Friday, July 08, 2011

U P D A T E - AB 114: STEALTH ATTACK ON CALIFORNIA SCHOOLS +STATE LAW IS STUNNING IN ITS IRRESPONSIBILITY + Bill Text

AB 114 was passed to appease the California Teachers Assn., to the detriment of school districts, which are already in serious financial straits.

LA Times Editorial | http://lat.ms/r7wGsb

July 8, 2011 - Ham-fisted yet pandering, and fiscally irresponsible too, AB 114 perpetrates an abuse of state power that could wreak budgetary havoc in local school districts. But in that case, why hasn't the news been filled with details of this bad-government bill as it wended its way through the Legislature? Because it was hurriedly and secretively passed, quite literally in the dark of night, with no committee hearings and almost no public notice, and then quickly signed by Gov. Jerry Brown.

AB 114 was passed to appease the California Teachers Assn., which sought to stanch the flood of teacher layoffs. That's certainly understandable. Just about everybody would like to avoid the reductions in force that have harmed dedicated educators and their students.

    But schools cannot operate on air and hope, which is what AB 114 requires. School districts no longer are allowed to prepare their own budget forecasts or even their own budgets; instead, the law requires them to assume that they will get as much money from the state this year as they did in the last, even though the projections on which the state budget is based are unrealistically rosy. School budgets will probably have to be slashed midyear, and school boards and superintendents will have to deal with it then, on the fly.

    They aren't allowed to lay off teachers or cut programs to balance their budgets, not now or during midyear cuts. How will they stay open, then? That's unclear. The law allows for shortening the school year by seven days, but only if the districts can successfully negotiate that with their individual unions. Since the teachers know they can't be laid off, they'll be in a strong position to refuse any such cuts in the academic year.

    Prudent school districts that have wisely set aside healthy contingency accounts to cover future expenses and keep the schools running smoothly will now find it hard to avoid spending that money. For those without substantial emergency funds, that means borrowing.

    The law even eliminates long-term fiscal responsibility by suspending 30-year-old rules that required school districts to demonstrate balanced budgets for the upcoming year and the two following. Counties were responsible for overseeing this prudent practice; now they have been stripped of that authority.

    More than 140 school districts are already in serious financial jeopardy, according to a state Department of Education estimate released in June. If Brown and legislative Democrats do not muster the courage to defy the California Teachers Assn. by repealing AB 114, they may push many more districts to the brink.

    State law is stunning in its irresponsibility

    By San Diego Union-Tribune Editorial Board | http://bit.ly/ppo8cS

    Saturday, July 2, 2011 at midnight - The prospect of an on-time adoption of the 2011-12 state budget offered beleaguered California school districts some hope for stability. Instead, the Legislature and Gov. Jerry Brown, at the behest of the California Teachers Association, secretively enacted a school-finance law that may yield chaos in many districts – and nearly guarantees it in San Diego Unified.

    AB 114 requires school districts to budget and preserve jobs as if revenue projections The Los Angeles Times calls “fantastical” will come true. If the projections are wrong, causing automatic midyear cuts in education funds, districts will have no ability to mandate layoffs. Since employee compensation takes up the great majority of district budgets, such layoffs are the only real answer to a revenue shortfall. But they could only be executed with union approval.

    AB 114 also reduces oversight authority of county boards of education, the public’s first line of defense when it comes to school districts’ fiscal responsibility.

    The result could be downright catastrophic for San Diego schools. District leaders are imploring board members to try to save money to prepare for the big hit the district will take in 2012-13 when scheduled raises of 7.2 percent for all employees are phased in. Now a state law exists that discourages such prudence and may give district employees a legal cudgel to block prudence – and it was adopted with zero public input.

    This is irresponsible public policy. The purpose of K-12 education in California is supposed to be about preparing students to have productive lives. Instead, AB 114 undermines that basic premise through risky financial gimmickry, loss of oversight and a focus on adults rather than the children they teach.

    AB 114 Legislative History:

    In order to view the PDF version of the bill text documents, you may need a free viewer from Adobe.
    Chaptered
    - 06/30/2011
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    Enrolled
    - 06/29/2011
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    Amended
    - 06/28/2011
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    Amended
    - 06/14/2011
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    Amended
    - 06/09/2011
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    Introduced
    - 01/10/2011


    This is merely a placeholder, an (out damned) “spot” bill to leave open the door for later legislative mischief.

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    Analyses:

    Assembly Floor - 06/28/2011 - 13582 bytes

    Senate Floor - 06/28/2011 - 9430 bytes

    Senate Floor - 06/15/2011 - 6413 bytes

    Senate Floor - 06/10/2011 - 9000 bytes

    Senate Floor - 03/08/2011 - 4676 bytes

    Votes

    Assembly Floor - 06/28/2011 - 1437 bytes

    Senate Floor - 06/28/2011 - 1078 bytes

    Senate Floor
    - 06/14/2011 - 1077 bytes

    Senate Floor - 06/10/2011 - 1078 bytes

    Assembly Floor - 02/22/2011 - 1426 bytes

    BILL NUMBER: AB 114	CHAPTERED
    BILL TEXT

    CHAPTER 43
    FILED WITH SECRETARY OF STATE JUNE 30, 2011
    APPROVED BY GOVERNOR JUNE 30, 2011
    PASSED THE SENATE JUNE 28, 2011
    PASSED THE ASSEMBLY JUNE 28, 2011
    AMENDED IN SENATE JUNE 28, 2011
    AMENDED IN SENATE JUNE 14, 2011
    AMENDED IN SENATE JUNE 9, 2011

    INTRODUCED BY Committee on Budget (Blumenfield (Chair), Alejo,
    Allen, Brownley, Buchanan, Butler, Cedillo, Chesbro, Dickinson,
    Feuer, Gordon, Huffman, Mitchell, Monning, and Swanson)

    JANUARY 10, 2011

    An act to amend Sections 1240, 1622, 2558.46, 8201, 8208, 8263.2,
    8263.4, 8447, 8499, 42127, 42238.146, 44955.5, 56325, and 69432.7 of,
    to amend and renumber Section 60422.3 of, to amend and repeal
    Sections 56139 and 56331 of, to amend, repeal, and add Sections
    8203.5, 41202, and 76300 of, to add Sections 41202.5, 41210, 41211,
    42251, and 46201.3 to, and to repeal and add Section 42606 of, the
    Education Code, to amend Section 7911.1 of the Family Code, to amend
    Sections 7572, 7582, 7585, 12440.1, and 17581.5 of, to amend and
    repeal Sections 7572.5, 7572.55, 7576, 7576.2, 7576.3, 7576.5,
    7586.5, 7586.6, and 7586.7 of, and to repeal Section 7588 of, the
    Government Code, and to amend Sections 5651 and 11323.2 of, to amend
    and repeal Sections 5701.3 and 5701.6 of, to add and repeal Section
    18356.1 of, and to repeal Chapter 6 (commencing with Section 18350)
    of Part 6 of Division 9 of, the Welfare and Institutions Code,
    relating to education finance, and making an appropriation therefor,
    to take effect immediately, bill related to the budget.


    LEGISLATIVE COUNSEL'S DIGEST


    AB 114, Committee on Budget. Education finance.
    (1) Existing law requires a county superintendent of schools to
    certify in writing whether or not the county office of education is
    able to meet its financial obligations for the current and 2
    subsequent fiscal years. Existing law requires a county
    superintendent of schools to approve, conditionally approve, or
    disapprove the adopted budget for the school districts under his or
    her jurisdiction and to determine whether the adopted budget is
    consistent with a financial plan that will enable the district to
    satisfy its multiyear financial commitments.
    This bill would require the budgets of a county office of
    education and a school district for the 2011-12 fiscal year to
    project the same level of revenue per unit of average daily
    attendance as it received in the 2010-11 fiscal year, and would
    delete the certification requirement regarding the 2 fiscal years
    subsequent to the 2011-12 fiscal year. The bill would prohibit the
    Superintendent of Public Instruction from requiring a county office
    of education to do otherwise.
    (2) Existing law requires a revenue limit to be calculated for
    each county superintendent of schools, adjusted for various factors,
    and reduced, as specified. Existing law reduces the revenue limit for
    each county superintendent of schools for the 2011-12 fiscal year by
    a deficit factor of 19.892%.
    This bill instead would set the deficit factor for each county
    superintendent of schools for the 2011-12 fiscal year at 20.041%.
    (3) The Child Care and Development Services Act, administered by
    the State Department of Education, provides that children who are 10
    years of age or younger, children with exceptional needs, children 12
    years of age or younger who are recipients of child protective
    services or at risk of abuse, neglect, or exploitation, children 12
    years of age or younger who are provided services during
    nontraditional hours, children 12 years of age or younger who are
    homeless, and children who are 11 and 12 years of age, as funding
    permits, as specified, are eligible, with certain requirements, for
    child care and development services.
    This bill would instead provide that children from infancy to 13
    years of age and their parents are eligible, with certain
    requirements, for child care and development services.
    (4) Existing law requires that a child who is 11 or 12 years of
    age and who is otherwise eligible for subsidized child care and
    development services, except for his or her age, be given first
    priority for enrollment, and in cases of programs operating at full
    capacity, first priority on the waiting list for a before or after
    school program, as specified. Existing law also requires contractors
    to provide each family of an otherwise eligible 11 or 12 year old
    child with information about the availability of before and after
    school programs located in the family's community.
    This bill would instead provide that the preferred placement for
    children who are 11 or 12 years of age and who are otherwise eligible
    for subsidized child care and development services is in a before or
    after school program. The bill would specify criteria for the
    provision of subsidized child care services for children who are 11
    and 12 years of age.
    (5) Existing law, effective July 1, 2011, requires the State
    Department of Education to reduce the maximum reimbursable amounts of
    the contracts for the Preschool Education Program, the General Child
    Care Program, the Migrant Day Care Program, the Alternative Payment
    Program, the CalWORKs Stage 3 Program, and the Allowance for
    Handicapped Program by 15%, as specified.
    This bill would instead provide that the reduction in the maximum
    reimbursable amounts of the contracts for the programs listed above
    would be 11% or whatever proportion is necessary to ensure that
    expenditures for these programs do not exceed the amounts
    appropriated for them, including any reductions made subsequent to
    the adoption of the annual Budget Act.
    (6) Existing law requires that the cost of state-funded child care
    services be governed by regional market rates, and establishes a
    family fee schedule reflecting specified income eligibility limits.
    Existing law revises the family fee schedule that was in effect for
    the 2007-08, 2008-09, 2009-10, and 2010-11 fiscal years to reflect an
    increase of 10% to existing fees, and requires the State Department
    of Education to submit an adjusted fee schedule to the Department of
    Finance for approval in order to be implemented by July 1, 2011.
    This bill would delete the provision requiring the fee schedule to
    reflect a 10% increase in family fees.
    (7) Under existing law (Proposition 98), the California
    Constitution requires the state to comply with a minimum funding
    obligation each fiscal year with respect to the support of school
    districts and community college districts. Existing statutory law
    specifies that state funding for the Child Care and Development
    Services Act is included within the calculation of state
    apportionments that apply toward this constitutional funding
    obligation.
    This bill would, commencing July 1, 2011, specify that funds
    appropriated for the Child Care and Development Services Act do not
    apply toward the constitutional minimum funding obligation for school
    districts and community college districts, with the exception of
    state funding for the part-day California state preschool programs
    and the After School Education and Safety Program.
    The bill would make related changes in the calculation of the
    minimum funding obligation required by Proposition 98.
    (8) Existing law prescribes the percentage of General Fund
    revenues appropriated for school districts and community college
    districts for purposes of the provisions of the California
    Constitution requiring minimum funding for the public schools.
    This bill would state that specified sales and use tax revenues
    transferred pursuant to certain provisions of the Revenue and
    Taxation Code are not General Fund revenues for these purposes. The
    bill would provide that its provisions would be operative for the
    2011-12 fiscal year and subsequent years only if one or more ballot
    measures approved before November 17, 2012, authorize those revenues
    to be so treated, and provide funding for school districts and
    community college districts in an amount equal to that which would
    have been provided if the tax revenues were General Fund revenues.
    The bill would require, if the aforementioned provisions of law
    are rendered inoperative because the ballot measure or measures are
    not approved, that by December 17, 2012, the Director of Finance, in
    consultation with the Superintendent of Public Instruction, determine
    the amount by which the minimum amount of moneys required to be
    applied by the state for the support of school districts and
    community college districts was reduced pursuant to the operation of
    the aforementioned provisions of law for the 2011-12 fiscal year.
    Following the determination of this amount, the bill would
    appropriate an amount equal to 17.8% of that amount from the General
    Fund to the Superintendent for each of the 2012-13 to 2016-17,
    inclusive, fiscal years in accordance with a specified priority
    order, and would appropriate 2.2% of that amount from the General
    Fund to the Chancellor of the California Community Colleges for each
    of the 2012-13 to 2016-17, inclusive, fiscal years, in accordance
    with a specified priority order.
    (9) Existing law requires the county superintendent of schools to
    determine a revenue limit for each school district in the county, and
    requires the amount of the revenue limit to be adjusted for various
    factors. Existing law reduces the revenue limit for each school
    district for the 2011-12 fiscal year by a deficit factor of 19.608%.
    This bill instead would set the deficit factor for each school
    district for the 2011-12 fiscal year at 19.754%.
    (10) Under existing law, county offices of education receive
    certain property tax revenues. Existing law requires a revenue limit
    to be calculated for each county superintendent of schools, and
    requires the amount of the revenue limit to be adjusted for various
    factors, including the amount of property tax revenues a county
    office of education receives.
    This bill would require the Superintendent of Public Instruction
    for the 2011-12 fiscal year to determine the amount of excess
    property taxes available to county offices of education, and would
    require the auditor-controller of each county to distribute those
    amounts to the Supplemental Revenue Augmentation Fund within the
    county exclusively to reimburse the state for the costs of providing
    trial court services and costs until those moneys are exhausted. By
    imposing additional duties on local agency officials, this bill would
    impose a state-mandated local program.
    (11) Existing law requires the Superintendent of Public
    Instruction to allocate, for the 2010-11 and 2011-12 fiscal years, a
    supplemental categorical block grant to a charter school that begins
    operation in the 2008-09, 2009-10, 2010-11, or 2011-12 fiscal year.
    Existing law requires that this supplemental categorical block grant
    equal $127 per unit of charter school average daily attendance as
    determined at the 2010-11 2nd principal apportionment for schools
    commencing operations in the 2008-09, 2009-10, or 2010-11 fiscal year
    and at the 2011-12 2nd principal apportionment for schools
    commencing operations in the 2011-12 fiscal year. Existing law
    prohibits a locally funded charter school that converted from a
    preexisting school between the 2008-09 and 2011-12 fiscal years,
    inclusive, from receiving these funds.
    This bill instead would provide that, to the extent funds are
    provided, for the 2010-11 to the 2014-15 fiscal years, inclusive, a
    supplemental categorical block grant would be allocated to charter
    schools commencing operations during or after the 2008-09 fiscal
    year. The bill would provide that a locally or direct funded charter
    school, not just a locally funded charter school, that converted from
    a preexisting school between the 2008-09 and 2014-15 fiscal years,
    inclusive, would be prohibited from receiving these funds.
    The bill would provide that for, the 2010-11 to the 2014-15 fiscal
    years, inclusive, the supplemental categorical block grant received
    by eligible charter schools would equal $127 per unit of charter
    school average daily attendance for charter schools commencing
    operations during or after the 2008-09 fiscal year, as specified.
    (12) Existing law authorizes the governing board of a school
    district to terminate the services of any certificated employees of
    the district during the time period between 5 days after the
    enactment of the Budget Act and August 15 of the fiscal year to which
    that Budget Act applies if the governing board of a school district
    determines that its total revenue limit per unit of average daily
    attendance for the fiscal year of that Budget Act has not increased
    by at least 2% and if in the opinion of the governing board it is
    therefore necessary to decrease the number of permanent employees in
    the district.
    This bill would make this provision inoperative from July 1, 2011,
    to July 1, 2012, inclusive.
    (13) Existing law sets forth the minimum number of instructional
    days and minutes school districts, county offices of education, and
    charter schools are required to offer.
    This bill, for the 2011-12 school year, would reduce the minimum
    number of required instructional days and minutes by up to 7 days,
    and would reduce the revenue limit for each school district, county
    office of education, and charter school, as specified. The bill would
    require implementation of this reduction by a school district,
    county office of education, and charter school that is subject to
    collective bargaining to be achieved through the bargaining process,
    provided that the agreement has been completed and reductions
    implemented no later than June 30, 2012. These provisions would be
    operative only for the 2011-12 school year and only if the Director
    of Finance determines that the state revenue forecast does not meet a
    specified amount.
    (14) Existing law requires school districts, county offices of
    education, and special education local plan areas to comply with
    state laws that conform to the federal Individuals with Disabilities
    Education Act (IDEA), in order that the state may qualify for federal
    funds available for the education of individuals with exceptional
    needs. Existing law requires school districts, county offices of
    education, and special education local plan areas to identify,
    locate, and assess individuals with exceptional needs and to provide
    those pupils with a free appropriate public education in the least
    restrictive environment, and with special education and related
    services as reflected in an individualized education program (IEP).
    Existing law requires the Superintendent of Public Instruction to
    administer the special education provisions of the Education Code and
    to be responsible for assuring provision of, and supervising,
    education and related services to individuals with exceptional needs
    as required pursuant to the federal IDEA.
    Existing law authorizes referral, through a prescribed process, of
    a pupil who is suspected of needing mental health services to a
    community mental health service. Existing law requires the State
    Department of Mental Health or a designated community mental health
    service to be responsible for the provision of mental health
    services, as defined, if required in a pupil's IEP.
    This bill would make these provisions concerning referral for
    mental health services inoperative as of July 1, 2011, would repeal
    them as of January 1, 2012, and would make other related conforming
    changes.
    (15) Existing law, for the 2008-09 to the 2014-15 fiscal years,
    inclusive, provides that the governing board of a school district is
    not required to provide pupils with instructional materials by a
    specified period of time following adoption of those materials by the
    State Board of Education.
    This bill would make a technical, nonsubstantive change in this
    provision by changing its section number.
    (16) Existing law, the Ortiz-Pacheco-Poochigian-Vasconcellos Cal
    Grant Program (Cal Grant Program), establishes the Cal Grant A and B
    Entitlement Awards, the California Community College Transfer
    Entitlement Awards, the Competitive Cal Grant A and B Awards, the Cal
    Grant C Awards, and the Cal Grant T Awards under the administration
    of the Student Aid Commission, and establishes eligibility
    requirements for awards under these programs for participating
    students attending qualifying institutions.
    Existing law imposes requirements on qualifying institutions,
    requiring the commission to certify by October 1 of each year the
    institution's latest 3-year cohort default rate as most recently
    reported by the United States Department of Education. Existing law
    provides that an otherwise qualifying institution that did not meet a
    specified 3-year cohort default rate would be ineligible for new Cal
    Grant awards at the institution. Under the Cal Grant Program, for
    the 2012-13 academic year and every academic year thereafter, an
    otherwise qualifying institution with a 3-year cohort default rate
    that is equal to or greater than 30% is ineligible for initial or
    renewal Cal Grant awards at the institution, except as specified.
    This bill instead would specify that an otherwise qualifying
    institution with a 3-year cohort default rate that is equal to or
    greater than 30% is ineligible for initial and renewal Cal Grant
    awards at the institution, except as specified.
    (17) Existing law establishes the California State University
    under the administration of the Trustees of the California State
    University. Existing law authorizes the trustees to draw from funds
    appropriated to the university, for use as a revolving fund, amounts
    necessary to make payments of obligations of the university directly
    to vendors. Existing law requires the trustees to contract with one
    or more public accounting firms to conduct systemwide and individual
    campus annual financial statement and compliance audits. Existing law
    further requires that at least 10 individual campus audits be
    conducted annually on a rotating basis, and that each campus be
    audited at least once every 2 years.
    This bill would require the annual audits to be conducted in
    accordance with generally accepted accounting principles. The bill
    would delete the requirements that at least 10 individual campus
    audits be conducted annually on a rotating basis, and that each
    campus be audited at least once every 2 years. The bill would require
    that the statements of net assets, revenues, expenses, changes in
    net assets, and cashflows be included as an addendum to the annual
    systemwide audit.
    (18) Existing law requires the governing board of each community
    college district to charge each student a fee, and sets that fee at
    $36 per unit per semester.
    This bill would raise the fee to $46 per unit per semester if the
    Director of Finance determines that the state revenue forecast does
    not meet a specified amount.
    (19) Under the California Constitution, whenever the Legislature
    or a state agency mandates a new program or higher level of service
    on any local government, the state is required to provide a
    subvention of funds to reimburse the local government, with specified
    exceptions. Existing law provides that no local agency or school
    district is required to implement or give effect to any statute or
    executive order, or portion thereof, that imposes a mandate during
    any fiscal year and for the period immediately following that fiscal
    year for which the Budget Act has not been enacted for the subsequent
    fiscal year if specified conditions are met, including that the
    statute or executive order, or portion thereof, has been specifically
    identified by the Legislature in the Budget Act for the fiscal year
    as being one for which reimbursement is not provided for that fiscal
    year. Existing law provides that only certain specified mandates are
    subject to that provision.
    This bill would specify that 2 additional mandates relating to
    community college districts are included among those that are subject
    to the provision.
    (20) The Administrative Procedure Act, among other things, sets
    forth procedures for the development, adoption, and promulgation of
    regulations by administrative agencies charged with the
    implementation of statutes.
    This bill would authorize the State Department of Social Services
    and the State Department of Education, notwithstanding the procedures
    required by the Administrative Procedure Act, to implement the
    provisions of the bill that relate to the Child Care and Development
    Services Act through all-county letters, management bulletins, or
    other similar instructions.
    (21) This bill would provide that the implementation of the
    provisions of the bill related to the provision of child care
    services would not be subject to the appeal and resolution procedures
    for agencies that contract with the State Department of Education
    for these purposes.
    (22) This bill would express the intent of the Legislature that
    specified funding in the Budget Act of 2011 related to educationally
    related mental health services would be exclusively available only
    for the 2011-12 and 2012-13 fiscal years.
    (23) This bill would express the intent of the Legislature that
    the State Department of Education and appropriate departments within
    the California Health and Human Services Agency modify or repeal
    regulations pertaining to the elimination of statutes pursuant to
    this bill related to mental health services provided by county mental
    health agencies. The bill would require the State Department of
    Education and appropriate departments within the California Health
    and Human Services Agency to review regulations to ensure appropriate
    implementation of educationally related mental health services
    required by the federal Individuals with Disabilities Education Act
    and of certain statutes enacted pursuant to this bill. The bill would
    authorize the State Department of Education and appropriate
    departments within the California Health and Human Services Agency to
    utilize the statutory process for adopting emergency regulations in
    implementing certain statutes enacted pursuant to this bill.
    (24) This bill would make conforming changes, correct some
    cross-references, and make other technical, nonsubstantive changes.
    (25) The California Constitution requires the state to reimburse
    local agencies and school districts for certain costs mandated by the
    state. Statutory provisions establish procedures for making that
    reimbursement.
    This bill would provide that, if the Commission on State Mandates
    determines that the bill contains costs mandated by the state,
    reimbursement for those costs shall be made pursuant to these
    statutory provisions.
    (26) Existing law requires the State Department of Education to
    award grants to school districts, county superintendents of schools,
    or entities approved by the department for nonrecurring expenses
    incurred in initiating or expanding a school breakfast program or a
    summer food service program.
    This bill would make an appropriation of $1,000 for purposes of
    these grants.
    (27) The funds appropriated by this bill would be applied toward
    the minimum funding requirements for school districts and community
    college districts imposed by Section 8 of Article XVI of the
    California Constitution.
    (28) This bill would declare that it is to take effect immediately
    as a bill providing for appropriations related to the Budget Bill.
    Appropriation: yes.


    THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:

    SECTION 1. Section 1240 of the Education Code is amended to read:
    1240. The county superintendent of schools shall do all of the
    following:
    (a) Superintend the schools of his or her county.
    (b) Maintain responsibility for the fiscal oversight of each
    school district in his or her county pursuant to the authority
    granted by this code.
    (c) (1) Visit and examine each school in his or her county at
    reasonable intervals to observe its operation and to learn of its
    problems. He or she annually may present a report of the state of the
    schools in his or her county, and of his or her office, including,
    but not limited to, his or her observations while visiting the
    schools, to the board of education and the board of supervisors of
    his or her county.
    (2) (A) For fiscal years 2004-05 to 2006-07, inclusive, to the
    extent that funds are appropriated for purposes of this paragraph,
    the county superintendent, or his or her designee, annually shall
    submit a report, at a regularly scheduled November board meeting, to
    the governing board of each school district under his or her
    jurisdiction, the county board of education of his or her county, and
    the board of supervisors of his or her county describing the state
    of the schools in the county or of his or her office that are ranked
    in deciles 1 to 3, inclusive, of the 2003 base Academic Performance
    Index (API), as defined in subdivision (b) of Section 17592.70, and
    shall include, among other things, his or her observations while
    visiting the schools and his or her determinations for each school
    regarding the status of all of the circumstances listed in
    subparagraph (J) and teacher misassignments and teacher vacancies. As
    a condition for receipt of funds, the county superintendent, or his
    or her designee, shall use a standardized template to report the
    circumstances listed in subparagraph (J) and teacher misassignments
    and teacher vacancies, unless the current annual report being used by
    the county superintendent, or his or her designee, already includes
    those details for each school.
    (B) Commencing with the 2007-08 fiscal year, to the extent that
    funds are appropriated for purposes of this paragraph, the county
    superintendent, or his or her designee, annually shall submit a
    report, at a regularly scheduled November board meeting, to the
    governing board of each school district under his or her
    jurisdiction, the county board of education of his or her county, and
    the board of supervisors of his or her county describing the state
    of the schools in the county or of his or her office that are ranked
    in deciles 1 to 3, inclusive, of the 2006 base API, pursuant to
    Section 52056. As a condition for the receipt of funds, the annual
    report shall include the determinations for each school made by the
    county superintendent, or his or her designee, regarding the status
    of all of the circumstances listed in subparagraph (J) and teacher
    misassignments and teacher vacancies, and the county superintendent,
    or his or her designee, shall use a standardized template to report
    the circumstances listed in subparagraph (J) and teacher
    misassignments and teacher vacancies, unless the current annual
    report being used by the county superintendent, or his or her
    designee, already includes those details with the same level of
    specificity that is otherwise required by this subdivision. For
    purposes of this section, schools ranked in deciles 1 to 3,
    inclusive, on the 2006 base API shall include schools determined by
    the department to meet either of the following:
    (i) The school meets all of the following criteria:
    (I) Does not have a valid base API score for 2006.
    (II) Is operating in fiscal year 2007-08 and was operating in
    fiscal year 2006-07 during the Standardized Testing and Reporting
    (STAR) Program testing period.
    (III) Has a valid base API score for 2005 that was ranked in
    deciles 1 to 3, inclusive, in that year.
    (ii) The school has an estimated base API score for 2006 that
    would be in deciles 1 to 3, inclusive.
    (C) The department shall estimate an API score for any school
    meeting the criteria of subclauses (I) and (II) of clause (i) of
    subparagraph (B) and not meeting the criteria of subclause (III) of
    clause (i) of subparagraph (B), using available test scores and
    weighting or corrective factors it deems appropriate. The department
    shall post the API scores on its Internet Web site on or before May
    1.
    (D) For purposes of this section, references to schools ranked in
    deciles 1 to 3, inclusive, on the 2006 base API shall exclude schools
    operated by county offices of education pursuant to Section 56140,
    as determined by the department.
    (E) In addition to the requirements above, the county
    superintendent, or his or her designee, annually shall verify both of
    the following:
    (i) That pupils who have not passed the high school exit
    examination by the end of grade 12 are informed that they are
    entitled to receive intensive instruction and services for up to two
    consecutive academic years after completion of grade 12 or until the
    pupil has passed both parts of the high school exit examination,
    whichever comes first, pursuant to paragraphs (4) and (5) of
    subdivision (d) of Section 37254.
    (ii) That pupils who have elected to receive intensive instruction
    and services, pursuant to paragraphs (4) and (5) of subdivision (d)
    of Section 37254, are being served.
    (F) (i) Commencing with the 2010-11 fiscal year and every third
    year thereafter, the Superintendent shall identify a list of schools
    ranked in deciles 1 to 3, inclusive, of the API for which the county
    superintendent, or his or her designee, annually shall submit a
    report, at a regularly scheduled November board meeting, to the
    governing board of each school district under his or her
    jurisdiction, the county board of education of his or her county, and
    the board of supervisors of his or her county that describes the
    state of the schools in the county or of his or her office that are
    ranked in deciles 1 to 3, inclusive, of the base API as defined in
    clause (ii).
    (ii) For the 2010-11 fiscal year, the list of schools ranked in
    deciles 1 to 3, inclusive, of the base API shall be updated using the
    criteria set forth in clauses (i) and (ii) of subparagraph (B),
    subparagraph (C), and subparagraph (D), as applied to the 2009 base
    API and thereafter shall be updated every third year using the
    criteria set forth in clauses (i) and (ii) of subparagraph (B),
    subparagraph (C), and subparagraph (D), as applied to the base API of
    the year preceding the third year consistent with clause (i).
    (iii) As a condition for the receipt of funds, the annual report
    shall include the determinations for each school made by the county
    superintendent, or his or her designee, regarding the status of all
    of the circumstances listed in subparagraph (J) and teacher
    misassignments and teacher vacancies, and the county superintendent,
    or his or her designee, shall use a standardized template to report
    the circumstances listed in subparagraph (J) and teacher
    misassignments and teacher vacancies, unless the current annual
    report being used by the county superintendent, or his or her
    designee, already includes those details with the same level of
    specificity that is otherwise required by this subdivision.
    (G) The county superintendent of the Counties of Alpine, Amador,
    Del Norte, Mariposa, Plumas, and Sierra, and the City and County of
    San Francisco shall contract with another county office of education
    or an independent auditor to conduct the required visits and make all
    reports required by this paragraph.
    (H) On a quarterly basis, the county superintendent, or his or her
    designee, shall report the results of the visits and reviews
    conducted that quarter to the governing board of the school district
    at a regularly scheduled meeting held in accordance with public
    notification requirements. The results of the visits and reviews
    shall include the determinations of the county superintendent, or his
    or her designee, for each school regarding the status of all of the
    circumstances listed in subparagraph (J) and teacher misassignments
    and teacher vacancies. If the county superintendent, or his or her
    designee, conducts no visits or reviews in a quarter, the quarterly
    report shall report that fact.
    (I) The visits made pursuant to this paragraph shall be conducted
    at least annually and shall meet the following criteria:
    (i) Minimize disruption to the operation of the school.
    (ii) Be performed by individuals who meet the requirements of
    Section 45125.1.
    (iii) Consist of not less than 25 percent unannounced visits in
    each county. During unannounced visits in each county, the county
    superintendent shall not demand access to documents or specific
    school personnel. Unannounced visits shall only be used to observe
    the condition of school repair and maintenance, and the sufficiency
    of instructional materials, as defined by Section 60119.
    (J) The priority objective of the visits made pursuant to this
    paragraph shall be to determine the status of all of the following
    circumstances:
    (i) Sufficient textbooks as defined in Section 60119 and as
    specified in subdivision (i).
    (ii) The condition of a facility that poses an emergency or urgent
    threat to the health or safety of pupils or staff as defined in
    district policy or paragraph (1) of subdivision (c) of Section
    17592.72.
    (iii) The accuracy of data reported on the school accountability
    report card with respect to the availability of sufficient textbooks
    and instructional materials, as defined by Section 60119, and the
    safety, cleanliness, and adequacy of school facilities, including
    good repair as required by Sections 17014, 17032.5, 17070.75, and
    17089.
    (iv) The extent to which pupils who have not passed the high
    school exit examination by the end of grade 12 are informed that they
    are entitled to receive intensive instruction and services for up to
    two consecutive academic years after completion of grade 12 or until
    the pupil has passed both parts of the high school exit examination,
    whichever comes first, pursuant to paragraphs (4) and (5) of
    subdivision (d) of Section 37254.
    (v) The extent to which pupils who have elected to receive
    intensive instruction and services, pursuant to paragraphs (4) and
    (5) of subdivision (d) of Section 37254, are being served.
    (K) The county superintendent may make the status determinations
    described in subparagraph (J) during a single visit or multiple
    visits. In determining whether to make a single visit or multiple
    visits for this purpose, the county superintendent shall take into
    consideration factors such as cost-effectiveness, disruption to the
    schoolsite, deadlines, and the availability of qualified reviewers.
    (L) If the county superintendent determines that the condition of
    a facility poses an emergency or urgent threat to the health or
    safety of pupils or staff as defined in district policy or paragraph
    (1) of subdivision (c) of Section 17592.72, or is not in good repair,
    as specified in subdivision (d) of Section 17002 and required by
    Sections 17014, 17032.5, 17070.75, and 17089, the county
    superintendent, among other things, may do any of the following:
    (i) Return to the school to verify repairs.
    (ii) Prepare a report that specifically identifies and documents
    the areas or instances of noncompliance if the district has not
    provided evidence of successful repairs within 30 days of the visit
    of the county superintendent or, for major projects, has not provided
    evidence that the repairs will be conducted in a timely manner. The
    report may be provided to the governing board of the school district.
    If the report is provided to the school district, it shall be
    presented at a regularly scheduled meeting held in accordance with
    public notification requirements. The county superintendent shall
    post the report on his or her Internet Web site. The report shall be
    removed from the Internet Web site when the county superintendent
    verifies the repairs have been completed.
    (d) Distribute all laws, reports, circulars, instructions, and
    blanks that he or she may receive for the use of the school officers.

