Do Most of Our Taxes Really Go to Our Schools?

Recently the City of Coronado published an informational flyer that showed 48% of a property owner’s taxes going toward public schools. The flyer specifically showed 32% going toward the Coronado Unified School District. While this is technically true, you should know that those funds actually go to our state government in Sacramento. Our state government then sends an equal share of all taxes to all school districts in the state who qualify for equalization money. Our school district in Coronado is one of those districts who receive equalized funding from this shared pot of money. Only a few districts in San Diego County, called Basic Aid districts, receive the full share of property taxes from their community. Basic Aid districts in San Diego County include the school districts of Del Mar Union, Rancho Santa Fe, Solana Beach, Cardiff, Encinitas Union, San Dieguito Union High, and Carlsbad Unified. Most people think their local taxes constitute the lion’s share of public school district funding. This has not been the case for more than 30 years. California’s current public- school finance structure has transformed from a mostly local system to a state system over the past three decades, beginning with a series of landmark court decisions dating back to the 1970s. The court decision, called Serrano v. Priest, determined that general-purpose revenue differences among school districts cannot be based on local property wealth. While the state legislature largely determines how revenue is allocated, the annual amount of K–12 education revenue is mostly determined by a constitutional minimum-funding guarantee established in 1988 by Proposition 98. This funding guarantee is highly dependent upon economic conditions and is calculated differently depending on whether the economy is strengthening, maintaining, or weakening from one year to the next. Both state and local general-purpose revenue-limit funding and state special-purpose earmark categorical funding are included in the Proposition 98 minimum-funding guarantee. General-purpose revenue makes up approximately two-thirds of a typical California school district’s total revenue. Each year, the state determines the amount of general-purpose, or revenue limit, funding school districts will receive based on historical formulas from the early 1970s. Revenue-limit income is a combination of local property taxes and state aid. For most school districts, state aid is reduced if property taxes increase, which is exactly what happens in Coronado. General-purpose revenue-limit funding is supposed to be comparable for all California school districts. In contrast, the remaining third of a typical district’s funding is special purpose categorical revenue, which is based on numerous formulas. By its very nature, special-purpose funding for categorical programs will differ across districts depending on the types and numbers of programs offered and enrollment in those programs. While our District receives additional funding because of the military presence, we receive very little other funding because of our demographic profile.