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California Department of Education
Official Letter
California Department of Education
Official Letter
November 5, 2018

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

Nonclassroom-Based Charter Schools Determination of Funding Requests for the Fiscal Year 2018–19

The purpose of this letter is to provide information regarding funding determination requests for charter schools operating under a nonclassroom-based (NCB) instructional setting. A charter school is considered operating as a NCB charter school if its total average daily attendance (ADA) is less than 80 percent classroom based.

A NCB charter school will need to request for a funding determination with the California Department of Education (CDE) to be eligible for funding for its NCB ADA. New NCB charter schools are required to file in their first year of operation while NCB charter schools with expiring funding determinations will need to renew their funding determinations in the final fiscal year (FY) of their existing funding determination period. Generally, new NCB charter schools are limited to a two-year funding determination period while NCB charter schools with expiring funding determinations can be approved for a minimum period of two years to a maximum of five years in length.

California Education Code (EC) sections 47612.5 and 47634.2, and California Code of Regulations, Title 5 (5 CCR) established the criteria for the review and evaluation of determination of funding requests for NCB charter schools. The statutes specify that a charter school may receive apportionment funding for NCB instruction only if a determination of funding is made by the State Board of Education (SBE). The NCB funding determination requests are reviewed by the CDE and presented to the Advisory Commission on Charter Schools (ACCS). Both the CDE and ACCS recommendations are then presented to the SBE for final approval.

If a charter school offers NCB instruction, as defined, and does not receive a funding determination from the SBE, the school will lose some or all of its state funding for its NCB ADA. EC Section 47612.5(e)(1) and 5 CCR Section 11963 specify the requirements for classroom-based instruction and school site conditions. Pertinent information from the California Legislative Information Web site is available at https://leginfo.legislature.ca.gov/faces/codes_displaySection.xhtml?lawCode=EDC&sectionNum=47612 and the Thomson Reuters Westlaw California Code of Regulations Web page at https://govt.westlaw.com/calregs/index.

A charter school that provides both classroom-based and NCB instruction should be aware that a funding determination will be required to receive LCFF funding for their NCB ADA if their classroom-based ADA falls below the 80 percent minimum in accordance with EC Section 47612.5(e)(1). Furthermore, we recommend that charter schools with classroom-based ADA to NCB ADA ratio projected near the 80 percent minimum obtain a funding determination to ensure against LCFF funding impacts should they unexpectedly fall below the 80 percent minimum.

Mitigating Circumstances

Pursuant to 5 CCR Section 11963.4(a), a nonclassroom-based 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” (also referred to as mitigating circumstance) by which to make a recommendation other than one that results from the criteria specified in 5 CCR Section 11963.4(a), which may 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 provide MC will complete Section VI of the determination of funding request. 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 determination of funding request. Further, MC explanations must include, if any, documented data regarding the individual and specific circumstances, factors that are unique about the charter school, an explanation on why the charter school failed to meet the 5 CCR requirements for funding, and an explanation on the specific actions taken by the charter school to meet the funding criteria. The CDE may require additional information from the charter school in support of its MC response.

Filing Deadlines

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 2018-19: Due on or before December 3, 2018.
  • NCB charter schools with an approved funding determination that will expire at the end of the FY 2018–19: Due on or before February 1, 2019.

Determination of funding requests postmarked after the applicable due date will not be accepted. The charter school will need to obtain a waiver approved by the SBE for any determination of funding request that is not filed timely or is not prospective. Information and timelines for filing a waiver are posted on the CDE Waivers Web page at http://www.cde.ca.gov/re/lr/wr/index.asp.

Untimely Funding Determinations - Local Control Funding Formula Impact

There may be a significant fiscal impact to a NCB charter school’s Local Control Funding Formula (LCFF) if a determination of funding request is not submitted timely. While the timing will differ based on whether the NCB charter school is 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 must have a funding determination approved by the SBE by its May 2019 meeting. If not met, beginning with the Second Principal (P-2) Apportionment for the FY 2018–19, the CDE will not disburse LCFF funds to the new charter school for any of its NCB ADA.
  • A continuing NCB charter school that files a prospective FY 2019–20 determination of funding request, must have a funding determination approved by the SBE by its January 2020 meeting. If not met, beginning with the First Principal (P-1) Apportionment for the FY 2019–20, 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 will need to be approved by the SBE by its May 2020 meeting.
  • A continuing NCB charter school that needs a FY 2018–19 funding determination, must have a funding determination approved by the SBE by its January 2019 meeting. If not met, beginning with the P-1 Apportionment for the FY 2018–19, 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 will need to be approved by the SBE by its May 2019 meeting.

In all of the three scenarios, funding may be adjusted after a funding determination is approved. However, any funding withheld at P-2 will not be adjusted until the following FY P-1 Apportionment certified in February. The charter school’s following FY Advance Apportionment funding will also be impacted. Note that 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 www.cde.ca.gov/re/ca/fc. If you have further questions about the implications to LCFF funding, please contact the School Fiscal Services Division by e-mail at pase@cde.ca.gov.

Filing Instructions

The forms and instructions for completing a determination of funding request are available on the CDE Nonclassroom-Based Determination of Funding Web page at www.cde.ca.gov/sp/cs/as/nclrbifunddet.asp.

The CDE will considered a timely and complete filing when the signed hardcopy and electronic files of the funding determination request and the charter school’s conflict of interest policy statements are received by the applicable due dates to:

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

Email electronic files to the CDE at:

Charter-SB740@cde.ca.gov.

If you have any questions regarding this subject, please contact the Charter Schools Division, by phone at 916-322-6029 or by e-mail at Charter-SB740@cde.ca.gov.

Sincerely,

/s/

Lisa Constancio, Director
Charter Schools Division

CSC:bf

Last Reviewed: Wednesday, November 7, 2018

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