LOCAL CONTROL FUNDING FORMULA

LOCAL CONTROL FUNDING FORMULA Calculator Manual & Training Guide For use in conjunction with v15.2

Table of Contents How to Use This Manual... 3 Background... 4 Navigation... 5 Quick Start Guide... 7 School District... 7 Charter School... 7 Results for School Districts and Charter Schools... 7 Document Checklist... 8 Tabs... 10 Instructions... 10 Assumptions... 11 Awards (required)... 13 District MYP Data (required for school districts)... 17 Charter MYP Data (required for charter schools)... 20 District Class Size... 21 District NSS... 22 District In-Lieu Taxes... 24 Calculator... 25 EPA... 30 Summary... 32 Graphs... 33 LCAP MPP... 34 Local 1 and Local 2... 36 Appendix A: Other Resources... 37 Appendix B: Acronyms... 38 Appendix C: Guided Tutorial, Searching the FCMAT Help Desk Archives... 39 Appendix D: Guided Tutorial, LCFF Calculator for a Basic School District... 41 Appendix F: Guided Tutorial, LCFF Calculator for a Complex School District... 43 Appendix G: Guided Tutorial, LCFF Calculator for a Charter School... 46 Fiscal Crisis & Management Assistance Team v 15.1b 2

How to Use This Manual This manual has been designed to coordinate with a half day presentation on using the Calculator for either school districts or charter schools. However, this manual can also be used as a stand-alone learning tool. FCMAT recommends that you review the Calculator Caveats document to determine if your agency will need to consider outside calculations to prepare a reasonably accurate revenue estimate. The Calculator Caveats can be found on the FCMAT website at http://fcmat.org/local-control-funding-formula-resources/. Use the Quick Start section to identify the tabs that must be completed based on your agency s structure and circumstances. Once the entry tabs have been identified, use the Document Checklist to gather information required to develop your calculation. Then, refer to the Tabs section as you work through the calculator for data entry and explanation information. The Appendixes contain additional resources you may wish to consult including a list of acronyms, and three guided tutorials walking you through how to use the Calculator, both as a district and charter school, and how to research the FCMAT Online Help Desk knowledge base. If you have questions while working through the calculator, FCMAT offers free assistance through its Help Desk process, which is accessible from FCMAT s website at www.fcmat.org. Unless additional research is necessary, FCMAT strives to respond to questions within 48 hours (two business days). Questions submitted through the FCMAT Help Desk are reviewed by a team, allowing for additional coverage and field expert knowledge to develop fast and accurate responses. Please submit Calculator all questions through the FCMAT Help Desk. Fiscal Crisis & Management Assistance Team v 15.1b 3

Background The 2013 14 budget package replaced the previous K 12 finance system with a new Local Control Funding Formula (LCFF). For school districts and charter schools, the LCFF creates base, supplemental, and concentration grants in place of most previously existing K 12 funding streams, including revenue limits and most state categorical programs. Additionally, the LCFF contains adjustments for kindergarten through grade three (K-3) and grades nine through twelve (9-12) and add-ons for Home-to-School Transportation and Targeted Instructional Improvement Block Grant. The LCFF legislation and a set of revisions were signed by the Governor on July 1, 2013. Additional cleanup legislation was signed on September 26, 2013. Emergency regulations were adopted by the State Board of Education (SBE) on January 16, 2014 and March 13, 2014. Under the revenue limit formula, funding was primarily allocated based on student attendance. State categorical programs were based on either student attendance data or student enrollment data reported through the California Longitudinal Pupil Achievement Data System (CALPADS) process. The new LCFF formula emphasizes data reported through CALPADS and it has become increasingly important to monitor and verify these figures. LCFF will continue to be funded through the Principal Apportionment system on the established 5-5-9 schedules. The California Department of Education (CDE) has indicated the LCFF formula will add layers of complexity to the system during the eight-year phase-in period. This complexity has delayed the agency s ability to incorporate many of the LCFF provisions into its apportionment system. Funding amounts provided in the Advance Apportionment (July 2013) and First Principal Apportionment (February 2014) will not be based on the LCFF formula. Because these certifications are merely a means to continue allocating funds, they should not be used as basis for budgeting. It is important for districts and charter schools to develop separate calculations to estimate funding levels and allow for cash and budget planning throughout the 2013-14 fiscal year. The idea for the Calculator originated with the California County Superintendents Educational Services Association (CCSESA) s Business and Administration Steering Committee (BASC). Marin County Office of Education, El Dorado County Office of Education and San Diego County Office of Education among other county office of education entities contributed significant resources to develop the initial calculator. In November 2013, the Fiscal Crisis & Management Assistance Team (FCMAT) assumed responsibility for maintaining and updating the Calculator. FCMAT continues to work with the original development team, Department of Finance (DOF), California Department of Education (CDE) and State Board of Education (SBE) to develop a solid tool for school districts and charter schools to estimate LCFF revenues. For users of FCMAT s Budget Explorer, a free multi-year projection software tool (www.budgetexplorer.org), the Calculator is the first step in projecting future revenues. Future plans for the Calculator include developing web-based software for seamless updates and reducing software conflict issues. This training manual contains the best information available at the time of publication, and will be continuously updated as new regulations are approved and other miscellaneous new information is known. Please refer back to the FCMAT website often for information related to routine Calculator updates and related materials, including this manual and the Calculator Caveat document. Fiscal Crisis & Management Assistance Team v 15.1b 4

