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My School Had an Emergency Closure. Do I Need to File a J-13A Emergency Waiver?

By the EdTec Data Team

October 16, 2019

Between power outages, wildfires, and other natural disasters, there are many events that may result in unexpected school closures. Read on to learn if you need to complete a J-13A emergency waiver, and the steps you should take to make sure you’re in compliance with the State of California’s requirements.

If my school experiences an unexpected closure, what should I do?

Before completing a J-13A emergency waiver, there are a few things to consider. First, find out if the length of the closure ends up putting your school below the state’s annual instructional minutes and days requirement. You’ll also want to look at your charter petition to see if you have instructional minutes or days requirements beyond what the state mandates. If your instructional time doesn’t fall below either requirement, you can relax – you don’t need to complete a J-13A waiver.

However, what if the closure puts you below the requirements? Again, don’t panic – you have options! Your first option is to add days to your calendar and/or minutes to your bell schedule later in the year to recover the lost days/minutes resulting from the closure. If you go this route, you do not need to complete a waiver, although it is highly recommended that you get these calendar and bell schedule changes approved by your board. But if you prefer to keep your calendar and bell schedule as is, your second option is to complete a J-13A waiver. Simply completing the waiver isn’t enough; it must be signed by a majority of your board, and approved by your authorizer, the county, and the California Department of Education (CDE). Only after your waiver makes it through this multi-level approval process will the state allow your school to be below the instructional time requirements without penalty.

The J13-A waiver also has a material decrease option. But what does this option really mean? The material decrease option applies to schools that stay open during an emergency. If the event has an adverse impact on the school’s attendance, a school can use the material decrease option to substitute its attendance for the affected days with the school’s average daily attendance (ADA). This option is a bit unpredictable and may not actually be as beneficial as just removing the lost days and/or replacing them. This option is unpredictable because we don’t know exactly what you will get as your final replacement ADA until the CDE approves the waiver and then does calculations based on your attendance data. This is one of the reasons why the California Charter Schools Association (CCSA) recommends not filing the waiver unless you know you’re below the instructional minutes and days requirement.

If the emergency occurred before P-1, do I need to file the waiver before submitting my school’s P-1?

Not necessarily, but you should confirm your attendance data accurately reflects any changes caused by the unexpected closure before submitting your P-1 to ensure your ADA is correct.

It is important your school decides as soon as possible whether it wants to file the waiver or add more days to your schedule since you obviously can’t make additions to the calendar or schedule after the year is over. Although schools report days of instruction with the P-Annual at the end of the year and auditors verify instructional time requirements around the same time, it is best to file a waiver before P-2 so you know what your P-2 ADA will be without having to wait for an adjustment. Waivers filed after P-2 will lead to any ADA funding revisions processed as prior year adjustments and won’t be reflected until P-1 of the following year. Also keep in mind that CDE approval can take months, depending how many waivers are submitted.

Now that we’ve discussed the waiver, are there any other things to keep in mind?

Yes, don’t forget your Student Information System (SIS)! Each SIS is different but there should be a way to change days from school days to non-school days. Make sure to update your SIS to reflect any closure days and, if applicable, add any replacement days. You need to do this even if you do not file a J-13A waiver. If you’re still uncertain of what the process is like in your SIS, reach out to your EdTec data contact or your SIS support line.

In addition to updating your SIS, you’ll also need to update your school calendar showing closure days as non-school days. Any other changes such as days added as replacement should also be included in your school calendar update. It is also helpful to recalculate your instructional days/minutes, so you have an updated calculation available.

If you have additional questions about the J-13A waiver, don’t hesitate to reach out to your EdTec data contact. You can also find additional guidance from CDE’s J-13A website at https://www.cde.ca.gov/fg/aa/pa/formj13afaq.asp.

