Evolution of California State School Finance with Implications from Other States, Kirst, Michael, Goertz, Margaret, and Odden, Allan. (2007), Consortium for Policy Research In Education (CPRE).[by the way, Kirst wrote a paper a while back about how educators could influence policy: tell the legislatures what they want to hear in short sound bites!!]
[below are quotations from this report -- my comments in brackets - my research is at my website]
California has created an aligned system of standards based reform in numerous ways, but has never integrated its basic finance system with what students are expected to know and do.
California has one of the highest academic standards of any state (Education Week, 2006.) However, there needs to be some explicit linkage between state finance design and state academic standards policies.
Public opinion studies by Rich Neimand (2006) suggest that California public opinion may respond positively to a comprehensive finance plan clearly focused on high standards and individual outcomes.
a coherent comprehensive solution and compelling message has the best chance of convincing a skeptical, but concerned, public. Themes such as standards, accountability, transparency, and efficiency should accompany proposals for more money. Policy framing needs to emphasize children rather than the needs of the education system.
In sum, California’s school accountability and finance systems that are both centralized should be linked to each other.
[no challenge of the standards based system here – makes one think, who is the real audience for this paper? Whose agenda is this study promoting? Certainly those who support high stakes testing – since this paper’s stance was, how can we change the finance system so that it makes high stakes testing policy more effective, more legitimate. The author compares others states but doesn’t really point out that the overall trend throughout the US is decreased spending on education - - it is just most dramatic in CA. I think there is a relationship between standards based reform and the financial mess we are in – and that relationship is embedded in the rhetoric that says that you don’t need a lot of money when you have high expectations in the form of terror by testing]
But the first step must be to throw the current system out and not try to patch it. There is nothing much that is useful to start with in the current non-system.
[the most frightening statement in this report]: only a handful of experts understand the intricacies of the current finance system.
Legislation in 1972 established the basis for the current state general aid formula, but the state has been transformed in many ways since then.
The finance system is more centralized than almost any state system in the nation.
The result of Proposition 13 is even more state control of all school policy, because state politicians believe that they need to regulate a system that is state financed, but traditionally locally- controlled in other policy areas.
Moreover, state assumption of control of about 80% of total school funding meant that local schools became hostage to the state's volatile sales- and income-tax revenue streams. Even the 1995-2000 economic boom did not raise the state's per-student spending enough to reach the national average. Some districts have resorted to non-profit fundraising foundations and parcel taxes, but these fund-raising devices are not widespread and serve relatively affluent small districts. Voters recognized the schools' plight, and in 1988 passed Proposition 98, which earmarks a specific proportion (about 40 percent) of the state's general-fund revenues for K-12 schools and community colleges. But when state revenues decline, the school-aid guarantee declines as well despite Proposition 98.
Categorical aid represents about a third of the money Sacramento spends on schools. Each categorical program created a constituency of beneficiaries that lobbies to preserve it….Local school officials lack money to clean bathrooms, but have some categorical funds for adult education they cannot spend easily within the school year.
After Prop. 13, some California parents concluded they should use private money to help finance local schools. California foundations sprouted all over the state, but particularly in high income suburbs. Public school foundations have grown steadily since the early 1980s (foundations raised more than $70 million in 2004). Now California has nearly 600 local school foundations, by far the most in the nation.
California has never seriously considered a weighted pupil formula like Florida or Kentucky uses to adjust for different pupil needs. Pupil weights allow local discretion in program design in other states, but state lack of confidence in local policymakers has resulted in state specification of education interventions through categorical programs.
[but WSF doesn’t guarantee increased per pupil spending and could be used to justify continuing underfunding!!]
This state confidence issue has deepened and continued to build for many years.
For example, Democratic Governor Gray Davis in 2000 said local control of education was a “disaster” and created many new categoricals. Some of these were incentive programs for local school bonuses if school test scores went up. But the incentive programs did not have much impact on local teacher behavior (PACE, 2000), and were eliminated when the state budget declined in 2001. 
In 2006, Republican Governor Schwarzenegger created 22 new categorical programs in such areas as art, music, and counseling. These new categorical program requirements add to a gigantic and bloated state education code.But why has such an outcry not led to a substantial overhaul similar to New Jersey, Kentucky, Arkansas, and Wyoming?
[perhaps because California is much, much bigger than these states and the political power structure is very different??? This report says that the problem fundamentally lies with these reasons:]
1. Who must, and who has the right to, initiate state policy action?
Experience reveals that policymakers’ answers focus especially on the roles of the legislature and governor. In California, leadership by the governor has become crucial for a large-scale change in school finance.
2. What are the unacceptable policy initiatives? Again, experience shows that unacceptable state policy ideas trample on group, regional, or big- city interests; challenge dominant economic interests; or promote unorthodox approaches. Even limited inquiry among top state policymakers will provide agreed-on accounts of what policy ideas will not be feasible. In California, Prop. 13 is viewed as immutable and categorical aid is a prime state intervention tool. Rarely are finance incentives related to pupil performance utilized. Proposals to reorganize most categorical grants into a few bloc grants have been rejected by the state political system for decades.
[notice that these factors are all implied to be of equal influence – but why is prop 13 seen as immutable? When CTA attempted to challenge it, the large property owners association told them to scuttle it and CTA backed down in the face of overwhelming political power – academics don’t talk about POWER. High stakes testing was the promotion of an “unorthodox approach” – no?]
3. What are the appropriate state policy actions? Experience again points to such rules as: to get along, go along; carry out informal rituals that will recognize and define the boundaries of power; mobilize everyone who can benefit from a proposed policy, or conversely mobilize those who stand to lose something. Many of the major interest groups are used to Proposition 98 as the key framework and underpinning for California school finance. Interest group politics result in policy that the public may not endorse or feel involves them (Neimand, 2006).
[no 3 applies to those coopted by the system – those who want to climb up the ladder, who place “getting along to go along” as their primary strategy for self promotion – who created and runs that system? CEO’s!!!! – who are effectively organized in CA in the CBRT or CBEE]
In California and other states, such attitudes about acceptable policy ideas have a dual effect; they keep the policy environment predictable, and they help policymakers build group cohesion that produces incremental education finance changes.
[again, CEO’s want the landscape to be predictable – hence their hostility to democracy—since capitalism is unpredictable, they want to control their costs, their labor pool as much as possible]
A majority of the public thinks the school finance problem is too big and complex to be addressed by the current mélange of politicians and entrenched interest groups. California has 6.3 million pupils and spends over $60 billion for K-12 operations. The public believes education problems are caused more by inadequate parenting than school finance shortcomings. Moreover, the public does not trust that money raised by state taxes and sent to Sacramento will come back to their local classrooms. The public believes there is substantial waste in local public schools, and want a finance system focused on pupil outcomes. The California public does not respond much to current finance reform symbols like equity, adequacy, or the need to fully fund Prop. 98. Equity implies redistribution of state funds among school districts with a lowest common denominator result. The public believes that adequacy is a minimum standard that will not enable high enough pupil outcomes.
[“the public” – those polled – voters? Who shapes public opinion? What were the assumptions of the pollers? How were the questions asked? These “opinions” are very gross generalizations at best, inaccurate and highly manipulated at worst]
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