What is LCFF?

The Local Control Funding Formula (LCFF) replaces California's nearly half-century-old, state-controlled school finance system with one that promises more local control as well as greater transparency and fairness.

Under the old system, school districts received approximately two-thirds of their revenues as general-purpose funding based on complex historical formulas (known as "revenue limit" funds), and about one-third through nearly four dozen highly regulated "categorical programs," such as for summer school, textbooks, staff development, gifted and talented students, and counselors for middle and high schools.

Under the new system, districts will receive a uniform base grant for every district, adjusted by grade level, plus additional funds for students with greater educational needs, defined as low-income, English learner and foster youth students. Districts will get an additional 20 percent of the base grant based on the numbers of these students enrolled in a district, and even more when they make up more than 55 percent of a district's enrollment.

Districts will have broad discretion over how to use the base grants. The funding law says that districts must expand or improve services for high-needs students in proportion to the additional funding that these students bring to the district. 

School districts have more authority to decide how to spend their money. But they also face new obligations to show that their spending improved student performance. Districts must adopt a Local Control and Accountability Plan (LCAP), after soliciting suggestions from teachers, parents and the community, and update it annually.

The plan must spell out the district's goals for improving student outcomes according to eight priorities set by the state, and align spending to meet the goals. Districts that fail to meet their goals and improve student outcomes will receive assistance from county offices of education and through a new agency, the California Collaborative for Educational Excellence. Districts that are persistently failing could be subject to state intervention or even a state takeover.