Using Benchmarking as a Budgeting Tool

By Trevor Skelton, Associate Client Manager

June 2019

California charters are full swing into the budgeting season for the upcoming school year, and for brand-new schools to thriving networks, budgeting is never a simple process. We at EdTec often find that benchmarking against historical data as well as data from similar charters is an invaluable tool in assessing whether a budget is built on realistic assumptions. This information should not be used to define an entire budget, but rather as one of many tools used to inform budget formation and key financial decisions. This data also helps school leaders to understand the charter financial landscape, discover inefficiencies in their budgeting practices, and evaluate where and why their budgets may be similar to or different from that of the average charter.

Revenue

From a historical viewpoint, the last five years have seen strong increases in K-12 education funding with the full implementation of the Local Control Funding Formula (LCFF), which was enacted in FY14 to replace the previous California education funding system. Between the five-year period from FY14 to FY18, the average charter’s total revenues grew from $9,513 per ADA to $13,078, or nearly 9% per year.

In FY14, average LCFF revenues for charters were $6,887 per unit of Average Daily Attendance (ADA) – in FY18, they were $9,633c a 40% increase as closing the gap toward target funding progressed ahead of schedule. However, not all schools have benefited equally from LCFF. Funding is distributed to schools based on the number of students who qualify for Free and Reduced Priced Meals, are foster youth or homeless, or qualify as English Language Learners. This unduplicated pupil percentage (UPP) of students is a major funding indicator now that LCFF has been fully implemented, with the intent to direct additional resources to students and schools that need them the most. Funding disparities between schools with low and high populations of unduplicated students have grown significantly, as shown in the graph below. Beyond LCFF, federal revenues, most commonly Every Student Succeeds Act (ESSA) Title funding, also have a direct relationship with unduplicated students. Thus, accurate budgeting, tracking, and reporting of ADA and student demographics via CALPADS are more important than ever in maximizing revenue.

In FY18 the average charter school reported a 64% UPP, so while many have enjoyed increased resources, others have been forced to innovate to acquire resources to make ends meet. For charters, we see that disparities in government funding are often supplemented with local funding where available. In particular and perhaps unsurprisingly, charters located in counties with higher median household incomes, especially the Bay Area and Coastal regions, have the greatest access to these additional resources. Charters with a UPP of below 25% reported an average of just below $1,000 per ADA in local revenue, compared to less than $500 for the average charter.

K-12 education funding is at a point of uncertainty. LCFF has reached target, and FCMAT projects meager 2-3% COLA adjustments in future years – well below the revenue increases of the past half-decade of steady economic growth. An economic recession would certainly impact not just state funding, but local resources as well. Charters will need to be able to adapt and weather a possible storm if they are to survive an uncertain future.

Expenses

In examining statewide charter expenditure data, we see that expenses have grown in a similar fashion to revenue over the past five years. The average charter was spending $8,411 per ADA in FY14 – by FY18, this had grown to $12,011, a 43% increase. Over this time period, California has grown from near the bottom of per pupil spending in all the U.S. to about average[1]. While certainly movement in the right direction, pupil performance indicators, a higher-than-average cost of living, and the uncertain future of LCFF funding all indicate that this is hardly the moment for celebration.

An average charter will spend 60% of its budget on salaries and benefits, so it is essential to understand each piece of the compensation puzzle and to budget appropriately for future considerations. Overall, salaries per ADA have risen 9% a year, a rate of growth charters may no longer be able to afford in the new post-LCFF-target world.

Employee benefits have become a major budget challenge for charters. From FY14 to FY18, the average charter’s spend on benefits grew from 25% of salaries to 29% of salaries. This means the growth in benefits spending has matched and then surpassed the growth in salaries by nearly 20%. As shown in the figure below, this growth was led by STRS, as the mandatory employer contribution rate doubled over this time from its long-standing 8.25% to 16.28% of salaries for certificated staff. This may very well explain why the rate of new charters that chose not to enroll in CalSTRS rose from its steady 10% to 20% in FY15 and 33% in FY16[2]. PERS has also seen rates that have more than doubled in the past decade, while health and welfare benefits continue to soar across the board.

Special education is notoriously difficult to budget for and is extremely underfunded. Based on our experience and data, we estimate the average charter spent at least $1,300 per ADA on special education in FY18. Charters that are a part of a Special Education Local Planning Area (SELPA) may receive SpEd revenues to cover around half of that, but for charters serving their students as a school of the district, it’s not uncommon for district SpEd encroachment fees to exceed $1,300 per ADA.

