Section 42240.

For the 1988–89 fiscal year, the Superintendent of Public Instruction shall do the following:

(a) Using the latest available data as of July 1, 1987, identify each school district that meets all of the following criteria:

(1) Has a second principal apportionment average daily attendance of fewer than 2,501 for the prior fiscal year.

(2) Has approved home-to-school transportation costs in excess of 3 percent of its general fund total expense of education in the prior fiscal year.

(b) For each school district identified pursuant to subdivision (a), or that receives funding pursuant to Section 42240 or 42240.1 in the prior fiscal year, the superintendent shall make the following calculations:

(1) Subtract from the approved home-to-school transportation costs an amount equal to 3 percent of the general fund total expense of education exclusive of lottery revenues.

(2) Compare the amount determined in paragraph (1) to the amount the district received in the 1987–88 fiscal year pursuant to Sections 42240 and 42240.1.

(c) If the comparison results in an amount less than the amount received in the 1987–88 fiscal year, the superintendent shall use that amount, but in no case shall the superintendent use an amount less than 95 percent of the amount received in the 1987–88 fiscal year.

(d) The superintendent shall calculate the net savings from the comparison in subdivision (c).

(e) If the comparison results in an amount greater than the amount received in the 1987–88 fiscal year, the superintendent shall use the amount calculated as the sum of the following:

(1) The amount received in the 1987–88 fiscal year.

(2) The amount determined by allocating the net savings calculated in subdivision (d) on a pro rata basis to each district in proportion to the amount by which comparison results in an amount greater than the amount received in the 1987–88 fiscal year.

(f) The superintendent shall divide the amount determined pursuant to subdivision (c) or (e), whichever is appropriate, by the 1987–88 second principal apportionment average daily attendance.

(g) The amount determined by subdivision (f) may be added to the amount determined pursuant to subdivision (b) of Section 42238.

(h) The amount determined pursuant to subdivision (c) or (e), whichever is appropriate, may be added to the district's transportation allowance under Section 41850.

(i) Each school district eligible for funds may elect to have the funds allocated pursuant to either subdivision (g) or (h).

(j) The amounts added to subdivision (b) of Section 42238 pursuant to subdivision (g) and the amount added to Section 41850 by subdivision (h) shall be considered to be permanent adjustments to the base revenue limit or transportation allowance as appropriate.

(Repealed and added by Stats. 1988, Ch. 1601, Sec. 2.)