Navigation In its current form, the Calculator is a large Excel spreadsheet with numerous tabs. The tabs are designed to be completed in order from left to right, starting with the Instructions tab and ending with the Local 2 tab. Additionally, the tabs and cells are color-coded to assist you in determining entry points and priorities: Workbook Legend Tabs requiring data entry for basic LCFF calculation Tabs requiring data entry for special circumstances or optional tools. Tabs with result calculations, graphs or summaries. Cells that are data entry points on all worksheets are colored light orange. Tab Titling The LCFF formula has aligned school district and charter school funding to an unprecedented level. Because the calculations are so similar, the calculator has been developed as a universal tool for both school districts and charter schools. A tab title with District or Charter in it indicates the agency that should complete the tab. For example, a school district would complete the District In-Lieu Taxes tab, not a charter school although the resulting information is used in the charter school s LCFF calculation. As a general rule, tabs that do not indicate District or Charter should be completed by both agencies. Law and Regulation References In addition to calculating multi-year revenue estimates, the calculator has been designed as an educational tool. Law and regulation references can be found in the left hand column of many tabs. Unless otherwise stated, the reference is to Education Code (EC). For example, the reference below is to E.C. 42238.03(b)(2). Other references include the California Code of Regulations (CCR). Education Code references can be researched on the California Legislative Information website: http://leginfo.legislature.ca.gov/faces/codes.xhtml. Fiscal Crisis & Management Assistance Team v 15.1b 5

California Code of Regulations references can be researched on the California Office of Administrative Law s website: http://ccr.oal.ca.gov. Fiscal Crisis & Management Assistance Team v 15.1b 6

Quick Start Guide The following chart identifies the entry tabs required to complete your agency s individual LCFF calculation. Use it in conjunction with the Document Checklist for efficiency. Please note your agency may choose to utilize some of the optional tabs, such as entering a projection title on the Instructions tab, changing assumptions data on the Assumptions tab, or creating local charts and calculations on the Local 1 and Local 2 tabs. School District The LCFF calculation contains some sub-calculations that only apply to a few districts. Tabs reflecting these special circumstances are identified below with an application question next to them. If the answer is yes, then the tab should be completed for your district s calculation. Awards District MYP Data District Class Size District NSS District In-Lieu Taxes LCAP MPP Does your district have K-3 class sizes above 24:1 and not have a collectively bargained alternative class size? Is your district eligible for necessary small school (NSS) funding? Does your district pay in-lieu of property tax to a charter school? Charter School The calculation for a charter school is simpler and does not contain some of the components of a school district calculation. Awards Charter MYP Data LCAP MPP Results for School Districts and Charter Schools After completing the entry tabs for your agency, review the calculation results in the following tabs: Calculator EPA Summary Graphs Calculation details Calculation of estimated Education Protection Act (EPA) funding Calculation summary details Select suggested graphs and charts to assist in local communications Fiscal Crisis & Management Assistance Team v 15.1b 7

Document Checklist Document/Data For school districts, the 5-digit District component of the County-District- School (CDS) code -or- for charter schools, the 7+ digit School component of the CDS code 2012-13 R1 Principal Apportionment certification schedules (as applicable to your agency, certified Feb 2014) School District Schedules Charter School Schedules o School District Revenue Limit o Charter School o School District ADA Categorical Block Grant o School District Revenue Limit Funding - Calculations o Charter School Block Grant Funding 2012-13 award amounts for Alternative Certification Programs (awarded by the Commission on Teacher Credentialing) and Teacher Dismissal Apportionment (if applicable) 2013-14 award amounts for Agriculture Vocational Education and Specialized Secondary Education (if applicable) Estimated property tax for current fiscal year through 2016-17 Estimated in-lieu of property tax for current fiscal year through 2016-17 Enrollment and unduplicated counts o 2013-14 actual enrollment and unduplicated counts (CALPADS report 1.17) o 2014-15 through 2017-18 Estimated Enrollment and Unduplicated Counts Unduplicated percentage o 2013-14 actual enrollment and unduplicated counts of any districts the charter school is physically located in. Average daily attendance (ADA), by grade level o District ADA 2012-13 actual ADA 2013-14 through 2016-17 estimated ADA o County Office of Education ADA 2012-13 actual ADA 2013-14 through 2016-17 estimated ADA o Charter Shift ADA 2012-13 actual ADA 2013-14 through 2016-17 estimated ADA o Charter School ADA 2012-13 actual ADA Entry Tab Awards Awards Awards Awards District MYP Data & District In-Lieu Taxes Charter MYP Data District MYP Data -or- Charter MYP Data Charter MYP Data District MYP Data District MYP Data District MYP Data District In-Lieu Taxes -or-charter MYP Data Fiscal Crisis & Management Assistance Team v 15.1b 8

