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Toward Equity and Coherence? California's Funding Formula in Year 3

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 By the members of the LCFF Research Collaborative

The Local Control Funding Formula Research Collaborative (LCFFRC) released our latest report on the implementation of California's Local Control Funding Formula (LCFF) earlier this month. In this year's study, we found continuing reasons for optimism, but also some persistent obstacles that impede district efforts to realize the full intent of the law.

Our optimism stems from districts' continuing efforts to adapt their strategies to improve stakeholder engagement and use their resources to better address the needs of LCFF's target students--those living in poverty, English learners, and foster youth. The obstacles include low capacity and insufficient expertise to realize meaningful stakeholder engagement, lack of clarity about the appropriate uses of Supplement and Concentration (S & C) funds, and the inability of the Local Control Accountability Plan (LCAP) template to achieve the multiple purposes assigned to it.

After three years of following the implementation of the LCFF and hundreds of interviews with district officials, principals, teachers, school board members, parents, union officials, and community organizations, we have yet to find anyone who wants to return to the old categorical system of school funding.  At the same time, we have encountered a fair amount of confusion and apprehension about whether districts are moving quickly enough to realize the equity intent of the law, which was the reason for including S & C funds in LCFF in the first place.

Some advocacy groups are frustrated by the lack of transparency regarding the uses of S & C funds. They are right. Neither the LCAP template nor the Standardized Account Code Structure (SACS) lends itself to tracking district expenditures to schools or targeted student groups. While our study found that districts are making good faith efforts to allocate S & C dollars to increase support and services for targeted students, we also found that many districts remain confused about the ways in which S & C dollars can or should be used.

This focus on the specific targeting of S & C funds is understandable, but in our view it misses a larger point. The LCFF's intent is for districts to ensure that their entire budget serves the goal of advancing equity and eliminating disparities in opportunities and outcomes. To this end, districts need to be more transparent about how they are using all of their resources, including base funding, S & C funds, and other state and federal grants. Additionally, districts should clarify the relationships between these increased investments and student outcomes. Only then can we know whether these investments are meeting their intended purposes, and where they are falling short.

Meeting the multiple goals of LCFF is enormously challenging. Our research shows that districts need additional support to accomplish this task. In our report, we recommend three steps the state can take to assist districts.

1)    Redouble efforts to clarify and communicate the intent of the LCFF. Despite significant state efforts to articulate LCFF goals, we found that districts and communities are not always hearing the message. This has led some districts to engage in practices that appear to be inconsistent with the law. To support the local understanding of LCFF, the state should widely publicize the policy's goals so that both educators and community members clearly understand the intent of the law.

2)    Ensure that local actors have the capacity to realize the LCFF's goals. Many districts, County Offices, and community groups lack the experience and expertise to implement aspects of the LCFF, including meaningful community engagement, strategic planning, and strategic budgeting. As a start toward building local capacity, greater transparency, and coherence, the state should identify and disseminate examples of promising practices so districts can learn from what others are doing.  

3)    Review the efficacy of the revised LCAP template and allow for local experimentation with new tools. The LCAP is expected to serve as a tool for stakeholder engagement and communication, strategic planning and budgeting, and accountability. No single document, not even the revised LCAP template, can serve all these purposes effectively. The state should allow local experimentation with alternative tools to achieve each of the purposes, and carefully track how districts are using the new dashboard to ensure true accountability for outcomes.

Our basic message to policy makers on the LCFF is "Stay the course." The LCFF policy framework is only now approaching completion. The new accountability system will not be fully implemented until this September. We are aware that some policy makers are eager to begin revamping the law, but we caution against hasty action. Given the strong support for local decision-making and many districts' sincere efforts to embrace the concept of equity embedded in the law, the LCFF needs to be given more time to succeed. With the addition of more support for local implementation and assistance to help districts be more transparent, policy makers would be wise to carefully monitor progress and avoid any action that might return California to a system that relies on a hodge-podge of categorical programs and state mandates.

The LCFF Research Collaborative includes: Daniel Humphrey (Independent Consultant), Julia Koppich (J. Koppich & Associates), Magaly Lavadenz (Loyola Marymount University), Julie Marsh (University of Southern California), Jennifer O'Day (American Institutes for Research), David Plank (Policy Analysis for California Education), Laura Stokes (Inverness Research), Michelle Hall (University of Southern California), Taylor Albright (University of Southern California), Jarah Blum (American Institutes for Research), Tasmin Dhaliwal (University of Southern California), Laila Fahimuddin (SRI Education), Katherine Ramage (Inverness Research), and Laura Tobben (University of California, Berkeley).

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