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ERIC Number: ED515626
Record Type: Non-Journal
Publication Date: 2010-Mar
Pages: 39
Abstractor: ERIC
Reference Count: 25
Funding California Schools: The Revenue Limit System
Weston, Margaret
Public Policy Institute of California
Tax revenue flows to California's nearly 1,000 school districts through many different channels. According to the Governor's Committee on Education Excellence (2007), this system is so complex that the state cannot determine how revenues are distributed among school districts, and after reviewing a large number of academic studies in the Getting Down to Facts project, Loeb, Bryk, and Hanushek (2007) conclude that California's school finance system is irrational, inequitable, inefficient, and inadequate. The consensus in both the policy and research communities is that California's system is in dire need of reform. In response to this emerging consensus, there have been two notable reform proposals. In 2007, the Governor's Committee on Education Excellence proposed to replace the current maze of revenue programs for districts with three simple and transparent programs: a base program providing for the general needs of school districts, a special education program providing additional funds for special education students, and a targeted program providing additional funds for districts with many English learners and economically disadvantaged students. Bersin, Kirst, and Liu (2008) proposed a similar structure. These proposals were analyzed in two previous PPIC (Public Policy Institute of California) reports. Although both of these proposals focus primarily on combining many current revenue programs into the special education and targeted programs, the base program under both proposals constitutes more than three quarters of all funding. Under both proposals, this base would be built on top of existing revenue limit funds, a source of revenue for school districts dating back to the 1970s. Revenue limit funds combine property tax revenue and state aid to provide the bulk of revenue currently allocated to school districts. In concept, it is simple to calculate each district's entitlement to these funds. In reality, the revenue limit entitlement is a complex series of formulas reflecting a long and complex history. And while it is commonly believed that revenue limit funds are equitably distributed because of a series of lawsuits in the 1970s and subsequent efforts to equalize funding per student, differences in funding per pupil can be significant. In 2005-2006, the difference in revenue limit funding between the state's highest and lowest funded districts was $26,510 per student. This paper seeks to explain the differences in funding across districts by examining the variation in seven components of revenue limit funding. An accompanying data set lists revenue limit funds per pupil for each of California's 978 districts in 2005-2006. The spreadsheet also lists the seven components for each district and explains why one district's funding differs from another's. A glossary is included. (Contains 14 tables, 1 figure, and 46 footnotes.) [For the technical appendix, see ED515652.]
Public Policy Institute of California. 500 Washington Street Suite 800, San Francisco, CA 94111. Tel: 415-291-4400; Fax: 415-291-4401; Web site:
Publication Type: Reports - Evaluative
Education Level: Elementary Secondary Education
Audience: N/A
Language: English
Sponsor: William and Flora Hewlett Foundation
Authoring Institution: Public Policy Institute of California
Identifiers - Location: California