o 2013-14 through 2016-17 estimated ADA By Necessary Small School (NSS) 2012-13 actual ADA & FTE count 2013-14 through 2016-17 estimated ADA & FTE Count By school site, average class size of all traditional K-3 self-contained classes with a teacher of record, including transitional kindergarten. This information is not required if the district has a collectively bargained alternative K-3 class size or class sizes are less than 24 students. Calculate as: Step 1 - For each eligible class, average the last day of every school calendar month ending on or before April 15 th Step 2: Average the Step 1 class results for each school. By sponsored Charter School, LCFF Target estimate for fiscal years 2013-14 through 2016-17 (Note: Basic Aid Districts only) Actual 2012-13 Economic Impact Aid (EIA) expenditures Estimated 2013-14 through 2016-17 expenditures for unduplicated pupils above what was spent on service for all pupils District NSS District Class Size District In-Lieu Taxes LCAP MPP LCAP MPP Fiscal Crisis & Management Assistance Team v 15.1b 9

Tabs Instructions Tab Entry 1. Enter a title in cell G2 that will show on all tabs. Use this option to identify calculation print outs if you run multiple scenarios. Code or Regulation Tab Explanation Upon opening the calculator, the instructions tab is the first to open. Check the version in the top left corner. Enter the title of the projection you are working on, such as 2014-15 Adopted Budget. The Instructions tab contains the workbook legend, version notation, and instructions for each tab. When opening a new version of the Calculator, take a few minutes to review the updated information contained on this tab. As you move through the calculator and have questions, read the instructions contained on the tab and refer back to this tab for further information. Fiscal Crisis & Management Assistance Team v 15.1b 10

Assumptions Tab Entry 1. Review the annual cost of living adjustment (COLA), gap percentage, and Education Protection Account (EPA) entitlement percentage prefilled in the calculator. If running alternative scenarios, make adjustments. 2. Review and confirm the statewide 90 th percentile rate. Code or Regulation Tab Explanation The Assumptions tab has been designed as a quick place to check basic assumptions contained in the calculation. If you are providing the calculation to others in printed format, it is recommended you provide this page to demonstrate the foundation on which the calculation is built. The COLAs contained in the LCFF calculator are the best information available at the time of publishing. As of this time, the COLAs noted in the calculator remain the official Department of Finance (DOF) COLAs for use in the calculator. These numbers are provided by the DOF as established in the legislation which specifically states the following: In each year, the grade span adjusted base grants in paragraph (1) shall be adjusted by the percentage change in the annual average value of the Implicit Price Deflator for State and Local Government Purchases of Goods and Services for the United States, as published by the United States Department of Commerce for the 12-month period ending in the third quarter of the prior fiscal year. This percentage change shall be determined using the latest data available as of May 10 of the preceding fiscal year compared with the annual average value of the same deflator for the 12-month period ending in the third quarter of the second preceding fiscal year, using the latest data available as of May 10 of the preceding fiscal year, as reported by the Department of Finance. The entry cells for the COLA's are left open for adjustment in case the agency chooses to run alternative scenarios. 42238.02(d)(2) In the case new information becomes available from the state, the gap percentage, EPA entitlement percentage and statewide 90 th percentile rate allow manual override. Fiscal Crisis & Management Assistance Team v 15.1b 11

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Awards (required) Tab Entry For all School Districts and continuing Charter Schools (existing in 2012-13): 1. In cell F5, enter the 5 digit district code or 6+ digit school code from the County-District- School (CDS) code. Verify the district or charter school name auto-populated correctly in cell D4. If you are a new charter school and your name does not auto-populate, you may still be able to use the calculator. See Appendix D, New Charter School Calculation. Code or Regulation For Charter Schools that did NOT exist in 2012-13 (new Charter Schools): 1. In cell F50, select the first school year from the drop down. 2. In cell F54, enter the CDS code (district component) of the District of physical location. 3. If the Charter School will start in 2014-15 or later, in cells F61 through F63 enter the District prior year totals Tab Explanation The LCFF calculation consolidates most previous funding streams, including revenue limit and most state categorical programs. Based on the CDS code, the Awards tab auto-populates from CDE certification documents to simplify the entry of historical data into your individual calculation. Review this data for accuracy. If your agency solely receives Necessary Small School (NSS) funding or is a charter school, you may need to scroll down to the appropriate entry sections for data review and entry. Fiscal Crisis & Management Assistance Team v 15.1b 13