    (e) Annually, on or before August 15, present a report to the
    governing board of the school district and the Superintendent
    regarding the fiscal solvency of a school district with a disapproved
    budget, qualified interim certification, or a negative interim
    certification, or that is determined to be in a position of fiscal
    uncertainty pursuant to Section 42127.6.
    (f) Keep in his or her office the reports of the Superintendent.
    (g) Keep a record of his or her official acts, and of all the
    proceedings of the county board of education, including a record of
    the standing, in each study, of all applicants for certificates who
    have been examined, which shall be open to the inspection of an
    applicant or his or her authorized agent.
    (h) Enforce the course of study.
    (i) (1) Enforce the use of state textbooks and instructional
    materials and of high school textbooks and instructional materials
    regularly adopted by the proper authority in accordance with Section
    51050.
    (2) For purposes of this subdivision, sufficient textbooks or
    instructional materials has the same meaning as in subdivision (c) of
    Section 60119.
    (3) (A) Commencing with the 2005-06 school year, if a school is
    ranked in any of deciles 1 to 3, inclusive, of the base API, as
    specified in paragraph (2) of subdivision (c), and not currently
    under review pursuant to a state or federal intervention program, the
    county superintendent specifically shall review that school at least
    annually as a priority school. A review conducted for purposes of
    this paragraph shall be completed by the fourth week of the school
    year. For the 2004-05 fiscal year only, the county superintendent
    shall make a diligent effort to conduct a visit to each school
    pursuant to this paragraph within 120 days of receipt of funds for
    this purpose.
    (B) In order to facilitate the review of instructional materials
    before the fourth week of the school year, the county superintendent
    in a county with 200 or more schools that are ranked in any of
    deciles 1 to 3, inclusive, of the base API, as specified in paragraph
    (2) of subdivision (c), may utilize a combination of visits and
    written surveys of teachers for the purpose of determining
    sufficiency of textbooks and instructional materials in accordance
    with subparagraph (A) of paragraph (1) of subdivision (a) of Section
    60119 and as defined in subdivision (c) of Section 60119. If a county
    superintendent elects to conduct written surveys of teachers, the
    county superintendent shall visit the schools surveyed within the
    same academic year to verify the accuracy of the information reported
    on the surveys. If a county superintendent surveys teachers at a
    school in which the county superintendent has found sufficient
    textbooks and instructional materials for the previous two
    consecutive years and determines that the school does not have
    sufficient textbooks or instructional materials, the county
    superintendent shall within 10 business days provide a copy of the
    insufficiency report to the school district as set forth in paragraph
    (4).
    (C) For purposes of this paragraph, "written surveys" may include
    paper and electronic or online surveys.
    (4) If the county superintendent determines that a school does not
    have sufficient textbooks or instructional materials in accordance
    with subparagraph (A) of paragraph (1) of subdivision (a) of Section
    60119 and as defined by subdivision (c) of Section 60119, the county
    superintendent shall do all of the following:
    (A) Prepare a report that specifically identifies and documents
    the areas or instances of noncompliance.
    (B) Provide within five business days of the review, a copy of the
    report to the school district, as provided in subdivision (c), or,
    if applicable, provide a copy of the report to the school district
    within 10 business days pursuant to subparagraph (B) of paragraph
    (3).
    (C) Provide the school district with the opportunity to remedy the
    deficiency. The county superintendent shall ensure remediation of
    the deficiency no later than the second month of the school term.
    (D) If the deficiency is not remedied as required pursuant to
    subparagraph (C), the county superintendent shall request the
    department to purchase the textbooks or instructional materials
    necessary to comply with the sufficiency requirement of this
    subdivision. If the department purchases textbooks or instructional
    materials for the school district, the department shall issue a
    public statement at the first regularly scheduled meeting of the
    state board occurring immediately after the department receives the
    request of the county superintendent and that meets the applicable
    public notice requirements, indicating that the district
    superintendent and the governing board of the school district failed
    to provide pupils with sufficient textbooks or instructional
    materials as required by this subdivision. Before purchasing the
    textbooks or instructional materials, the department shall consult
    with the district to determine which textbooks or instructional
    materials to purchase. All purchases of textbooks or instructional
    materials shall comply with Chapter 3.25 (commencing with Section
    60420) of Part 33. The amount of funds necessary for the purchase of
    the textbooks and materials is a loan to the school district
    receiving the textbooks or instructional materials. Unless the school
    district repays the amount owed based upon an agreed-upon repayment
    schedule with the Superintendent, the Superintendent shall notify the
    Controller and the Controller shall deduct an amount equal to the
    total amount used to purchase the textbooks and materials from the
    next principal apportionment of the district or from another
    apportionment of state funds.
    (j) Preserve carefully all reports of school officers and
    teachers.
    (k) Deliver to his or her successor, at the close of his or her
    official term, all records, books, documents, and papers belonging to
    the office, taking a receipt for them, which shall be filed with the
    department.
    (l) (1) Submit two reports during the fiscal year to the county
    board of education in accordance with the following:
    (A) The first report shall cover the financial and budgetary
    status of the county office of education for the period ending
    October 31. The second report shall cover the period ending January
    31. Both reports shall be reviewed by the county board of education
    and approved by the county superintendent no later than 45 days after
    the close of the period being reported.
    (B) As part of each report, the county superintendent shall
    certify in writing whether or not the county office of education is
    able to meet its financial obligations for the remainder of the
    fiscal year and, based on current forecasts, for two subsequent
    fiscal years. The certifications shall be classified as positive,
    qualified, or negative, pursuant to standards prescribed by the
    Superintendent, for the purposes of determining subsequent state
    agency actions pursuant to Section 1240.1. For purposes of this
    subdivision, a negative certification shall be assigned to a county
    office of education that, based upon current projections, will not
    meet its financial obligations for the remainder of the fiscal year
    or for the subsequent fiscal year. A qualified certification shall be
    assigned to a county office of education that may not meet its
    financial obligations for the current fiscal year or two subsequent
    fiscal years. A positive certification shall be assigned to a county
    office of education that will meet its financial obligations for the
    current fiscal year and subsequent two fiscal years. In accordance
    with those standards, the Superintendent may reclassify a
    certification. If a county office of education receives a negative
    certification, the Superintendent, or his or her designee, may
    exercise the authority set forth in subdivision (c) of Section 1630.
    Copies of each certification, and of the report containing that
    certification, shall be sent to the Superintendent at the time the
    certification is submitted to the county board of education. Copies
    of each qualified or negative certification and the report containing
    that certification shall be sent to the Controller at the time the
    certification is submitted to the county board of education.
    (i) For the 2011-12 fiscal year, notwithstanding any of the
    standards and criteria adopted by the state board pursuant to Section
    33127, each county office of education budget shall project the same
    level of revenue per unit of average daily attendance as it received
    in the 2010-11 fiscal year and shall maintain staffing and program
    levels commensurate with that level.
    (ii) For the 2011-12 fiscal year, the county superintendent shall
    not be required to certify in writing whether or not the county
    office of education is able to meet its financial obligations for the
    two subsequent fiscal years.
    (iii) For the 2011-12 fiscal year, notwithstanding any of the
    standards and criteria adopted by the state board pursuant to Section
    33127, the Superintendent, as a condition on approval of a county
    office of education budget, shall not require a county office of
    education to project a lower level of revenue per unit of average
    daily attendance than it received in the 2010-11 fiscal year nor
    require the county superintendent to certify in writing whether or
    not the county office of education is able to meet its financial
    obligations for the two subsequent fiscal years.
    (2) All reports and certifications required under this subdivision
    shall be in a format or on forms prescribed by the Superintendent,
    and shall be based on standards and criteria for fiscal stability
    adopted by the state board pursuant to Section 33127. The reports and
    supporting data shall be made available by the county superintendent
    to an interested party upon request.
    (3) This subdivision does not preclude the submission of
    additional budgetary or financial reports by the county
    superintendent to the county board of education or to the
    Superintendent.
    (4) The county superintendent is not responsible for the fiscal
    oversight of the community colleges in the county, however, he or she
    may perform financial services on behalf of those community
    colleges.
    (m) If requested, act as agent for the purchase of supplies for
    the city and high school districts of his or her county.
    (n) For purposes of Section 44421.5, report to the Commission on
    Teacher Credentialing the identity of a certificated person who
    knowingly and willingly reports false fiscal expenditure data
    relative to the conduct of an educational program. This requirement
    applies only if, in the course of his or her normal duties, the
    county superintendent discovers information that gives him or her
    reasonable cause to believe that false fiscal expenditure data
    relative to the conduct of an educational program has been reported.
    SEC. 2. Section 1622 of the Education Code is amended to read:
    1622. (a) On or before July 1 of each fiscal year, the county
    board of education shall adopt an annual budget for the budget year
    and shall file that budget with the Superintendent of Public
    Instruction, the county board of supervisors, and the county auditor.
    The budget, and supporting data, shall be maintained and made
    available for public review. The budget shall indicate the date,
    time, and location at which the county board of education held the
    public hearing required under Section 1620.
    (b) The Superintendent of Public Instruction shall examine the
    budget to determine whether it (1) complies with the standards and
    criteria adopted by the State Board of Education pursuant to Section
    33127 for application to final local educational agency budgets, (2)
    allows the county office of education to meet its financial
    obligations during the fiscal year, and (3) is consistent with a
    financial plan that will enable the county office of education to
    satisfy its multiyear financial commitments. In addition, the
    Superintendent shall identify any technical corrections to the budget
    that must be made. On or before August 15, the Superintendent of
    Public Instruction shall approve or disapprove the budget and, in the
    event of a disapproval, transmit to the county office of education
    in writing his or her recommendations regarding revision of the
    budget and the reasons for those recommendations. For the 2011-12
    fiscal year, notwithstanding any of the standards and criteria
    adopted by the state board pursuant to Section 33127, the
    Superintendent, as a condition on approval of a county office of
    education budget, shall not require a county office of education to
    project a lower level of revenue per unit of average daily attendance
    than it received in the 2010-11 fiscal year nor require the county
    superintendent to certify in writing whether or not the county office
    of education is able to meet its financial obligations for the two
    subsequent fiscal years.
    (c) On or before September 8, the county board of education shall
    revise the county office of education budget to reflect changes in
    projected income or expenditures subsequent to July 1, and to include
    any response to the recommendations of the Superintendent of Public
    Instruction, shall adopt the revised budget, and shall file the
    revised budget with the Superintendent of Public Instruction, the
    county board of supervisors, and the county auditor. Prior to
    revising the budget, the county board of education shall hold a
    public hearing regarding the proposed revisions, which shall be made
    available for public inspection not less than three working days
    prior to the hearing. The agenda for that hearing shall be posted at
    least 72 hours prior to the public hearing and shall include the
    location where the budget will be available for public inspection.
    The revised budget, and supporting data, shall be maintained and made
    available for public review.
    (d) The Superintendent of Public Instruction shall examine the
    revised budget to determine whether it complies with the standards
    and criteria adopted by the State Board of Education pursuant to
    Section 33127 for application to final local educational agency
    budgets and, no later than October 8, shall approve or disapprove the
    revised budget. If the Superintendent of Public Instruction
    disapproves the budget, he or she shall call for the formation of a
    budget review committee pursuant to Section 1623. For the 2011-12
    fiscal year, notwithstanding any of the standards and criteria
    adopted by the state board pursuant to Section 33127, the
    Superintendent, as a condition on approval of a county office of
    education budget, shall not require a county office of education
    to project a lower level of
    revenue per unit of average daily attendance than it received in the
    2010-11 fiscal year nor require the county superintendent to certify
    in writing whether or not the county office of education is able to
    meet its financial obligations for the two subsequent fiscal years.
    (e) Notwithstanding any other provision of this section, the
    budget review for a county office of education shall be governed by
    paragraphs (1), (2), and (3) of this subdivision, rather than by
    subdivisions (c) and (d), if the county board of education so elects,
    and notifies the Superintendent of Public Instruction in writing of
    that decision, no later than October 31 of the immediately preceding
    calendar year.
    (1) In the event of the disapproval of the budget of a county
    office of education pursuant to subdivision (b), on or before
    September 8, the county superintendent of schools and the county
    board of education shall review the recommendations of the
    Superintendent of Public Instruction at a regularly scheduled meeting
    of the county board of education and respond to those
    recommendations. That response shall include the proposed actions to
    be taken, if any, as a result of those recommendations.
    (2) No later than October 8, after receiving the response required
    under paragraph (1), the Superintendent of Public Instruction shall
    review that response and either approve or disapprove the budget of
    the county office of education. If the Superintendent of Public
    Instruction disapproves the budget, he or she shall call for the
    formation of a budget review committee pursuant to Section 1623.
    (3) Not later than 45 days after the Governor signs the annual
    Budget Act, the county office of education shall make available for
    public review any revisions in revenues and expenditures that it has
    made to its budget to reflect the funding made available by that
    Budget Act.
    SEC. 3. Section 2558.46 of the Education Code is amended to read:
    2558.46. (a) (1) For the 2003-04 fiscal year, the revenue limit
    for each county superintendent of schools determined pursuant to this
    article shall be reduced by a 1.195 percent deficit factor.
    (2) For the 2004-05 fiscal year, the revenue limit for each county
    superintendent of schools determined pursuant to this article shall
    be reduced by a 0.323 percent deficit factor.
    (3) For the 2003-04 and 2004-05 fiscal years, the revenue limit
    for each county superintendent of schools determined pursuant to this
    article shall be reduced further by a 1.826 percent deficit factor.
    (4) For the 2005-06 fiscal year, the revenue limit for each county
    superintendent of schools determined pursuant to this article shall
    be reduced further by a 0.898 percent deficit factor.
    (5) For the 2008-09 fiscal year, the revenue limit for each county
    superintendent of schools determined pursuant to this article shall
    be reduced by a 7.839 percent deficit factor.
    (6) For the 2009-10 fiscal year, the revenue limit for each county
    superintendent of schools determined pursuant to this article shall
    be reduced by an 18.621 percent deficit factor.
    (7) For the 2010-11 fiscal year, the revenue limit for each county
    superintendent of schools determined pursuant to this article shall
    be reduced by an 18.250 percent deficit factor.
    (8) For the 2011-12 fiscal year, the revenue limit for each county
    superintendent of schools determined pursuant to this article shall
    be reduced by a 20.041 percent deficit factor.
    (b) In computing the revenue limit for each county superintendent
    of schools for the 2006-07 fiscal year pursuant to this article, the
    revenue limit shall be determined as if the revenue limit for that
    county superintendent of schools had been determined for the 2003-04,
    2004-05, and 2005-06 fiscal years without being reduced by the
    deficit factors specified in subdivision (a).
    (c) In computing the revenue limit for each county superintendent
    of schools for the 2010-11 fiscal year pursuant to this article, the
    revenue limit shall be determined as if the revenue limit for that
    county superintendent of schools had been determined for the 2009-10
    fiscal year without being reduced by the deficit factors specified in
    subdivision (a).
    (d) In computing the revenue limit for each county superintendent
    of schools for the 2011-12 fiscal year pursuant to this article, the
    revenue limit shall be determined as if the revenue limit for that
    county superintendent of schools had been determined for the 2010-11
    fiscal year without being reduced by the deficit factors specified in
    subdivision (a).
    (e) In computing the revenue limit for each county superintendent
    of schools for the 2012-13 fiscal year pursuant to this article, the
    revenue limit shall be determined as if the revenue limit for that
    county superintendent of schools had been determined for the 2011-12
    fiscal year without being reduced by the deficit factor specified in
    subdivision (a).
    SEC. 4. Section 8201 of the Education Code is amended to read:
    8201. The purpose of this chapter is as follows:
    (a) To provide a comprehensive, coordinated, and cost-effective
    system of child care and development services for children from
    infancy to 13 years of age and their parents, including a full range
    of supervision, health, and support services through full- and
    part-time programs.
    (b) To encourage community-level coordination in support of child
    care and development services.
    (c) To provide an environment that is healthy and nurturing for
    all children in child care and development programs.
    (d) To provide the opportunity for positive parenting to take
    place through understanding of human growth and development.
    (e) To reduce strain between parent and child in order to prevent
    abuse, neglect, or exploitation.
    (f) To enhance the cognitive development of children, with
    particular emphasis upon those children who require special
    assistance, including bilingual capabilities to attain their full
    potential.
    (g) To establish a framework for the expansion of child care and
    development services.
    (h) To empower and encourage parents and families of children who
    require child care services to take responsibility to review the
    safety of the child care program or facility and to evaluate the
    ability of the program or facility to meet the needs of the child.
    SEC. 5. Section 8203.5 of the Education Code is amended to read:
    8203.5. (a) The Superintendent shall ensure that each contract
    entered into under this chapter to provide child care and development
    services, or to facilitate the provision of those services, provides
    support to the public school system of this state through the
    delivery of appropriate educational services to the children served
    pursuant to the contract.
    (b) The Superintendent shall ensure that all contracts for child
    care and development programs include a requirement that each public
    or private provider maintain a developmental profile to appropriately
    identify the emotional, social, physical, and cognitive growth of
    each child served in order to promote the child's success in the
    public schools. To the extent possible, the department shall provide
    a developmental profile to all public and private providers using
    existing profile instruments that are most cost efficient. The
    provider of any program operated pursuant to a contract under Section
    8262 shall be responsible for maintaining developmental profiles
    upon entry through exit from a child development program.
    (c) Notwithstanding any other provision of law, "moneys to be
    applied by the state," as used in subdivision (b) of Section 8 of
    Article XVI of the California Constitution, includes funds
    appropriated for the Child Care and Development Service Act pursuant
    to Chapter 2 (commencing with Section 8200) of Part 6, whether or not
    those funds are allocated to school districts, as defined in Section
    41302.5, or community college districts.
    (d) This section is not subject to Part 34 (commencing with
    Section 62000).
    (e) This section shall remain in effect only until July 1, 2011,
    and as of that date is repealed, unless a later enacted statute, that
    is enacted before July 1, 2011, deletes or extends that date.
    SEC. 6. Section 8203.5 is added to the Education Code, to read:
    8203.5. (a) The Superintendent shall ensure that each contract
    entered into under this chapter to provide child care and development
    services, or to facilitate the provision of those services, provides
    support to the public school system of this state through the
    delivery of appropriate educational services to the children served
    pursuant to the contract.
    (b) The Superintendent shall ensure that all contracts for child
    care and development programs include a requirement that each public
    or private provider maintain a developmental profile to appropriately
    identify the emotional, social, physical, and cognitive growth of
    each child served in order to promote the child's success in the
    public schools. To the extent possible, the department shall provide
    a developmental profile to all public and private providers using
    existing profile instruments that are most cost efficient. The
    provider of any program operated pursuant to a contract under Section
    8262 shall be responsible for maintaining developmental profiles
    upon entry through exit from a child development program.
    (c) This section is not subject to Part 34 (commencing with
    Section 62000) of Division 4 of Title 2.
    (d) This section shall become operative on July 1, 2011.
    SEC. 7. Section 8208 of the Education Code is amended to read:
    8208. As used in this chapter:
    (a) "Alternative payments" includes payments that are made by one
    child care agency to another agency or child care provider for the
    provision of child care and development services, and payments that
    are made by an agency to a parent for the parent's purchase of child
    care and development services.
    (b) "Alternative payment program" means a local government agency
    or nonprofit organization that has contracted with the department
    pursuant to Section 8220.1 to provide alternative payments and to
    provide support services to parents and providers.
    (c) "Applicant or contracting agency" means a school district,
    community college district, college or university, county
    superintendent of schools, county, city, public agency, private
    nontax-exempt agency, private tax-exempt agency, or other entity that
    is authorized to establish, maintain, or operate services pursuant
    to this chapter. Private agencies and parent cooperatives, duly
    licensed by law, shall receive the same consideration as any other
    authorized entity with no loss of parental decisionmaking
    prerogatives as consistent with the provisions of this chapter.
    (d) "Assigned reimbursement rate" is that rate established by the
    contract with the agency and is derived by dividing the total dollar
    amount of the contract by the minimum child day of average daily
    enrollment level of service required.
    (e) "Attendance" means the number of children present at a child
    care and development facility. "Attendance," for the purposes of
    reimbursement, includes excused absences by children because of
    illness, quarantine, illness or quarantine of their parent, family
    emergency, or to spend time with a parent or other relative as
    required by a court of law or that is clearly in the best interest of
    the child.
    (f) "Capital outlay" means the amount paid for the renovation and
    repair of child care and development facilities to comply with state
    and local health and safety standards, and the amount paid for the
    state purchase of relocatable child care and development facilities
    for lease to qualifying contracting agencies.
    (g) "Caregiver" means a person who provides direct care,
    supervision, and guidance to children in a child care and development
    facility.
    (h) "Child care and development facility" means any residence or
    building or part thereof in which child care and development services
    are provided.
    (i) "Child care and development programs" means those programs
    that offer a full range of services for children from infancy to 13
    years of age, for any part of a day, by a public or private agency,
    in centers and family child care homes. These programs include, but
    are not limited to, all of the following:
    (1) General child care and development.
    (2) Migrant child care and development.
    (3) Child care provided by the California School Age Families
    Education Program (Article 7.1 (commencing with Section 54740) of
    Chapter 9 of Part 29 of Division 4 of Title 2).
    (4) California state preschool program.
    (5) Resource and referral.
    (6) Child care and development services for children with
    exceptional needs.
    (7) Family child care home education network.
    (8) Alternative payment.
    (9) Schoolage community child care.
    (j) "Child care and development services" means those services
    designed to meet a wide variety of needs of children and their
    families, while their parents or guardians are working, in training,
    seeking employment, incapacitated, or in need of respite. These
    services may include direct care and supervision, instructional
    activities, resource and referral programs, and alternative payment
    arrangements.
    (k) "Children at risk of abuse, neglect, or exploitation" means
    children who are so identified in a written referral from a legal,
    medical, or social service agency, or emergency shelter.
    (l) "Children with exceptional needs" means either of the
    following:
    (1) Infants and toddlers under three years of age who have been
    determined to be eligible for early intervention services pursuant to
    the California Early Intervention Services Act (Title 14 (commencing
    with Section 95000) of the Government Code) and its implementing
    regulations. These children include an infant or toddler with a
    developmental delay or established risk condition, or who is at high
    risk of having a substantial developmental disability, as defined in
    subdivision (a) of Section 95014 of the Government Code. These
    children shall have active individualized family service plans, shall
    be receiving early intervention services, and shall be children who
    require the special attention of adults in a child care setting.
    (2) Children ages 3 to 21 years, inclusive, who have been
    determined to be eligible for special education and related services
    by an individualized education program team according to the special
    education requirements contained in Part 30 (commencing with Section
    56000) of Division 4 of Title 2, and who meet eligibility criteria
    described in Section 56026 and, Article 2.5 (commencing with Section
    56333) of Chapter 4 of Part 30 of Division 4 of Title 2, and Sections
    3030 and 3031 of Title 5 of the California Code of Regulations.
    These children shall have an active individualized education program,
    shall be receiving early intervention services or appropriate
    special education and related services, and shall be children who
    require the special attention of adults in a child care setting.
    These children include children with mental retardation, hearing
    impairments (including deafness), speech or language impairments,
    visual impairments (including blindness), serious emotional
    disturbance (also referred to as emotional disturbance), orthopedic
    impairments, autism, traumatic brain injury, other health
    impairments, or specific learning disabilities, who need special
    education and related services consistent with Section 1401(3)(A) of
    Title 20 of the United States Code.
    (m) "Closedown costs" means reimbursements for all approved
    activities associated with the closing of operations at the end of
    each growing season for migrant child development programs only.
    (n) "Cost" includes, but is not limited to, expenditures that are
    related to the operation of child care and development programs.
    "Cost" may include a reasonable amount for state and local
    contributions to employee benefits, including approved retirement
    programs, agency administration, and any other reasonable program
    operational costs. "Cost" may also include amounts for licensable
    facilities in the community served by the program, including lease
    payments or depreciation, downpayments, and payments of principal and
    interest on loans incurred to acquire, rehabilitate, or construct
    licensable facilities, but these costs shall not exceed fair market
    rents existing in the community in which the facility is located.
    "Reasonable and necessary costs" are costs that, in nature and
    amount, do not exceed what an ordinary prudent person would incur in
    the conduct of a competitive business.
    (o) "Elementary school," as contained in former Section 425 of
    Title 20 of the United States Code (the National Defense Education
    Act of 1958, Public Law 85-864, as amended), includes early childhood
    education programs and all child development programs, for the
    purpose of the cancellation provisions of loans to students in
    institutions of higher learning.
    (p) "Family child care home education network" means an entity
    organized under law that contracts with the department pursuant to
    Section 8245 to make payments to licensed family child care home
    providers and to provide educational and support services to those
    providers and to children and families eligible for state-subsidized
    child care and development services. A family child care home
    education network may also be referred to as a family child care home
    system.
    (q) "Health services" include, but are not limited to, all of the
    following:
    (1) Referral, whenever possible, to appropriate health care
    providers able to provide continuity of medical care.
    (2) Health screening and health treatment, including a full range
    of immunization recorded on the appropriate state immunization form
    to the extent provided by the Medi-Cal Act (Chapter 7 (commencing
    with Section 14000) of Part 3 of Division 9 of the Welfare and
    Institutions Code) and the Child Health and Disability Prevention
    Program (Article 6 (commencing with Section 124025) of Chapter 3 of
    Part 2 of Division 106 of the Health and Safety Code), but only to
    the extent that ongoing care cannot be obtained utilizing community
    resources.
    (3) Health education and training for children, parents, staff,
    and providers.
    (4) Followup treatment through referral to appropriate health care
    agencies or individual health care professionals.
    (r) "Higher educational institutions" means the Regents of the
    University of California, the Trustees of the California State
    University, the Board of Governors of the California Community
    Colleges, and the governing bodies of any accredited private
    nonprofit institution of postsecondary education.
    (s) "Intergenerational staff" means persons of various
    generations.
    (t) "Limited-English-speaking-proficient and
    non-English-speaking-proficient children" means children who are
    unable to benefit fully from an English-only child care and
    development program as a result of either of the following:
    (1) Having used a language other than English when they first
    began to speak.
    (2) Having a language other than English predominantly or
    exclusively spoken at home.
    (u) "Parent" means a biological parent, stepparent, adoptive
    parent, foster parent, caretaker relative, or any other adult living
    with a child who has responsibility for the care and welfare of the
    child.
    (v) "Program director" means a person who, pursuant to Sections
    8244 and 8360.1, is qualified to serve as a program director.
    (w) "Proprietary child care agency" means an organization or
    facility providing child care, which is operated for profit.
    (x) "Resource and referral programs" means programs that provide
    information to parents, including referrals and coordination of
    community resources for parents and public or private providers of
    care. Services frequently include, but are not limited to: technical
    assistance for providers, toy-lending libraries, equipment-lending
    libraries, toy- and equipment-lending libraries, staff development
    programs, health and nutrition education, and referrals to social
    services.
    (y) "Severely disabled children" are children with exceptional
    needs from birth to 21 years of age, inclusive, who require intensive
    instruction and training in programs serving pupils with the
    following profound disabilities: autism, blindness, deafness, severe
    orthopedic impairments, serious emotional disturbances, or severe
    mental retardation. "Severely disabled children" also include those
    individuals who would have been eligible for enrollment in a
    developmental center for handicapped pupils under Chapter 6
    (commencing with Section 56800) of Part 30 of Division 4 of Title 2
    as it read on January 1, 1980.
    (z) "Short-term respite child care" means child care service to
    assist families whose children have been identified through written
    referral from a legal, medical, or social service agency, or
    emergency shelter as being neglected, abused, exploited, or homeless,
    or at risk of being neglected, abused, exploited, or homeless. Child
    care is provided for less than 24 hours per day in child care
    centers, treatment centers for abusive parents, family child care
    homes, or in the child's own home.
    (aa) (1) "Site supervisor" means a person who, regardless of his
    or her title, has operational program responsibility for a child care
    and development program at a single site. A site supervisor shall
    hold a permit issued by the Commission on Teacher Credentialing that
    authorizes supervision of a child care and development program
    operating in a single site. The Superintendent may waive the
    requirements of this subdivision if the Superintendent determines
    that the existence of compelling need is appropriately documented.
    (2) For California state preschool programs, a site supervisor may
    qualify under any of the provisions in this subdivision, or may
    qualify by holding an administrative credential or an administrative
    services credential. A person who meets the qualifications of a
    program director under both Sections 8244 and 8360.1 is also
    qualified under this subdivision.
    (ab) "Standard reimbursement rate" means that rate established by
    the Superintendent pursuant to Section 8265.
    (ac) "Startup costs" means those expenses an agency incurs in the
    process of opening a new or additional facility prior to the full
    enrollment of children.
    (ad) "California state preschool program" means part-day and
    full-day educational programs for low-income or otherwise
    disadvantaged three- and four-year-old children.
    (ae) "Support services" means those services that, when combined
    with child care and development services, help promote the healthy
    physical, mental, social, and emotional growth of children. Support
    services include, but are not limited to: protective services, parent
    training, provider and staff training, transportation, parent and
    child counseling, child development resource and referral services,
    and child placement counseling.
    (af) "Teacher" means a person with the appropriate permit issued
    by the Commission on Teacher Credentialing who provides program
    supervision and instruction that includes supervision of a number of
    aides, volunteers, and groups of children.
    (ag) "Underserved area" means a county or subcounty area,
    including, but not limited to, school districts, census tracts, or
    ZIP Code areas, where the ratio of publicly subsidized child care and
    development program services to the need for these services is low,
    as determined by the Superintendent.
    (ah) "Workday" means the time that the parent requires temporary
    care for a child for any of the following reasons:
    (1) To undertake training in preparation for a job.
    (2) To undertake or retain a job.
    (3) To undertake other activities that are essential to
    maintaining or improving the social and economic function of the
    family, are beneficial to the community, or are required because of
    health problems in the family.
    (ai) "Three-year-old children" means children who will have their
    third birthday on or before December 2 of the fiscal year in which
    they are enrolled in a California state preschool program.
    (aj) "Four-year-old children" means children who will have their
    fourth birthday on or before December 2 of the fiscal year in which
    they are enrolled in a California state preschool program.
    (ak) "Local educational agency" means a school district, a county
    office of education, a community college district, or a school
    district on behalf of one or more schools within the school district.

