Tuesday, January 10, 2017

Today, Governor Brown released his 2017-18 state budget proposal – a budget urging focus and restraint.  In recognition of the potential to enhance advising, curricular alignment, and meaningful and timely assessment the Governor dedicates substantial resources to Guided Pathways.

Governor Brown's investment in Guided Pathways is an important and necessary catalyst for a systemic and integrated redesign of the student experience at California's community colleges. Guided Pathways resources will enhance and deepen the impact of SSSP and Equity programs and services for our public community colleges and the League applauds the Governor for this investment.

Economic Context:
The January budget proposal reflects initial signs of an economic slowdown coupled with uncertainty about federally-funded programs. Governor Brown’s budget reflects concern with appropriating one-time funds for ongoing purposes, and emphasizes that the current spending trajectory will lead to a state budget deficit.

Proposition 98 and Community Colleges:
California’s economic flattening has resulted in adjustments to Proposition 98, reducing the guarantee by $900 million for the combined 2015-16 and 2016-17 budget years. The total Proposition 98 K-14 guarantee for 2017-18 is $73.5 billion.

For community colleges, the Governor’s 2017-18 proposal provides over $400 million in Proposition 98 resources – of which approximately $220 million are in one-time funds.  The clear message intended for colleges is that these one-time resources present an opportunity for strategic improvement in curriculum development, planning, and other measures to strengthen program outcomes.

The Governor’s budget summary is available here. Below is a chart illustrating the major augmentations in the proposed budget for community colleges:

Item                                2016-17 Enacted Augmentations 2017-18 System Budget Request 2017-18 Governor's January Proposal
Ongoing Funds
Cost of Living Adjustment (COLA) 0% 1% $94.1 M (1.48%)
Enrollment Growth 2% 2% $79.3 M (1.34%)
Base Augmentation $75 M $200 M $23.6 M
Student Success and Support Program (SSSP) No Augmentation No Augmentation No Augmentation
SSSP - Equity No Augmentation No Augmentation No Augmentation
Workforce & CTE Pathways $248 M No Augmentation No Augmentation
Basic Skills $30M $25M No Augmentation
Full-Time Student Success Grants $2.2 M No Augmentation $3.1 M
COLA for EOPS, DSPS, Cal Works, Childcare Tax Bailout 0% 1% $5.4 M (1.48%)
Online Education Initiative No Augmentation $10 M $10 M
One-Time Funds
Guided Pathways     $150 M
Integrated Library Systems   $6 M $6 M
Deferred Maintenance & Instructional Equipment   $184.5M $43.7 M
Prop 39 Clean Energy Job Creation Fund      $52.3 M
Innovation Awards   $25M $20 M

Areas of Concern:
The League has identified some critical areas of concern within the 2017-18 budget proposal: a departure from the Proposition 98 statutory split, an inadequate investment in operating funds to maintain quality programs, capital outlay projects, and Cal Grants.

Proposition 98 Statutory Split – The 2017-18 budget departs from the statutory Proposition 98 split of 10.93 percent and proposes a split of 10.87 percent for California Community Colleges. The difference translates into about $43 million of revenue community colleges should receive. The decision to suspend the guaranteed split of Proposition 98 funds will further widen the gap in community college per-student spending in comparison to the state’s other two public postsecondary education sectors. The League will urge Governor Brown to continue its longstanding support for community colleges and provide the statutory split.

General Operating Resources – The 2017-18 budget proposes $23.6 million to fund general operating expenses. General operating funds ensure that our colleges can continue to offer a quality education. Base funds are essential to maintaining for faculty and staff talent, converting part-time professors to full-time faculty, paying for healthcare and pensions, and covering  other operating costs. Further investment in general operating funds will be a primary focus of League advocacy.

Bond and Capital Outlay – In 2016, California voters approved a facilities bond providing a $2 billion infrastructure investment in California’s community colleges. The proposed budget only funds five of 29 ready-to-go capital projects for total of $7.4 million of the $29.2 billion in facilities needs as identified in the Five-Year Capital Outlay Plan.

Cal Grants – The 2017-18 Budget proposes to phase-out the Middle Class Scholarship, a $74 million program. Further, the budget does nothing to reform Cal Grants to better serve community college students.  The budget continues to distribute less then 10% of Cal Grant resources to California community college students despite the fact that our students comprise two-thirds of the higher education population.  We are urging Governor Brown and members of the Legislature to ensure that saving from the Middle Class Scholarship program remain invested in financial aid.

We look forward to working with Governor Brown, members and staff of the Legislature, and representatives from the Department of Finance in the weeks ahead to discuss further the opportunities presented by the 2017-18 budget proposal.

In the next week the League will forward an email analysis from Lizette Navarette with more details on specific proposals.  You can also follow budget updates on the League’s Legislative Updates or attend the budget discussion at the 2017 Legislative Conference, January 29-30, 2017.