The tab contains calculations to determine funding per ADA used in the Floor, Minimum State Aid (MSA), and Economic Recovery Target (ERT) calculations. Additionally, it contains the basic aid district fair share calculation to be in effect throughout the implementation period of LCFF. These are integral components of the LCFF calculation and should be reviewed carefully for accuracy and completeness. Fiscal Crisis & Management Assistance Team v 15.1b 14

Version 15.2 includes the ability to develop calculations for Charter Schools that were not in existence in 2012-13, or the foundation year to calculate the Floor component of the LCFF. New Charter schools only need to complete one of the following sections based on the first operational year. Fiscal Crisis & Management Assistance Team v 15.1b 15

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District MYP Data (required for school districts) Tab Entry 1. On line 10, enter the estimated property taxes for the budget and each projection year. 2. On lines 19 through 23, enter enrollment and unduplicated pupil count data and projections. 3. On lines 30 through 34, enter Average Daily Attendance (ADA) projections. 4. On lines 37 through 40, enter special program ADA, if applicable. 5. On lines 43 through 47, enter County Office of Education operated program ADA. 6. On lines 52 through 56, enter ADA of students that transferred from the charter school in prior year to the school district in current year. 7. On lines 59 through 63, enter ADA of the students that transferred from the school district in prior year to the charter school in current year. Code or Regulation Tab Explanation The District MYP tab contains integral local assumptions regarding property taxes, enrollment, unduplicated pupil counts and ADA used in the LCFF calculation. The unduplicated Pupil count contains five years of entry to demonstrate the three-year rolling average calculation. 42238.02(b)(1) 42238.02(b)(6) School districts have a funding guarantee based on the greater of current or prior fiscal year ADA. In the ADA data entry section, enter the actual ADA for the fiscal year, not the funded ADA. The Calculator will determine if the current or prior year ADA is higher and calculate accordingly. If a school district is in declining enrollment (will be funded on prior year ADA) and has a sponsored charter school, complete the Charter Shift ADA section. Rules for reporting charter shift ADA have not changed with the implementation of LCFF. However, because the grade spans are funded at different rates, school districts should be careful to adjust the appropriate grade span. For example, if a 2012-13.75 ADA student attended at a school district while in 3 rd grade and is now attending at the sponsored charter school in 4 th grade, the adjustment should be made to 3 rd grade ADA. Fiscal Crisis & Management Assistance Team v 15.1b 17

One significant difference in the LCFF calculation from the prior revenue limit calculation is funding by grade span. Previously, agencies were able to report ADA for certain student groups as ungraded. Starting in 2013-14, ADA will be reported by grade span. Fiscal Crisis & Management Assistance Team v 15.1b 18

Please note only one of the following tabs should be completed. The other tab should remain completely unfilled for accurate and reliable projections: District MYP Data and Charter MYP Data. Fiscal Crisis & Management Assistance Team v 15.1b 19

Charter MYP Data (required for charter schools) Tab Entry 1. On line 10, enter the estimated in-lieu of property taxes for the budget year plus projected years. 2. On lines 19 through 23, enter enrollment and unduplicated pupil count estimates. 3. On lines 29 through 33, enter the school district of physical location s unduplicated pupil percentage. This is a required component used to calculate the concentration grant. 4. In column E, lines 39 through 70, enter Average Daily Attendance (ADA) estimates. Tab Explanation The Charter MYP tab contains integral local assumptions regarding in-lieu of property taxes, enrollment, unduplicated pupil counts and ADA used in the LCFF calculation. The unduplicated Pupil count contains five years of entry to demonstrate the three-year rolling average calculation. Code or Regulation Please note only one of the following tabs should be completed. The other tab should remain completely unpopulated for accurate and reliable projections: District MYP Data and Charter MYP Data. Fiscal Crisis & Management Assistance Team v 15.1b 20

District Class Size Tab Entry Please note, districts that have a collectively bargained alternative or are already operating at the 24:1 standard do not need to complete this tab. Funding will automatically be included in the LCFF calculation. 1. Enter the average class size per school. There are enough entry lines to test 30 school sites. Note: Calculate the average class size of every class at a school site per the CDE s direction. 2. If the district has more than 30 school sites that have passed, erase the tested school site data and continue entering untested sites. Tab Explanation The LCFF calculation contains additional funding for grades K-3. This funding is similar to previous K- 3 Class Size Reduction (K-3 CSR) funding. As a pre-requisite to receiving this funding, school districts must maintain a class size of 24 students to 1 teacher or less. Prior to the LCFF formula, school districts were afforded class size flexibility due to prior funding reductions. Some school districts may still be operating under that flexibility. As a condition of receiving the K-3 Grade Span Adjustment (GSA) funds in the LCFF formula, a school district operating under the previously established flexibility guidelines must make adequate progress towards meeting the new 24:1 standard. The required progress is measured in relation to the Gap funding rate. Code or Regulation 15498.1 However, districts operating above 24:1 in 2012-13 should complete this tab to confirm they are making adequate yearly progress. PLEASE NOTE THAT THIS TAB IS ONLY FOR SCHOOL DISTRICTS. Charter schools automatically receive GSA funding without demonstrating adequate progress. Fiscal Crisis & Management Assistance Team v 15.1b 21