Finally, we see facilities costs rising across the state for charters with and without SB740 revenues. Facilities costs for charters are rising at a pace of 8-10% per year, translating to over $600 per ADA net of facilities revenues.

For these areas with inherent risk and uncertainty, conservative budgeting with contingencies is imperative in managing school budgets.

Fiscal Health

These data all come together to form a charter’s overall fiscal standing. Overall, California charters have averaged somewhere between $400-$500 in operating income per ADA in any given year for the past five fiscal years, which has allowed them to steadily grow their fund balances. In FY18, new schools saved between 10-20% of expenses, while older schools were able to accumulate greater reserves for future investments and to manage cash fluctuations. Charters had a median of 80 days cash on hand – a comfortable amount for the average-sized charter – and at least 25% had 30 days cash on hand.

While operating income, fund balance, and cash balance are the main indicators of a charter’s financial stability, variance to budget will also be important to monitor. Continuously tracking budget vs. actuals year-to-date for trends and discrepancies can help to identify clear areas of weakness in a school’s financial or budgeting practices. And of course, managing against any debt covenants or authorizer requirements is imperative to staying in good financial standing.

Averages don’t tell the whole story. Every school has variances from the norm, but it’s essential to be able to explain why and understand what the possible financial implications may be. From individual school practices to the California Department of Education’s new LCAP Budget Summary for Parents, we see a trend toward increasing transparency when it comes to California’s education funding and spending. Adopting a practice of regular communication of school budget information and comparative data like this with parents, community members, school staff, lenders, and others can foster engagement and understanding with stakeholders, empowering those most invested in educating California.

 

[1] http://www.teaching-certification.com/teaching/education-spending-by-state.html

[2] https://calpensions.com/2017/09/11/fewer-charter-schools-choosing-calstrs-pensions/

Data Sources: Unaudited Actuals Financial Data (CDE); Public Schools Data Files (CDE); CALPADS UPC Source File (CDE); SB740 grantee lists (CSFA); County Data (U.S. Census Bureau); EdTec Client Data (Note: only includes financial data for charters whose data is available (n = 588 – 927), and thus is not representative of all charters. Sample sizes and composition vary over time.)

Register for the EdTec/YM&C 2019 Charter Leadership Forums!

Young, Minney & Corr, LLP (YM&C) and EdTec are partnering to bring you the latest fiscal, operational, legal, and political updates, along with expert advice, to help your charter school thrive in these challenging and uncertain times.  All charter developers and operators are invited to attend this annual educational and networking event, which promises to deliver critical information and practical takeaways for your role as a charter school leader.

Event Locations & Dates 

SF Bay Area
Tuesday, April 30, 2019

Sacramento
Wednesday, May 1, 2019

San Diego
Thursday, May 9, 2019

Los Angeles
Friday, May 10, 2019

Click here to view more event details and register for an event!

California Charters, Stay Calm and Focus on Your LCAP Submission and the 2019 Dashboard!

By Jennifer Reyes, Ed.d., Educational Support Services Manager; Chris Lim, Senior Director of Data Management; and Annice Weinstein, Senior Manager, Assessment Data and Analysis 

April 16, 2019

California charter leaders, as you enter the last few months of the school year, pay attention to these important tasks to help you stay on top of your LCAP submission as well as ensure accurate reporting on the 2019 Dashboard.

CALPADS Submissions and the Dashboard

Demographic data reported to CALPADS informs the subgroup information reported on the CA School Dashboard. The CA Department of Education (CDE) typically extracts this information shortly after CAASPP testing is completed, so review the 8.1 ODS report in CALPADS to be sure the right demographic information is reported for each student: race/ethnicity, socioeconomic status, homeless, foster, English learner, and disability status. For corrections, update the information in your student information system (SIS) first, then push an updated extract up to CALPADS, so the original source of your data (your SIS) is accurate and matches what’s in CALPADS.

We also recommend you push up an enrollment update to CALPADS prior to testing to make sure all students enrolled at your school are represented in TOMS.

