The little yellow school bus may soon be coming to the end of the road.

Budget cuts and increased fuel costs are combining to make it harder for school districts to provide bus service for students. And a new state proposal could render transportation funding as optional for school officials.

The plan also would reduce state school transportation spending by 20 percent, to $496 million.

The budgeting moves won't affect special education transportation funding.

State funding for transportation has lagged for years, with most districts receiving less than half of the funding needed from Sacramento to keep programs rolling, according to California Department of Education statistics.

"When you eliminate funding, everything's on the table," said Trent Allen, spokesman for Sacramento County's San Juan Unified School District. "… We're running out of general fund we can backfill with."

It could have been worse.

Gov. Arnold Schwarzenegger had initially proposed diverting $315 million from the K-12 school bus program in order to retire state transportation-related debt.

Now he seems to be on-board with the plan proposed by a bipartisan committee of legislators.

"We will see where this proposal ends up at the end of the day," said H.D. Palmer, spokesman for the California Department of Finance. "At this point the administration doesn't have any opposition."

Palmer says there shouldn't be concern about giving districts more flexibility in managing transportation funds. He said past experience with a more limited program has shown that more districts moved money into transportation than took it out.

"We expect to see the same pattern with this expanded flexibility," Palmer said.

School districts have struggled of late to balance budgets decimated by state budget cuts. And because only transportation for special education students is mandated, transportation for the general population is often considered for cuts.

Many districts already have reduced bus rides to and from school by increasing the distance students must walk before a bus is made available.

The future model for school busing could be found at the Elk Grove Unified School District, where transportation was slashed by more than half in 2005. About 3,800 students had to find alternative ways to get to school that year, according to school officials.

Busing is now offered only to special education students and students in the district's rural areas.

The transition saved the district $3 million annually and went quite smoothly, said Richard Odegaard, Elk Grove's associate superintendent.

"We had teams that went out and talked at school sites," he said. "We were pretty well prepared before it was implemented."

Odegaard said officials from the district and Elk Grove's transit system – e-tran – worked together to add routes and time buses to school-bell schedules, he said.

"We have quite a number of students that ride public transportation to school," Odegaard said.

It's uncertain how Elk Grove trustees would react to losing 20 percent of the $3.8 million in state funding the district receives. Elk Grove's transportation budget is $10.5 million.

"I don't know if we would take the cut in transportation or take it someplace else," Odegaard said.

School officials are concerned about cutting too much. They fear deeper reductions could mean fewer children attending school, translating into less money schools get for average daily attendance, or ADA.

"If we were to cut home-to-school transportation and we lost three-quarters of a percent of ADA, we would lose the value of cutting transportation," Odegaard said.

Sacramento City Unified isn't worried about average daily attendance as much as student safety, said Marcus Walton, district spokesman.

He said the district will use general fund money to fill the void left by state cuts.

Sacramento City Unified receives about half of its transportation money from the state.

"We have a responsibility to the health and safety of our students as they travel to and from school," Walton said.

Call The Bee's Diana Lambert, (916) 321-1090.