District NSS Tab Entry 1. Enter estimated ADA for each eligible Necessary Small School (NSS) in your agency. For example, the first NSS is entered on lines 74 through 91. ADA is entered on lines 76 through 79. 2. Enter the estimated number of full time equivalents (FTE) for each school. (line 82) 3. Select whether the school is continues to be eligible for NSS funding. Please note funding rules changed with the implementation LCFF. (line 83) 4. Review the best funding method suggested. Select the funding method to be used in the calculation. (Line 86) For 2013-14, select the method certified in April 2014. 5. Repeat for each NSS in your district. Code or Regulation Tab Explanation The NSS tab is automated to compare LCFF funding against NSS funding. The tab is also designed to compare ADA to determine the greater funding of prior or current year ADA, as allowed under NSS funding. In the 2013-14 fiscal year, the spreadsheet may recommend LCFF funding over NSS funding even though NSS funding would yield greater funding if selected in 2013-14. This occurs when the district is eligible for Economic Recovery Target (ERT) funding but only with the lower LCFF funding level. ERT is a one-time calculation that results in additional funding that is a permanent add-on to LCFF funding, even after full implementation, and thus will result in greater revenues over time, as compared to greater revenues in the 2013-14 fiscal year. ERT is calculated based on certifications submitted in April 2014. A school district should change the predetermined funding method in 2013-14 to reflect the April certification. REMEMBER, the ERT funding is calculated in the 2013-14 fiscal year ONLY and you will be unable to requalify in future years. Section C demonstrates the check of whether it is more beneficial to use the ADA of current or prior fiscal year. Additionally, it calculates the adjustment to reduce the base and GSA funding for students funded under NSS. This section requires no additional entry. Fiscal Crisis & Management Assistance Team v 15.1b 22

Section D calculates NSS funding to be included in the floor. This section requires no entry. Fiscal Crisis & Management Assistance Team v 15.1b 23

District In-Lieu Taxes Tab Entry 1. On line 11, enter the district s total local property taxes less Redevelopment Agency (RDA) revenues. For Basic Aid School Districts, the following items should be obtained from the charter school s LCFF calculation: 2. By charter school, on line 43 (and equivalent rows for multiple charter schools), enter the total Target and Grade Span Adjustment funding by fiscal year. This should be obtained from the Target section of the Calculator tab in the Charter School s LCFF calculation. 3. On line 44 (and equivalent rows), enter the charter school s total Target grant. Obtain this from the Summary Tab, Summary of Funding, Target. 4. On line 46 (and equivalent rows), enter the charter school s Floor and Gap funding. Obtain this from the Summary Tab, Summary of Funding, Total Phase-In Entitlement. Code or Regulation 47635(a)(1 Tab Explanation If the district has students that attend a charter school, regardless of whether the charter school is sponsored by the district, complete this tab. Calculations can be generated for up to six charter schools. If the district has students of residence that attend more than six charter schools, isolate five charter school calculations at a time and in the sixth line, group the remaining charter schools to complete the calculation. Repeat this process as many times as it takes to isolate calculations for each individual charter school. The District In-Lieu Taxes tab contains two calculations. The first calculation is most common and is used when the amount of property taxes per ADA is less than LCFF funding per ADA. ) If property taxes per ADA are more than the LCFF funding per ADA (as is the case for Basic Aid districts), complete section 2. The second calculation, 2a, calculates LCFF funding per ADA. Fiscal Crisis & Management Assistance Team v 15.1b 24

Calculator Tab Entry No entry is required on this tab. Code or Regulation Tab Explanation The Calculator tab pulls information from all of the other tabs to generate the final LCFF funding calculations, no entry is required on this tab. Target Calculation At full implementation, the LCFF funding is simply calculated as the Target plus Economic Recovery Target (ERT) funding. Full implementation is estimated to occur in 2020-21, an eight year implementation period. The Target calculation contains many smaller funding components: Base Grant: an amount determined by grade span per ADA. Grade Span Adjustment: For grade spans K-3 and 9-12, an additional amount provided to reduce class sizes. Supplemental Grant: Additional funds to provide services to the following targeted student populations: foster youth, English learners, low socioeconomic students. Concentration Grant: Funds in addition to the Supplemental Grant if the unduplicated concentration of the targeted student populations exceed 55% of all students. Targeted Instructional Improvement Block Grant and Home-to-School Transportation: Agencies that received these funds under the previous funding model continue to receive it as an add-on. However, funding will remain flat, COLA is not applied in subsequent years. Economic Recovery Target Calculation The Economic Recovery Target (ERT) provides additional funding to ensure that virtually all districts are at least restored to their 2007-08 state funding levels on a per ADA basis. ERT is a one-time calculation that results in additional funding that is a permanent add-on to LCFF funding, even after full implementation. REMEMBER, the ERT funding is calculated in the 2013-14 fiscal year ONLY. Fiscal Crisis & Management Assistance Team v 15.1b 25

