (FTE) certificated employees responsible for independent study shall not exceed a pupil to teacher ratio (PTR) of 25:1 or the ratio of pupils to FTE certificated employees for all other educational programs operated by the largest unified school district in the county or counties in which the charter school operates. For the purposes of this section, an FTE certificated employee means an employee who is required to work a minimum six-hour day and 175 days per FY. Part-time positions shall generate a partial FTE on a proportional basis. For continuing charter schools, calculate the PTR based on the charter school’s prior year P-2 Apportionment ADA. The ratio of ADA for independent study pupils to FTE certificated employees responsible for independent study shall not exceed a PTR of 25:1 or the ratio of pupils to FTE certificated employees for all other educational programs operated by the largest unified school district in the county or counties in which the charter school operates.
  2. If applicable, provide a listing of entities that received in the previous FY or will receive in the current FY $50,000 or more, or 10 percent or more of the charter school’s total expenditures, cumulatively. Identify the amount received by each entity; whether each of the contract payments is based on specific services rendered, or upon an amount per unit of ADA or some other percentage; and provide an identification of which entities, if any, have contract payments based on a per unit ADA amount or some other percentage.
  3. Provide an identification of the members comprising the charter school’s governing board and a description of how those members were selected; whether the governing board has adopted and implemented conflict of interest policies and procedures; and whether any of the governing board members are affiliated in any way with any of the entities reported per the contract payments reporting requirements and if so, how.
  4. Provide an explanation and description of all transfers reported and identified in the Other Outgo and Other Financing Uses category.
  5. If applicable, provide a listing and the amounts of each of the Other Reserves reported on line III.E.d.
  6. If a charter school opts to include facility costs as an instructional cost, the total annual facility-related and operational cost, total facility square footage occupied by the charter school, total prior year P-2 classroom-based ADA, and the total student hours attended by NCB students at the school site, must be provided.
  7. Enter the number of FTE employees who possess a valid teaching certificate, permit, or other document equivalent to that which a teacher in other public schools would be required to hold issued by the CTC and who work in the charter school in a position required to provide direct instruction or direct instructional support to students. For purposes of this requirement, direct instructional support includes activities that are directly related to student instruction that are performed by qualified certificated persons such as curriculum coordinators, individualized education plan coordinators, librarians, counselors, psychologists, nurses, etc.
  8. Enter the charter school’s certified prior FY P-2 Apportionment ADA and the budget FY estimated P-2 Apportionment ADA.

Section IV. Nonclassroom-Based Virtual or On-line Charter Schools

  • Indicate whether the charter school is a virtual or on-line charter school, which is defined as a charter school that provides teaching and student interaction on the Internet for at least 80 percent of the time.
  • A virtual or on-line charter school must be able to demonstrate compliance with regulations specified pursuant to 5 CCR sections 11963.5(b)(2) to (8).

Section V. Calculated Funding Determination Percentage

The results of the FDF are calculated and displayed in this section. Data input is not needed for Section V. The two percentages displayed must meet the Funding Determination Criteria for the charter school’s requested funding determination. To qualify for full funding (100% funding determination), the NCB charter school must meet three conditions:

  • Spend at least 40 percent of total public (federal and state) revenues on Instructional Certificated Salaries and Benefits, and
  • Spend at least 80 percent of total revenues on Instruction and Instruction-Related Services, and
  • Maintain a Pupil to Teacher Ratio (PTR) of: a) 25 to 1; or b) Equivalent PTR of the largest unified school district in county or counties in which the charter school operates.

If the criteria is not met to qualify for the funding requested, the charter school may choose to provide mitigating circumstances for consideration by the ACCS.

Section VI. Mitigating Circumstances

If a charter school not meet the spending criteria for the funding determination requested, regulations allow the charter school to provide mitigating circumstances for consideration by the ACCS for making a recommendation for funding other than one that results from the criteria specified in the regulations.

Regulations specify that mitigating circumstances may include, but are not limited to, the following:

  • One-time or unique or exceptional expenses
  • Size of the charter school
  • Number of years charter school has been in operation

The previous mitigating circumstances form is no longer available and has been consolidated into this section. NCB charter schools choosing to provide mitigating circumstances must complete this section. Any supporting documentation should also be filed along with the FDF.

Section VII. Certification

Obtain the appropriate authorized signature for the charter school. Submission of an FDF without a signed certification will be deemed an incomplete submission by the CDE. Certification may be signed by the charter school's director, principal, or governing board chairperson. The certification is required by 5 CCR Section 11963.3(b)(1).

Deadlines

Newly Operational NCB Charter Schools

On or before December 3, 2018.

NCB Charter Schools with an expiring funding determination

On or before February 1, 2019.

What and Where to File

Hardcopy AND electronic copies of the documents must be submitted to the CDE by the appropriate deadline.

  • Completed and signed FDF
  • Conflict of Interest Policy

Attention: Nonclassroom-Based Funding Determination
Charter Schools Division
California Department of Education
1430 N Street, Suite 5401
Sacramento, CA 95814-5901

E-mail electronic copies of the above documents, as well as any other pertinent information, to the CDE at charter-sb740@cde.ca.gov.

Questions:  
Last Reviewed: Wednesday, November 7, 2018