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How Can California's New School Finance System Foster Deeper Learning?

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This post is by Soung Bae, Senior Research and Policy Analyst, Stanford Center for Opportunity Policy in Education (SCOPE).

In an effort to better understand how states are designing and implementing educational policies that create deeper learning opportunities for all students, my colleague, Liz Leisy Stosich, and I have been studying California's vanguard policies: the Local Control Funding Formula (LCFF) and the Local Control and Accountability Plan (LCAP). The LCFF marked a historic shift in the way California allocates funding to school districts and the way the state provides support and intervention to school districts to ensure meaningful learning for all students.

The LCFF replaced a complicated and heavily regulated system of categorical funding and simplified the funding formula by eliminating approximately three-quarters of the categorical programs and providing unrestricted or general purpose funds directly to districts with the specific intent of providing more fiscal resources to districts that serve students with the greatest needs (e.g., English language learners, low-income students, and foster youth). In addition, LCFF affords district officials more autonomy and flexibility with which to allocate funds to meet local needs and priorities. The newfound autonomy and flexibility aligns with research on the role of school districts in supporting ambitious teaching and learning. School districts, by supporting instructional leadership and high-quality teaching and by focusing resources on improving teaching and learning, can have a positive impact on engaging all students in deeper learning.  

In exchange for increased fiscal flexibility and autonomy, LCFF requires district officials to develop and adopt LCAPs that detail the district's annual goals, the allocation of resources, and the articulation of the steps that will be taken to realize their goals. Through the LCFF and LCAP policies, a more streamlined and transparent system of school finance and accountability has emerged. As a result, these policies create a system that has the potential to support more equitable and meaningful learning through resource accountability, which ensures that adequate school resources are allocated according to students' learning needs and that students have equitable access to high-quality curriculum and materials, as well as high-quality educators and staff. Yet, what paved the way for these policies to take root in California?

The Principle of Subsidiarity

Governor Jerry Brown first introduced the principle of subsidiarity in his 2013 State of the State address. He argued that local school districts and school boards should have maximum authority and discretion to distribute funds and to plan for the educational needs of the students whom they serve. "A central authority should only perform those tasks which cannot be performed at a more immediate or local level," said Governor Brown. Thus, LCFF was designed to increase local education agencies' fiscal flexibility and shift the responsibility for strategic budgeting and planning from the state back to the local level.

This principle of subsidiarity resonated with policymakers, educators, and community members. State leaders explained that "the opportunity of local control was so powerful" because it gave educational leaders the autonomy to make financial and programmatic decisions for themselves based on their local needs and priorities. This move toward local autonomy may reflect the state's (and nation's) backlash against the NCLB era, where top-down authority and mandates reigned. In addition, education leaders recognized that LCFF emphasized the key role that central offices can play in facilitating and supporting autonomous decision-making at the local level, which research has shown can bolster school improvement efforts and support deeper learning.

Stakeholder Engagement

State leaders in California talked about the importance of the stakeholder engagement process as an enabling condition for the LCFF policy. The stakeholder engagement sessions allowed the Governor's staff and the Department of Finance folks who were spearheading the reform to "engage in a listening tour" and give stakeholders opportunities to provide "true feedback." The stakeholder engagement sessions not only provided a mechanism to build a public campaign for the policy, but also involved system actors in the design of the policy. For example, because LCFF was designed to allocate funds based on student needs, large, urban districts that served a large proportion of low-income students, English language learners, or foster youth stood to see a significant increase in their funding levels. In contrast, suburban districts that served fewer high-needs students but had benefitted from the categorical system of funding were likely to see a decrease in their funding levels. Thus, the stakeholder engagement process allowed state education leaders to work alongside their legislative colleagues to negotiate and modify the original funding proposal so that it satisfied the needs and priorities of all stakeholders. 

Accountability for Equitable Outcomes

While LCFF was being designed and negotiated, critics argued that the policy offered school district officials local control and flexibility to allocate funds to programs and services that best met the needs of their communities, but without any accountability. One state leader recalled that the civil rights community and advocacy groups and community groups were very excited about LCFF, but they "were very deeply concerned that there was nothing in there that made sure that this funding would actually result in the students who generate those dollars actually benefiting in any way, shape, or form." Although the LCAP was designed as a "strategic planning tool" that married budget decisions with school improvement decisions, it also serves as an accountability mechanism by default. School officials are required to document in the plan the district's goals and how resources are allocated to realize the goals; thus, creating a more transparent system for stakeholders. Moreover, it brings parents, educators, and members of the community into the development process, since stakeholder engagement is a critical component of the LCAPs. This provides stakeholders with an active role in deciding how the funds are spent and for what purposes, which furthers the state's commitment to local control and ensures access to data and information needed to make informed decisions about supporting deeper learning and continuous improvement.

Looking Ahead

As states work to develop their state plans for ESSA, California is well situated to continue their commitment to local control, since the federal law provides greater flexibility and shifts control back to the states. The state began the work of reforming the school finance and accountability system a year and a half before ESSA came on the scene. Thus, while the federal requirements in ESSA may inform the work, it will not drive the work. As one state leader explained, "There's still, I think, a fair amount of policy consensus that California is going to do this the way that we think is best. Then try to make sure we work in what we need to do to work with the ESSA." California's redesigned school finance and accountability system may provide worthwhile lessons for how states can take advantage of the flexibility that ESSA provides and create more equitable and meaningful learning opportunities for all students.

 

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