A bill that could lead to changes in the way California public schools are funded—and send more money to most of them—is headed to Gov. Gavin Newsom’s desk for his signature. California is one of seven states that fund schools based on average daily attendance—the average number of students in class every day throughout the school year—rather than on how many students are signed up to attend at the start of the school year. But schools in the state plan their budgets and allocate funds based on the number of students enrolled. And under the current funding formula, when students aren’t in the classroom—whether skipping school or home sick — districts lose money. Senator Anthony Portantino, a Democrat representing Burbank, has introduced legislation that would research the impacts of changing the school funding formula from attendance-based to enrollment-based. If signed by Newsom, SB 98 would direct the Legislative Analyst’s Office to prepare and submit a report to the Legislature on the effects of the change by January 1, 2026. A 2022 Policy Analysis for California Education report found that about 90% of school districts in the state would receive more funding under an enrollment-based formula than the current attendance-based system, with the biggest boost going to districts with more low-income students and English learners. But the report also argued that the current funding formula acts as an incentive for schools to prioritize student attendance, which could drop if the state switches to funding schools based on enrollment.