Synopsis of the Legislative Budget Subcommittees Examine Governor’s Spending Plan for Community Colleges

On April 18 and 20, the Assembly and Senate Budget Subcommittees, respectively, convened on the Governor’s proposed spending plan for California Community Colleges. Neither subcommittee took formal votes on any issues, deferring those until after the May Revise when the State has a clearer understanding of its fiscal condition.?

Here were some of the key takeaways from the hearings:

1. The State’s revenue picture is in flux, with a strong likelihood that April tax collections will fall below January’s projections. As such, the State may be unable to meet its spending priorities, particularly outside of TK and K-14 Proposition 98 programs. Providing a COLA for base apportionment and a limited number of categorical programs remains a top priority for the Administration, although in what form and amount remains to be seen.
2. Regaining student enrollment is another priority, with positive feedback from legislators on the testimony of Interim Chancellor Daisy Gonzalez, who explained how student numbers are beginning to rebound. That said, there has yet to be a consensus among legislators or the Administration on continuing this trend. The Administration maintains that repurposing Deferred Maintenance funds for enrollment is the best approach, although legislators of either party do not necessarily share that sentiment. Some legislators commended the League’s proposal for keeping those funds in Deferred Maintenance while allowing districts the flexibility to use a limited portion of them for enrollment.
3. State financial support for student housing—so promising last year—is now dividing legislators and the Administration as they struggle to contend with reduced revenues. The Administration’s plan to postpone consideration of $250 million in additional support until 2024-25 was predictably opposed by advocates for districts and students, but even that represents only one level of complexity in this arena. Decisions on how to allocate funds between the segments and whether grants or revolving loans are the best way forward will undoubtedly require significant discussion following the May Revise.
4. While the recent audit on the dedicated funds for full-time faculty had the potential to create significant tension in the hearings, its impact was relatively light. Legislators in both Houses referred to it with the Chancellor’s Office emphasizing its commitment to diversifying the faculty ranks. Like many other items in the budget, the diminishing availability of funds, at least in the short run, has the practical effect of limiting this discussion.
5. The complexity of the Student-Centered Funding Formula (SCFF) and its disparate impact on districts was certainly referenced but by no means the focal point of either hearing. Unless things dramatically change with the May Revise, this is not a major point of discussion for this budget season.

On April 26, the California Senate?released its budget blueprint, which rejects both the Administration’s proposed delay in student housing money and repurposing of Deferred Maintenance for Enrollment while providing the California Community Colleges with a total of $100 million in new ongoing funds for local discretionary purposes on activities that directly support students, mitigate learning loss related to COVID-19 impacts, and promote targeted recruitment and retention efforts across the State. In light of the State’s deteriorating fiscal condition, the Governor immediately rejected the Senate’s approach and will unveil a modified version of his January budget in May.?

Even with the economic climate, the League continues to promote Stability, Predictability, and Flexibility as the best prescription for community colleges. Since the Administration has already signaled an interest in streamlined reporting for categoricals (for districts meeting their goals under the Governor’s Roadmap), we will likely see greater discussion of budgetary flexibility for districts in the May Revise.?

Right now, the only certainty is that grassroots advocacy by districts through CEOs, College Presidents, Trustees, Students, Administrators, Staff, and Faculty is critical. The more legislators hear about the local impact of statewide proposals, the greater the likelihood that the final budget will reflect the priorities of our institutions.?

The subcommittees will soon be wrapping up their pre-May Revise hearings, which are more informational, and be gearing up for the post-May Revise process when actual votes are cast. Continue to follow the League’s electronic and social media for updates on the budget process.?