California’s school finance system fuels the learning and developmental opportunities that our state’s nearly six million public school students receive. That system is shaped by the critical decisions made by elected state and local leaders.

The California Association of School Business Officials (CASBO) has developed this guide to provide essential information about school business and finance to inform this decision-making and leadership. The guide is divided into three sections that describe:

• How (and how well) California public schools are funded, including Proposition 98, the Local Control Funding Formula, recent federal Covid-19 relief funds, school facilities, and more;
• Current issues in school business and school finance; and
• Basics of local school district budgets.

These past several years have been among the most challenging for schools in California’s history. A worldwide pandemic, pervasive economic and racial inequity, staffing shortages, and declining enrollments have stretched capacities and impacted nearly every aspect of our public education system. As you consider the school finance landscape, some important realities to keep in mind include:

• California continues to serve the most diverse student population in the nation, including approximately six out of 10 students who live in poverty, one
  out of five who are English learners, one out of 10 who have disabilities, and a rising number who lack housing.
• An unexpected surge in funding levels has created unprecedented opportunities to strengthen education, but significant challenges and pressures remain. These include rising costs; increasing imperatives to meet the physical, social, emotional and mental health needs of children at school; limited time for planning and integration of new, major initiatives; and long-term fiscal sustainability; and the likelihood of a recession in the next couple of years.
• The state and nation are experiencing a severe shortage of qualified teachers for many subjects and classrooms, as well as a shortage of other key staff and school leaders.

We encourage you to gain a deeper understanding about these and many other issues that shape school funding and business in California. While sometimes less visible, funding and business issues are crucial to supporting the success of our students every day in all of our classrooms.

Lastly, we’d like to acknowledge that while these past several years have been especially difficult, educators, school staff, leaders and school business officials across the state have continued to work tirelessly to confront the challenges and meet the needs of their students and communities. We are grateful to all those who serve and support public education.