Policy Brief

Effects of the Local Control Funding Formula on Revenues, Expenditures, and Student Outcomes

Studying
Authors
Paul Bruno
University of Southern California
Rucker Johnson
University of California, Berkeley
Published
Summary

California’s Local Control Funding Formula (LCFF), signed into law in 2013, represents a substantial investment in school districts serving disadvantaged students and a modest relaxation of restrictions on district expenditures.

The policy came at a time when the state was able to increase K-12 funding, thereby restoring cuts made a few years earlier. Through the LCFF, the state distributed a large portion of those increased funds based on the proportion of disadvantaged students in each school district—those who qualify for free or reduced-price meals, have limited English proficiency, or are in foster care. Moreover, the state relinquished many of the restrictions on how districts could spend their revenues, creating more flexibility for districts.

This brief summarizes two analyses of school district funding and expenditures under the LCFF.

  • Paul Bruno’s analysis looks at school finance patterns since 2004-05, providing a reminder that the new policy—and the additional state funding it provided—was laid on top of existing patterns of revenue distribution from federal, local property tax, and other local sources, and followed a period of dramatic school funding cuts because of the Great Recession.
  • Rucker C. Johnson and Sean Tanner document the more recent changes in district expenditures and flexibility under the LCFF and tie those to improvements in student outcomes that have occurred since the policy was enacted.

KEY FINDINGS:

  • Per-pupil revenues have increased since 2013-14, particularly for districts with predominantly low-income students.
  • The data provide initial evidence that money targeted to districts with the greatest student needs has led to improvements in student outcomes.
  • Expenditure increases largely went toward teachers, pensions, and special education.