    SEC. 8. Section 8263.2 of the Education Code is amended to read:
    8263.2. (a) Notwithstanding any other law, effective July 1,
    2011, the department shall reduce the maximum reimbursable amounts of
    the contracts for the Preschool Education Program, the General Child
    Care Program, the Migrant Day Care Program, the Alternative Payment
    Program, the CalWORKs Stage 3 Program, and the Allowance for
    Handicapped Program by 11 percent or by whatever proportion is
    necessary to ensure that expenditures for these programs do not
    exceed the amounts appropriated for them, including any reductions
    made subsequent to the adoption of the annual Budget Act. The
    department may consider the contractor's performance or whether the
    contractor serves children in underserved areas as defined in
    subdivision (ag) of Section 8208 when determining contract
    reductions, provided that the aggregate reduction to each program
    specified in this subdivision is 11 percent or by whatever proportion
    is necessary to ensure that expenditures for these programs do not
    exceed the amounts appropriated for them, including any reductions
    made subsequent to the adoption of the annual Budget Act.
    (b) Notwithstanding any other law, effective July 1, 2011,
    families shall be disenrolled from subsidized child care services,
    consistent with the priorities for services specified in subdivision
    (b) of Section 8263. Families shall be disenrolled in the following
    order:
    (1) Families whose income exceeds 70 percent of the state median
    income (SMI) adjusted for family size, except for families whose
    children are receiving child protective services or are at risk of
    being neglected or abused.
    (2) Families with the highest income below 70 percent of the SMI,
    in relation to family size.
    (3) Families that have the same income and have been enrolled in
    child care services the longest.
    (4) Families that have the same income and have a child with
    exceptional needs.
    (5) Families whose children are receiving child protective
    services or are at risk of being neglected or abused, regardless of
    family income.
    SEC. 9. Section 8263.4 of the Education Code is amended to read:
    8263.4. (a) The preferred placement for
    children who are 11 or 12 years of age and who are otherwise eligible
    for subsidized child care and development services shall be in a
    before or after school program.
    (b) Children who are 11 or 12 years of age shall be eligible for
    subsidized child care services only for the portion of care needed
    that is not available in a before or after school program provided
    pursuant to Article 22.5 (commencing with Section 8482) or Article
    22.6 (commencing with Section 8484.7). Contractors shall provide each
    family of an eligible 11 or 12 year old with the option of combining
    care provided in a before or after school program with subsidized
    child care in another setting, for those hours within a day when the
    before or after school program does not operate, in order to meet the
    child care needs of the family.
    (c) Children who are 11 or 12 years of age, who are eligible for
    and who are receiving subsidized child care services, and for whom a
    before or after school program is not available, shall continue to
    receive subsidized child care services.
    (d) A before or after school program shall be considered not
    available when a parent certifies in writing, on a form provided by
    the department that is translated into the parent's primary language
    pursuant to Sections 7295.4 and 7296.2 of the Government Code, the
    reason or reasons why the program would not meet the child care needs
    of the family. The reasons why a before or after school program
    shall be considered not available shall include, but not be limited
    to, any of the following:
    (1) The program does not provide services when needed during the
    year, such as during the summer, school breaks, or intersession.
    (2) The program does not provide services when needed during the
    day, such as in the early morning, evening, or weekend hours.
    (3) The program is too geographically distant from the child's
    school of attendance.
    (4) The program is too geographically distant from the parents'
    residence.
    (5) Use of the program would create substantial transportation
    obstacles for the family.
    (6) Any other reason that makes the use of before or after school
    care inappropriate for the child or burdensome on the family.
    (e) If an 11 or 12 year old child who is enrolled in a subsidized
    child development program becomes ineligible for subsidized child
    care under subdivision (b) and is disenrolled from the before or
    after school program, or if the before or after school program no
    longer meets the child care needs of the family, the child shall be
    given priority to return to the subsidized child care services upon
    the parent's notification of the contractor of the need for child
    care.
    (f) This section does not apply to an 11 or 12 year old child with
    a disability, including a child with exceptional needs who has an
    individualized education program as required by the federal
    Individuals with Disabilities Education Act (20 U.S.C. Sec. 1400 et
    seq.), Section 504 of the federal Rehabilitation Act of 1973 (29
    U.S.C. Sec. 794), or Part 30 (commencing with Section 56000) of
    Division 4 of Title 2.
    (g) The savings generated each contract year by the implementation
    of the changes made to this section by the act amending this section
    during the 2005-06 Regular Session shall remain with each
    alternative payment program, child development center, or other
    contractor for the provision of child care services, except for care
    provided by programs pursuant to Article 15.5 (commencing with
    Section 8350). Each contractor shall report annually to the
    department the amount of savings resulting from this implementation,
    and the department shall report annually to the Legislature the
    amount of savings statewide resulting from that implementation.
    SEC. 10. Section 8447 of the Education Code is amended to read:
    8447. (a) The Legislature hereby finds and declares that greater
    efficiencies may be achieved in the execution of state subsidized
    child care and development program contracts with public and private
    agencies by the timely approval of contract provisions by the
    Department of Finance, the Department of General Services, and the
    State Department of Education and by authorizing the State Department
    of Education to establish a multiyear application, contract
    expenditure, and service review as may be necessary to provide timely
    service while preserving audit and oversight functions to protect
    the public welfare.
    (b) (1) The Department of Finance and the Department of General
    Services shall approve or disapprove annual contract funding terms
    and conditions, including both family fee schedules and regional
    market rate schedules that are required to be adhered to by contract,
    and contract face sheets submitted by the State Department of
    Education not more than 30 working days from the date of submission,
    unless unresolved conflicts remain between the Department of Finance,
    the State Department of Education, and the Department of General
    Services. The State Department of Education shall resolve conflicts
    within an additional 30 working day time period. Contracts and
    funding terms and conditions shall be issued to child care
    contractors no later than June 1. Applications for new child care
    funding shall be issued not more than 45 working days after the
    effective date of authorized new allocations of child care moneys.
    (2) Notwithstanding paragraph (1), the State Department of
    Education shall implement the regional market rate schedules based
    upon the county aggregates, as determined by the Regional Market
    survey conducted in 2005.
    (3) Notwithstanding paragraph (1), for the 2006-07 fiscal year,
    the State Department of Education shall update the family fee
    schedules by family size, based on the 2005 state median income
    survey data for a family of four. The family fee schedule used during
    the 2005-06 fiscal year shall remain in effect. However, the
    department shall adjust the family fee schedule for families that are
    newly eligible to receive or will continue to receive services under
    the new income eligibility limits. The family fees shall not exceed
    10 percent of the family's monthly income.
    (4) Notwithstanding any other law, the family fee schedule that
    was in effect for the 2007-08, 2008-09, 2009-10, and 2010-11 fiscal
    years shall be adjusted to reflect the income eligibility limits
    specified in subdivision (b) of Section 8263.1 for the 2011-12 fiscal
    year, and shall retain a flat fee per family. The revised family fee
    schedule shall begin at income levels at which families currently
    begin paying fees. The revised family fees shall not exceed 10
    percent of the family's monthly income. The State Department of
    Education shall first submit the adjusted fee schedule to the
    Department of Finance for approval in order to be implemented by July
    1, 2011.
    (5) It is the intent of the Legislature to fully fund the third
    stage of child care for former CalWORKs recipients.
    (c) With respect to subdivision (b), it is the intent of the
    Legislature that the Department of Finance annually review contract
    funding terms and conditions for the primary purpose of ensuring
    consistency between child care contracts and the child care budget.
    This review shall include evaluating any proposed changes to contract
    language or other fiscal documents to which the contractor is
    required to adhere, including those changes to terms or conditions
    that authorize higher reimbursement rates, that modify related
    adjustment factors, that modify administrative or other service
    allowances, or that diminish fee revenues otherwise available for
    services, to determine if the change is necessary or has the
    potential effect of reducing the number of full-time equivalent
    children that may be served.
    (d) Alternative payment child care systems, as set forth in
    Article 3 (commencing with Section 8220), shall be subject to the
    rates established in the Regional Market Rate Survey of California
    Child Care Providers for provider payments. The State Department of
    Education shall contract to conduct and complete a Regional Market
    Rate Survey no more frequently than once every two years, consistent
    with federal regulations, with a goal of completion by March 1.
    (e) By March 1 of each year, the Department of Finance shall
    provide to the State Department of Education the State Median Income
    amount for a four-person household in California based on the best
    available data. The State Department of Education shall adjust its
    fee schedule for child care providers to reflect this updated state
    median income; however, no changes based on revisions to the state
    median income amount shall be implemented midyear.
    (f) Notwithstanding the June 1 date specified in subdivision (b),
    changes to the regional market rate schedules and fee schedules may
    be made at any other time to reflect the availability of accurate
    data necessary for their completion, provided these documents receive
    the approval of the Department of Finance. The Department of Finance
    shall review the changes within 30 working days of submission and
    the State Department of Education shall resolve conflicts within an
    additional 30 working day period. Contractors shall be given adequate
    notice prior to the effective date of the approved schedules. It is
    the intent of the Legislature that contracts for services not be
    delayed by the timing of the availability of accurate data needed to
    update these schedules.
    (g) Notwithstanding any other provision of law, no family
    receiving CalWORKs cash aid may be charged a family fee.
    SEC. 11. Section 8499 of the Education Code is amended to read:
    8499. For purposes of this chapter, the following definitions
    shall apply:
    (a) "Block grant" means the block grant contained in Title VI of
    the Child Care and Development Fund, as established by the federal
    Personal Responsibility and Work Opportunity Reconciliation Act of
    1996 (P.L. 104-193).
    (b) "Child care" means all licensed child care and development
    services and license-exempt child care, including, but not limited
    to, private for-profit programs, nonprofit programs, and publicly
    funded programs, for all children up to and including 12 years of
    age, including children with exceptional needs and children from all
    linguistic and cultural backgrounds.
    (c) "Child care provider" means a person who provides child care
    services or represents persons who provide child care services.
    (d) "Community representative" means a person who represents an
    agency or business that provides private funding for child care
    services, or who advocates for child care services through
    participation in civic or community-based organizations but is not a
    child care provider and does not represent an agency that contracts
    with the State Department of Education to provide child care and
    development services.
    (e) "Consumer" means a parent or person who receives, or who has
    received within the past 36 months, child care services.
    (f) "Department" means the State Department of Education.
    (g) "Local planning council" means a local child care and
    development planning council as described in Section 8499.3.
    (h) "Public agency representative" means a person who represents a
    city, county, city and county, or local educational agency.
    SEC. 12. Section 41202 of the Education Code is amended to read:
    41202. The words and phrases set forth in subdivision (b) of
    Section 8 of Article XVI of the Constitution of the State of
    California shall have the following meanings:
    (a) "Moneys to be applied by the State," as used in subdivision
    (b) of Section 8 of Article XVI of the California Constitution, means
    appropriations from the General Fund that are made for allocation to
    school districts, as defined, or community college districts. An
    appropriation that is withheld, impounded, or made without provisions
    for its allocation to school districts or community college
    districts, shall not be considered to be "moneys to be applied by the
    State."
    (b) "General Fund revenues which may be appropriated pursuant to
    Article XIII B," as used in paragraph (1) of subdivision (b) of
    Section 8 of Article XVI, means General Fund revenues that are the
    proceeds of taxes as defined by subdivision (c) of Section 8 of
    Article XIII B of the California Constitution, including, for the
    1986-87 fiscal year only, any revenues that are determined to be in
    excess of the appropriations limit established pursuant to Article
    XIII B for the fiscal year in which they are received. General Fund
    revenues for a fiscal year to which paragraph (1) of subdivision (b)
    is being applied shall include, in that computation, only General
    Fund revenues for that fiscal year that are the proceeds of taxes, as
    defined in subdivision (c) of Section 8 of Article XIII B of the
    California Constitution, and shall not include prior fiscal year
    revenues. Commencing with the 1995-96 fiscal year, and each fiscal
    year thereafter, "General Fund revenues that are the proceeds of
    taxes," as defined in subdivision (c) of Section 8 of Article XIII B
    of the California Constitution, includes any portion of the proceeds
    of taxes received from the state sales tax that are transferred to
    the counties pursuant to, and only if, legislation is enacted during
    the 1995-96 fiscal year the purpose of which is to realign children's
    programs. The amount of the proceeds of taxes shall be computed for
    any fiscal year in a manner consistent with the manner in which the
    amount of the proceeds of taxes was computed by the Department of
    Finance for purposes of the Governor's Budget for the Budget Act of
    1986.
    (c) "General Fund revenues appropriated for school districts," as
    used in paragraph (1) of subdivision (b) of Section 8 of Article XVI
    of the California Constitution, means the sum of appropriations made
    that are for allocation to school districts, as defined in Section
    41302.5, regardless of whether those appropriations were made from
    the General Fund to the Superintendent of Public Instruction, to the
    Controller, or to any other fund or state agency for the purpose of
    allocation to school districts. The full amount of any appropriation
    shall be included in the calculation of the percentage required by
    paragraph (1) of subdivision (b) of Article XVI, without regard to
    any unexpended balance of any appropriation. Any reappropriation of
    funds appropriated in any prior year shall not be included in the sum
    of appropriations.
    (d) "General Fund revenues appropriated for community college
    districts," as used in paragraph (1) of subdivision (b) of Section 8
    of Article XVI of the California Constitution, means the sum of
    appropriations made that are for allocation to community college
    districts, regardless of whether those appropriations were made from
    the General Fund to the Controller, to the Chancellor of the
    California Community Colleges, or to any other fund or state agency
    for the purpose of allocation to community college districts. The
    full amount of any appropriation shall be included in the calculation
    of the percentage required by paragraph (1) of subdivision (b) of
    Article XVI, without regard to any unexpended balance of any
    appropriation. Any reappropriation of funds appropriated in any prior
    year shall not be included in the sum of appropriations.
    (e) "Total allocations to school districts and community college
    districts from General Fund proceeds of taxes appropriated pursuant
    to Article XIII B," as used in paragraph (2) or (3) of subdivision
    (b) of Section 8 of Article XVI of the California Constitution, means
    the sum of appropriations made that are for allocation to school
    districts, as defined in Section 41302.5, and community college
    districts, regardless of whether those appropriations were made from
    the General Fund to the Controller, to the Superintendent of Public
    Instruction, to the Chancellor of the California Community Colleges,
    or to any other fund or state agency for the purpose of allocation to
    school districts and community college districts. The full amount of
    any appropriation shall be included in the calculation of the
    percentage required by paragraph (2) or (3) of subdivision (b) of
    Section 8 of Article XVI, without regard to any unexpended balance of
    any appropriation. Any reappropriation of funds appropriated in any
    prior year shall not be included in the sum of appropriations.
    (f) "General Fund revenues appropriated for school districts and
    community college districts, respectively" and "moneys to be applied
    by the state for the support of school districts and community
    college districts," as used in Section 8 of Article XVI of the
    California Constitution, shall include funds appropriated for the
    Child Care and Development Services Act pursuant to Chapter 2
    (commencing with Section 8200) of Part 6 and shall not include any of
    the following:
    (1) Any appropriation that is not made for allocation to a school
    district, as defined in Section 41302.5, or to a community college
    district regardless of whether the appropriation is made for any
    purpose that may be considered to be for the benefit to a school
    district, as defined in Section 41302.5, or a community college
    district. This paragraph shall not be construed to exclude any
    funding appropriated for the Child Care and Development Services Act
    pursuant to Chapter 2 (commencing with Section 8200) of Part 6.
    (2) Any appropriation made to the Teachers' Retirement Fund or to
    the Public Employees' Retirement Fund except those appropriations for
    reimbursable state mandates imposed on or before January 1, 1988.
    (3) Any appropriation made to service any public debt approved by
    the voters of this state.
    (g) "Allocated local proceeds of taxes," as used in paragraph (2)
    or (3) of subdivision (b) of Section 8 of Article XVI of the
    California Constitution, means, for school districts as defined,
    those local revenues, except revenues identified pursuant to
    paragraph (5) of subdivision (h) of Section 42238, that are used to
    offset state aid for school districts in calculations performed
    pursuant to Sections 2558, 42238, and Chapter 7.2 (commencing with
    Section 56836) of Part 30.
    (h) "Allocated local proceeds of taxes," as used in paragraph (2)
    or (3) of subdivision (b) of Section 8 of Article XVI of the
    California Constitution, means, for community college districts,
    those local revenues that are used to offset state aid for community
    college districts in calculations performed pursuant to Section
    84700. In no event shall the revenues or receipts derived from
    student fees be considered "allocated local proceeds of taxes."
    (i) For the purposes of calculating the 4 percent entitlement
    pursuant to subdivision (a) of Section 8.5 of Article XVI of the
    California Constitution, "the total amount required pursuant to
    Section 8(b)" shall mean the General Fund aid required for schools
    pursuant to subdivision (b) of Section 8 of Article XVI of the
    California Constitution, and shall not include allocated local
    proceeds of taxes.
    (j) This section shall remain in effect only until July 1, 2011,
    and as of that date is repealed, unless a later enacted statute, that
    is enacted before July 1, 2011, deletes or extends that date.
    SEC. 13. Section 41202 is added to the Education Code, to read:
    41202. The words and phrases set forth in subdivision (b) of
    Section 8 of Article XVI of the Constitution of the State of
    California shall have the following meanings:
    (a) "Moneys to be applied by the State," as used in subdivision
    (b) of Section 8 of Article XVI of the California Constitution, means
    appropriations from the General Fund that are made for allocation to
    school districts, as defined, or community college districts. An
    appropriation that is withheld, impounded, or made without provisions
    for its allocation to school districts or community college
    districts, shall not be considered to be "moneys to be applied by the
    State."
    (b) "General Fund revenues which may be appropriated pursuant to
    Article XIII B," as used in paragraph (1) of subdivision (b) of
    Section 8 of Article XVI, means General Fund revenues that are the
    proceeds of taxes as defined by subdivision (c) of Section 8 of
    Article XIII B of the California Constitution, including, for the
    1986-87 fiscal year only, any revenues that are determined to be in
    excess of the appropriations limit established pursuant to Article
    XIII B for the fiscal year in which they are received. General Fund
    revenues for a fiscal year to which paragraph (1) of subdivision (b)
    is being applied shall include, in that computation, only General
    Fund revenues for that fiscal year that are the proceeds of taxes, as
    defined in subdivision (c) of Section 8 of Article XIII B of the
    California Constitution, and shall not include prior fiscal year
    revenues. Commencing with the 1995-96 fiscal year, and each fiscal
    year thereafter, "General Fund revenues that are the proceeds of
    taxes," as defined in subdivision (c) of Section 8 of Article XIII B
    of the California Constitution, includes any portion of the proceeds
    of taxes received from the state sales tax that are transferred to
    the counties pursuant to, and only if, legislation is enacted during
    the 1995-96 fiscal year the purpose of which is to realign children's
    programs. The amount of the proceeds of taxes shall be computed for
    any fiscal year in a manner consistent with the manner in which the
    amount of the proceeds of taxes was computed by the Department of
    Finance for purposes of the Governor's Budget for the Budget Act of
    1986.
    (c) "General Fund revenues appropriated for school districts," as
    used in paragraph (1) of subdivision (b) of Section 8 of Article XVI
    of the California Constitution, means the sum of appropriations made
    that are for allocation to school districts, as defined in Section
    41302.5, regardless of whether those appropriations were made from
    the General Fund to the Superintendent, to the Controller, or to any
    other fund or state agency for the purpose of allocation to school
    districts. The full amount of any appropriation shall be included in
    the calculation of the percentage required by paragraph (1) of
    subdivision (b) of Article XVI, without regard to any unexpended
    balance of any appropriation. Any reappropriation of funds
    appropriated in any prior year shall not be included in the sum of
    appropriations.
    (d) "General Fund revenues appropriated for community college
    districts," as used in paragraph (1) of subdivision (b) of Section 8
    of Article XVI of the California Constitution, means the sum of
    appropriations made that are for allocation to community college
    districts, regardless of whether those appropriations were made from
    the General Fund to the Controller, to the Chancellor of the
    California Community Colleges, or to any other fund or state agency
    for the purpose of allocation to community college districts. The
    full amount of any appropriation shall be included in the calculation
    of the percentage required by paragraph (1) of subdivision (b) of
    Article XVI, without regard to any unexpended balance of any
    appropriation. Any reappropriation of funds appropriated in any prior
    year shall not be included in the sum of appropriations.
    (e) "Total allocations to school districts and community college
    districts from General Fund proceeds of taxes appropriated pursuant
    to Article XIII B," as used in paragraph (2) or (3) of subdivision
    (b) of Section 8 of Article XVI of the California Constitution, means
    the sum of appropriations made that are for allocation to school
    districts, as defined in Section 41302.5, and community college
    districts, regardless of whether those appropriations were made from
    the General Fund to the Controller, to the Superintendent, to the
    Chancellor of the California Community Colleges, or to any other fund
    or state agency for the purpose of allocation to school districts
    and community college districts. The full amount of any appropriation
    shall be included in the calculation of the percentage required by
    paragraph (2) or (3) of subdivision (b) of Section 8 of Article XVI,
    without regard to any unexpended balance of any appropriation. Any
    reappropriation of funds appropriated in any prior year shall not be
    included in the sum of appropriations.
    (f) "General Fund revenues appropriated for school districts and
    community college districts, respectively" and "moneys to be applied
    by the state for the support of school districts and community
    college districts," as used in Section 8 of Article XVI of the
    California Constitution, shall include funds appropriated for
    part-day California state preschool programs under Article 7
    (commencing with Section 8235) of Chapter 2 of Part 6 of Division 1
    of Title 1, and the After School Education and Safety Program
    established pursuant to Article 22.5 (commencing with Section 8482)
    of Chapter 2 of Part 6 of Division 1 of Title 1, and shall not
    include any of the following:
    (1) Any appropriation that is not made for allocation to a school
    district, as defined in Section 41302.5, or to a community college
    district, regardless of whether the appropriation is made for any
    purpose that may be considered to be for the benefit to a school
    district, as defined in Section 41302.5, or a community college
    district. This paragraph shall not be construed to exclude any
    funding appropriated for part-day California state preschool programs
    under Article 7 (commencing with Section 8235) of Chapter 2 of Part
    6 of Division 1 of Title 1 or the After School Education and Safety
    Program established pursuant to Article 22.5 (commencing with Section
    8482) of Chapter 2 of Part 6 of Division 1 of Title 1.
    (2) Any appropriation made to the Teachers' Retirement Fund or to
    the Public Employees' Retirement Fund except those appropriations for
    reimbursable state mandates imposed on or before January 1, 1988.
    (3) Any appropriation made to service any public debt approved by
    the voters of this state.
    (4) With the exception of the programs identified in paragraph
    (1), commencing with the 2011-12 fiscal year, any funds appropriated
    for the Child Care and Development Services Act, pursuant to Chapter
    2 (commencing with Section 8200) of Part 6 of Division 1 of Title 1.
    (g) "Allocated local proceeds of taxes," as used in paragraph (2)
    or (3) of subdivision (b) of Section 8 of Article XVI of the
    California Constitution, means, for school districts as defined,
    those local revenues, except revenues identified pursuant to
    paragraph (5) of subdivision (h) of Section 42238, that are used to
    offset state aid for school districts in calculations performed
    pursuant to Sections 2558, 42238, and Chapter 7.2 (commencing with
    Section 56836) of Part 30.
    (h) "Allocated local proceeds of taxes," as used in paragraph (2)
    or (3) of subdivision (b) of Section 8 of Article XVI of the
    California
    Constitution, means, for community college districts, those local
    revenues that are used to offset state aid for community college
    districts in calculations performed pursuant to Section 84700. In no
    event shall the revenues or receipts derived from student fees be
    considered "allocated local proceeds of taxes."
    (i) For purposes of calculating the 4-percent entitlement pursuant
    to subdivision (a) of Section 8.5 of Article XVI of the California
    Constitution, "the total amount required pursuant to Section 8(b)"
    shall mean the General Fund aid required for schools pursuant to
    subdivision (b) of Section 8 of Article XVI of the California
    Constitution, and shall not include allocated local proceeds of
    taxes.
    (j) This section shall become operative on July 1, 2011.
    SEC. 14. Section 41202.5 is added to the Education Code, to read:
    41202.5. (a) The finds and declares as follows:
    (1) The Legislature acted to implement Proposition 98 soon after
    its passage by defining "total allocations to school districts and
    community college districts from General Fund proceeds of taxes" to
    include the entirety of programs funded under the Child Care and
    Development Services Act (Chapter 2 (commencing with Section 8200) of
    Part 6 of Division 1 of Title 1).
    (2) In California Teachers Assn. v. Hayes (1992) 5 Cal.App.4th
    1513, the Court of Appeal permitted the inclusion of child care
    within the Proposition 98 minimum funding guarantee but left open the
    possibility of excluding particular child care programs that did not
    directly advance and support the educational mission of school
    districts.
    (b) It is the intent of the Legislature to clarify that the
    part-time state preschool programs and the After School Education and
    Safety Program fall within the Proposition 98 guarantee and to fund
    other child care programs less directly associated with school
    districts from appropriations that do not count toward the
    Proposition 98 minimum guarantee.
    (c) Notwithstanding any other provision of law, for purposes of
    making the computations required by subdivision (b) of Section 8 of
    Article XVI of the California Constitution in the 2011-12 fiscal year
    and each subsequent fiscal year, both of the following apply:
    (1) For purposes of paragraph (1) of subdivision (b) of Section 8
    of Article XVI of the California Constitution, the term "General Fund
    revenues appropriated for school districts and community college
    districts, respectively, in fiscal year 1986-87" does not include
    General Fund revenues appropriated for any program within Chapter 2
    (commencing with Section 8200) of Part 6 of Division 1 of Title 1,
    with the exception of the part-day California state preschool
    programs set forth in Article 7 (commencing with Section 8235) and
    the After School Education and Safety Program in Article 22.5
    (commencing with Section 8482). The Director of Finance shall adjust
    accordingly "the percentage of General Fund revenues appropriated for
    school districts and community college districts, respectively, in
    fiscal year 1986-87," for purposes of applying that percentage in the
    2011-12 fiscal year and each subsequent fiscal year in making the
    calculations required under paragraph (1) of subdivision (b) of
    Section 8 of Article XVI of the California Constitution.
    (2) General Fund revenues appropriated in the 2010-11 fiscal year
    or any subsequent fiscal year for any program within Chapter 2
    (commencing with Section 8200) of Part 6 of Division 1 of Title 1,
    with the exception of the part-day California state preschool
    programs set forth in Article 7 (commencing with Section 8235) and
    the After School Education and Safety Program in Article 22.5
    (commencing with Section 8482), are not included within the "total
    allocations to school districts and community college districts from
    General Fund proceeds of taxes appropriated pursuant to Article XIII
    B" for purposes of paragraph (2) or (3) of subdivision (b) of Section
    8 of Article XVI of the California Constitution.
    SEC. 15. Section 41210 is added to the Education Code, to read:
    41210. (a) The revenues transferred pursuant to Section 6015.15
    and 6201.15 of the Revenue and Taxation Code are not "General Fund
    revenues" as that term is used in Section 8 of Article XVI of the
    California Constitution.
    (b) This section shall be operative for the 2011-12 fiscal year
    and subsequent years so long as one or more ballot measures approved
    before November 17, 2012, authorize the determination in subdivision
    (a) and provide funding for school districts and community college
    districts in an amount equal to that which would have been provided
    if the revenues referenced in subdivision (a) were General Fund
    revenues for purposes of Section 8 of Article XVI of the California
    Constitution.
    SEC. 16. Section 41211 is added to the Education Code, to read:
    41211. The following shall apply if Section 41210 is rendered
    inoperative because the ballot measure or measures described in
    subdivision (b) of that section are not approved:
    (a) Before December 17, 2012, the Director of Finance, in
    consultation with the Superintendent, shall determine the amount of
    funding that would have been provided in the 2011-12 fiscal year to
    school districts and community college districts if the revenues
    described in subdivision (a) of Section 41210 were General Fund
    revenues for purposes of Section 8 of Article XVI of the California
    Constitution.
    (b) For each of the 2012-13 to 2016-17, inclusive, fiscal years,
    17.8 percent of the amount determined in subdivision (a) is
    appropriated from the General Fund to the Superintendent and shall be
    distributed in the following priority:
    (1) To reduce amounts deferred under Section 14041.6.
    (2) To repay obligations to school districts and county offices of
    education under Section 6 of Article XIII B of the California
    Constitution.
    (3) To use for other one-time purposes as provided by statute
    enacted after the effective date of this section.
    (c) For each of the 2012-13 to 2016-17, inclusive, fiscal years,
    2.2 percent of the amount determined in subdivision (a) is
    appropriated from the General Fund to the Chancellor of the
    California Community Colleges and shall be distributed in the
    following priority:
    (1) To reduce amounts deferred under Section 84321.6.
    (2) To repay obligations to community college districts under
    Section 6 of Article XIII B of the California Constitution.
    (3) To use for other one-time purposes as provided by statute
    enacted after the effective date of this section.
    (d) For the 2011-12 fiscal year and subsequent fiscal years, the
    computations required by Section 8 of Article XVI of the California
    Constitution shall include the amount determined in subdivision (a).
    SEC. 17. Section 42127 of the Education Code is amended to read:
    42127. (a) On or before July 1 of each year, the governing board
    of each school district shall accomplish the following:
    (1) Hold a public hearing on the budget to be adopted for the
    subsequent fiscal year. The budget to be adopted shall be prepared in
    accordance with Section 42126. The agenda for that hearing shall be
    posted at least 72 hours prior to the public hearing and shall
    include the location where the budget will be available for public
    inspection.
    (A) For the 2011-12 fiscal year, notwithstanding any of the
    standards and criteria adopted by the state board pursuant to Section
    33127, each school district budget shall project the same level of
    revenue per unit of average daily attendance as it received in the
    2010-11 fiscal year and shall maintain staffing and program levels
    commensurate with that level.
    (B) For the 2011-12 fiscal year, the school district shall not be
    required to demonstrate that it is able to meet its financial
    obligations for the two subsequent fiscal years.
    (2) Adopt a budget. Not later than five days after that adoption
    or by July 1, whichever occurs first, the governing board shall file
    that budget with the county superintendent of schools. That budget
    and supporting data shall be maintained and made available for public
    review. If the governing board of the district does not want all or
    a portion of the property tax requirement levied for the purpose of
    making payments for the interest and redemption charges on
    indebtedness as described in paragraph (1) or (2) of subdivision (b)
    of Section 1 of Article XIII A of the California Constitution, the
    budget shall include a statement of the amount or portion for which a
    levy shall not be made.
    (b) The county superintendent of schools may accept changes in any
    statement included in the budget, pursuant to subdivision (a), of
    the amount or portion for which a property tax levy shall not be
    made. The county superintendent or the county auditor shall compute
    the actual amounts to be levied on the property tax rolls of the
    district for purposes that exceed apportionments to the district
    pursuant to Chapter 6 (commencing with Section 95) of Part 0.5 of
    Division 1 of the Revenue and Taxation Code. Each school district
    shall provide all data needed by the county superintendent or the
    county auditor to compute the amounts. On or before August 15, the
    county superintendent shall transmit the amounts computed to the
    county auditor who shall compute the tax rates necessary to produce
    the amounts. On or before September 1, the county auditor shall
    submit the rate computed to the board of supervisors for adoption.
    (c) The county superintendent of schools shall do all of the
    following:
    (1) Examine the adopted budget to determine whether it complies
    with the standards and criteria adopted by the state board pursuant
    to Section 33127 for application to final local educational agency
    budgets. The county superintendent shall identify, if necessary, any
    technical corrections that are required to be made to bring the
    budget into compliance with those standards and criteria.
    (2) Determine whether the adopted budget will allow the district
    to meet its financial obligations during the fiscal year and is
    consistent with a financial plan that will enable the district to
    satisfy its multiyear financial commitments. In addition to his or
    her own analysis of the budget of each school district, the county
    superintendent of schools shall review and consider studies, reports,
    evaluations, or audits of the school district that were commissioned
    by the district, the county superintendent, the Superintendent, and
    state control agencies and that contain evidence that the school
    district is showing fiscal distress under the standards and criteria
    adopted in Section 33127 or that contain a finding by an external
    reviewer that more than three of the 15 most common predictors of a
    school district needing intervention, as determined by the County
    Office Fiscal Crisis and Management Assistance Team, are present. The
    county superintendent of schools shall either conditionally approve
    or disapprove a budget that does not provide adequate assurance that
    the district will meet its current and future obligations and resolve
    any problems identified in studies, reports, evaluations, or audits
    described in this paragraph.
    (d) On or before August 15, the county superintendent of schools
    shall approve, conditionally approve, or disapprove the adopted
    budget for each school district. If a school district does not submit
    a budget to the county superintendent of schools, the county
    superintendent of schools shall, at district expense, develop a
    budget for that school district by September 15 and transmit that
    budget to the governing board of the school district. The budget
    prepared by the county superintendent of schools shall be deemed
    adopted, unless the county superintendent of schools approves any
    modifications made by the governing board of the school district. The
    approved budget shall be used as a guide for the district's
    priorities. The Superintendent shall review and certify the budget
    approved by the county. If, pursuant to the review conducted pursuant
    to subdivision (c), the county superintendent of schools determines
    that the adopted budget for a school district does not satisfy
    paragraph (1) or (2) of that subdivision, he or she shall
    conditionally approve or disapprove the budget and, not later than
    August 15, transmit to the governing board of the school district, in
    writing, his or her recommendations regarding revision of the budget
    and the reasons for those recommendations, including, but not
    limited to, the amounts of any budget adjustments needed before he or
    she can conditionally approve that budget. The county superintendent
    of schools may assign a fiscal adviser to assist the district to
    develop a budget in compliance with those revisions. In addition, the
    county superintendent of schools may appoint a committee to examine
    and comment on the superintendent's review and recommendations,
    subject to the requirement that the committee report its findings to
    the superintendent no later than August 20. For the 2011-12 fiscal
    year, notwithstanding any of the standards and criteria adopted by
    the state board pursuant to Section 33127, the county superintendent,
    as a condition on approval of a school district budget, shall not
    require a school district to project a lower level of revenue per
    unit of average daily attendance than it received in the 2010-11
    fiscal year nor require the school district to demonstrate that it is
    able to meet its financial obligations for the two subsequent fiscal
    years.
    (e) On or before September 8, the governing board of the school
    district shall revise the adopted budget to reflect changes in
    projected income or expenditures subsequent to July 1, and to include
    any response to the recommendations of the county superintendent of
    schools, shall adopt the revised budget, and shall file the revised
    budget with the county superintendent of schools. Prior to revising
    the budget, the governing board shall hold a public hearing regarding
    the proposed revisions, to be conducted in accordance with Section
    42103. In addition, if the adopted budget is disapproved pursuant to
    subdivision (d), the governing board and the county superintendent of
    schools shall review the disapproval and the recommendations of the
    county superintendent of schools regarding revision of the budget at
    the public hearing. The revised budget and supporting data shall be
    maintained and made available for public review.
    (1) For the 2011-12 fiscal year, notwithstanding any of the
    standards and criteria adopted by the state board pursuant to Section
    33127, each school district budget shall project the same level of
    revenue per unit of average daily attendance as it received in the
    2010-11 fiscal year and shall maintain staffing and program levels
    commensurate with that level.
    (2) For the 2011-12 fiscal year, the school district shall not be
    required to demonstrate that it is able to meet its financial
    obligations for the two subsequent fiscal years.
    (f) On or before September 22, the county superintendent of
    schools shall provide a list to the Superintendent identifying all
    school districts for which budgets may be disapproved.
    (g) The county superintendent of schools shall examine the revised
    budget to determine whether it (1) complies with the standards and
    criteria adopted by the state board pursuant to Section 33127 for
    application to final local educational agency budgets, (2) allows the
    district to meet its financial obligations during the fiscal year,
    (3) satisfies all conditions established by the county superintendent
    of schools in the case of a conditionally approved budget, and (4)
    is consistent with a financial plan that will enable the district to
    satisfy its multiyear financial commitments, and, not later than
    October 8, shall approve or disapprove the revised budget. If the
    county superintendent of schools disapproves the budget, he or she
    shall call for the formation of a budget review committee pursuant to
    Section 42127.1, unless the governing board of the school district
    and the county superintendent of schools agree to waive the
    requirement that a budget review committee be formed and the
    department approves the waiver after determining that a budget review
    committee is not necessary. Upon the grant of a waiver, the county
    superintendent immediately has the authority and responsibility
    provided in Section 42127.3. Upon approving a waiver of the budget
    review committee, the department shall ensure that a balanced budget
    is adopted for the school district by November 30. If no budget is
    adopted by November 30, the Superintendent may adopt a budget for the
    school district. The Superintendent shall report to the Legislature
    and the Director of Finance by December 10 if any district, including
    a district that has received a waiver of the budget review committee
    process, does not have an adopted budget by November 30. This report
    shall include the reasons why a budget has not been adopted by the
    deadline, the steps being taken to finalize budget adoption, the date
    the adopted budget is anticipated, and whether the Superintendent
    has or will exercise his or her authority to adopt a budget for the
    school district. For the 2011-12 fiscal year, notwithstanding any of
    the standards and criteria adopted by the state board pursuant to
    Section 33127, the county superintendent, as a condition on approval
    of a school district budget, shall not require a school district to
    project a lower level of revenue per unit of average daily attendance
    than it received in the 2010-11 fiscal year nor require the school
    district to demonstrate that it is able to meet its financial
    obligations for the two subsequent fiscal years.
    (h) Not later than October 8, the county superintendent of schools
    shall submit a report to the Superintendent identifying all school
    districts for which budgets have been disapproved or budget review
    committees waived. The report shall include a copy of the written
    response transmitted to each of those districts pursuant to
    subdivision (d).
    (i) Notwithstanding any other provision of this section, the
    budget review for a school district shall be governed by paragraphs
    (1), (2), and (3) of this subdivision, rather than by subdivisions
    (e) and (g), if the governing board of the school district so elects
    and notifies the county superintendent in writing of that decision,
    not later than October 31 of the immediately preceding calendar year.
    On or before July 1, the governing board of a school district for
    which the budget review is governed by this subdivision, rather than
    by subdivisions (e) and (g), shall conduct a public hearing regarding
    its proposed budget in accordance with Section 42103.
    (1) If the adopted budget of a school district is disapproved
    pursuant to subdivision (d), on or before September 8, the governing
    board of the school district, in conjunction with the county
    superintendent of schools, shall review the superintendent's
    recommendations at a regular meeting of the governing board and
    respond to those recommendations. The response shall include any
    revisions to the adopted budget and other proposed actions to be
    taken, if any, as a result of those recommendations.
    (2) On or before September 22, the county superintendent of
    schools will provide a list to the Superintendent identifying all
    school districts for which a budget may be tentatively disapproved.
    (3) Not later than October 8, after receiving the response
    required under paragraph (1), the county superintendent of schools
    shall review that response and either approve or disapprove the
    budget. If the county superintendent of schools disapproves the
    budget, he or she shall call for the formation of a budget review
    committee pursuant to Section 42127.1, unless the governing board of
    the school district and the county superintendent of schools agree to
    waive the requirement that a budget review committee be formed and
    the department approves the waiver after determining that a budget
    review committee is not necessary. Upon the grant of a waiver, the
    county superintendent has the authority and responsibility provided
    to a budget review committee in Section 42127.3. Upon approving a
    waiver of the budget review committee, the department shall ensure
    that a balanced budget is adopted for the school district by November
    30. The Superintendent shall report to the Legislature and the
    Director of Finance by December 10 if any district, including a
    district that has received a waiver of the budget review committee
    process, does not have an adopted budget by November 30. This report
    shall include the reasons why a budget has not been adopted by the
    deadline, the steps being taken to finalize budget adoption, and the
    date the adopted budget is anticipated. For the 2011-12 fiscal year,
    notwithstanding any of the standards and criteria adopted by the
    state board pursuant to Section 33127, the county superintendent, as
    a condition on approval of a school district budget, shall not
    require a school district to project a lower level of revenue per
    unit of average daily attendance than it received in the 2010-11
    fiscal year nor require the school district to demonstrate that it is
    able to meet its financial obligations for the two subsequent fiscal
    years.
    (4) Not later than 45 days after the Governor signs the annual
    Budget Act, the school district shall make available for public
    review any revisions in revenues and expenditures that it has made to
    its budget to reflect the funding made available by that Budget Act.

