Staying roughly equivalent with inflation, state funding for K-12 education increased by 24.2 percent between 2020–21 and 2025–26 hitting record highs in recent years, according to the Public Policy Institute of California’s (PPIC) October fact sheet “Financing California’s Public Schools.”
Local, state and federal funding in 2025–26 totaled $142.8 billion — down from $144.2 billion the year prior. Since the COVID-19 pandemic, the federal government has accounted for 5 to 6 percent of funding after historic one-time investments during the period.
The state contributes around 55 to 60 percent of K-12 funding and has since the early 1990s, while the local share hovers around 33 percent. Proposition 98, funded by state’s General Fund and revenue from property taxes, sets a constitutionally guaranteed funding minimum and is the most prominent source with $104 billion going toward K-12 education in 2025–26.
“Another $11 billion in non–Proposition 98 state funding was allocated through other General Fund and special fund dollars, and the state lottery,” PPIC notes.
Ballot initiatives and court decisions “shape how California funds its schools,” the fact sheet said.
Additionally, the fact sheet explains that per pupil spending in California is higher than the national average.
“In 2023–24 (the most recent school year for which we have nationally comparable data), spending per pupil on current operations (e.g., staff and materials) was $22,321 (in 2026 dollars), roughly $3,500 more than the average in the rest of the nation, which was $18,864 per pupil,” according to the fact sheet. “Compared to other populous states, California spent less per pupil than Illinois and far less than New York, which was the top-spending state nationwide ($33,779). California spent about $5,100 more than Georgia, $7,300 more than Florida, and $8,200 more than Texas.”
California’s Local Control Funding Formula (LCFF), which has been in place for more than a decade, gives local educational agencies additional money based on their shares of students from high-need groups, including low-income and English learner (EL) students as well as foster youth.
“LCFF sets a funding target for each district; the state funds what is not met by local revenue. About 15 percent of districts are ‘basic aid’: they exceed the target and retain the extra local funds,” according to the fact sheet.
In 2024–25, districts spent roughly $23,200 per pupil. Spending was the highest to for low-income, EL, Black and Latino learners.
“Evidence shows that additional funding for high-need groups improved test scores, though funding was not always well-targeted to the highest-need students and schools,” PPIC said.
Areas of concern
In spite of record levels of funding, fiscal challenges remain with continued declining enrollment projected. “However, due to the Proposition 98 guarantee, declining enrollment may also lead to higher funding per student statewide,” the fact sheet clarifies.
With most spending used on staffing, increasing personnel costs such as benefits and health coverage can “have an outsized fiscal impact.”
Higher chronic absenteeism since the pandemic has also had an impact as funding is based on average daily attendance.
The fact sheet also explains how more funding allocated outside of the funding formula is set with more restrictions or reporting requirements — like Proposition 28 funding for arts and music — targets resources in a more deliberate manner but limits LEAs’ flexibility.
Read the fact sheet to learn more.
