Student Count Options for School Funding

The method California uses to count students for funding purposes is an important decision that drives both resources and behaviors. For more than 100 years, California has funded school districts based on the average number of students who attend school each day. Although this average daily attendance (ADA) method was once used by many states, the practice has faded. Now, California is one of just six states that use ADA to allocate state education funding to school districts. The remaining states use other student count methods such as average enrollment.

Some state legislators, advocates, and education leaders have proposed that California switch from an attendance-based funding system to one that funds based on enrollment, and some are debating ways to adjust count methods to protect districts experiencing attendance volatility and declining enrollment. As policymakers engage in these discussions, it is critically important that they understand California’s current count method as well as potential alternatives to it.

This report studies California’s attendance-based funding system. Our intent is to inform policymakers and advocates as they consider whether and how to revise existing policies or craft new policies to address a variety of state priorities related to fiscal stability, equity, attendance, and more.

We find that about 90 percent of districts would receive more funding under an enrollment-based formula than they would under the current ADA-based system, with the biggest boost going to high school districts and districts with more low-income, English learner, and foster youth students. Switching to an enrollment-based count method would increase the cost of the Local Control Funding Formula (LCFF) by about $3.4 billion annually. Since this additional funding would come from the Proposition 98 guarantee, the legislature could choose whether to change the student count method, thereby increasing the LCFF allocation, or to invest that money in other programs outside of LCFF.

It is clear to us that a new count method, by itself, cannot achieve all goals. Switching from attendance to enrollment may help districts gain greater fiscal stability and may shift more resources to school districts with greater student needs. Such a change could also offer districts more flexibility around how to serve students instructionally—including students who might learn better through a competency-based model—and could avoid prioritizing attendance over student and public health. On the other hand, the current system includes a fiscal incentive that, most agree, encourages higher attendance, even if that attendance definition is relatively weak. If the state dispensed with this incentive, it would likely need to find other ways to drive positive practices related to student attendance and engagement.