[Email notice of this letter was sent on July 20, 2023, to the PASE and CDEfisc email distribution lists.]

July 20, 2023

Dear County Superintendents of Schools:

2023–24 Advance Principal Apportionment

The California Department of Education (CDE) certified the 2023–2024 Advance Principal Apportionment (Advance) on July 20, 2023 pursuant to California Education Code (EC) Section 41330. The statewide total was $53,191,098,777. At the end of each month from July 2023 through January 2024, county treasurers will receive warrants that reflect state aid for Advance programs for local educational agencies (LEA). County superintendents of schools should advise school districts and charter schools of this apportionment immediately.

The 2023–24 Advance is apportioned on the basis of an LEA’s Second Principal Apportionment (P-2) funding from the preceding fiscal year pursuant to EC Section 41330 and funding appropriations provided in the 2023–24 Budget Act and Senate Bill (SB) 114, Chapter 48, Statutes of 2023.

A summary of the Advance calculations is provided below. This letter, as well as Excel files that provide funding and monthly payment amounts, are available on the CDE website at https://www.cde.ca.gov/fg/aa/pa/pa2324.asp. Additionally, the CDE has posted the 2023–24 Funding Rates and Information web page at: https://www.cde.ca.gov/fg/aa/pa/pa2324rates.asp.

2023–24 Advance Calculations by Program

The following provides specific details regarding the calculation of funding for each program, including the Local Control Funding Formula (LCFF). Because this apportionment is merely a means to begin allocating funds in accordance with EC Section 41330, it should not be used by LEAs for budgeting.

SB 114 enacted several changes to programs within the Principal Apportionment. While some of these changes were captured in the 2023–24 Advance, other changes—such as the county office of education (COE) declining enrollment protection for alternative education grant, Student Support and Enrichment Block Grant for COEs, and LCFF Equity Multiplier—were not. Additionally, the Arts and Music Education Funding authorized by Proposition 28 was not included in the Advance. Items not included in the 2023–24 Advance will be reflected at a subsequent apportionment during the 2023–24 fiscal year.

Local Control Funding Formula State Aid – County Offices of Education

The estimated 2023–24 LCFF State Aid for each COE is based on funding from the 2022–23 P-2 certification and reflects the following:

1. The 2022–23 LCFF Entitlement, including the add-on funding component, was adjusted to reflect the 8.22 percent 2023–24 cost of living adjustment (COLA) for COEs funded based on the LCFF Target and LCFF Floor.
2. Additional funding for Local Control and Accountability Plan support for COEs funded on the Target formula as of 2016–17 P-2, pursuant to EC Section 2575.1, is included in the Advance state aid amount and was adjusted to reflect the 8.22 percent 2023–24 COLA for LCFF.
3. Additional state aid for differentiated assistance pursuant to EC Section 2575.2 is equal to the 2022–23 P-2 amount and includes an updated $300,000 base allowance for COEs.
4. The 2022–23 P-2 local revenue amount was used to determine the COE’s Advance state aid and excludes any one-time Redevelopment Agency (RDA) Asset Liquidation funds reported as part of the COE’s 2022–23 P-2 property taxes.
5. The Education Protection Account (EPA) Entitlement, which is an offset to state aid, has been recalculated to reflect the 2023–24 funding estimate of $13.9 billion. See the EPA section below for additional details.

Local Control Funding Formula State Aid – School Districts and Charter Schools

The estimated 2023–24 LCFF State Aid is based on funding from the 2022–23 P-2 certification and reflects the following:

1. Applicable components of the 2022–23 P-2 LCFF Entitlement were increased by the 8.22 percent COLA, including the Base, Supplemental, and Concentration Grant, Necessary Small School Allowance, 2012–13 Home-to-School Transportation Add-on, 2012–13 Small School District Bus Replacement add-on, and the Transitional Kindergarten add-on.
2. 2022–23 class size penalties (reflected in the miscellaneous adjustments and minimum state aid adjustments lines of the P-2 School District LCFF funding exhibit) have been excluded from the Advance.
3. The 2022–23 P-2 local revenue amount was used to determine the school district’s Advance state aid and excludes any one-time RDA Asset Liquidation funds reported as part of the district’s 2022–23 P-2 property taxes.
4. The EPA Entitlement, which is an offset to state aid, has been recalculated to reflect the 2023–24 funding estimate of $13.9 billion. See the EPA section below for additional detail.