The ERT calculation compares the 2012-13 former undeficited Revenue Limit and categorical funding level to the 2013-14 Target rate on a per ADA basis by applying an inflation factor out to 2020-21. The 2012-13 undeficited revenue limit funding per ADA is first adjusted for 2013-14 COLA of 1.0157 and then inflated to 2020-21 using a factor of 1.143964124%, based on a projected COLA of 1.94% each year. The 2013-14 Target per ADA is also adjusted for inflation for 2014-15 through 2020-21 using this same factor. For purposes of determining eligibility for the Economic Recovery Target (ERT), the calculator reflects an estimate of $14,500 as the 90 th percentile of per-pupil funding rates under the previous funding system. This figure is based on statewide numbers that are not yet known. (ERT rate is from the Awards tab) Floor Calculation In addition to establishing the funding calculation at full implementation, the LCFF funding formula contains provisions for a phase-in period. An integral component of the phase-in period is the Floor calculation, or a calculation that uses 2012-13 funding per ADA to establish a minimum LCFF funding level during implementation. After establishing the per ADA amount received in 2012-13, the formula multiplies it by projected ADA and adds categorical funding. For school districts, categorical funding is adjusted to pre-deficit funding levels and not adjusted for fluctuations in ADA. For charter schools, categorical funding is adjusted to pre-deficit funding levels, and a per ADA rate is created to adjust for fluctuations in ADA. In future years, Gap funding is added into the floor to move the Floor towards the Target, or full implementation. (Floor Funding per ADA from the Awards tab) Fiscal Crisis & Management Assistance Team v 15.1b 26

Gap Funding The first step in calculating the phase-in funding level is to compare an agency s Floor to their Target. If the Floor is less than the Target, the difference is called Gap. If an agency s Floor is greater than the Target, no Gap funding will be received by the district. The State budget will contain a Gap funding percentage throughout the implementation period. The second step in calculating the phase-in funding level is applying the funding percentage to the remaining Gap to determine the amount of additional funding provided. At the end of the year, the Gap is added into the Floor, moving the value of the Floor closer to the Target, or full implementation. At full implementation, Gap will be $0 and cease to exist. Minimum State Aid The third step in calculating phase-in funding is comparing LCFF funding to a measurement called Minimum State Aid (MSA). Minimum State Aid guarantees that a school district will not receive less in State Aid than received in the 2012-13 fiscal year on a per ADA basis in 2013-14. The formula establishes 2013-14 minimum state aid funding value by calculating a per ADA funding amount from 12-13 and multiplying it by 2013-14 ADA. Next, it reduces LCFF phase-in funding level (Floor + Gap + Fiscal Crisis & Management Assistance Team v 15.1b 27

ERT) by projected property taxes/in-lieu of property tax. If the remaining value is lower than the MSA, it is increased to equal MSA. (Minimum State Aid Funding per ADA from the Awards tab) Starting in 2014-15, if a charter school s MSA and in-lieu property taxes are greater than LCFF funding, the MSA will be reduced to bring the total back down to LCFF funding. Fiscal Crisis & Management Assistance Team v 15.1b 28

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EPA Tab Entry No entry is required on this tab. Code or Regulation Tab Explanation The Education Protection Account (EPA) provides agencies with general purpose state aid funding pursuant to Proposition 30, The Schools and Local Public Safety Protection Act of 2012, approved by the voters on November 6, 2012. EPA funding is primarily comprised of two funding sources, personal income tax and sales and use tax. Under Proposition 30, Personal income tax is increased for seven years, ending in 2018-19. Sales and use tax is increased by ¼ cent for four years, ending in 2015-16. EPA funding is a source component of an agency s LCFF funding, paid on a quarterly, instead of a monthly, basis. The information generated in the tab should be isolated in the budget by object code, but does not generally change the amount of funding a district receives under LCFF. In the case of an excess tax district or charter school fully funded through in-lieu taxes, a minimum funding rate of $200 per ADA will be applied. The results are primarily to ensure compliance with regulations of Proposition 30 and used in development of cash flow projections. The EPA Entitlement, as a percentage of statewide adjusted Revenue Limit, auto-fills from the Assumption tab. The assumption percentage is calculated by the CDE at the four apportionment certification points in the fiscal year: Advance, P-1, P-2 and Annual. It is left open for editing on the Assumptions tab for manual updates throughout the year. Additionally, if desired, it can be adjusted to a lower percentage to estimate the effect of expiring tax provisions. Fiscal Crisis & Management Assistance Team v 15.1b 30

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Summary Tab Entry No entry is required on this tab. Code or Regulation Tab Explanation This tab provides a high level overview of the results of specific components of the LCFF calculation. It is useful to confirm reasonableness and provide a quick summary breakdown of LCFF funding calculation results and the minimum proportionality percentage (MPP). It also provides a quick view of funding sources by object code. This is useful to integrate the LCFF calculator results back into the agency s budget. Fiscal Crisis & Management Assistance Team v 15.1b 32

