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Lesson 8.7

Allocations:
Districts Control How Money Gets to the Classroom

If a school budget falls and no one notices, does it make a sound?

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Does your school district office seem powerful? It might be because they are the ones cutting the checks.

The responsibility for managing and disbursing funds for everything from paychecks to school supplies lies in the hands of the school district. (Well, technically, money flows through "Local Education Agencies" (LEAs), but most LEAs are school districts. Charter schools and county offices of education also fall into the "LEA" category. So now you know.)

The District Budget Process

As explained in Lesson 8.3, California school districts depend on the state for most of their annual revenues. The state budget determines the amount of money that will be allocated toward education. That amount is apportioned to school districts through the Local Control Funding Formula (LCFF) described in Lesson 8.5. State leaders have until June 30 each year to decide on a state budget.

Funny thing about that June 30 deadline. By law, school districts also have to adopt a final budget at the end of June for their coming school and fiscal year, which starts the next day, on July 1. If it seems like school district leaders are obsessively reading tea leaves in June, it's because they are. District officials use informed estimates and assumptions to create their annual budgets. The planning typically starts in earnest by January, but budget planning and management are year-round concerns in most school districts. The budgeting process for charter schools is somewhat different, because charter schools must budget for facilities costs.

Districts differ in their approach to public input about the budget. Some districts try to keep the information quiet. Others do all they can to present the information clearly and let the public know when feedback will be most helpful. Common to all districts is the legal obligation to present budget information at public school board meetings. The parent leaders who really understand their school district budgets are generally those who make a point of attending board meetings regularly and who aren’t shy about asking for clarification from district business officials or the superintendent’s office when necessary.

Who Controls the Money?

School districts, in turn, manage local schools. In the majority of California districts, the central office makes the big decisions about how schools and classrooms will operate, including a great deal about how they use resources. That can include everything from the school calendar to the number of students per classroom to where to purchase supplies to how many custodians are needed.

Good Intentions
Districts get money for kids who are poor /
or speak only limited English. /
But does that money carry through /
after the budget is finished?

Most California schools have a site budget. The school principal controls it, often with the help of a site council or similar group that includes parents and school staff. Site budgets usually cover only non-staff costs because staffing decisions are made by the district.

If school accounting includes staff expenses at all, the figures are rarely "real." That is, they are almost always calculated on the basis of district-wide average costs rather than the true salary costs for individuals. This often leads to a misleading view of how equitably financial resources are used. Imagine two schools, each with the same number of teachers. Using district-wide average costs, both schools appear to receive equal an equal amount of money. But this is a false impression. If one of the schools has a larger number of experienced teachers, the true expenditures at that school will be higher than the school with less experienced, lower-paid teachers.

Districts are required to disclose actual staff costs at the site level in School Accountability Report Cards (SARCs). Many have ignored the requirement.

In 2006, The Education Trust-West pursued a groundbreaking analysis of the effect of teacher seniority on the distribution of actual resources in schools. The findings of its original study, The Hidden Gap, highlighted the likelihood that high-poverty schools are disproportionately staffed with inexperienced teachers. This analysis drove some interest in transparency. Districts are now required to include actual salary costs in their School Accountability Report Cards (SARC), a public document that is required for each school each year. In 2017, California's lawmakers considered acting to comply with the federal Every Student Succeeds Act (ESSA), which requires disclosure of actual personnel expenses for each school. It seems likely that the SARC will eventually serve as a primary means to deliver this information. Unfortunately the data from SARCs are not systematically collected or summarized in a manner that permits analysis. Efforts are underway in California to establish clear guidelines for reporting this information to comply with ESSA.

The deficiencies of California’s data systems are discussed further in Lesson 9.5.

Many districts have experimented with giving school principals increased control over spending decisions, even in some cases including portions of their personnel budgets. Site-based budgeting is not as easy as it might sound, though. Not all principals are equally good at budgeting, or for that matter at spending. Finding a practical and effective balance between school-based insights, multi-school programs and district-level fiscal control is tough work. It requires good processes, effective accounting and strong communication.

Updated August 2017

Review

Under LCFF, school districts control the allocation of funds to schools. The largest use of funds in education is for staff salaries and benefits, which can vary greatly with staff seniority. One report is designed to provide transparency to how much money is actually spent at each school site. Which one is it?

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Questions & Comments

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user avatar
Brandi Galasso October 8, 2015 at 10:29 am
Does any one know how much per student our schools should recieve. If district recieves $9000 per student how much does school get per student? Because district doesnt actually say.
user avatar
Steven N October 1, 2015 at 12:25 pm
The SARC (School Accountability Report Card) are required by the State, are posted by the State and districts. They contain the average teacher salary At A School, in relation to the average at a district. Although the comparisons disrict-to-district are invalid (TCOE Total Cost Of Employment is better): I find the school-to-school comparisons very useful myself.
My District is now submitting and posting these locally on the proper schedule (January of every year). Yeah our District Office (Karen R. and Cathy B.)!
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