San Miguel Joint Union School District v. Ross

Opinion

EVANS, Acting P. J.

Plaintiff, San Miguel Joint Union School District (District), is considered an impacted District qualified for federal

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aid pursuant to Public Law No. 81-874 (64 Stat. 1100 [Sept. 30, 1950]); this as a result of the significant number of students attending classes who are children of parents who live or work on federally owned land not subject to local property taxation.

The federal aid granted is unrestricted and may be used by the District for any educationally related purpose.

In May 1978, the District received in excess of $18,000 in federal impact aid. The funds received were deposited in the District’s general fund; they were not in any way restricted, separately identified, or reserved, nor were they required to be so.

Prior to the 1978-1979 fiscal year, California had a comprehensive scheme of school aid known as the “Foundation Program.” (See former Ed. Code, § 17300 et seq., now § 14000 et seq.) A revision of that method of school aid was made necessary by the passage of article XIII A, section 4 to the California Constitution (Prop. 13 on the June 6, 1978, ballot commonly known as the Jarvis-Gann initiative) which placed limitation on the taxing power of local agencies. Upon its passage the state responded to that need by enacting school financing “bail out” legislation (Stats. 1978, chs. 292 and 332).

Chapter 332 established a “revenue limit” which was essentially the sum required for operation of the educational programs of the local schools. In order to determine the amount of state aid to be given the local schools, the revenue limit was required to be adjusted by certain enumerated factors. At issue in this proceeding is the factor requiring the reduction of the revenue limit by one-third of the District’s general fund and special reserve fund balances to the extent that they were unreserved, unrestricted, and exceeded $50,000 or 5 percent of the District’s total revenue.

Although the revenue limit formula did not expressly require reduction of state aid by all or a portion of federal impact aid received by the District, the resulting reduction in this instance accomplished that end.