Weighted formula’s impact

In six years, when Gov. Brown’s proposed new funding system is fully phased in, the average statewide funding per student is expected to be $9,200. At that time, the per-pupil funding for Los Angeles Unified would be $1,250 higher per student – $10,460; Coachella Valley Unified, a 17,000-student district in Riverside County, would receive $12,162 per student.

At the opposite end, Pleasanton Unified, in Contra Costa County, would receive about $5,000 less per child than Coachella Valley – $7,198, or a little more than 1 percent above the $7,073 it’s scheduled to receive in Prop 98 funding next year. Berkeley Unified would get $8,212, only $515 more per child after six years of phasing in the new finance system.

The numbers, released last week by the Department of Finance, show  the fundamental realignment in funding that would unfold under Brown’s weighted student funding formula. (Click here for the full statewide district-by-district breakdown. See the far right column for the additional dollars each district will get in 2017-18 compared with the proposed 2012-13 district per-student amounts in column 5. If you’re confused, hold tight; I’ll explain how to read the chart, using Alameda County, in a moment.)

In its broadest terms, the weighted student formula system gives extra dollars to districts with large numbers of English-learning students and those from families with low incomes – out of recognition that these children require extra resources to compensate for their disadvantages, and perhaps to attract and retain good teachers.

Those districts with very low percentages of these children not only would get relatively less, but, like Pleasanton, would not benefit, after years of facing substantial cuts in state funding, from what Finance officials are predicting will be substantial increases in Proposition 98 funding levels in the next half-dozen years.

Under the current system, districts get roughly the same basic per-student allotment (generally but not always within a 10 percent range), plus extra money from categorical programs for designated purposes – many of which do serve poor kids. Brown wants to throw most of the categorical money into a pot and redistribute it to the targeted children. Since some of the formulas for categoricals like Economic Impact Aid, home-to-school transportation, and Targeted Instructional Improvement Grants (desegregation funding favoring a handful of urban districts) are dated,  one can argue that the new system would be fairer and simpler. However, because Brown is not guaranteeing minimal increases in base-level funding, some districts – particularly high school districts and rural districts with a lot of bus money – that benefited under the current system would lose out under a weighted system unless the formula is changed.

How your district might fare

In analyzing the district-by-district breakdown , keep the following points in the back of your mind:

• Brown builds in the assumption that his proposed temporary $6.8 billion tax initiative will pass in November. If it doesn’t, all bets are off.
• The Department of Finance assumes that Proposition 98 funding will increase a healthy 40 percent between now and 2017-18 as the state’s economy recovers. That’s why Brown can claim that, with very few exceptions, districts will do better in 2017-18 than in 2012-13.
• The weighted student system consists of a uniform base grant, comprising 68 percent of the Proposition 98 funding for the system, and the supplemental funding for disadvantaged students, making up the remaining 32 percent. The base grant will start out at $4,920 and grow to $6,660 in 2017-18.
• The weighted student formula does not include about $3 billion in categorical funds that would continue to be protected. The largest is special education funding, along with after-school and school nutrition programs.
• This is the first pass; Brown administration officials have indicated a willingness to change it, and, as you will see, there are reasons to do so.
• Basic aid districts – the roughly 10 percent of districts that are funded with property taxes alone – are not included, though they would be affected through a loss of categorical money.

Using Alameda County, above, to illustrate, the  most important columns in the chart are 5, 11, and 14.

• Column 5: What each district will receive in per-student funding in 2012-13, pre-weighted student formula: $6,302 in the case of Alameda City Unified. No district will receive less than this. (HTS refers to home-to-school transportation, which will be protected next year only.)
• Column 11: The per-student funding in 2017-18, after the full implementation of the weighted student formula ($7,981 for Alameda City Unified).
• Column 14 (far right): The dollar difference between the 2012-13 and 2017-18 funding ($1,679 for Alameda City Unified).

As for the other columns:

• Columns 6-13: Brown is proposing to phase in the formula over six years; the columns show the effect on per-student funding and net difference over that time. In 2012-13, only 5 percent of per-student funding will include the weighted formula; the rest will be the current system. Brown is proposing to hold all districts harmless, with no loss of money next year only (column 6). So in 2013-14, without that protection, some districts, including Berkeley and Pleasanton, will lose some funding per student with the formula based 15 percent on the formula, 85 percent based on the old system. Some small rural districts with big busing expenses will lose the most under the new system unless busing as a categorical is protected, as some rural superintendents are proposing.
• Column 2: Number of students in the district
• Columns 3 and 4: The percentages of students who are English learners and are from low-income households. Extra dollars are based on these figures. (Since about three-quarters of English learners are also low-income students, there is overlap. The formula, however, does not double count. To estimate the correct number of non-low-income English learners, the Department of Finance multiplied the EL percentage by one-quarter and then added this percentage to the low-income percentage. In the case of Alameda  City Unified, a quarter of 22.37 percent is about 6 percent EL, added to 32.5 percent low-income for a total population of disadvantaged of 38.5 percent.

Three quick observations:

• There are at least a couple of ways of comparing how your district would fare under a weighted student formula.  One is to add 40 percent to the district’s 2012-13 per student funding to see how the district would do in 2017-18 under the current system, then compare that with 2017-18 funding under a weighted student funding. Another way is to compare the 2017-18 per student funding with $9,200, the statewide per student funding that year. (There clearly are some errors in the Department of Finance chart, Cambrian District in Santa Clara County the most obvious.)

• The funding of East Side Union High School District in San Jose, the state’s second largest high school district, illustrates the need for two potential changes to the formula.

One would be to continue the current funding system’s awarding of  extra dollars to high school districts and, to a lesser degree, to unified districts, out of recognition that older students incur higher expenses. East Side Union would get $7,257 per student next year under the current system, nearly $1,000 above the state average. In 2017-18, it would get $8,155, more than $1,000 below the state average. For a district struggling to prepare students for college and the job market, that will be tough.

East Side Union may also be hurt by the use of free and reduced lunch eligibility as the criterion for the low-income weight. Signing up for lunches is voluntary, and fewer students do so in high school than in elementary school. East Side Union’s feeder districts are roughly 60 percent low-income. East Side Union is 40 percent. The drop will translate into a lot fewer dollars under the weighted formula. Using a district’s Title I numbers, which are based on census data, may be a more accurate measure.

• The formula gives bonus money to districts with high concentrations of disadvantaged students, starting when they comprise 60 percent of a student body. A district with 80 percent disadvantaged students w0uld get nearly $3,000 per student more than a district with 50 percent. The Legislature  may want to examine the research justifying such a difference.

Thanks to Bob Blattner of  Blattner and Associates of Sacramento and Nick Schweizer of the Department of Finance for walking me through the numbers. Blame me, not them, if there are any mistakes in translation.