    (j) Any school district for which the county board of education
    serves as the governing board is not subject to subdivisions (c) to
    (h), inclusive, but is governed instead by the budget procedures set
    forth in Section 1622.
    SEC. 18. Section 42238.146 of the Education Code is amended to
    read:
    42238.146. (a) (1) For the 2003-04 fiscal year, the revenue limit
    for each school district determined pursuant to this article shall
    be reduced by a 1.198 percent deficit factor.
    (2) For the 2004-05 fiscal year, the revenue limit for each school
    district determined pursuant to this article shall be reduced by a
    0.323 percent deficit factor.
    (3) For the 2003-04 and 2004-05 fiscal years, the revenue limit
    for each school district determined pursuant to this article shall be
    further reduced by a 1.826 percent deficit factor.
    (4) For the 2005-06 fiscal year, the revenue limit for each school
    district determined pursuant to this article shall be reduced by a
    0.892 percent deficit factor.
    (5) For the 2008-09 fiscal year, the revenue limit for each school
    district determined pursuant to this article shall be reduced by a
    7.844 percent deficit factor.
    (6) For the 2009-10 fiscal year, the revenue limit for each school
    district determined pursuant to this article shall be reduced by a
    18.355 percent deficit factor.
    (7) For the 2010-11 fiscal year, the revenue limit for each school
    district determined pursuant to this article shall be reduced by a
    17.963 percent deficit factor.
    (8) For the 2011-12 fiscal year, the revenue limit for each school
    district determined pursuant to this article shall be reduced by a
    19.754 percent deficit factor.
    (b) In computing the revenue limit for each school district for
    the 2006-07 fiscal year pursuant to this article, the revenue limit
    shall be determined as if the revenue limit for that school district
    had been determined for the 2003-04, 2004-05, and 2005-06 fiscal
    years without being reduced by the deficit factors specified in
    subdivision (a).
    (c) In computing the revenue limit for each school district for
    the 2010-11 fiscal year pursuant to this article, the revenue limit
    shall be determined as if the revenue limit for that school district
    had been determined for the 2009-10 fiscal year without being reduced
    by the deficit factors specified in subdivision (a).
    (d) In computing the revenue limit for each school district for
    the 2011-12 fiscal year pursuant to this article, the revenue limit
    shall be determined as if the revenue limit for that school district
    had been determined for the 2010-11 fiscal year without being reduced
    by the deficit factors specified in subdivision (a).
    (e) In computing the revenue limit for each school district for
    the 2012-13 fiscal year pursuant to this article, the revenue limit
    shall be determined as if the revenue limit for that school district
    had been determined for the 2011-12 fiscal year without being reduced
    by the deficit factors specified in subdivision (a).
    SEC. 19. Section 42251 is added to the Education Code, to read:
    42251. (a) The Superintendent shall make the following
    calculations for the 2011-12 fiscal year:
    (1) Determine the amount of funds that will be restricted after
    the Superintendent makes the deduction pursuant to Section 52335.3
    for each county office of education pursuant to subdivision (e) of
    Section 2558 as of June 30, 2012.
    (2) Divide fifty million dollars ($50,000,000) by the statewide
    sum of the amounts determined pursuant to paragraph (1). If the
    fraction is greater than one it shall be deemed to be one.
    (3) Multiply the fraction determined pursuant to paragraph (2) by
    the amount determined pursuant to paragraph (1) for each county
    office of education.
    (b) The auditor-controller of each county shall distribute the
    amounts determined in paragraph (3) of subdivision (a)
    to the Supplemental Revenue Augmentation Fund created within the
    county pursuant to Section 100.06 of the Revenue and Taxation Code.
    The aggregate amount of transfers required by this subdivision shall
    be made in two equal shares, with the first share being transferred
    no later than January 15, 2012, and the second share being
    transferred after that date but no later than May 1, 2012.
    (c) The moneys transferred to the Supplemental Revenue
    Augmentation Fund in the 2011-12 fiscal year shall be transferred by
    the county office of education to the Controller, in amounts and for
    those purposes as directed by the Director of Finance, exclusively to
    reimburse the state for the costs of providing trial court services
    and costs until those moneys are exhausted.
    SEC. 20. Section 42606 of the Education Code is repealed.
    SEC. 21. Section 42606 is added to the Education Code, to read:
    42606. (a) To the extent funds are provided, for the 2010-11 to
    the 2014-15 fiscal years, inclusive, the Superintendent shall
    allocate a supplemental categorical block grant to a charter school
    that began operation during or after the 2008-09 fiscal year. These
    supplemental categorical block grant funds may be used for any
    educational purpose. Commencing in the 2011-12 fiscal year, a locally
    or direct funded charter school that converted from a preexisting
    school between the 2008-09 and 2014-15 fiscal years, inclusive, is
    not eligible for funding
    specified in this section. A charter school that receives funding
    pursuant to this subdivision shall not receive additional funding for
    programs specified in paragraph (2) of subdivision (a) of Section
    42605, with the exception of the program funded pursuant to Item
    6110-211-0001 of Section 2.00 of the annual Budget Act.
    (b) (1) For the 2010-11 fiscal year, the supplemental categorical
    block grant shall equal one hundred twenty-seven dollars ($127) per
    unit of charter school average daily attendance as determined at the
    2010-11 second principal apportionment for charter schools commencing
    operations during or after the 2008-09 fiscal year. A locally funded
    charter school that converted from a preexisting school during or
    after the 2008-09 fiscal year is not eligible for funding specified
    in this section.
    (2) For the 2011-12 to the 2014-15 fiscal years, inclusive, the
    supplemental categorical block grant shall equal one hundred
    twenty-seven dollars ($127) per unit of charter school average daily
    attendance as determined at the current year second principal
    apportionment for charter schools commencing operations during or
    after the 2008-09 fiscal year. In lieu of this supplemental grant, a
    school district shall provide new conversion charter schools that
    commenced operations within the district during or after the 2008-09
    fiscal year, one hundred twenty-seven dollars ($127) per unit of
    charter school average daily attendance as determined at the current
    year second principal apportionment. This paragraph does not preclude
    a school district and a new conversion charter school from
    negotiating an alternative funding rate. Absent agreement from both
    parties on an alternative rate, the school district shall be
    obligated to provide funding at the one hundred twenty-seven dollars
    ($127) per average daily attendance rate.
    SEC. 22. Section 44955.5 of the Education Code is amended to read:

    44955.5. (a) During the time period between five days after the
    enactment of the Budget Act and August 15 of the fiscal year to which
    that Budget Act applies, if the governing board of a school district
    determines that its total revenue limit per unit of average daily
    attendance for the fiscal year of that Budget Act has not increased
    by at least 2 percent, and if in the opinion of the governing board
    it is therefore necessary to decrease the number of permanent
    employees in the district, the governing board may terminate the
    services of any permanent or probationary certificated employees of
    the district, including employees holding a position that requires an
    administrative or supervisory credential. The termination shall be
    pursuant to Sections 44951 and 44955 but, notwithstanding anything to
    the contrary in Sections 44951 and 44955, in accordance with a
    schedule of notice and hearing adopted by the governing board.
    (b) This section is inoperative from July 1, 2002, to July 1,
    2003, inclusive, and from July 1, 2011, to July 1, 2012, inclusive.
    SEC. 23. Section 46201.3 is added to the Education Code, to read:
    46201.3. (a) For the 2011-12 school year, the minimum number of
    instructional days and minutes school districts, county offices of
    education, and charter schools are required to offer as set forth in
    Sections 41420, 46200, 46200.5, 46201, 46201.5, 46202, and 47612.5
    shall be reduced by up to seven days.
    (b) Implementation of the reduction in the number of instructional
    days offered by a school district, county office of education, and
    charter school that is subject to collective bargaining pursuant to
    Chapter 10.7 (commencing with Section 3540) of Division 4 of Title 1
    of the Government Code shall be achieved through the bargaining
    process, provided that the agreement has been completed and
    reductions implemented no later than June 30, 2012.
    (c) The revenue limit for each school district, county office of
    education, and charter school determined pursuant to Article 3
    (commencing with Section 2550) of Chapter 12 of Part 2 of Division 1
    of Title 1, Article 2 (commencing with Section 42238) of Chapter 7 of
    Part 24 of Division 3, and Article 2 (commencing with Section 47633)
    of Chapter 6 of Part 26.8 of Division 4 shall be reduced by the
    product of 4 percent and the fraction determined pursuant to
    paragraph (2).
    (1) Subtract the revenue forecast determined pursuant to
    subdivision (a) of Section 3.94 of the Budget Act of 2011 from
    eighty-six billion four hundred fifty-two million five hundred
    thousand dollars ($86,452,500,000).
    (2) Divide the lesser of two billion dollars ($2,000,000,000) or
    the amount calculated in paragraph (1) by two billion dollars
    ($2,000,000,000).
    (d) This section does not affect the number of instructional days
    or instructional minutes that may be reduced pursuant to Section
    46201.2.
    (e) The revenue limit reductions authorized by this section, when
    combined with the reductions applied under subdivision (c) of Section
    3.94 of the Budget Act of 2011, may not be applied so as to reduce
    school funding below the requirements of Section 8 of Article XVI of
    the California Constitution based on the applicable revenues
    estimated by the Department of Finance pursuant to Section 3.94 of
    the Budget Act of 2011.
    (f) This section shall be operative on February 1, 2012, only for
    the 2011-12 school year and only if subdivision (c) of Section 3.94
    of the Budget Act of 2011 is operative.
    SEC. 24. Section 56139 of the Education Code is amended to read:
    56139. (a) The Superintendent is responsible for monitoring local
    educational agencies to ensure compliance with the requirement to
    provide mental health services to individuals with exceptional needs
    pursuant to Chapter 26.5 (commencing with Section 7570) of Division 7
    of Title 1 of the Government Code and to ensure that funds provided
    for this purpose are appropriately utilized.
    (b) The Superintendent shall submit a report to the Legislature by
    April 1, 2005, that includes all of the following:
    (1) A description of the data that is currently collected by the
    department related to pupils served and services provided pursuant to
    Chapter 26.5 (commencing with Section 7570) of Division 7 of Title 1
    of the Government Code.
    (2) A description of the existing monitoring processes used by the
    department to ensure that local educational agencies are complying
    with Chapter 26.5 (commencing with Section 7570) of Division 7 of
    Title 1 of the Government Code, including the monitoring performed to
    ensure the appropriate use of funds for programs identified in
    Section 64000.
    (3) Recommendations on the manner in which to strengthen and
    improve monitoring by the department of the compliance by a local
    educational agency with the requirements of Chapter 26.5 (commencing
    with Section 7570) of Division 7 of Title 1 of the Government Code,
    on the manner in which to strengthen and improve collaboration and
    coordination with the State Department of Mental Health in monitoring
    and data collection activities, and on the additional data needed
    related to Chapter 26.5 (commencing with Section 7570) of Division 7
    of Title 1 of the Government Code.
    (c) The Superintendent shall collaborate with the Director of
    Mental Health in preparing the report required pursuant to
    subdivision (b) and shall convene at least one meeting of appropriate
    stakeholders and organizations, including a representative from the
    State Department of Mental Health and mental health directors, to
    obtain input on existing data collection and monitoring processes,
    and on ways to strengthen and improve the data collected and
    monitoring performed.
    (d) This section shall become inoperative on July 1, 2011, and, as
    of January 1, 2012, is repealed, unless a later enacted statute,
    that becomes operative on or before January 1, 2012, deletes or
    extends the dates on which it becomes inoperative and is repealed.
    SEC. 25. Section 56325 of the Education Code is amended to read:
    56325. (a) (1) As required by subclause (I) of clause (i) of
    subparagraph (C) of paragraph (2) of subsection (d) of Section 1414
    of Title 20 of the United States Code, the following shall apply to
    special education programs for individuals with exceptional needs who
    transfer from district to district within the state. In the case of
    an individual with exceptional needs who has an individualized
    education program and transfers into a district from a district not
    operating programs under the same local plan in which he or she was
    last enrolled in a special education program within the same academic
    year, the local educational agency shall provide the pupil with a
    free appropriate public education, including services comparable to
    those described in the previously approved individualized education
    program, in consultation with the parents, for a period not to exceed
    30 days, by which time the local educational agency shall adopt the
    previously approved individualized education program or shall
    develop, adopt, and implement a new individualized education program
    that is consistent with federal and state law.
    (2) In the case of an individual with exceptional needs who has an
    individualized education program and transfers into a district from
    a district operating programs under the same special education local
    plan area of the district in which he or she was last enrolled in a
    special education program within the same academic year, the new
    district shall continue, without delay, to provide services
    comparable to those described in the existing approved individualized
    education program, unless the parent and the local educational
    agency agree to develop, adopt, and implement a new individualized
    education program that is consistent with federal and state law.
    (3) As required by subclause (II) of clause (i) of subparagraph
    (C) of paragraph (2) of subsection (d) of Section 1414 of Title 20 of
    the United States Code, the following shall apply to special
    education programs for individuals with exceptional needs who
    transfer from an educational agency located outside the State of
    California to a district within California. In the case of an
    individual with exceptional needs who transfers from district to
    district within the same academic year, the local educational agency
    shall provide the pupil with a free appropriate public education,
    including services comparable to those described in the previously
    approved individualized education program, in consultation with the
    parents, until the local educational agency conducts an assessment
    pursuant to paragraph (1) of subsection (a) of Section 1414 of Title
    20 of the United States Code, if determined to be necessary by the
    local educational agency, and develops a new individualized education
    program, if appropriate, that is consistent with federal and state
    law.
    (b) (1) To facilitate the transition for an individual with
    exceptional needs described in subdivision (a), the new school in
    which the individual with exceptional needs enrolls shall take
    reasonable steps to promptly obtain the pupil's records, including
    the individualized education program and supporting documents and any
    other records relating to the provision of special education and
    related services to the pupil, from the previous school in which the
    pupil was enrolled, pursuant to paragraph (2) of subsection (a) of
    Section 99.31 of Title 34 of the Code of Federal Regulations.
    (2) The previous school in which the individual with exceptional
    needs was enrolled shall take reasonable steps to promptly respond to
    the request from the new school.
    (c) If whenever a pupil described in subdivision (a) was placed
    and residing in a residential nonpublic, nonsectarian school, prior
    to transferring to a district in another special education local plan
    area, and this placement is not eligible for funding pursuant to
    Section 56836.16, the special education local plan area that contains
    the district that made the residential nonpublic, nonsectarian
    school placement is responsible for the funding of the placement,
    including related services, for the remainder of the school year. An
    extended year session is included in the school year in which the
    session ends.
    SEC. 26. Section 56331 of the Education Code is amended to read:
    56331. (a) A pupil who is suspected of needing mental health
    services may be referred to a community mental health service in
    accordance with Section 7576 of the Government Code.
    (b) Prior to referring a pupil to a county mental health agency
    for services, the local educational agency shall follow the
    procedures set forth in Section 56320 and conduct an assessment in
    accordance with Sections 300.301 to 300.306, inclusive, of Title 34
    of the Code of Federal Regulations. If an individual with exceptional
    needs is identified as potentially requiring mental health services,
    the local educational agency shall request the participation of the
    county mental health agency in the individualized education program.
    A local educational agency shall provide any specially designed
    instruction required by an individualized education program,
    including related services such as counseling services, parent
    counseling and training, psychological services, or social work
    services in schools as defined in Section 300.34 of Title 34 of the
    Code of Federal Regulations. If the individualized education program
    of an individual with exceptional needs includes a functional
    behavioral assessment and behavior intervention plan, in accordance
    with Section 300.530 of Title 34 of the Code of Federal Regulations,
    the local educational agency shall provide documentation upon
    referral to a county mental health agency. Local educational agencies
    shall provide related services, by qualified personnel, unless the
    individualized education program team designates a more appropriate
    agency for the provision of services. Local educational agencies and
    community mental health services shall work collaboratively to ensure
    that assessments performed prior to referral are as useful as
    possible to the community mental health service agency in determining
    the need for mental health services and the level of services
    needed.
    (c) This section shall become inoperative on July 1, 2011, and, as
    of January 1, 2012, is repealed, unless a later enacted statute,
    that becomes operative on or before January 1, 2012, deletes or
    extends the dates on which it becomes inoperative and is repealed.
    SEC. 27. Section 60422.3 of the Education Code is amended and
    renumbered to read:
    60049. (a) Notwithstanding subdivision (i) of Section 60200,
    Section 60422, or any other provision of law, for the 2008-09 to the
    2014-15 fiscal years, inclusive, the governing board of a school
    district is not required to provide pupils with instructional
    materials by a specified period of time following adoption of those
    materials by the state board.
    (b) Notwithstanding subdivision (a), this section does not relieve
    school districts of their obligations to provide every pupil with
    textbooks or instructional materials, as provided in Section 1240.3.
    (c) This section does not relieve school districts of the
    obligation to hold a public hearing or hearings pursuant to
    subparagraphs (A) and (B) of paragraph (1) of subdivision (a) of
    Section 60119.
    (d) This section shall become inoperative on July 1, 2015, and, as
    of January 1, 2016, is repealed, unless a later enacted statute,
    that becomes operative on or before January 1, 2016, deletes or
    extends the dates on which it becomes inoperative and is repealed.
    SEC. 28. Section 69432.7 of the Education Code is amended to read:

