Education funding: maximum categorical education flexibility pilot program.

Existing law establishes various categorical education programs and appropriates the funding for those programs in the annual Budget Act. Existing law requires the Superintendent of Public Instruction, for the 2008–09 to 2012–13 fiscal years, inclusive, to apportion from the amount provided in the annual Budget Act for specified categorical education programs an amount based on the same relative proportion that the local educational agency received in the 2008–09 fiscal year for those programs and authorizes school districts, for those fiscal years, to use these funds, with specified exceptions, for any educational purpose, to the extent permitted by federal law. Existing law, for those fiscal years, deems local educational agencies that use these categorical education program funds for any educational purpose to be in compliance with the program and funding requirements of those categorical education programs. Existing law, as a condition of receiving the categorical education program funds that may be used for any educational purpose, requires school districts and county offices of education, at a regularly scheduled, open, public hearing, to take testimony from the public, discuss, and approve or disapprove the proposed use of funding. Existing law requires a local educational agency to report expenditures, as specified, to indicate the activities for which these funds were expended and requires the department annually to collect and provide this information to the appropriate legislative policy and budget committees and the Department of Finance. This bill would establish the 3-year Maximum Categorical Education Flexibility Pilot Program in which up to 3 school districts would be selected to participate. To be eligible for selection, a school district would be required to meet certain preconditions, including developing a plan or initiative to accelerate pupils' progress to proficiency that includes specified goals. A school district selected to participate would be required to agree to demonstrate significant progress toward accelerating pupils' progress toward proficiency on California's academic standards over the 3-year pilot program period, a narrowing of the achievement gap in its federally recognized subgroups, fiscal solvency, positive growth on the district API, improvement in its college entrance rate, and an increase in its graduation rate. The bill would require the Superintendent to apportion to the participating school districts special apportionments equal to the amounts of funding those school districts received in the 2009–10 fiscal year for specified programs, including the Economic Impact Aid Program, the Class Size Reduction Program, and Transportation Programs, except special education pupil transportation. A participating school district would be allowed to use the special apportionments for any purpose related to improving pupil achievement and academic instruction and would be required to implement an open and transparent process that allows public input so as to notify parents, staff, and the community of discussions and pending decisions related to the flexible use of categorical education program funds. A participating school district would be deemed to be in compliance with the program and funding requirements associated with the categorical education programs included in the pilot program, except that a participating school district that receives funding for economic impact aid would be required to continue to designate staff to coordinate services and programs for English learners, including the home language survey, and to continue in existence parent advisory committees and schoolsite councils. A participating school district would be required to submit an evaluative annual report to the department, the state board, the Governor, and the Legislature and to submit to the department an annual expenditure report. The Superintendent would be required to contract for an independent evaluation of the pilot program that would consist of an interim evaluation report and a final independent evaluation report that identifies the success and failures of the pilot program and makes recommendations regarding improving the pilot program and whether the program should be continued. The bill would prohibit the waiver of any provisions of the pilot program.