Education Protection Account

EPA revenues, as authorized by Section 36 of Article XIII of the California Constitution, are generated by an increase in the personal income tax rates for upper-income taxpayers. All LEAs will receive quarterly EPA payments through the 2030–31 fiscal year, which will be paid outside of the Principal Apportionment. For most LEAs, EPA funding offsets state aid allocated through the Principal Apportionment.

Using the 2023–24 EPA revenue estimate of approximately $13.9 billion, the CDE calculated estimated EPA entitlements using a factor of 44.55990366 percent based on the adjusted 2022–23 P-2 statewide total of revenue limits and charter school block grant funding, adjusted to reflect the statutory COLA of 8.22 percent, and 2022–23 P-2 local revenue data, adjusted to exclude one-time RDA Asset Liquidation funds. If an LEA’s 2022–23 P-2 EPA entitlement was based on $200 per average daily attendance (ADA) (the minimum), the 2023–24 estimated EPA entitlement was not recalculated for the Advance.

While the funding is not allocated through the Principal Apportionment, estimated 2023–24 EPA amounts are provided on the Advance Apportionment Summary available on the CDE’s website at https://www.cde.ca.gov/fg/aa/pa/iassf23adv.asp for your convenience. For additional information on EPA calculations, letters of apportionment, payment schedules, spending restrictions, frequently asked questions, Standardized Account Code Structure financial reporting and more, please refer to CDE’s EPA web page at https://www.cde.ca.gov/fg/aa/pa/epa.asp.

Basic Aid “Choice”, Court-Ordered Voluntary Pupil Transfer, and Charter Supplement

The 2023–24 Advance funding for Basic Aid “Choice”, Court-Ordered Voluntary Pupil Transfer, and Charter Supplement is based on the 2022–23 P-2 amounts for each LEA, adjusted for the 8.22 percent COLA.

Adults in Correctional Facilities

LEAs that participate in the Adults in Correctional Facilities (AICF) program receive funding on a reimbursement basis. The 2023–24 Budget Act provides $8,670,000, which will be used to fund the 2022–23 program. Advance funding for the AICF program is equal to the 2022–23 P-2 state aid amounts for each LEA adjusted for the statutory COLA for 2022–23 at 6.56 percent.

Special Education – Assembly Bill 602 Program

The 2023–24 Budget Act provides $4,509,589,000 for the AB 602 program. The estimated 2023–24 state aid for each Special Education Local Plan Area (SELPA) is based on funding from the 2022–23 P-2 certification and reflects the following adjustments:

• The 2022–23 Special Education Property Tax amount was used to determine the SELPA’s Advance state aid and excludes any one-time RDA Asset Liquidation funds reported as part of the county’s 2022–23 P-2 property taxes.
• A factor of 1.0162285811 was applied to each SELPA’s adjusted 2022–23 state aid amount.

Special Education – Infant (Ages Two Years and Younger) Program

The 2023–24 Budget Act provides $88,368,000 for the Infant program. The Advance is based on the 2022–23 P-2 amounts for each LEA, increased by a factor of 1.0591190632.

Special Education – Mental Health Services

Pursuant to EC Section 56836.07(e) funding for mental health services is calculated and allocated at the LEA level and based on the ADA reported for each LEA for the 2023–24.

