First, it limits the amount each school district can spend on administrative costs. Second, it establishes new performance budgeting requirements. Limit on Administrative Costs. The proposition requires each school district, beginning in 1999-00, to limit certain administrative costs to 5 percent of all funds received. These funds include all federal, state, and local support.
Some expenses are easy to classify according to the proposition's definitions.
For example, the salaries of classroom teachers would always be considered a direct service, and school board and superintendent expenses would be considered administrative costs. Other expenses are harder to classify. For instance, printing and duplication expenses would be considered an administrative cost if a district duplicates or prints materials for a school site at a central location. However, if the same materials were duplicated or printed at a school site, the expense would be considered a direct service. This measure also requires each school district, beginning in 1998-99, to link its annual budget to specific outcome objectives related to improving student performance.