Graphs Tab Entry No entry is required on this tab. However, this tab is unlocked and the graphs and charts may be adjusted to fit local needs. Code or Regulation Tab Explanation Multiple graphs and charts have been developed to assist agencies in communicating the results and impact of the LCFF formula over the multi-year projection. These charts and graphs are presented as a suggestion and can be adjusted to fit local needs. Further, additional charts and graphs can be created by the agency on this tab. Please see the calculator for sample charts and graphs. Fiscal Crisis & Management Assistance Team v 15.1b 33

LCAP MPP Tab Entry 1. In cell E9, enter the amount of EIA funds expended in 2012-13. 2. In cells F8 H8, enter the estimated amount of funds expended on services for unduplicated pupils that is in addition to what was expended on services provided for all pupils. Code or Regulation 15496(a)(2) Tab Explanation The State Board of Education (SBE) and California Department of Education (CDE) have clearly stated that this percentage is not meant to be a financial measure, like a maintenance of effort calculation based on dollars, but rather a proxy to communicate the amount of increased or improved services. Therefore, the district is not required to meet or exceed the prior year dollar amount of expenditures entered into the calculation. The requirement may be met by either increasing or improving services, as described in the Local Control Accountability Plan (LCAP). Title 5 CCR section 15496(a)(2) states: "Estimate the amount of LCFF funds expended by the LEA on services for unduplicated pupils in the prior year that is in addition to what was expended on services provided for all pupils. The estimated amount of funds expended in 2013-14 shall be no less than the amount of Economic Impact Aid funds the LEA expended in the 2012-13 fiscal year." Therefore, in cell E9 of the 'LCAP MPP' tab, only enter the amount expended in the 2012-13 fiscal year, regardless of carryover funding or award amount. On row 8 (cells F8, G8, H8), only enter the value of funds expended on services for unduplicated pupils that is in addition to what was expended on services provided for all pupils regardless of what was spent in EIA funds that year. Take the minimum proportionality percentage calculated in step 7/8 and use it in the development of the local LCAP. Fiscal Crisis & Management Assistance Team v 15.1b 34

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Local 1 and Local 2 Tab Entry No entry is required on this tab. However, this tab is unlocked and the graphs and charts may be adjusted to fit local needs. Code or Regulation Tab Explanation These two tabs created for local use purposes. Use it to create calculations, charts or graphs to suit local needs. Fiscal Crisis & Management Assistance Team v 15.1b 36

Appendix A: Other Resources California Department of Education (CDE) Mailing list, FAQs, Legislation, Other California Legislative Information Education Code California Office of Administrative Law California Code of Regulations http://www.cde.ca.gov/fg/aa/lc/ http://leginfo.legislature.ca.gov/faces/codes.xhtml http://ccr.oal.ca.gov Fiscal Crisis & Management Assistance Team (FCMAT) Calculator, Caveats, CALPADs training, Mailing List Online Help Desk, Online Help Desk http://fcmat.org/local-control-funding-formula-resources/ WestEd Mailing list, Videos, Articles, Other http://lcff.wested.org/ Fiscal Crisis & Management Assistance Team v 15.1b 37

Appendix B: Acronyms ADA Average Daily Attendance CY EL ERT FRPM FY LCAP MPP NSL NSS PY RL SACS SBE SDC SED TIIBG Current Year English Learners Economic Recovery Target Free Reduced Priced Meals Foster Youth Local Control Accountability Plan Minimum Proportionality Percentage National School Lunch Necessary Small School Prior Year Revenue Limit Standardized Account Code Structure State Board of Education Special Day Class Socioeconomically Disadvantaged Targeted Instructional Improvement Block Grant Fiscal Crisis & Management Assistance Team v 15.1b 38

Appendix C: Guided Tutorial, Searching the FCMAT Help Desk Archives Task: Use the FCMAT Help Desk Archives to answer the following question: Solution: Can supplemental and concentration grant funding be used for facilities? 1. Using your preferred internet browser, browse to the following page: https://servicedesk.csis.k12.ca.us/footprints/fcmat_kb.html 2. In the Category drop down box, select LCFF 3. In the Search Results for Keyword entry box, type Supplemental 4. Browse the results synopsis to determine which questions might contain the question. Fiscal Crisis & Management Assistance Team v 15.1b 39

5. Click on the blue title question to read the full question and answer. Fiscal Crisis & Management Assistance Team v 15.1b 40