The 2023–24 Budget Act provides $437,168,000 for Mental Health Services. The Advance calculation is based on the ADA reported for each LEA for the 2022–23 P-2 multiplied by per-ADA rates of $80.9163599137 for all LEAs and $0.5983577186 for the Los Angeles County Court. New charter schools were not included in the Advance calculation and will be included at the 2023–24 First Principal Apportionment when current year ADA are available.

Special Education – Early Intervention Preschool Grant

The 2023–24 Budget Act provides $260,000,000 for Early Intervention Preschool Grant. The Advance is equal to the 2022–23 P-2 amounts for each LEA.

Expanded Learning Opportunities Program

The 2023–24 Budget Act provides $4 billion for the Expanded Learning Opportunities Program. The CDE has set aside $5 million of the total appropriation for COE apportionments to provide technical assistance, evaluation, and training services to support program improvement [ECSection 46120(d)(8)]. The total appropriation to eligible school districts and charter schools at Advance is $3,995,000,000.

The 2023–24 entitlement calculation is based on each LEA’s 2022–23 P-2 unduplicated pupil percentage (UPP) and classroom-based ADA in grades TK/K–6 [EC Section 46120(d)(1)]. LEAs eligible for Rate 1 in 2022–23 (UPP greater than or equal to 75.00%) remain eligible for Rate 1 for at least three years even if the prior year UPP is less than 75.00% [EC Section 46120(d)(4)].

• Rate 1 remains at $2,750 in 2023–24.
• Rate 2 is $1,802.6618617530 at 2023–24 Advance. The amount for Rate 2 decreased by $251.54 from 2022–23 as the result of the 3.27 percent statewide increase in classroom-based ADA in grades TK/K–6 used in the funding calculation, and no increase to the state budget allocation for the program.

Details on the 2023–24 rates and funding calculation are available at https://www.cde.ca.gov/fg/aa/pa/pa2324rates.asp#elop.

Transfer of Funds for County Served District Funded Average Daily Attendance

EC Section 2576 requires the CDE to transfer funds from the district of residence to the COE for District Funded County Program ADA at the per-ADA LCFF rate of the school district, unless the school district and COE agree on an alternative. Transfer of Funds for County Served District Funded ADA is based on the 2022–23 P-2 amounts, adjusted to reflect the 8.22 percent 2023–24 COLA applicable to the per-ADA LCFF rates.

Other State Aid

Other State Aid appropriations for the 2023–24 Advance can be found in Sections 39 and 94 of SB 114, and Section 147 of Assembly Bill 130 (Chapter 44, Statutes of 2021).

Home-to-School Transportation Reimbursement

The Advance carries forward the 2022–23 P-2 Home-to-School Transportation Reimbursement calculated for each eligible county office of education and school district. Pursuant to EC Section 41850.1, as amended by SB 114, school districts with a districtwide charter petition approved pursuant to EC Section 47606 were excluded.

Charter School Overpayments

Charter schools with a 2022–23 overpayment will see the amount reflected in the Advance Apportionment Summary on Line A-20, Prior Year Amount Charter Overpaid. The negative adjustment on this line decreases the charter school’s total 2023–24 Principal Apportionment, which has the effect of decreasing current year monthly Principal Apportionment payments to repay the prior year overpayment.

Payment Schedule

Monthly payments for the Advance (July 2023 – January 2024) are available on the CDE’s website at the county summary level and by LEA. For cash flow planning, LEAs should refer to the Principal Apportionment Payment Schedule web page at https://www.cde.ca.gov/fg/aa/pa/papayschedule.asp. The State Controller’s Office website provides monthly payment information, including offset amounts at https://www.sco.ca.gov/ard_payments_k12.html and estimated payment dates at https://www.sco.ca.gov/Files-ARD-Payments/sched_2023.xlsx (XLSX).

If you need assistance, or have any further questions, please contact the Principal Apportionment Section by email at PASE@cde.ca.gov or by phone at 916-324-4541.

Sincerely,

Dean Patterson, Administrator
Principal Apportionment Section

Kiyomi Meeker, Administrator
Principal Apportionment Section

DP/KM:ss