California districts have new funding opportunities on the table for the 2026-27 school year. With that opportunity comes an important question: How can your district put those dollars to work?
AB 126 is a wide-ranging education budget trailer bill that covers everything from special education and professional development to student services and inclusive practices. You don’t need to understand every section to recognize the opportunities it creates for your teams.
Let’s break down what funding is available, where those dollars can support your district’s priorities, and what to consider as you plan your next steps.
What is AB 126?
AB 126 is legislation that puts many of the education investments and policy changes in California’s 2026–27 state budget into effect.
For special education leaders, the biggest headline is a significant increase in ongoing funding.
According to the Governor’s office, California increased K–12 special education funding by $2.4 billion, a 43% increase over the 2025 Budget Act.
For 2026–27, the legislation establishes a special education base rate of $1,340 per unit of average daily attendance (ADA) for each Special Education Local Plan Area (SELPA). Beginning in 2027–28, that rate will be adjusted annually for inflation.
Because special education funding is allocated through the SELPA structure and distributed according to local plans, what the increase means for an individual district can vary. Your SELPA and district business office can help you understand how the new funding translates locally.
And special education funding is only part of the story.
What this could mean for your district
An opportunity to invest in more consistent special education instruction, strengthen progress monitoring, expand educator training, and improve how teams support students across schools.
An opportunity to invest in more consistent special education instruction, strengthen progress monitoring, expand educator training, and improve how teams support students across schools.
More than $5 billion for student support and professional development
The Student Support and Professional Development Discretionary Block Grant gives eligible local educational agencies considerable flexibility to address local priorities.
AB 126 established significant new funding for the block grant, and subsequent 2026 budget actions brought total 2026–27 funding to just over $5 billion¹.
Unlike a competitive grant, eligible districts don’t have to apply for the funding. Allocations are based on ADA, and funds are available for expenditure through June 30, 2032.
The state identifies potential uses ranging from professional development, educator recruitment, student support systems, and other district priorities permitted under the funding guidelines. Those examples aren’t an exhaustive list. The California Department of Education notes that LEAs are encouraged, but not required, to use the funding for the purposes specifically identified in the law.
For special education and student services leaders, that flexibility is worth paying attention to. It creates an opportunity to bring your teams’ needs into broader district conversations about where these resources could have the greatest impact.
$30 million to strengthen inclusive practices
AB 126 also provides a one-time $30 million increase for the Supporting Inclusive Practices project, which is administered through the Riverside and El Dorado County Offices of Education.
The investment is intended to help schools and educators strengthen evidence-based practices and expand opportunities for students with disabilities to participate meaningfully in general education settings.
For districts already working toward more consistent inclusive practices across schools and classrooms, this is another opportunity to strengthen what’s already working and address the gaps that remain.
Additional investments in student services and educator capacity
Supporting students and educators takes a comprehensive approach. AB 126 extends beyond these major funding areas with opportunities to invest in behavior, mental health, and other crucial supports.
The legislation includes additional investments related to students experiencing homelessness, educator preparation and workforce development, literacy and learning recovery, transition, and inclusive postsecondary opportunities for students with disabilities.
Not every program works the same way. Some funding flows directly to eligible LEAs, special education funding operates through the SELPA structure, and other investments support targeted programs, grants, or technical assistance.
The important takeaway is that districts have several new or expanded opportunities to consider, not one pot of money with one set of rules.
How to put AB 126 funding to work
You don’t need to become an expert in California school finance to get started. You do need to bring the needs you see every day into the right conversations.
1. Find out what’s available to your district
Start with your district business office to understand your block grant allocation and other applicable funding.
For special education, talk with your SELPA about how the increased base funding affects the resources available locally.
2. Start with your needs, not the funding
Before deciding where new dollars should go, identify the areas where additional resources could make the greatest difference.
Where are educators experiencing friction? Where is implementation inconsistent? Where could students benefit from stronger systems?
That could include IEP implementation, inclusive practices, behavior supports, professional learning, transition planning, staff capacity, or another district priority.
3. Bring the right people into the conversation
Funding decisions don’t have to happen in a silo.
Depending on the opportunity, special education, student services, curriculum and instruction, district leadership, your business office, and your SELPA may all have a role.
Bringing those perspectives together can help districts identify investments that address shared challenges instead of creating another isolated initiative.
4. Look for investments that last
The special education base-rate increase is ongoing and inflation-adjusted beginning in 2027–28. The Student Support and Professional Development Discretionary Block Grant, meanwhile, remains available for expenditure through June 30, 2032.
That gives districts an opportunity to look beyond immediate gaps and consider where investments could strengthen systems, build educator capacity, and create more consistent practices over time.
Turn California’s new funding into lasting impact
The AB 126 legislation is complex. Finding the opportunities within it doesn’t have to be. Start by understanding what’s available, then look at the priorities in front of your teams. Where can additional resources strengthen your systems and build capacity?
RethinkEd can help you explore how available funding aligns with your district’s goals across special education, professional learning, behavior, wellness, and student support.
Source
1: Student Support and Professional Development Grant – Professional Learning (CA Dept of Education).” Ca.Gov, 2025, www.cde.ca.gov/ci/pl/sspdgrant.asp. Accessed 30 Oct. 2026.