Appendix D: Guided Tutorial, LCFF Calculator for a Basic School District Task Complete an LCFF calculation on behalf of Sample District using the information provided. Background Info and Documents County-District-School (CDS) Code: 00-12345-123456 The district estimates property taxes will remain flat, but there is a new, large construction project scheduled to start in 2015-16 that will increase the district s property tax receipts. The following are their projections: 2013-14 2014-15 2015-16 2016-17 Property Taxes $64,064 $65,000 $200,000 $201,000 The new construction project is not expected to affect the student population: 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18 Enrollment 17 18 18 19 17 18 Unduplicated Pupil Count 4 5 4 6 5 5 Avg Class Size 18 17 17 19 16 18 ADA TK/K-3 9.72 8 7 9 7 7 4-6 7.87 7 8 7 7 7 7-8.68 2 2 2 2 2 9-12 0 0 0 0 0 0 In 2013-14, the County Office of Education educates one student in 5 th grade on behalf of the district. This student has perfect attendance (1.0 ADA) and will progress a grade every year. The district expended $5,421 in EIA funds in 2012-13. They plan to expend the following on services targeting foster youth, English learners, and socio economic disadvantaged students: 2013-14 2014-15 2015-16 2016-17 Projected Expenditures $5,500 $5,700 $5,900 $6,100 Fiscal Crisis & Management Assistance Team v 15.1b 41

Basic School District Solution: Fiscal Crisis & Management Assistance Team v 15.1b 42

Appendix F: Guided Tutorial, LCFF Calculator for a Complex School District Task Complete an LCFF calculation on behalf of Sample District using the information provided. Background Info and Documents County-District-School (CDS) Code: 00-12345-123456 The district estimates property taxes will remain flat, but there is a new, large construction project scheduled to start in 2015-16 that will increase the district s property tax receipts. The following are their projections: 2013-14 2014-15 2015-16 2016-17 Property Taxes $64,064 $65,000 $200,000 $201,000 The new construction project is not expected to affect enrollment or unduplicated pupil count: 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18 Enrollment 17 18 18 19 17 18 Unduplicated Pupil Count 4 5 4 6 5 5 The district has one very small school that is eligible for NSS funding, First Little School. It has one teacher and estimates very little change to ADA due to the construction project. The district has decided to accept the funding recommendations of the calculator. 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18 Avg Class Size 18 17 17 19 16 18 ADA TK/K-3 9.72 8 7 9 7 7 4-6 7.87 7 8 7 7 7 7-8.68 2 2 2 2 2 9-12 0 0 0 0 0 0 In 2013-14, the County Office of Education educates one student in 5 th grade on behalf of the district. This student has perfect attendance (1.0 ADA) and will progress a grade every year. In 2012-13, the school district had one student in the 3 rd grade transfer to the sponsored charter school (.75 ADA). A 6th grade student s parents opted to transfer her back to the school district in 2013-14 after attending the charter school for half of 2012-13 (.50 ADA). The school district s authorized charter provided the following information from their LCFF calculation: 2013-14 2014-15 2015-16 2016-17 Target Base + GSA 142,358 106,755 75,680 37,175 Total Target Grant 152,264 114,690 77,940 40,055 Floor + Gap 139,245 112,065 82,705 50,266 The district expended $5,421 in EIA funds in 2012-13. They plan to expend the following on services targeting foster youth, English learners, and socio economic disadvantaged students: Fiscal Crisis & Management Assistance Team v 15.1b 43

2013-14 2014-15 2015-16 2016-17 Projected Expenditures $5,500 $5,700 $5,900 $6,100 Fiscal Crisis & Management Assistance Team v 15.1b 44

Complex School District Solution: Fiscal Crisis & Management Assistance Team v 15.1b 45

Appendix G: Guided Tutorial, LCFF Calculator for a Charter School Task Complete an LCFF calculation on behalf of My Sample Charter School using the information provided. Background Info and Documents County-District-School (CDS) Code: 00-12345-123456 The sponsoring/district of physical location provided the following information: The district estimates property taxes will remain flat, but there is a new, large construction project scheduled to start in 2015-16 that will increase the district s property tax receipts. The following information was provided to the charter school from the sponsoring/district of physical location: 2013-14 2014-15 2015-16 2016-17 2017-18 In-Lieu of Property Tax $32,836 $29,545 $68,966 $37,175 -- Unduplicated % of District 27.78% 25.00% 27.27% 27.78% 29.63% In addition, the charter school estimates the following information: 2013-14 2014-15 2015-16 2016-17 2017-18 Enrollment 23 12 12 7 2 Unduplicated Count 8 5 4 3 0 2013-14 2014-15 2015-16 2016-17 Avg Class Size 20 15 10 5 ADA K-3 2.00 0.00 0.00 0.00 4-6 18.00 15.00 10.00 5.00 7-8 0.00 0.00 0.00 0.00 9-12 0.00 0.00 0.00 0.00 The charter school plans to expend the following on services targeting foster youth, English learners, and socioeconomic disadvantaged students: 2013-14 2014-15 2015-16 2016-17 Projected Expenditures $5,500 $5,700 $5,900 $6,100 Fiscal Crisis & Management Assistance Team v 15.1b 46

Charter School Solution: Fiscal Crisis & Management Assistance Team v 15.1b 47