The end-of-year submissions (EOY 1, 2, and 3) provide information on program eligibility, chronic absenteeism, suspension rate, and other disciplinary incidents, as well as college and career readiness. EOY information is also used to determine graduation rates along with cumulative enrollment, which the CDE uses to determine which students will factor into each of the Dashboard calculations.

LCAP Annual Update

Coordinate with your staff to gather the data necessary to update all the measurable outcomes defined in your LCAP. You’ll notice that some of the measures may be a year old (SBAC scores or graduation rate from 2017-18),but do your best to gather current data when available (example: local assessment data). Gathering the data early will give you a chance to share progress with your stakeholders and get their feedback, as well as use the data to determine if the actions or services you implemented are showing the results you anticipated. If they aren’t, this is the perfect time to update your plans in the 2019-20 LCAP.

If you haven’t been coding your finances to align with your LCAP goals, actions, and services throughout the year, you’ll need to start reviewing your general ledger to identify how each of the expenses line up with your LCAP. The Annual Update requires you to include your estimated actual expenditures for each action/service, including the funding source (base, supplemental/concentration, title funds, CSI), so this task can take some time.

It’s also a good time to start planning for that final round of stakeholder engagement prior to Board approval.  This will allow you to get quality input on your draft LCAP so that your entire school community is represented in the plan.  You will be able to include these efforts in the stakeholder engagement section and show that you are meeting this LCAP requirement.

One last item to start preparing is your responses to how you’ve addressed each of the local indicators. You will need to present the information at a regularly scheduled board meeting either at the end of this school year or the start of the next school year. Your overall score – Standard Met or Standard Not Met – will be entered by your Dashboard Coordinator next fall, but since you will be including that information in the LCAP Annual Update, it makes sense to prepare your narratives for the Dashboard local indicator reporting at the end of 2018-19.

The end of the school year will be here before we know it! We recommend planning ahead and allotting time to get these items right, as they have a significant impact on your school. For additional questions on the LCAP, Dashboard, or CALPADS submissions, please contact LCAP360@edtec.com.

California Charters, Know the Impact of Participation Rate on Your School’s Academic Indicators!

By Annice Weinstein, Senior Manager, Assessment Data and Analysis

March 29, 2019

In 2018, the California Department of Education added participation rate as a factor into the calculations for the Academic Indicators on the CA School Dashboard. But how exactly does that affect your school?

For both ELA and Math, the goal is to have a participation rate of 95% or higher on the Smarter Balanced Summative Assessments (SBAC) and the California Alternate Assessments (CAAs.) If the participation rate falls below 95%, a fourth of a point (.25) is deducted from the Distance from Standard (DFS) for that subject for each percentage point below the target 95%.

For example, if a school had a participation rate of 91% on the SBAC/CAA ELA and a DFS in ELA of 9:

95% – 91% = 4 (points below the target participation rate)

4 x .25 = 1 (deduction amount from the DFS)

9 – 1 = Adjusted DFS of 8

Participation rate is calculated for every subgroup with 11 or more students and factored into the Academic Indicators for all reported Dashboard subgroups.

The following students are not included in the participation rate calculation: students absent from testing due to a significant medical emergency who are also flagged with the medical emergency condition code on the CAASPP file, and for the ELA portion of the SBAC/CAA, English learners enrolled in a U.S. school for less than one year. Parent waivers do not exempt students from the participation rate calculations.

Schools are also responsible for testing students who transfer in during the beginning 14-day grade period or during the Accountability Testing Window. These students will be included in the participation rate calculation. Schools are not responsible for testing students who transfer in during the ending 14-day grace period or transfer out during the beginning 14-day grace period. However, schools are responsible for testing students who transfer out during the Accountability Testing Window or during the ending 14-day grace period.

To see how participation rate may have affected your school’s Academic Indicators in 2018, schoolwide and for each significant subgroup, enter your school name into the box on this site:

https://public.tableau.com/profile/aweinstein#!/vizhome/2018_Participation_Rate_Impact/ParticipationRateDashboard