Novato Unified School District

SCHOOL FINANCE TERMINOLOGY

The following information was obtained from:

Average Daily Attendance (ADA)
The total number of days of student attendance divided by the total number of days in the regular school year. A student attending every day would equal one ADA. ADA is not the same as enrollment, which is the number of students enrolled in each school and district. (This number is determined by counting students on a given day in October.) ADA usually is lower than enrollment due to factors such as students moving, dropping out, or staying home due to illness. The state uses a school district’s ADA to determine its general purpose (revenue limit) and some other funding.

Block Grant
An allotment of money that is the sum of multiple special-purpose funds combined into one. A block grant tends to have fewer restrictions on how the money is spent than the original, disparate funding streams had; and it often combines funds that have similar purposes.

Building Fund
A fund that districts must use only for buildings. The money comes from sources such as bonds and the sale/rental of property.

Cafeteria Fund
A separate fund used by many districts to track the income and expenses related to food service.

Cost-of-Living Adjustment (COLA)
An increase in funding for schools from the state or federal government due to inflation. In California, the law states that schools should receive a certain COLA based on the Implicit Price Deflator for State and Local Government Purchases of Goods and Services.

Deferred Maintenance
Major repairs or replacement of buildings and equipment. Declines in school funding over a number of years led many districts to delay preventive maintenance expenses in order to maintain education programs. As a result, some school facilities were left in a state of disrepair. The state provides some money to match local districts’ funds for deferred maintenance. If districts develop a maintenance plan and set aside up to one-half of 1% of their general fund for deferred maintenance, the state matches that money. The money must go into a separate accounting fund.

Developer Fees
A charge per square foot on residential and commercial construction within a school district. These fees, charged both to developers of new properties and to property owners who remodel, are based on the premise that new construction will lead to additional students. Individual school districts decide whether to levy the fees and at what rate up to the maximum allowed by law. The maximum, adjusted for inflation every two years, is higher for residential than for commercial construction. Districts are required to substantiate the financial impact of new development and show that they have used the revenues to address that impact. Proceeds may be used for building or renovating schools and for portable classrooms.

General Fund
Accounting term used by local educational agencies to differentiate general revenues and expenditures from those placed in separate funds for specific uses, such as a Cafeteria Fund. The General Fund is used to account for the ordinary operations of a local educational agency. All transactions except those required or permitted by law to be in another fund are accounted for in the General Fund.

Revenue Limit
The specific combination of state and local property taxes a school district may receive per pupil (ADA) for its general education program. Categorical aid is granted in addition to revenue limit income.