Categorical spending questionedPublic Advocates wants more accountability
Gov. Jerry Brown generally favors giving school districts more control to spend state dollars as they choose – the same position as his predecessor, Arnold Schwarzenegger. In his new state budget, Brown is proposing to extend temporary control that the Legislature gave districts over some previously earmarked money for two more years, through 2014-15.
But deregulation comes with an obligation of transparency. Districts should tell the public and report back to the Legislature on how they spent the money, much of which was supposed to be targeted to poor children.
That hasn’t happened, according to the advocacy group Public Advocates. Although the Legislature required districts to hold separate public hearings on how money for the “categorical” programs would be used and to do accountability reports to the state, the Department of Education let them off the hook with an advisory letter in 2009. The Department said that districts didn’t have to do either step. In budget hearings today, Public Advocates will ask the Legislature to insist that districts follow the law.
The money – more than $4.5 billion – had been divvied up among 40 categorical programs for designated purposes, including instructional materials, teacher development, adult education, remedial instruction, and regional occupational centers.
In permanently cutting the budget for categorical programs by 20 percent in 2009, the Legislature said that districts, faced with a financial crisis, could set their own priorities and spend the money as they wanted. The Legislative Analyst’s Office, which did a survey of districts last year, reported that many districts did shift money from maintenance and materials to prevent further layoffs and to pay for basic costs. Last month, for example, the San Jose Unified trustees voted to divert the adult education money to core K-12 expenses, which they said should be their first priority. (Update: The LAO today released an updated district survey. Its conclusion: “Compared to 2009–10, however, a higher percentage of districts in 2010–11 are either diverting funding from flexed categorical programs or discontinuing them altogether.” The LAO is recommending deregulating additional categorical programs, including K-3 class-size reduction, a popular program championed by the California Teachers Assn.)
Researchers affiliated with Policy Analysis for California Education (PACE) and the RAND Corporation are following the impact of deregulation but reported that a lack data from the districts is hampering their work.
Some of the biggest categorical programs – class size reduction subsidies and economic impact aid targeting the largest low-income districts such as Los Angeles Unified – are still off limits. But the LAO and many districts favor further deregulation.
Gov. Brown and his chief education adviser, State Board of Education President Michael Kirst, advocate eventually creating a new funding system by redirecting all money from categorical programs to a per-student formula with more dollars for low-income children, English learners, and high-cost and rural districts.
It’s a good idea, but it presupposes that districts will spend the former categorical money on kids most in need. That’s why, Public Advocates says, it is important now to start tracking what districts are actually doing – and for districts to hold hearings explaining their decisions to parents.
It’s doubtful that the Legislature will reimpose categorical spending of the 40 programs it has liberated; once given control, districts will fight to keep it. But legislators should keep watch; they’ll be able to do that only if they demand more detailed reporting from districts.
Clarification: Here is the 2008 study that Michael Kirst co-authored. As he mentioned in a comment, categorical money for special education is not included in the weighted student formula that he proposed. An updated version, done last year by researchers for the Public Policy Institute of California, also exempts Economic Impact Aid, another large categorical program.