    69432.7. As used in this chapter, the following terms have the
    following meanings:
    (a) An "academic year" is July 1 to June 30, inclusive. The
    starting date of a session shall determine the academic year in which
    it is included.
    (b) "Access costs" means living expenses and expenses for
    transportation, supplies, and books.
    (c) "Award year" means one academic year, or the equivalent, of
    attendance at a qualifying institution.
    (d) "College grade point average" and "community college grade
    point average" mean a grade point average calculated on the basis of
    all college work completed, except for nontransferable units and
    courses not counted in the computation for admission to a California
    public institution of higher education that grants a baccalaureate
    degree.
    (e) "Commission" means the Student Aid Commission.
    (f) "Enrollment status" means part- or full-time status.
    (1) "Part time," for purposes of Cal Grant eligibility, means 6 to
    11 semester units, inclusive, or the equivalent.
    (2) "Full time," for purposes of Cal Grant eligibility, means 12
    or more semester units or the equivalent.
    (g) "Expected family contribution," with respect to an applicant,
    shall be determined using the federal methodology pursuant to
    subdivision (a) of Section 69506 (as established by Title IV of the
    federal Higher Education Act of 1965, as amended (20 U.S.C. Sec. 1070
    et seq.)) and applicable rules and regulations adopted by the
    commission.
    (h) "High school grade point average" means a grade point average
    calculated on a 4.0 scale, using all academic coursework, for the
    sophomore year, the summer following the sophomore year, the junior
    year, and the summer following the junior year, excluding physical
    education, reserve officer training corps (ROTC), and remedial
    courses, and computed pursuant to regulations of the commission.
    However, for high school graduates who apply after their senior year,
    "high school grade point average" includes senior year coursework.
    (i) "Instructional program of not less than one academic year"
    means a program of study that results in the award of an associate or
    baccalaureate degree or certificate requiring at least 24 semester
    units or the equivalent, or that results in eligibility for transfer
    from a community college to a baccalaureate degree program.
    (j) "Instructional program of not less than two academic years"
    means a program of study that results in the award of an associate or
    baccalaureate degree requiring at least 48 semester units or the
    equivalent, or that results in eligibility for transfer from a
    community college to a baccalaureate degree program.
    (k) "Maximum household income and asset levels" means the
    applicable household income and household asset levels for
    participants, including new applicants and renewing recipients, in
    the Cal Grant Program, as defined and adopted in regulations by the
    commission for the 2001-02 academic year, which shall be set pursuant
    to the following income and asset ceiling amounts:
    CAL GRANT PROGRAM INCOME CEILINGS


    +--------------------+--------------+--------------+
    | Cal Grant |
    | A, |
    | C, and T Cal Grant B |
    +--------------------+--------------+--------------+
    |Dependent and Independent students with |
    |dependents* |
    +--------------------+--------------+--------------+
    |Family Size |
    +--------------------+--------------+--------------+
    | Six or more $74,100 $40,700 |
    +--------------------+--------------+--------------+
    | Five $68,700 $37,700 |
    +--------------------+--------------+--------------+
    | Four $64,100 $33,700 |
    +--------------------+--------------+--------------+
    | Three $59,000 $30,300 |
    +--------------------+--------------+--------------+
    | Two $57,600 $26,900 |
    +--------------------+--------------+--------------+
    |Independent |
    +--------------------+--------------+--------------+
    | Single, no $23,500 $23,500 |
    |dependents |
    +--------------------+--------------+--------------+
    | Married $26,900 $26,900 |
    +--------------------+--------------+--------------+


    *Applies to independent students with dependents other than a
    spouse.
    CAL GRANT PROGRAM ASSET CEILINGS


    +----------------------+-------------+-------------+
    | Cal Grant |
    | A, |
    | C, and T Cal Grant B |
    +----------------------+-------------+-------------+
    |Dependent** $49,600 $49,600 |
    +----------------------+-------------+-------------+
    |Independent $23,600 $23,600 |
    +----------------------+-------------+-------------+


    **Applies to independent students with dependents other than a
    spouse.


    The commission shall annually adjust the maximum household income
    and asset levels based on the percentage change in the cost of living
    within the meaning of paragraph (1) of subdivision (e) of Section 8
    of Article XIII B of the California Constitution. The maximum
    household income and asset levels applicable to a renewing recipient
    shall be the greater of the adjusted maximum household income and
    asset levels or the maximum household income and asset levels at the
    time of the renewing recipient's initial Cal Grant award. For a
    recipient who was initially awarded a Cal Grant for an academic year
    before the 2011-12 academic year, the maximum household income and
    asset levels shall be the greater of the adjusted maximum household
    income and asset levels or the 2010-11 academic year maximum
    household income and asset levels. An applicant or renewal recipient
    who qualifies to be considered under the simplified needs test
    established by federal law for student assistance shall be presumed
    to meet the asset level test under this section. Prior to disbursing
    any Cal Grant funds, a qualifying institution shall be obligated,
    under the terms of its institutional participation agreement with the
    commission, to resolve any conflicts that may exist in the data the
    institution possesses relating to that individual.
    (l) (1) "Qualifying institution" means an institution that
    complies with paragraphs (2) and (3) and is any of the following:
    (A) A California private or independent postsecondary educational
    institution that participates in the Pell Grant Program and in at
    least two of the following federal campus-based student aid programs:

    (i) Federal Work-Study.
    (ii) Perkins Loan Program.
    (iii) Supplemental Educational Opportunity Grant Program.
    (B) A nonprofit institution headquartered and operating in
    California that certifies to the commission that 10 percent of the
    institution's operating budget, as demonstrated in an audited
    financial statement, is expended for purposes of institutionally
    funded student financial aid in the form of grants, that demonstrates
    to the commission that it has the administrative capacity to
    administer the funds, that is accredited by the Western Association
    of Schools and Colleges, and that meets any other state-required
    criteria adopted by regulation by the commission in consultation with
    the Department of Finance. A regionally accredited institution that
    was deemed qualified by the commission to participate in the Cal
    Grant Program for the 2000-01 academic year shall retain its
    eligibility as long as it maintains its existing accreditation
    status.
    (C) A California public postsecondary educational institution.
    (2) (A) The institution shall provide information on where to
    access California license examination passage rates for the most
    recent available year from graduates of its undergraduate programs
    leading to employment for which passage of a California licensing
    examination is required, if that data is electronically available
    through the Internet Web site of a California licensing or regulatory
    agency. For purposes of this paragraph, "provide" may exclusively
    include placement of an Internet Web site address labeled as an
    access point for the data on the passage rates of recent program
    graduates on the Internet Web site where enrollment information is
    also located, on an Internet Web site that provides centralized
    admissions information for postsecondary educational systems with
    multiple campuses, or on applications for enrollment or other program
    information distributed to prospective students.
    (B) The institution shall be responsible for certifying to the
    commission compliance with the requirements of subparagraph (A).
    (3) (A) The commission shall certify by October 1 of each year the
    institution's latest three-year cohort default rate as most recently
    reported by the United States Department of Education.
    (B) For purposes of the 2011-12 academic year, an otherwise
    qualifying institution with a 2008 trial three-year cohort default
    rate reported by the United States Department of Education as of
    February 28, 2011, that is equal to or greater than 24.6 percent
    shall be ineligible for initial and renewal Cal Grant awards at the
    institution, except as provided in subparagraph (F).
    (C) For purposes of the 2012-13 academic year, and every academic
    year thereafter, an otherwise qualifying institution with a
    three-year cohort default rate that is equal to or greater than 30
    percent, as certified by the commission on October 1, 2011, and every
    year thereafter, shall be ineligible for initial and renewal Cal
    Grant awards at the institution, except as provided in subparagraph
    (F).
    (D) (i) An otherwise qualifying institution that becomes
    ineligible under this paragraph for initial and renewal Cal Grant
    awards may regain its eligibility for the academic year following an
    academic year in which it satisfies the requirements established in
    subparagraph (B) or (C), as applicable.
    (ii) If the United States Department of Education corrects or
    revises an institution's three-year cohort default rate that
    originally failed to satisfy the requirements established in
    subparagraph (B) or (C), as applicable, and the correction or
    revision results in the institution's three-year cohort default rate
    satisfying those requirements, that institution shall immediately
    regain its eligibility for the academic year to which the corrected
    or revised three-year cohort default rate would have been applied.
    (E) An otherwise qualifying institution for which no three-year
    cohort default rate has been reported by the United States Department
    of Education shall be provisionally eligible to participate in the
    Cal Grant Program until a three-year cohort default rate has been
    reported for the institution by the United States Department of
    Education.
    (F) An institution that is ineligible for initial and renewal Cal
    Grant awards at the institution under subparagraph (B) or (C) shall
    be eligible for renewal Cal Grant awards for recipients who were
    enrolled in the
    ineligible institution during the academic year before the academic
    year for which the institution is ineligible and who choose to renew
    their Cal Grant awards to attend the ineligible institution. Cal
    Grant awards subject to this subparagraph shall be reduced as
    follows:
    (i) The maximum Cal Grant A and B awards specified in the annual
    Budget Act shall be reduced by 20 percent.
    (ii) The reductions specified in this subparagraph shall not
    impact access costs as specified in subdivision (b) of Section 69435.

    (G) Notwithstanding any other law, the requirements of this
    paragraph shall not apply to institutions with 40 percent or less of
    undergraduate students borrowing federal student loans, using
    information reported to the United States Department of Education for
    the academic year two years prior to the year in which the
    commission is certifying the three-year cohort default rate pursuant
    to subparagraph (A).
    (H) By January 1, 2013, the Legislative Analyst shall submit to
    the Legislature a report on the implementation of this paragraph. The
    report shall be prepared in consultation with the commission, and
    shall include policy recommendations for appropriate measures of
    default risk and other direct or indirect measures of quality or
    effectiveness in educational institutions participating in the Cal
    Grant Program, and appropriate scores for those measures. It is the
    intent of the Legislature that appropriate policy and fiscal
    committees review the requirements of this paragraph and consider
    changes thereto.
    (m) "Satisfactory academic progress" means those criteria required
    by applicable federal standards published in Title 34 of the Code of
    Federal Regulations. The commission may adopt regulations defining
    "satisfactory academic progress" in a manner that is consistent with
    those federal standards.
    SEC. 29. Section 76300 of the Education Code is amended to read:
    76300. (a) The governing board of each community college district
    shall charge each student a fee pursuant to this section.
    (b) (1) The fee prescribed by this section shall be thirty-six
    dollars ($36) per unit per semester, effective with the fall term of
    the 2011-12 academic year.
    (2) The board of governors shall proportionately adjust the amount
    of the fee for term lengths based upon a quarter system, and also
    shall proportionately adjust the amount of the fee for summer
    sessions, intersessions, and other short-term courses. In making
    these adjustments, the board of governors may round the per unit fee
    and the per term or per session fee to the nearest dollar.
    (c) For the purposes of computing apportionments to community
    college districts pursuant to Section 84750.5, the board of governors
    shall subtract, from the total revenue owed to each district, 98
    percent of the revenues received by districts from charging a fee
    pursuant to this section.
    (d) The board of governors shall reduce apportionments by up to 10
    percent to any district that does not collect the fees prescribed by
    this section.
    (e) The fee requirement does not apply to any of the following:
    (1) Students enrolled in the noncredit courses designated by
    Section 84757.
    (2) California State University or University of California
    students enrolled in remedial classes provided by a community college
    district on a campus of the University of California or a campus of
    the California State University, for whom the district claims an
    attendance apportionment pursuant to an agreement between the
    district and the California State University or the University of
    California.
    (3) Students enrolled in credit contract education courses
    pursuant to Section 78021, if the entire cost of the course,
    including administrative costs, is paid by the public or private
    agency, corporation, or association with which the district is
    contracting and if these students are not included in the calculation
    of the full-time equivalent students (FTES) of that district.
    (f) The governing board of a community college district may exempt
    special part-time students admitted pursuant to Section 76001 from
    the fee requirement.
    (g) (1) The fee requirements of this section shall be waived for
    any student who, at the time of enrollment, is a recipient of
    benefits under the Temporary Assistance to Needy Families program,
    the Supplemental Security Income/State Supplementary Program, or a
    general assistance program or has demonstrated financial need in
    accordance with the methodology set forth in federal law or
    regulation for determining the expected family contribution of
    students seeking financial aid.
    (2) The governing board of a community college district also shall
    waive the fee requirements of this section for any student who
    demonstrates eligibility according to income standards established by
    regulations of the board of governors.
    (3) Paragraphs (1) and (2) may be applied to a student enrolled in
    the 2005-06 academic year if the student is exempted from
    nonresident tuition under paragraph (3) of subdivision (a) of Section
    76140.
    (h) The fee requirements of this section shall be waived for any
    student who, at the time of enrollment, is a dependent, or surviving
    spouse who has not remarried, of any member of the California
    National Guard who, in the line of duty and while in the active
    service of the state, was killed, died of a disability resulting from
    an event that occurred while in the active service of the state, or
    is permanently disabled as a result of an event that occurred while
    in the active service of the state. "Active service of the state,"
    for the purposes of this subdivision, refers to a member of the
    California National Guard activated pursuant to Section 146 of the
    Military and Veterans Code.
    (i) The fee requirements of this section shall be waived for any
    student who is the surviving spouse or the child, natural or adopted,
    of a deceased person who met all of the requirements of Section
    68120.
    (j) The fee requirements of this section shall be waived for any
    student in an undergraduate program, including a student who has
    previously graduated from another undergraduate or graduate program,
    who is the dependent of any individual killed in the September 11,
    2001, terrorist attacks on the World Trade Center and the Pentagon or
    the crash of United Airlines Flight 93 in southwestern Pennsylvania,
    if that dependent meets the financial need requirements set forth in
    Section 69432.7 for the Cal Grant A Program and either of the
    following applies:
    (1) The dependent was a resident of California on September 11,
    2001.
    (2) The individual killed in the attacks was a resident of
    California on September 11, 2001.
    (k) A determination of whether a person is a resident of
    California on September 11, 2001, for purposes of subdivision (j)
    shall be based on the criteria set forth in Chapter 1 (commencing
    with Section 68000) of Part 41 of Division 5 for determining
    nonresident and resident tuition.
    (l) (1) "Dependent," for purposes of subdivision (j), is a person
    who, because of his or her relationship to an individual killed as a
    result of injuries sustained during the terrorist attacks of
    September 11, 2001, qualifies for compensation under the federal
    September 11th Victim Compensation Fund of 2001 (Title IV (commencing
    with Section 401) of Public Law 107-42).
    (2) A dependent who is the surviving spouse of an individual
    killed in the terrorist attacks of September 11, 2001, is entitled to
    the waivers provided in this section until January 1, 2013.
    (3) A dependent who is the surviving child, natural or adopted, of
    an individual killed in the terrorist attacks of September 11, 2001,
    is entitled to the waivers under subdivision (j) until that person
    attains the age of 30 years.
    (4) A dependent of an individual killed in the terrorist attacks
    of September 11, 2001, who is determined to be eligible by the
    California Victim Compensation and Government Claims Board, is also
    entitled to the waivers provided in this section until January 1,
    2013.
    (m) (1) It is the intent of the Legislature that sufficient funds
    be provided to support the provision of a fee waiver for every
    student who demonstrates eligibility pursuant to subdivisions (g) to
    (j), inclusive.
    (2) From funds provided in the annual Budget Act, the board of
    governors shall allocate to community college districts, pursuant to
    this subdivision, an amount equal to 2 percent of the fees waived
    pursuant to subdivisions (g) to (j), inclusive. From funds provided
    in the annual Budget Act, the board of governors shall allocate to
    community college districts, pursuant to this subdivision, an amount
    equal to ninety-one cents ($0.91) per credit unit waived pursuant to
    subdivisions (g) to (j), inclusive. It is the intent of the
    Legislature that funds provided pursuant to this subdivision be used
    to support the determination of financial need and delivery of
    student financial aid services, on the basis of the number of
    students for whom fees are waived. It also is the intent of the
    Legislature that the funds provided pursuant to this subdivision
    directly offset mandated costs claimed by community college districts
    pursuant to Commission on State Mandates consolidated Test Claims
    99-TC-13 (Enrollment Fee Collection) and 00-TC-15 (Enrollment Fee
    Waivers). Funds allocated to a community college district for
    determination of financial need and delivery of student financial aid
    services shall supplement, and shall not supplant, the level of
    funds allocated for the administration of student financial aid
    programs during the 1992-93 fiscal year.
    (n) The board of governors shall adopt regulations implementing
    this section.
    (o) This section shall be inoperative and is repealed on January
    1, 2012, only if Section 3.94 of the Budget Act of 2011 is operative.

