State Superintendent says unequal funding could lead to lawsuit

by Joanne Faryon | KPBS and Kevin Croweinewsource

Search statewide maps of basic aid districts

If California doesn’t act soon to fix inequities in public education funding, it could face a civil rights lawsuit. That’s the message from State Superintendent Tom Torlakson.

In an interview, Torlakson responded to an ongoing investigation into K-12 education funding in California by KPBS and inewsource, an investigative reporting nonprofit based at San Diego State University. The investigation has found a system of inequity: some districts in wealthy neighborhoods benefit from high property values and property taxes; districts in middle-class and poor neighborhoods rely on the state to make up for their falling property values and taxes, a losing proposition in today’s economy.

inewsource’s analysis of education funding data found that some districts have doubled per pupil spending because of increased local tax revenue.

Statewide, 125 basic aid districts have generated a combined $644 million in excess tax revenue. But, the increased funding per student varies greatly across the group, with one district bringing in an extra $4.85 per student while another has more than $13,000 in additional funding to spend per student.

“There are certainly big differences between the resources for various communities, that’s a fact,” said Randolph Ward, San Diego County Superintendent of Schools.

In a 1968 case, Serrano v. Priest, the California Supreme Court ordered the state to address the gap in funding between schools in poor neighborhoods and those in wealthy communities, which could raise more money from property taxes.

In an effort to close that education funding gap, the state introduced revenue limits in 1972, which put a ceiling on how much money schools could raise.

Then, the passage of Proposition 13 in 1978 caused property tax revenues to drop. Most neighborhoods didn’t – and still don’t – raise enough money in local property taxes to reach their school revenue limit. So, the state has made up the difference.

But, rising property values and state cuts to education funding have once again created a widening gap between rich and poor districts.

“Some districts, very few, about 124 or so in 2009-2010, have more than enough property taxes to meet their entitlement,” said Margaret Weston, an analyst with the Public Policy Institute of California. “They used to be called basic aid, and now we tend to call them excess tax districts.”

The excess tax districts get to keep the extra tax revenue and can spend it on students.

Revenue limit funds typically make up about 70 percent of a district’s funding. The rest comes from a mix of categorical funds, grants and stimulus funds.

At least eight excess tax districts districts statewide – two of which are located in San Diego – more than doubled their revenue limit spending per pupil through excess revenues. Rancho Santa Fe received an additional $5,871per student over the $4,963 state-determined revenue limit, and Solana Beach brought in $5,080 per student more than its $4,965 revenue limit.

Carmel Unified in Monterey County topped the list with an additional $13,094 per student over the $5,208 revenue limit.

More than one-third of the districts are located in the bay area, and eight are located in San Diego County.

But not all basic aid districts are swimming in funds. Santa Barbara Elementary School District received an additional $4.85 per pupil based on local tax revenues, and San Dieguito Union High got an additional $111 per student. In all, thirteen districts received less than $200 per student in additional funding.

For per-pupil figures, inewsource examined excess tax districts with at least 500 students average daily attendance.

A bill that aims to clarify district financials and simplify school funding is making its way through the state legislature. The bill, AB-18, would base funding on the needs of a district, rather than outdated spending formulas. Torlakson said he is in favor of the legislation.

“I think a wiser way to go is to look at the increase in revenues that come back in to the state budget and differentially target those increased revenues towards the districts that are at the low end of the totem pole,” he said.

State and local education officials have known about the inequities created by basic aid districts, but have been at a loss for what to do about them. They’ve cut funding to the districts twice. The 2009-2010 cuts totaled $104 million.

According to the independent Legislative Analyst’s office, the state has the power to redistribute funds among districts within a county. But Torlakson said that’s not the solution.

“That’s just going to create turmoil and conflict between legislators from different regions of the state and between school districts in different regions of the state,” he said.

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About Joanne Faryon:

Joanne Faryon is a freelance reporter and former inewsource and KPBS reporter.