District Sources of Revenue:

The Los Angeles Unified School District’s (LAUSD) General Fund receives money from a variety of sources each year (based on estimated budget amounts in the Adopted 2007-08 Final Budget):

• 48 percent—State tax money and local property taxes collected locally but distributed by the State (State Revenue Limit Sources).  This is general purpose funding and supports the core operations of the District;


• 42 percent—Federal and other State income set aside specifically for special education, K-3 class-size reduction, programs to promote the District’s desegregation efforts (Targeted Instruction Improvement Program), to compensate for poverty and fund bilingual programs, among other restricted uses;


• 7 percent—Funds carried over from the previous budget year;


• 3 percent—Local income from interest, cash donations and other financing sources.
  

District Expenditures:

The Los Angeles Unified School District (LAUSD)’s General Fund revenues are spent on the following annual expenditures (based on the Adopted 2007-08 Final Budget):

• 79 percent—Employees’ salaries and benefits, with the largest portion being teacher salaries and benefits;


• 11 percent—Operating expenses, such as utilities, contracts for student transportation services, non-public school services for severely handicapped special education students, instructional contract services, rentals and leases of facilities such as classrooms and offices, and other contractual services;


• 8 percent—Cost of books and supplies, primarily at school sites;


• 1 percent—“Other outgoing” funds, primarily interfund transfers of General Fund moneys in support of other funds; and


• 1 percent—Capital outlay, including equipment, minor building repairs, and books and media for school libraries.

 

How the State of California Funds Education

The Governor and the California Legislature determine how much State and property tax funding will be set aside for public education. This is achieved by using guidelines established by Proposition 98, the 1988 voter-approved constitutional amendment that sets minimum funding levels for education.

For 2008-09, the Governor proposes to allocate $43.8 billion for K-12 education, or 43 percent of the $101 billion State General Fund budget. The monies will serve more than six million students and 9,000 schools throughout the state.

The State provides local districts with general purpose revenues based on average daily attendance (ADA), which reflects actual school attendance. About 60-65 percent of the State funds that districts receive are for general purposes, such as employee salaries and benefits, supplies, textbooks, maintenance, and other expenses.

The State and Federal governments allocate funds to help encourage specific educational changes. These “categorical monies” are provided to fund specific programs or serve specific groups of children, such as K-3 class-size reduction or special education. For most school districts, categorical funds represent about 30-35 percent of their budget and can heavily influence local spending decisions.