    SEC. 30. Section 76300 is added to the Education Code, to read:
    76300. (a) The governing board of each community college district
    shall charge each student a fee pursuant to this section.
    (b) (1) The fee prescribed by this section shall be forty-six
    dollars ($46) per unit per semester, effective with the fall term of
    the 2011-12 academic year.
    (2) The board of governors shall proportionately adjust the amount
    of the fee for term lengths based upon a quarter system, and also
    shall proportionately adjust the amount of the fee for summer
    sessions, intersessions, and other short-term courses. In making
    these adjustments, the board of governors may round the per unit fee
    and the per term or per session fee to the nearest dollar.
    (c) For the purposes of computing apportionments to community
    college districts pursuant to Section 84750.5, the board of governors
    shall subtract, from the total revenue owed to each district, 98
    percent of the revenues received by districts from charging a fee
    pursuant to this section.
    (d) The board of governors shall reduce apportionments by up to 10
    percent to any district that does not collect the fees prescribed by
    this section.
    (e) The fee requirement does not apply to any of the following:
    (1) Students enrolled in the noncredit courses designated by
    Section 84757.
    (2) California State University or University of California
    students enrolled in remedial classes provided by a community college
    district on a campus of the University of California or a campus of
    the California State University, for whom the district claims an
    attendance apportionment pursuant to an agreement between the
    district and the California State University or the University of
    California.
    (3) Students enrolled in credit contract education courses
    pursuant to Section 78021, if the entire cost of the course,
    including administrative costs, is paid by the public or private
    agency, corporation, or association with which the district is
    contracting and if these students are not included in the calculation
    of the full-time equivalent students (FTES) of that district.
    (f) The governing board of a community college district may exempt
    special part-time students admitted pursuant to Section 76001 from
    the fee requirement.
    (g) (1) The fee requirements of this section shall be waived for
    any student who, at the time of enrollment, is a recipient of
    benefits under the Temporary Assistance to Needy Families program,
    the Supplemental Security Income/State Supplementary Program, or a
    general assistance program or has demonstrated financial need in
    accordance with the methodology set forth in federal law or
    regulation for determining the expected family contribution of
    students seeking financial aid.
    (2) The governing board of a community college district also shall
    waive the fee requirements of this section for any student who
    demonstrates eligibility according to income standards established by
    regulations of the board of governors.
    (3) Paragraphs (1) and (2) may be applied to a student enrolled in
    the 2005-06 academic year if the student is exempted from
    nonresident tuition under paragraph (3) of subdivision (a) of Section
    76140.
    (h) The fee requirements of this section shall be waived for any
    student who, at the time of enrollment, is a dependent or surviving
    spouse who has not remarried, of any member of the California
    National Guard who, in the line of duty and while in the active
    service of the state, was killed, died of a disability resulting from
    an event that occurred while in the active service of the state, or
    is permanently disabled as a result of an event that occurred while
    in the active service of the state. "Active service of the state,"
    for the purposes of this subdivision, refers to a member of the
    California National Guard activated pursuant to Section 146 of the
    Military and Veterans Code.
    (i) The fee requirements of this section shall be waived for any
    student who is the surviving spouse or the child, natural or adopted,
    of a deceased person who met all of the requirements of Section
    68120.
    (j) The fee requirements of this section shall be waived for any
    student in an undergraduate program, including a student who has
    previously graduated from another undergraduate or graduate program,
    who is the dependent of any individual killed in the September 11,
    2001, terrorist attacks on the World Trade Center and the Pentagon or
    the crash of United Airlines Flight 93 in southwestern Pennsylvania,
    if that dependent meets the financial need requirements set forth in
    Section 69432.7 for the Cal Grant A Program and either of the
    following applies:
    (1) The dependent was a resident of California on September 11,
    2001.
    (2) The individual killed in the attacks was a resident of
    California on September 11, 2001.
    (k) A determination of whether a person is a resident of
    California on September 11, 2001, for purposes of subdivision (j)
    shall be based on the criteria set forth in Chapter 1 (commencing
    with Section 68000) of Part 41 of Division 5 for determining
    nonresident and resident tuition.
    (l) (1) "Dependent," for purposes of subdivision (j), is a person
    who, because of his or her relationship to an individual killed as a
    result of injuries sustained during the terrorist attacks of
    September 11, 2001, qualifies for compensation under the federal
    September 11th Victim Compensation Fund of 2001 (Title IV (commencing
    with Section 401) of Public Law 107-42).
    (2) A dependent who is the surviving spouse of an individual
    killed in the terrorist attacks of September 11, 2001, is entitled to
    the waivers provided in this section until January 1, 2013.
    (3) A dependent who is the surviving child, natural or adopted, of
    an individual killed in the terrorist attacks of September 11, 2001,
    is entitled to the waivers under subdivision (j) until that person
    attains 30 years of age.
    (4) A dependent of an individual killed in the terrorist attacks
    of September 11, 2001, who is determined to be eligible by the
    California Victim Compensation and Government Claims Board, is also
    entitled to the waivers provided in this section until January 1,
    2013.
    (m) (1) It is the intent of the Legislature that sufficient funds
    be provided to support the provision of a fee waiver for every
    student who demonstrates eligibility pursuant to subdivisions (g) to
    (j), inclusive.
    (2) From funds provided in the annual Budget Act, the board of
    governors shall allocate to community college districts, pursuant to
    this subdivision, an amount equal to 2 percent of the fees waived
    pursuant to subdivisions (g) to (j), inclusive. From funds provided
    in the annual Budget Act, the board of governors shall allocate to
    community college districts, pursuant to this subdivision, an amount
    equal to ninety-one cents ($0.91) per credit unit waived pursuant to
    subdivisions (g) to (j), inclusive. It is the intent of the
    Legislature that funds provided pursuant to this subdivision be used
    to support the determination of financial need and delivery of
    student financial aid services, on the basis of the number of
    students for whom fees are waived. It also is the intent of the
    Legislature that the funds provided pursuant to this subdivision
    directly offset mandated costs claimed by community college districts
    pursuant to Commission on State Mandates consolidated Test Claims
    99-TC-13 (Enrollment Fee Collection) and 00-TC-15 (Enrollment Fee
    Waivers). Funds allocated to a community college district for
    determination of financial need and delivery of student financial aid
    services shall supplement, and shall not supplant, the level of
    funds allocated for the administration of student financial aid
    programs during the 1992-93 fiscal year.
    (n) The board of governors shall adopt regulations implementing
    this section.
    (o) This section shall become operative on January 1, 2012, only
    if Section 3.94 of the Budget Act of 2011 is operative.
    SEC. 31. Section 7911.1 of the Family Code is amended to read:
    7911.1. (a) Notwithstanding any other law, the State Department
    of Social Services or its designee shall investigate any threat to
    the health and safety of children placed by a California county
    social services agency or probation department in an out-of-state
    group home pursuant to the provisions of the Interstate Compact on
    the Placement of Children. This authority shall include the authority
    to interview children or staff in private or review their file at
    the out-of-state facility or wherever the child or files may be at
    the time of the investigation. Notwithstanding any other law, the
    State Department of Social Services or its designee shall require
    certified out-of-state group homes to comply with the reporting
    requirements applicable to group homes licensed in California
    pursuant to Title 22 of the California Code of Regulations for each
    child in care regardless of whether he or she is a California
    placement, by submitting a copy of the required reports to the
    Compact Administrator within regulatory timeframes. The Compact
    Administrator within one business day of receiving a serious events
    report shall verbally notify the appropriate placement agencies and
    within five working days of receiving a written report from the
    out-of-state group home, forward a copy of the written report to the
    appropriate placement agencies.
    (b) Any contract, memorandum of understanding, or agreement
    entered into pursuant to paragraph (b) of Article 5 of the Interstate
    Compact on the Placement of Children regarding the placement of a
    child out of state by a California county social services agency or
    probation department shall include the language set forth in
    subdivision (a).
    (c) The State Department of Social Services or its designee shall
    perform initial and continuing inspection of out-of-state group homes
    in order to either certify that the out-of-state group home meets
    all licensure standards required of group homes operated in
    California or that the department has granted a waiver to a specific
    licensing standard upon a finding that there exists no adverse impact
    to health and safety. Any failure by an out-of-state group home
    facility to make children or staff available as required by
    subdivision (a) for a private interview or make files available for
    review shall be grounds to deny or discontinue the certification. The
    State Department of Social Services shall grant or deny an initial
    certification or a waiver under this subdivision to an out-of-state
    group home facility that has more than six California children placed
    by a county social services agency or probation department by August
    19, 1999. The department shall grant or deny an initial
    certification or a waiver under this subdivision to an out-of-state
    group home facility that has six or fewer California children placed
    by a county social services agency or probation department by
    February 19, 2000. Certifications made pursuant to this subdivision
    shall be reviewed annually.
    (d) Within six months of the effective date of this section, a
    county shall be required to obtain an assessment and placement
    recommendation by a county multidisciplinary team for each child in
    an out-of-state group home facility. On or after March 1, 1999, a
    county shall be required to obtain an assessment and placement
    recommendation by a county multidisciplinary team prior to placement
    of a child in an out-of-state group home facility.
    (e) Any failure by an out-of-state group home to obtain or
    maintain its certification as required by subdivision (c) shall
    preclude the use of any public funds, whether county, state, or
    federal, in the payment for the placement of any child in that
    out-of-state group home, pursuant to the Interstate Compact on the
    Placement of Children.
    (f) (1) A multidisciplinary team shall consist of participating
    members from county social services, county mental health, county
    probation, county superintendents of schools, and other members as
    determined by the county.
    (2) Participants shall have knowledge or experience in the
    prevention, identification, and treatment of child abuse and neglect
    cases, and shall be qualified to recommend a broad range of services
    related to child abuse or neglect.
    (g) (1) The department may deny, suspend, or discontinue the
    certification of the out-of-state group home if the department makes
    a finding that the group home is not operating in compliance with the
    requirements of subdivision (c).
    (2) Any judicial proceeding to contest the department's
    determination as to the status of the out-of-state group home
    certificate shall be held in California pursuant to Section 1085 of
    the Code of Civil Procedure.
    (h) The certification requirements of this section shall not
    impact placements of emotionally disturbed children made pursuant to
    an individualized education program developed pursuant to the federal
    Individuals with Disabilities Education Act (20 U.S.C. Sec. 1400 et
    seq.) if the placement is not funded with federal or state foster
    care funds.
    (i) Only an out-of-state group home authorized by the Compact
    Administrator to receive state funds for the placement by a county
    social services agency or probation department of any child in that
    out-of-state group home from the effective date of this section shall
    be eligible for public funds pending the department's certification
    under this section.
    SEC. 32. Section 7572 of the Government Code is amended to read:
    7572. (a) A child shall be assessed in all areas related to the
    suspected disability by those qualified to make a determination of
    the child's need for the service before any action is taken with
    respect to the provision of related services or designated
    instruction and services to a child, including, but not limited to,
    services in the areas of occupational therapy and physical therapy.
    All assessments required or conducted pursuant to this section shall
    be governed by the assessment procedures contained in Article 2
    (commencing with Section 56320) of Chapter 4 of Part 30 of Division 4
    of Title 2 of the Education Code.
    (b) Occupational therapy and physical therapy assessments shall be
    conducted by qualified medical personnel as specified in regulations
    developed by the State Department of Health Services in consultation
    with the State Department of Education.
    (c) A related service or designated instruction and service shall
    only be added to the child's individualized education program by the
    individualized education program team, as described in Part 30
    (commencing with Section 56000) of Division 4 of Title 2 of the
    Education Code, if a formal assessment has been conducted pursuant to
    this section, and a qualified person conducting the assessment
    recommended the service in order for the child to benefit from
    special education. In no case shall the inclusion of necessary
    related services in a pupil's individualized education plan be
    contingent upon identifying the funding source. Nothing in this
    section shall prevent a parent from obtaining an independent
    assessment in accordance with subdivision (b) of Section 56329 of the
    Education Code, which shall be considered by the individualized
    education program team.
    (1) If an assessment has been conducted pursuant to subdivision
    (b), the recommendation of the person who conducted the assessment
    shall be reviewed and discussed with the parent and with appropriate
    members of the individualized education program team prior to the
    meeting of the individualized education program team. When the
    proposed recommendation of the person has been discussed with the
    parent and there is disagreement on the recommendation pertaining to
    the related service, the parent shall be notified in writing and may
    require the person who conducted the assessment to attend the
    individualized education program team meeting to discuss the
    recommendation. The person who conducted the assessment shall attend
    the individualized education program team meeting if requested.
    Following this discussion and review, the recommendation of the
    person who conducted the assessment shall be the recommendation of
    the individualized education program team members who are attending
    on behalf of the local educational agency.
    (2) If an independent assessment for the provision of related
    services or designated instruction and services is submitted to the
    individualized education program team, review of that assessment
    shall be conducted by the person specified in subdivision (b). The
    recommendation of the person who reviewed the independent assessment
    shall be reviewed and discussed with the parent and with appropriate
    members of the individualized education program team prior to the
    meeting of the individualized education program team. The parent
    shall be notified in writing and may request the person who reviewed
    the independent assessment to attend the individualized education
    program team meeting to discuss the recommendation. The person who
    reviewed the independent
    assessment shall attend the individualized education program team
    meeting if requested. Following this review and discussion, the
    recommendation of the person who reviewed the independent assessment
    shall be the recommendation of the individualized education program
    team members who are attending on behalf of the local agency.
    (3) Any disputes between the parent and team members representing
    the public agencies regarding a recommendation made in accordance
    with paragraphs (1) and (2) shall be resolved pursuant to Chapter 5
    (commencing with Section 56500) of Part 30 of Division 4 of Title 2
    of the Education Code.
    (d) Whenever a related service or designated instruction and
    service specified in subdivision (b) is to be considered for
    inclusion in the child's individualized educational program, the
    local education agency shall invite the responsible public agency
    representative to meet with the individualized education program team
    to determine the need for the service and participate in developing
    the individualized education program. If the responsible public
    agency representative cannot meet with the individualized education
    program team, then the representative shall provide written
    information concerning the need for the service pursuant to
    subdivision (c). Conference calls, together with written
    recommendations, are acceptable forms of participation. If the
    responsible public agency representative will not be available to
    participate in the individualized education program meeting, the
    local educational agency shall ensure that a qualified substitute is
    available to explain and interpret the evaluation pursuant to
    subdivision (d) of Section 56341 of the Education Code. A copy of the
    information shall be provided by the responsible public agency to
    the parents or any adult pupil for whom no guardian or conservator
    has been appointed.
    SEC. 33. Section 7572.5 of the Government Code is amended to read:

    7572.5. (a) If an assessment is conducted pursuant to Article 2
    (commencing with Section 56320) of Chapter 4 of Part 30 of Division 4
    of Title 2 of the Education Code, which determines that a child is
    seriously emotionally disturbed, as defined in Section 300.8 of Title
    34 of the Code of Federal Regulations, and any member of the
    individualized education program team recommends residential
    placement based on relevant assessment information, the
    individualized education program team shall be expanded to include a
    representative of the county mental health department.
    (b) The expanded individualized education program team shall
    review the assessment and determine whether:
    (1) The child's needs can reasonably be met through any
    combination of nonresidential services, preventing the need for
    out-of-home care.
    (2) Residential care is necessary for the child to benefit from
    educational services.
    (3) Residential services are available that address the needs
    identified in the assessment and that will ameliorate the conditions
    leading to the seriously emotionally disturbed designation.
    (c) If the review required in subdivision (b) results in an
    individualized education program that calls for residential
    placement, the individualized education program shall include all of
    the items outlined in Section 56345 of the Education Code, and shall
    also include:
    (1) Designation of the county mental health department as lead
    case manager. Lead case management responsibility may be delegated to
    the county welfare department by agreement between the county
    welfare department and the designated county mental health
    department. The county mental health department shall retain
    financial responsibility for the provision of case management
    services.
    (2) Provision for a review of the case progress, the continuing
    need for out-of-home placement, the extent of compliance with the
    individualized education program, and progress toward alleviating the
    need for out-of-home care, by the full individualized education
    program team at least every six months.
    (3) Identification of an appropriate residential facility for
    placement with the assistance of the county welfare department as
    necessary.
    (d) This section shall become inoperative on July 1, 2011, and, as
    of January 1, 2012, is repealed, unless a later enacted statute,
    that becomes operative on or before January 1, 2012, deletes or
    extends the dates on which it becomes inoperative and is repealed.
    SEC. 34. Section 7572.55 of the Government Code is amended to
    read:
    7572.55. (a) Residential placements for a child with a disability
    who is seriously emotionally disturbed may be made out-of-state only
    after in-state alternatives have been considered and are found not
    to meet the child's needs and only when the requirements of Section
    7572.5, and subdivision (e) of Section 56365 of the Education Code
    have been met. The local education agency shall document the
    alternatives to out-of-state residential placement that were
    considered and the reasons why they were rejected.
    (b) Out-of-state placements shall be made only in a privately
    operated school certified by the California Department of Education.
    (c) A plan shall be developed for using less restrictive
    alternatives and in-state alternatives as soon as they become
    available, unless it is in the best educational interest of the child
    to remain in the out-of-state school. If the child is a ward or
    dependent of the court, this plan shall be documented in the record.
    (d) This section shall become inoperative on July 1, 2011, and, as
    of January 1, 2012, is repealed, unless a later enacted statute,
    that becomes operative on or before January 1, 2012, deletes or
    extends the dates on which it becomes inoperative and is repealed.
    SEC. 35. Section 7576 of the Government Code is amended to read:
    7576. (a) The State Department of Mental Health, or a community
    mental health service, as described in Section 5602 of the Welfare
    and Institutions Code, designated by the State Department of Mental
    Health, is responsible for the provision of mental health services,
    as defined in regulations by the State Department of Mental Health,
    developed in consultation with the State Department of Education, if
    required in the individualized education program of a pupil. A local
    educational agency is not required to place a pupil in a more
    restrictive educational environment in order for the pupil to receive
    the mental health services specified in his or her individualized
    education program if the mental health services can be appropriately
    provided in a less restrictive setting. It is the intent of the
    Legislature that the local educational agency and the community
    mental health service vigorously attempt to develop a mutually
    satisfactory placement that is acceptable to the parent and addresses
    the educational and mental health treatment needs of the pupil in a
    manner that is cost effective for both public agencies, subject to
    the requirements of state and federal special education law,
    including the requirement that the placement be appropriate and in
    the least restrictive environment. For purposes of this section,
    "parent" is as defined in Section 56028 of the Education Code.
    (b) A local educational agency, individualized education program
    team, or parent may initiate a referral for assessment of the social
    and emotional status of a pupil, pursuant to Section 56320 of the
    Education Code. Based on the results of assessments completed
    pursuant to Section 56320 of the Education Code, an individualized
    education program team may refer a pupil who has been determined to
    be an individual with exceptional needs, as defined in Section 56026
    of the Education Code, and who is suspected of needing mental health
    services to a community mental health service if the pupil meets all
    of the criteria in paragraphs (1) to (5), inclusive. Referral
    packages shall include all documentation required in subdivision (c),
    and shall be provided immediately to the community mental health
    service.
    (1) The pupil has been assessed by school personnel in accordance
    with Article 2 (commencing with Section 56320) of Chapter 4 of Part
    30 of Division 4 of Title 2 of the Education Code. Local educational
    agencies and community mental health services shall work
    collaboratively to ensure that assessments performed prior to
    referral are as useful as possible to the community mental health
    service in determining the need for mental health services and the
    level of services needed.
    (2) The local educational agency has obtained written parental
    consent for the referral of the pupil to the community mental health
    service, for the release and exchange of all relevant information
    between the local educational agency and the community mental health
    service, and for the observation of the pupil by mental health
    professionals in an educational setting.
    (3) The pupil has emotional or behavioral characteristics that
    satisfy all of the following:
    (A) Are observed by qualified educational staff in educational and
    other settings, as appropriate.
    (B) Impede the pupil from benefiting from educational services.
    (C) Are significant as indicated by their rate of occurrence and
    intensity.
    (D) Are associated with a condition that cannot be described
    solely as a social maladjustment or a temporary adjustment problem,
    and cannot be resolved with short-term counseling.
    (4) As determined using educational assessments, the pupil's
    functioning, including cognitive functioning, is at a level
    sufficient to enable the pupil to benefit from mental health
    services.
    (5) The local educational agency, pursuant to Section 56331 of the
    Education Code, has provided appropriate counseling and guidance
    services, psychological services, parent counseling and training, or
    social work services to the pupil pursuant to Section 56363 of the
    Education Code, or behavioral intervention as specified in Section
    56520 of the Education Code, as specified in the individualized
    education program and the individualized education program team has
    determined that the services do not meet the educational needs of the
    pupil, or, in cases where these services are clearly inadequate or
    inappropriate to meet the educational needs of the pupil, the
    individualized education program team has documented which of these
    services were considered and why they were determined to be
    inadequate or inappropriate.
    (c) If referring a pupil to a community mental health service in
    accordance with subdivision (b), the local educational agency or the
    individualized education program team shall provide the following
    documentation:
    (1) Copies of the current individualized education program, all
    current assessment reports completed by school personnel in all areas
    of suspected disabilities pursuant to Article 2 (commencing with
    Section 56320) of Chapter 4 of Part 30 of Division 4 of Title 2 of
    the Education Code, and other relevant information, including reports
    completed by other agencies.
    (2) A copy of the parent's consent obtained as provided in
    paragraph (2) of subdivision (b).
    (3) A summary of the emotional or behavioral characteristics of
    the pupil, including documentation that the pupil meets the criteria
    set forth in paragraphs (3) and (4) of subdivision (b).
    (4) A description of the counseling, psychological, and guidance
    services, and other interventions that have been provided to the
    pupil, as provided in the individualized education program of the
    pupil, including the initiation, duration, and frequency of these
    services, or an explanation of the reasons a service was considered
    for the pupil and determined to be inadequate or inappropriate to
    meet his or her educational needs.
    (d) Based on preliminary results of assessments performed pursuant
    to Section 56320 of the Education Code, a local educational agency
    may refer a pupil who has been determined to be, or is suspected of
    being, an individual with exceptional needs, and is suspected of
    needing mental health services, to a community mental health service
    if a pupil meets the criteria in paragraphs (1) and (2). Referral
    packages shall include all documentation required in subdivision (e)
    and shall be provided immediately to the community mental health
    service.
    (1) The pupil meets the criteria in paragraphs (2) to (4),
    inclusive, of subdivision (b).
    (2) Counseling and guidance services, psychological services,
    parent counseling and training, social work services, and behavioral
    or other interventions as provided in the individualized education
    program of the pupil are clearly inadequate or inappropriate in
    meeting his or her educational needs.
    (e) If referring a pupil to a community mental health service in
    accordance with subdivision (d), the local educational agency shall
    provide the following documentation:
    (1) Results of preliminary assessments to the extent they are
    available and other relevant information including reports completed
    by other agencies.
    (2) A copy of the parent's consent obtained as provided in
    paragraph (2) of subdivision (b).
    (3) A summary of the emotional or behavioral characteristics of
    the pupil, including documentation that the pupil meets the criteria
    in paragraphs (3) and (4) of subdivision (b).
    (4) Documentation that appropriate related educational and
    designated instruction and services have been provided in accordance
    with Sections 300.34 and 300.39 of Title 34 of the Code of Federal
    Regulations.
    (5) An explanation of the reasons that counseling and guidance
    services, psychological services, parent counseling and training,
    social work services, and behavioral or other interventions as
    provided in the individualized education program of the pupil are
    clearly inadequate or inappropriate in meeting his or her educational
    needs.
    (f) The procedures set forth in this chapter are not designed for
    use in responding to psychiatric emergencies or other situations
    requiring immediate response. In these situations, a parent may seek
    services from other public programs or private providers, as
    appropriate. This subdivision does not change the identification and
    referral responsibilities imposed on local educational agencies under
    Article 1 (commencing with Section 56300) of Chapter 4 of Part 30 of
    Division 4 of Title 2 of the Education Code.
    (g) Referrals shall be made to the community mental health service
    in the county in which the pupil lives. If the pupil has been placed
    into residential care from another county, the community mental
    health service receiving the referral shall forward the referral
    immediately to the community mental health service of the county of
    origin, which shall have fiscal and programmatic responsibility for
    providing or arranging for the provision of necessary services. The
    procedures described in this subdivision shall not delay or impede
    the referral and assessment process.
    (h) A county mental health agency does not have fiscal or legal
    responsibility for costs it incurs prior to the approval of an
    individualized education program, except for costs associated with
    conducting a mental health assessment.
    (i) This section shall become inoperative on July 1, 2011, and, as
    of January 1, 2012, is repealed, unless a later enacted statute,
    that becomes operative on or before January 1, 2012, deletes or
    extends the dates on which it becomes inoperative and is repealed.
    SEC. 36. Section 7576.2 of the Government Code is amended to read:

    7576.2. (a) The Director of the State Department of Mental Health
    is responsible for monitoring county mental health agencies to
    ensure compliance with the requirement to provide mental health
    services to disabled pupils pursuant to this chapter and to ensure
    that funds provided for this purpose are appropriately utilized.
    (b) The Director of the State Department of Mental Health shall
    submit a report to the Legislature by April 1, 2005, that includes
    the following:
    (1) A description of the data that is currently collected by the
    State Department of Mental Health related to pupils served and
    services provided pursuant to this chapter.
    (2) A description of the existing monitoring process used by the
    State Department of Mental Health to ensure that county mental health
    agencies are complying with this chapter.
    (3) Recommendations on the manner in which to strengthen and
    improve monitoring by the State Department of Mental Health of the
    compliance by a county mental health agency with the requirements of
    this chapter, on the manner in which to strengthen and improve
    collaboration and coordination with the State Department of Education
    in monitoring and data collection activities, and on the additional
    data needed related to this chapter.
    (c) The Director of the State Department of Mental Health shall
    collaborate with the Superintendent of Public Instruction in
    preparing the report required pursuant to subdivision (b) and shall
    convene at least one meeting of appropriate stakeholders and
    organizations, including a representative from the State Department
    of Education, to obtain input on existing data collection and
    monitoring processes, and on ways to strengthen and improve the data
    collected and monitoring performed.
    (d) This section shall become inoperative on July 1, 2011, and, as
    of January 1, 2012, is repealed, unless a later enacted statute,
    that becomes operative on or before January 1, 2012, deletes or
    extends the dates on which it becomes inoperative and is repealed.
    SEC. 37. Section 7576.3 of the Government Code is amended to read:

    7576.3. (a) It is the intent of the Legislature that the Director
    of the State Department of Mental Health collaborate with an entity
    with expertise in children's mental health to collect, analyze, and
    disseminate best practices for delivering mental health services to
    disabled pupils. The best practices may include, but are not limited
    to:
    (1) Interagency agreements in urban, suburban, and rural areas
    that result in clear identification of responsibilities between local
    educational agencies and county mental health agencies and result in
    efficient and effective delivery of services to pupils.
    (2) Procedures for developing and amending individualized
    education programs that include mental health services that provide
    flexibility to educational and mental health agencies and protect the
    interests of children in obtaining needed mental health needs.
    (3) Procedures for creating ongoing communication between the
    classroom teacher of the pupil and the mental health professional who
    is directing the mental health program for the pupil.
    (b) This section shall become inoperative on July 1, 2011, and, as
    of January 1, 2012, is repealed, unless a later enacted statute,
    that becomes operative on or before January 1, 2012, deletes or
    extends the dates on which it becomes inoperative and is repealed.
    SEC. 38. Section 7576.5 of the Government Code is amended to read:

    7576.5. (a) If funds are appropriated to local educational
    agencies to support the costs of providing services pursuant to this
    chapter, the local educational agencies shall transfer those funds to
    the community mental health services that provide services pursuant
    to this chapter in order to reduce the local costs of providing these
    services. These funds shall be used exclusively for programs
    operated under this chapter and are offsetting revenues in any
    reimbursable mandate claim relating to special education programs and
    services.
    (b) This section shall become inoperative on July 1, 2011, and, as
    of January 1, 2012, is repealed, unless a later enacted statute,
    that becomes operative on or before January 1, 2012, deletes or
    extends the dates on which it becomes inoperative and is repealed.
    SEC. 39. Section 7582 of the Government Code is amended to read:
    7582. Assessments and therapy treatment services provided under
    programs of the State Department of Health Care Services, or its
    designated local agencies, rendered to a child referred by a local
    education agency for an assessment or a disabled child or youth with
    an individualized education program, shall be exempt from financial
    eligibility standards and family repayment requirements for these
    services when rendered pursuant to this chapter.
    SEC. 40. Section 7585 of the Government Code is amended to read:
    7585. (a) Whenever a department or local agency designated by
    that department fails to provide a related service or designated
    instruction and service required pursuant to Section 7575, and
    specified in the pupil's individualized education program, the
    parent, adult pupil, if applicable, or a local educational agency
    referred to in this chapter, shall submit a written notification of
    the failure to provide the service to the Superintendent of Public
    Instruction or the Secretary of California Health and Human Services.

