Prop 28 brought a new wave of arts and music funding to California schools but with it comes one big question many administrators are asking:
“What happens to Prop 28 funds if we don’t spend them right away?”
Whether you’re a district business officer, arts coordinator, or school site leader, understanding what’s allowed when rolling over funds (and what isn’t) is critical to staying compliant and protecting your school’s allocation.
This guide breaks down exactly how the carryover rules work, what documentation districts need to maintain, and when to spend before the window closes.
Prop 28 Funding Basics: The Spending Window
Each year, the California Department of Education (CDE) allocates Prop 28 funds to Local Educational Agencies (LEAs) — districts, charters, and county offices of education.
Spending Timeline
- LEAs have up to three fiscal years to spend each annual allocation.
- After that period, unspent funds may revert back to the state or trigger audit findings.
- The “clock” starts when the funds are received, not when they’re assigned to a school site.
Example:
If your district received its first allocation in FY 2023–24, you have until the end of FY 2025–26 to fully expend those funds.
Rolling Over Funds: What’s Allowed
Rolling over Prop 28 funds is permitted within the three-year spending window as long as your district:
- Maintains clear accounting records showing funds remain designated for arts and music programs.
- Keeps documentation of expenditure plans showing intent to use funds for eligible purposes.
- Uses the funds to supplement—not replace—existing arts budgets.
- Aligns spending with the 80/20 rule — at least 80% for staffing, up to 20% for training, materials, or partnerships.
Common and compliant rollover uses include:
- Saving funds to hire a full-time arts instructor in the following school year.
- Delaying purchase of instruments or equipment until procurement cycles align.
- Expanding existing programs once staffing becomes available.
- Partnering with external vendors while waiting for credentialed hires.
Tip: The CDE expects that rollover decisions are intentional, strategic, and documented — not due to oversight or delay.
What’s Not Allowed
While carryover flexibility exists, certain practices can jeopardize compliance or future allocations:
- Using Prop 28 funds to cover general operating expenses (e.g., utilities, admin salaries, or classroom materials not tied to arts).
- Shifting funds between schools without maintaining the site-level allocation logic provided by the CDE.
- Allowing funds to sit unused without a board-approved expenditure plan or evidence of planned use.
- Supplanting existing district arts budgets or reassigning funds after the three-year window.
If funds are left unspent or misused after three fiscal years, they can be subject to state audit and reversion, which may affect future Prop 28 allocations to the LEA.
Documentation Districts Should Maintain
To remain audit-ready, LEAs should keep:
- Board-approved expenditure plans showing Prop 28 use by fiscal year.
- Site-level accounting records for each school’s allocation.
- Staffing and payroll documentation verifying certificated or classified arts positions.
- Vendor contracts and invoices for any external partnerships.
- Evidence of board presentations or reports confirming oversight.
How School Sites Can Plan Ahead
School administrators can play a proactive role in ensuring rollover funds are used wisely:
- Schedule mid-year budget reviews to track unspent balances.
- Identify supply or program needs early to avoid fiscal-year crunches.
- Collaborate with district business offices to confirm planned carryovers are documented.
- If hiring challenges persist, apply for a Prop 28 waiver early and partner with compliant vendors like After School Music Academy to deliver instruction in the meantime.
Partnering for Smart Prop 28 Planning
After School Music Academy partners with California districts to ensure Prop 28 and ELOP funds are used strategically and compliantly.
Our turnkey programs help schools:
- Deliver arts and music instruction even when staffing shortages occur.
- Utilize rollover funds effectively before expiration.
- Maintain documentation and compliance alignment with CDE guidelines.
We work alongside district administrators and site teams to ensure no Prop 28 dollar goes unused and every student benefits from high-quality, creative instruction.
Learn more about partnering with After School Music Academy
FAQ: Rolling Over Prop 28 Funds
Q: Can Prop 28 funds roll over from year to year?
A: Yes. Districts can roll over unspent Prop 28 funds for up to three fiscal years, as long as funds are properly documented, designated for arts education, and used within compliance guidelines.
Q: What happens if we don’t spend our Prop 28 funds within three years?
A: Funds that remain unspent after three fiscal years are subject to reversion to the state and may appear in audit findings. Districts should plan expenditures and document their timeline of use.
Q: Can we save Prop 28 funds to hire staff next year?
A: Yes. Districts may strategically roll over funds to hire full-time or part-time arts instructors in the following school year, especially if recruitment or scheduling challenges delayed hiring.
Q: Can we use rollover funds for vendors or external arts partners?
A: Yes, within the 20% allowable category, Prop 28 funds may be used for partnerships, materials, or training.
If staffing shortages persist, districts can also apply for the Prop 28 waiver to partner with external arts providers like After School Music Academy.
Q: How can we make sure our Prop 28 rollover plan stays compliant?
A: Maintain board-approved expenditure plans, keep documentation of site allocations, and regularly review spending progress. Working with an experienced vendor like After School Music Academy can also help your district track compliance and utilization across sites.