Basic Aid Presentation - Huntington Beach City School District

Huntington Beach City School District
Impact of Basic Aid
February 12, 2013

What is a Basic Aid School District?
2
• Basic Aid, also known as “local funding”,
essentially occurs when the local property tax
revenue in a school district exceeds the total
general purpose funding to be provided by the
“Revenue Limit” funding formula.

What We Know Right Now!
3
• We are not currently a Basic Aid district.
• We are accepting interdistrict transfers for
students transferring in from surrounding
districts for 2013-14.
• We don’t currently have enough information to
determine our Basic Aid status for 2014-15 and
beyond.

Average Daily Attendance
4
• Average Daily Attendance (ADA) – the total number of days
of student attendance divided by the total number of days in
the regular school year. A student attending every day would
equal 1.0 ADA.
• ADA is reported to the California Department of Education at
the First Principal Apportionment (P1), the Second Principal
Apportionment (P2), and the Annual Apportionment.
• ADA reported as of P2 is used to calculate the Basic Aid
status of a district.

Revenue Limit
5
• Revenue Limit – the amount of general purpose funding a
school district receives per ADA.
• The funded 2012-13 Revenue Limit amount per ADA is
$4,979.57 for Huntington Beach City School District .
• Our total Revenue Limit funding, projected for 2012-13 at P2,
is the Revenue Limit amount of $4,979.57 times the projected
P2 ADA of 6,837 which equals $34,045,320.

Local Property Taxes
6
• Local school district taxes are reported by the County
Auditor and County Superintendent of Schools and also
include Community Redevelopment Funds and payments to
Charter Schools in lieu of property taxes.
• Our local property tax share of the Revenue Limit estimated
@ P1 for 2012-13 is $32,999,478.

Estimate @ P2 2012-13
7
Local property
tax share of
the Revenue
Limit
$32,999,478
Total Revenue Limit
$34,045,320
Minus local property
tax share
$32,999,478
Equals State Aid
$1,045,842
Total Revenue
Limit
exceeds local
property tax
share
Not Basic Aid

Impact of Interdistrict Transfers In!
8
• Huntington Beach City School District has benefited from
students transferring in from surrounding school districts,
but had a slight decline in 2012-13.
‣2008-09
‣2009-10
‣2010-11
‣2011-12
‣2012-13
622 students
760 students
860 students
924 students
866 students

Declining Enrollment Impact on ADA
9
• Declining enrollment has started to impact our ADA so a
decline in ADA has been built into multiyear projections.
ADA @ P2 is projected as follows:
‣2012-13 P2
‣2013-14 P2
‣2014-15 P2
6,837 ADA
6,737 ADA
6,637 ADA

Funding Formula Projections
10
• The Governor has proposed to change the Revenue Limit
funding formula to a new Local Control Funding Formula
(LCFF). The LCFF would be “weighted” with additional
funding for English Learners and low-income students. The
funding formula may change but basic aid will still be
calculated using a funding amount per ADA. Current funding
adjusted by 4.5 percent is projected as follows:
‣2012-13 $4,979.57
‣2013-14 $5,203.65
‣2014-15 $5,437.82

Local Property Tax Estimates
11
• Local property taxes are increasing because of the improving
housing market. The 2012-13 property tax estimate included
some one-time revenue from Community Redevelopment
Agencies. With that one-time revenue removed and
estimated growth at 7.5 percent, property taxes @ P2 are
projected as follows:
‣2012-13 P2 $32,999,478
‣2013-14 P2 $33,612,452
‣2014-15 P2 $36,133,385

Estimate @ P2 2013-14
12
Local property
tax share of
the Revenue
Limit
$33,612,452
Total Revenue Limit
$35,056,990
Minus local property
tax share
$33,612,452
Equals State Aid
$1,444,538
Total Revenue
Limit
exceeds local
property tax
share
Not Basic Aid

Estimate @ P2 2014-15
13
Local property
tax share of
the Revenue
Limit
$36,133,385
Total Revenue Limit
$36,090,811
Minus local property
tax share
$36,133,385
Equals State Aid
($42,574)
Local property
tax
exceeds
Total Revenue
Limit
Basic Aid

Staffing Impact
14
• We would no longer receive funding for interdistrict transfer
students coming to our district.
• Partial funding for some interdistrict transfer students is
possible if we declare our district a “district of choice”, but
no funding is available for students coming from another
basic aid district (Newport-Mesa).
• We would need to eliminate approximately 25 to 30 teaching
positions due to loss of interdistrict transfer students (866).
Elimination of classified positions would depend on services
currently provided to those students.

Other Impacts
15
• There would be some consolidation of school sites resulting
in a potential closed school.
• The recommended minimum reserve balance for economic
uncertainty is 10 percent rather than 3 percent because we
would be solely dependent on the fluctuations in local
property taxes. Sufficient reserve levels may approach 20 to
30 percent! School Services of California, Inc. and the Fiscal
Crisis Management Assistance Team (FCMAT) both
recommend these higher reserve amounts.

Benefits of Basic Aid
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‣More funding for fewer students.
‣Local property taxes often grow faster than cost of living
adjustments (COLA) to state aid.
‣Declining enrollment won’t have a negative impact on district
funding.

When Will We Know?
17
‣The May Revision of the Governor’s Budget will include the
latest financial update.
‣A new State Budget will be approved before June 30, 2013.
‣Students will begin walking through our doors in September.
‣Local property taxes will be adjusted @ P1 (December 2013).
‣STAY TUNED – MUCH MORE TO COME!

Questions?