    (b) When either the Superintendent or the secretary receives a
    written notification of the failure to provide a service as specified
    in subdivision (a), a copy shall immediately be transmitted to the
    other party. The Superintendent, or his or her designee, and the
    secretary, or his or her designee, shall meet to resolve the issue
    within 15 calendar days of receipt of the notification. A written
    copy of the meeting resolution shall be mailed to the parent, the
    local educational agency, and affected departments, within 10 days of
    the meeting.
    (c) If the issue cannot be resolved within 15 calendar days to the
    satisfaction of the Superintendent and the secretary, they shall
    jointly submit the issue in writing to the Director of the Office of
    Administrative Hearings, or his or her designee, in the Department of
    General Services.
    (d) The Director of the Office of Administrative Hearings, or his
    or her designee, shall review the issue and submit his or her
    findings in the case to the Superintendent and the secretary within
    30 calendar days of receipt of the case. The decision of the
    director, or his or her designee, shall be binding on the departments
    and their designated agencies who are parties to the dispute.
    (e) If the meeting, conducted pursuant to subdivision (b), fails
    to resolve the issue to the satisfaction of the parent or local
    educational agency, either party may appeal to the director, whose
    decision shall be the final administrative determination and binding
    on all parties.
    (f) Whenever notification is filed pursuant to subdivision (a),
    the pupil affected by the dispute shall be provided with the
    appropriate related service or designated instruction and service
    pending resolution of the dispute, if the pupil had been receiving
    the service. The Superintendent and the secretary shall ensure that
    funds are available for the provision of the service pending
    resolution of the issue pursuant to subdivision (e).
    (g) This section does not prevent a parent or adult pupil from
    filing for a due process hearing under Section 7586.
    (h) The contract between the State Department of Education and the
    Office of Administrative Hearings for conducting due process
    hearings shall include payment for services rendered by the Office of
    Administrative Hearings which are required by this section.
    SEC. 41. Section 7586.5 of the Government Code is amended to read:

    7586.5. (a) Not later than January 1, 1988, the Superintendent of
    Public Instruction and the Secretary of the Health and Human
    Services Agency jointly shall submit to the Legislature and the
    Governor a report on the implementation of this chapter. The report
    shall include, but not be limited to, information regarding the
    number of complaints and due process hearings resulting from this
    chapter.
    (b) This section shall become inoperative on July 1, 2011, and, as
    of January 1, 2012, is repealed, unless a later enacted statute,
    that becomes operative on or before January 1, 2012, deletes or
    extends the dates on which it becomes inoperative and is repealed.
    SEC. 42. Section 7586.6 of the Government Code is amended to read:

    7586.6. (a) The Superintendent of Public Instruction and the
    Secretary of the Health and Human Services Agency shall ensure that
    the State Department of Education and the State Department of Mental
    Health enter into an interagency agreement by January 1, 1998. It is
    the intent of the Legislature that the agreement include, but not be
    limited to, procedures for ongoing joint training, technical
    assistance for state and local personnel responsible for implementing
    this chapter, protocols for monitoring service delivery, and a
    system for compiling data on program operations.
    (b) It is the intent of the Legislature that the designated local
    agencies of the State Department of Education and the State
    Department of Mental Health update their interagency agreements for
    services specified in this chapter at the earliest possible time. It
    is the intent of the Legislature that the state and local interagency
    agreements be updated at least every three years or earlier as
    necessary.
    (c) This section shall become inoperative on July 1, 2011, and, as
    of January 1, 2012, is repealed, unless a later enacted statute,
    that becomes operative on or before January 1, 2012, deletes or
    extends the dates on which it becomes inoperative and is repealed.
    SEC. 43. Section 7586.7 of the Government Code is amended to read:

    7586.7. (a) The Superintendent of Public Instruction and the
    Secretary of the Health and Human Services Agency jointly shall
    prepare and implement within existing resources a plan for in-service
    training of state and local personnel responsible for implementing
    the provisions of this chapter.
    (b) This section shall become inoperative on July 1, 2011, and, as
    of January 1, 2012, is repealed, unless a later enacted statute,
    that becomes operative on or before January 1, 2012, deletes or
    extends the dates on which it becomes inoperative and is repealed.
    SEC. 44. Section 7588 of the Government Code is repealed.
    SEC. 45. Section 12440.1 of the Government Code is amended to
    read:
    12440.1. (a) The trustees, in conjunction with the Controller,
    shall implement a process that allows any campus or other unit of the
    university to make payments of obligations of the university from
    its revolving fund directly to all of its vendors. Notwithstanding
    Article 5 (commencing with Section 16400) of Chapter 2 of Part 2 of
    Division 4 of Title 2, or any other law, the trustees may draw from
    funds appropriated to the university, for use as a revolving fund,
    amounts necessary to make payments of obligations of the university
    directly to vendors. In any fiscal year, the trustees shall obtain
    the approval of the Director of Finance to draw amounts in excess of
    10 percent of the total appropriation to the university for that
    fiscal year for use as a revolving fund.

    (b) Notwithstanding Sections 925.6, 12410, and 16403, or any
    other law, the trustees shall maintain payment records for three
    years and make those records available to the Controller for
    postaudit review, as needed.
    (c) (1) Notwithstanding Section 8546.4 or any other law, the
    trustees shall contract with one or more public accounting firms to
    conduct a systemwide annual financial statement audit in accordance
    with generally accepted accounting principles (GAAP), as well as
    other required compliance audits without obtaining the approval of
    any other state officer or entity.
    (2) The statement of net assets, statement of revenues, expenses,
    changes in net assets, and statement of cashflows of each campus
    shall be included as an addendum to the annual systemwide audit.
    Summary information on transactions with auxiliary organizations for
    each campus shall also be included in the addendum. Any additional
    information necessary shall be provided upon request.
    (d) The internal and independent financial statement audits of the
    trustees shall test compliance with procurement procedures and the
    integrity of the payments made. The results of these audits shall be
    included in the biennial report required by Section 13405.
    (e) As used in this section:
    (1) "Trustees" means the Trustees of the California State
    University.
    (2) "University" means the California State University.
    SEC. 46. Section 17581.5 of the Government Code is amended to
    read:
    17581.5. (a) A school district or community college district
    shall not be required to implement or give effect to the statutes, or
    a portion of the statutes, identified in subdivision (c) during any
    fiscal year and for the period immediately following that fiscal year
    for which the Budget Act has not been enacted for the subsequent
    fiscal year if all of the following apply:
    (1) The statute or a portion of the statute, has been determined
    by the Legislature, the commission, or any court to mandate a new
    program or higher level of service requiring reimbursement of school
    districts or community college districts pursuant to Section 6 of
    Article XIII B of the California Constitution.
    (2) The statute, or a portion of the statute, or the test claim
    number utilized by the commission, specifically has been identified
    by the Legislature in the Budget Act for the fiscal year as being one
    for which reimbursement is not provided for that fiscal year. For
    purposes of this paragraph, a mandate shall be considered
    specifically to have been identified by the Legislature only if it
    has been included within the schedule of reimbursable mandates shown
    in the Budget Act and it specifically is identified in the language
    of a provision of the item providing the appropriation for mandate
    reimbursements.
    (b) Within 30 days after enactment of the Budget Act, the
    Department of Finance shall notify school districts of any statute or
    executive order, or portion thereof, for which reimbursement is not
    provided for the fiscal year pursuant to this section.
    (c) This section applies only to the following mandates:
    (1) School Bus Safety I (CSM-4433) and II (97-TC-22) (Chapter 642
    of the Statutes of 1992; Chapter 831 of the Statutes of 1994; and
    Chapter 739 of the Statutes of 1997).
    (2) County Treasury Withdrawals (96-365-03; and Chapter 784 of the
    Statutes of 1995 and Chapter 156 of the Statutes of 1996).
    (3) Grand Jury Proceedings (98-TC-27; and Chapter 1170 of the
    Statutes of 1996, Chapter 443 of the Statutes of 1997, and Chapter
    230 of the Statutes of 1998).
    (4) Law Enforcement Sexual Harassment Training (97-TC-07; and
    Chapter 126 of the Statutes of 1993).
    (5) Health Benefits for Survivors of Peace Officers and
    Firefighters (Chapter 1120 of the Statutes of 1996 and 97-TC-25).
    (d) This section applies to the following mandates for the
    2010-11, 2011-12, and 2012-13 fiscal years only:
    (1) Removal of Chemicals (Chapter 1107 of the Statutes of 1984 and
    CSM 4211 and 4298).
    (2) Scoliosis Screening (Chapter 1347 of the Statutes of 1980 and
    CSM 4195).
    (3) Pupil Residency Verification and Appeals (Chapter 309 of the
    Statutes of 1995 and 96-384-01).
    (4) Integrated Waste Management (Chapter 1116 of the Statutes of
    1992 and 00-TC-07).
    (5) Law Enforcement Jurisdiction Agreements (Chapter 284 of the
    Statutes of 1998 and 98-TC-20).
    (6) Physical Education Reports (Chapter 640 of the Statutes of
    1997 and 98-TC-08).
    (7) 98.01.042.390-Sexual Assault Response Procedures (Chapter 423
    of the Statutes of 1990 and 99-TC-12).
    (8) 98.01.059.389-Student Records (Chapter 593 of the Statutes of
    1989 and 02-TC-34).
    SEC. 47. Section 5651 of the Welfare and Institutions Code is
    amended to read:
    5651. The proposed annual county mental health services
    performance contract shall include all of the following:
    (a) The following assurances:
    (1) That the county is in compliance with the expenditure
    requirements of Section 17608.05.
    (2) That the county shall provide services to persons receiving
    involuntary treatment as required by Part 1 (commencing with Section
    5000) and Part 1.5 (commencing with Section 5585).
    (3) That the county shall comply with all requirements necessary
    for Medi-Cal reimbursement for mental health treatment services and
    case management programs provided to Medi-Cal eligible individuals,
    including, but not limited to, the provisions set forth in Chapter 3
    (commencing with Section 5700), and that the county shall submit cost
    reports and other data to the department in the form and manner
    determined by the department.
    (4) That the local mental health advisory board has reviewed and
    approved procedures ensuring citizen and professional involvement at
    all stages of the planning process pursuant to Section 5604.2.
    (5) That the county shall comply with all provisions and
    requirements in law pertaining to patient rights.
    (6) That the county shall comply with all requirements in federal
    law and regulation pertaining to federally funded mental health
    programs.
    (7) That the county shall provide all data and information set
    forth in Sections 5610 and 5664.
    (8) That the county, if it elects to provide the services
    described in Chapter 2.5 (commencing with Section 5670), shall comply
    with guidelines established for program initiatives outlined in that
    chapter.
    (9) Assurances that the county shall comply with all applicable
    laws and regulations for all services delivered.
    (b) The county's proposed agreement with the department for state
    hospital usage as required by Chapter 4 (commencing with Section
    4330) of Part 2 of Division 4.
    (c) Any contractual requirements needed for any program
    initiatives utilized by the county contained within this part. In
    addition, any county may choose to include contract provisions for
    other state directed mental health managed programs within this
    performance contract.
    (d) Other information determined to be necessary by the director,
    to the extent this requirement does not substantially increase county
    costs.
    SEC. 48. Section 5701.3 of the Welfare and Institutions Code is
    amended to read:
    5701.3. (a) Consistent with the annual Budget Act, this chapter
    shall not affect the responsibility of the state to fund
    psychotherapy and other mental health services required by Chapter
    26.5 (commencing with Section 7570) of Division 7 of Title 1 of the
    Government Code, and the state shall reimburse counties for all
    allowable costs incurred by counties in providing services pursuant
    to that chapter. The reimbursement provided pursuant to this section
    for purposes of Chapter 26.5 (commencing with Section 7570) of
    Division 7 of Title 1 of the Government Code shall be provided by the
    state through an appropriation included in either the annual Budget
    Act or other statute. Counties shall continue to receive
    reimbursement from specifically appropriated funds for costs
    necessarily incurred in providing psychotherapy and other mental
    health services in accordance with this chapter. For reimbursement
    claims for services delivered in the 2001-02 fiscal year and
    thereafter, counties are not required to provide any share of those
    costs or to fund the cost of any part of these services with money
    received from the Local Revenue Fund established by Chapter 6
    (commencing with Section 17600) of Part 5 of Division 9.
    (b) This section shall become inoperative on July 1, 2011, and, as
    of January 1, 2012, is repealed, unless a later enacted statute,
    that becomes operative on or before January 1, 2012, deletes or
    extends the dates on which it becomes inoperative and is repealed.
    SEC. 49. Section 5701.6 of the Welfare and Institutions Code is
    amended to read:
    5701.6. (a) Counties may utilize money received from the Local
    Revenue Fund established by Chapter 6 (commencing with Section 17600)
    of Part 5 of Division 9 to fund the costs of any part of those
    services provided pursuant to Chapter 26.5 (commencing with Section
    7570) of Division 7 of Title 1 of the Government Code. If money from
    the Local Revenue Fund is used by counties for those services,
    counties are eligible for reimbursement from the state for all
    allowable costs to fund assessments, psychotherapy, and other mental
    health services allowable pursuant to Section 300.24 of Title 34 of
    the Code of Federal Regulations and required by Chapter 26.5
    (commencing with Section 7570) of Division 7 of Title 1 of the
    Government Code.
    (b) This section is declaratory of existing law.
    (c) This section shall become inoperative on July 1, 2011, and, as
    of January 1, 2012, is repealed, unless a later enacted statute,
    that becomes operative on or before January 1, 2012, deletes or
    extends the dates on which it becomes inoperative and is repealed.
    SEC. 50. Section 11323.2 of the Welfare and Institutions Code is
    amended to read:
    11323.2. (a) Necessary supportive services shall be available to
    every participant in order to participate in the program activity to
    which he or she is assigned or to accept employment or the
    participant shall have good cause for not participating under
    subdivision (f) of Section 11320.3. As provided in the
    welfare-to-work plan entered into between the county and participant
    pursuant to this article, supportive services shall include all of
    the following:
    (1) Child care.
    (A) Paid child care shall be available to every participant with a
    dependent child in the assistance unit who needs paid child care if
    the child is 10 years of age or under, or requires child care or
    supervision due to a physical, mental, or developmental disability or
    other similar condition as verified by the county welfare
    department, or who is under court supervision.
    (B) To the extent funds are available paid child care shall be
    available to a participant with a dependent child in the assistance
    unit who needs paid child care if the child is 11 or 12 years of age.

    (C) Necessary child care services shall be available to every
    former recipient for up to two years, pursuant to Article 15.5
    (commencing with Section 8350) of Chapter 2 of Part 6 of Division 1
    of Title 1 of the Education Code.
    (D) A child in foster care receiving benefits under Title IV-E of
    the federal Social Security Act (42 U.S.C. Sec. 670 et seq.) or a
    child who would become a dependent child except for the receipt of
    federal Supplemental Security Income benefits pursuant to Title XVI
    of the federal Social Security Act (42 U.S.C. Sec. 1381 et seq.)
    shall be deemed to be a dependent child for the purposes of this
    paragraph.
    (E) The provision of care and payment rates under this paragraph
    shall be governed by Article 15.5 (commencing with Section 8350) of
    Chapter 2 of Part 6 of Division 1 of Title 1 of the Education Code.
    Parent fees shall be governed by subdivisions (g) and (h) of Section
    8263 of the Education Code.
    (2) Transportation costs, which shall be governed by regional
    market rates as determined in accordance with regulations established
    by the department.
    (3) Ancillary expenses, which shall include the cost of books,
    tools, clothing specifically required for the job, fees, and other
    necessary costs.
    (4) Personal counseling. A participant who has personal or family
    problems that would affect the outcome of the welfare-to-work plan
    entered into pursuant to this article shall, to the extent available,
    receive necessary counseling or therapy to help him or her and his
    or her family adjust to his or her job or training assignment.
    (b) If provided in a county plan, the county may continue to
    provide case management and supportive services under this section to
    former participants who become employed. The county may provide
    these services for up to the first 12 months of employment to the
    extent they are not available from other sources and are needed for
    the individual to retain the employment.
    SEC. 51. Section 18356.1 is added to the Welfare and Institutions
    Code, to read:
    18356.1. This chapter shall become inoperative on July 1, 2011,
    and, as of January 1, 2012, is repealed, unless a later enacted
    statute, that becomes operative on or before January 1, 2012, deletes
    or extends the dates on which it becomes inoperative and is
    repealed.
    SEC. 52. Notwithstanding the rulemaking provisions of the
    Administrative Procedure Act (Chapter 3.5 (commencing with Section
    11340) of Part 1 of Division 3 of Title 2 of the Government Code),
    the State Department of Social Services or the State Department of
    Education may implement Section 4, Sections 7 to 11, inclusive, and
    Section 50 of this act, through all-county letters, management
    bulletins, or other similar instructions.
    SEC. 53. Notwithstanding any other law, the implementation of
    Section 4, Sections 7 to 11, inclusive, and Section 50 of this act is
    not subject to the appeal and resolution procedures for agencies
    that contract with the State Department of Education for the
    provision of child care services or the due process requirements
    afforded to families that are denied services specified in Chapter 19
    (commencing with Section 18000) of Division 1 of Title 5 of the
    California Code of Regulations.
    SEC. 54. It is the intent of the Legislature that funding provided
    in provisions 18 and 26 of Item 6110-161-0001 and provision 9 of
    Item 6110-161-0890 of Section 2.00 of the Budget Act of 2011 for
    educationally related mental health services, including out-of-home
    residential services for emotionally disturbed pupils, required by
    the federal Individuals with Disabilities Education Act (20 U.S.C.
    Sec. 1400 et seq.) shall be exclusively available for these services
    only for the 2011-12 and 2012-13 fiscal years.
    SEC. 55. (a) It is the intent of the Legislature that the State
    Department of Education and the appropriate departments within the
    California Health and Human Services Agency modify or repeal
    regulations that are no longer supported by statute due to the
    amendments in Sections 24 to 26, inclusive, Section 32 to 44,
    inclusive, Sections 47 to 49, inclusive, and Section 51 of this act.
    (b) The State Department of Education and the appropriate
    departments within the California Health and Human Services Agency
    shall review regulations to ensure the appropriate implementation of
    educationally related mental health services required by the federal
    Individuals with Disabilities Education Act (20 U.S.C. Sec. 1400 et
    seq.) and Sections 24 to 26, inclusive, Section 32 to 44, inclusive,
    Sections 47 to 49, inclusive, and Section 51 of this act.
    (c) The State Department of Education and the appropriate
    departments within the California Health and Human Services Agency
    may adopt regulations to implement Sections 24 to 26, inclusive,
    Section 32 to 44, inclusive, Sections 47 to 49, inclusive, and
    Section 51 of this act. The adoption, amendment, repeal, or
    readoption of a regulation authorized by this section is deemed to
    address an emergency, for purposes of Sections 11346.1 and 11349.6 of
    the Government Code, and the State Department of Education and the
    appropriate departments within the California Health and Human
    Services Agency are hereby exempted, for this purpose, from the
    requirements of subdivision (b) of Section 11346.1 of the Government
    Code. For purposes of subdivision (e) of Section 11346.1 of the
    Government Code, the 180-day period, as applicable to the effective
    period of an emergency regulatory action and submission of specified
    materials to the Office of Administrative Law, is hereby extended to
    one year.
    SEC. 56. If the Commission on State Mandates determines that this
    act contains costs mandated by the state, reimbursement to local
    agencies and school districts for those costs shall be made pursuant
    to Part 7 (commencing with Section 17500) of Division 4 of Title 2 of
    the Government Code.
    SEC. 57. There is hereby appropriated one thousand dollars
    ($1,000) from the General Fund to the State Department of Education
    for purposes of funding the award grants pursuant to Section 49550.3
    of the Education Code to school districts, county superintendents of
    schools, or entities approved by the department for nonrecurring
    expenses incurred in initiating or expanding a school breakfast
    program or a summer food service program.
    SEC. 58. This act is a bill providing for appropriations related
    to the Budget Bill within the meaning of subdivision (e) of Section
    12 of Article IV of the California Constitution, has been identified
    as related to the budget in the Budget Bill, and shall take effect
    immediately.



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