SACRAMENTO, Calif. (CN) - Education is a high-risk issue in California, according to a new audit identifying failures from the state's $42 billion expenditure on education in the 2011-12 fiscal year.
Despite spending nearly half of the General Fund on education, California spends less money per student in grades kindergarten through 12th than comparable states, the new report released by California State Auditor Elaine Howle Tuesday states.
California also has a lower high school graduation rate and a higher high school dropout rate than the national median.
Howle found that recent changes in the state's plans to educate the more than 6 million K-12 students and 2 million public college students have created problems. A new funding approach - the local control funding formula - is supposed to simplify how local education agencies are funded and give them more control over how they spend those funds.
"The state intends to invest $25 billion in new funding to fully implement the funding formula by fiscal year 2020-21, but reaching that level of funding will require significant and sustained growth in the State's revenues," Howle wrote.
Additionally, performance assessments of the local education agencies (LEAs) under the new funding formula will not occur until late 2015.
Howle also found that the new common core state standards changing the way teachers educate their students will pose considerable challenges.
"Although proponents believe common core promises to better prepare K-12 students for college and the workforce, its implementation poses significant challenges including the need for professional development for teachers; changes to curriculum, instructional materials, and student assessments; and increased investments in technology. Implementing common core is costly: in fiscal year 2013-a14 the State committed $1.25 billion to help LEAs offset their costs, but LEAs will certainly incur additional costs," Howle wrote.
Los Angeles Unified School District has already decided to boost common core implementation with a $1 billion investment in technology upgrades.
Howle also noted that California plans to suspend current tests for the 2013-14 academic year as it transitions to common core and determines the validity of new tests. This may affect the state's ability to satisfy federal requirements, however, as the U.S. Department of Education has already informed California that noncompliance could cause the state to lose certain federal funding that provided the state with $3.5 billion in the 2012-13 fiscal year.
California's public universities are also facing challenges. Gov. Jerry Brown has proposed increasing funding for the University of California and California State University if they freeze current tuition levels, agree to meet certain performance measures, and maintain current enrollment levels.
The UC and CSU systems are unsure, however, if they can freeze tuition levels, and are trying to come to a resolution with the California Department of Finance for future funding.
"After years of uncertain funding, the University of California (UC) and the California State University (CSU) systems continue to seek a stable and predictable funding stream," Howle wrote.
California residents seeking to attend a public university may also face some difficulties, as the UC and CSU systems have curbed enrollment growth, and increased costs of attending the universities may preclude some residents from attending, according to the audit.
The report also found that the California Community College system has increased class sizes and cut courses and programs, affecting students' ability to complete their education in a reasonable amount of time.
"Our assessment of current education issues has led the California State Auditor to add California's education system to the list of high-risk issues," the report states. "Providing a quality and cost-effective education to the more than 8 million students in public schools and universities is vital to the economic future of California."