This chapter shall remain in effect only until July 1, 1990, and as of that date is repealed, unless Senate Constitutional Amendment No. 1 is ratified by the voters at the statewide election to be held on June 5, 1990.

(Added by Stats. 1989, Ch. 82, Sec. 8. Effective June 30, 1989. See same-numbered section in the prevailing Chapter 2 added by Stats. 1989, Ch. 83. Note: Repeal condition failed; SCA 1 was adopted June 5, 1990, as Prop. 111.)

(a) Notwithstanding Section 41206, by January 1, 2006, the Superintendent of Public Instruction and the Director of Finance shall jointly determine the outstanding balance of the minimum funding obligation to school districts and community college districts pursuant to § 8 of Article XVI of the California Constitution for the 1995-96 to 2003-04 fiscal years, inclusive. The Director of Finance shall notify the Governor and Legislature of the amount of the outstanding balance for each fiscal year between the 1995-96 and 2003-04 fiscal years, inclusive, and the total amount of the outstanding balance for those years. This notification does not constitute a certification for purposes of Section 41206.

(b) If the joint determination required pursuant to subdivision (a) is not made for any fiscal year by January 1, 2006, the Controller shall make the determination for that fiscal year or years and shall notify the Governor and Legislature of that determination on or before March 1, 2006. This notification does not constitute a certification for purposes of Section 41206.

(c) For purposes of this section, the outstanding balance of the minimum funding obligation to school districts and community college districts pursuant to § 8 of Article XVI of the California Constitution for a fiscal year is the amount, if any, by which the amount required to be applied by the state for the support of school districts and community college districts pursuant to § 8 of Article XVI of the California Constitution, including any maintenance factor that should have been allocated in that fiscal year pursuant to subdivision (e) of Section 8 of Article XVI, exceeds the amount applied by the state for the support of school districts and community college districts for that fiscal year.

(d) Commencing with the 2006-07 fiscal year, the sum of one hundred fifty million dollars ($150,000,000) is hereby annually appropriated from the General Fund to the Controller for allocation to school districts and community college districts for the purpose of discharging in full the outstanding balance of the minimum funding obligation to school districts and community college districts pursuant to § 8 of Article XVI of the California Constitution identified in subdivision (a) or (b) of this section. This annual appropriation shall continue until the Director of Finance reports to the Legislature that the sum of appropriations made and allocated pursuant to this subdivision equals the total outstanding balance of the minimum funding obligation to school districts and community college districts pursuant to § 8 of Article XVI of the California Constitution determined pursuant to subdivision (a) or (b), as applicable.

(1) The amount annually appropriated pursuant to this subdivision shall be allocated to school districts and community college districts in a manner that reflects the proportion of regular average daily attendance in school districts, as defined in subdivision (a) of Section 41209, to funded full-time equivalent students in community college districts, as those numbers are reported at the time of the second principal apportionment for the fiscal year prior to the fiscal year in which funds are to be received.

(2) The Controller shall allocate funds annually appropriated pursuant to this subdivision to school districts and community college districts based on attendance information provided by the department and Chancellor of the California Community Colleges on August 15 of each year commencing with the 2006-07 fiscal year, unless otherwise provided by the Legislature pursuant to subdivision (g). For purposes of this subdivision a school district includes a county office of education and a charter school.

(e) For purposes of § 8 of Article XVI of the California Constitution, the amounts appropriated and allocated pursuant to this section shall be applied to the outstanding balance of the minimum funding obligation to school districts and community college districts pursuant to § 8 of Article XVI of the California Constitution for the 1995-96 to 2003-04 fiscal years, inclusive, in chronological order beginning with the 1995-96 fiscal year and shall be deemed to be appropriations made and allocated in the fiscal year in which the deficiencies resulting in the outstanding balance were incurred. When the amount determined to be owed for each fiscal year pursuant to subdivision (a) or (b) is fully appropriated and allocated pursuant to subdivision (d), the data used in the computations made under subdivision (a) or (b) and the total amount owed by the state for the support of school districts and community college districts pursuant to § 8 of Article XVI of the California Constitution for that fiscal year, including as much of the maintenance factor for that fiscal year determined pursuant to subdivision (d) of Section 8 of Article XVI as has been allocated as required by subdivision (e) of Section 8 of Article XVI by virtue of the payments made under this section, shall be deemed certified for purposes of Section 41206.

(f) Funding received by school districts and community college districts pursuant to this section shall first be deemed to be paid in satisfaction of any outstanding claims pursuant to Section 6 of XIII B of the California Constitution for reimbursement of state-mandated local costs for any fiscal year. Notwithstanding any amounts that are deemed, pursuant to this subdivision, to be paid in satisfaction of outstanding claims for reimbursement of state-mandated local costs, the Controller may audit any claim as allowed by law and may reduce any amount owed by a local educational agency pursuant to an audit by reducing amounts owed for any other mandate claims. The Controller shall apply amounts received by each school district or community college district against any balances of unpaid claims for reimbursement of state-mandated local costs and interest in chronological order beginning with the earliest claim. The Controller shall report to each local educational agency the amounts of any claims and interest that are offset from funds provided pursuant to this section and shall report a summary of the amounts offset for each mandate for each fiscal year to the Department of Finance and the fiscal committees of the Legislature. The governing board of a school district or community college district may expend funds received pursuant to this section in excess of amounts offsetting mandate claims for any other one-time purposes, as determined by the governing board.

(g) The Legislature may specify in the annual Budget Act or other statute other one-time purposes for which the funds appropriated pursuant to this section shall be used so long as those appropriations are made for allocation to school districts or community college districts.

(Repealed (as added by Stats. 1989, Ch. 83) and added by Stats. 2004, Ch. 216, Sec. 6. Effective August 11, 2004.)