BILL ANALYSIS
AB 551
Page 1
ASSEMBLY THIRD READING
AB 551 (Furutani)
As Amended January 25, 2010
Majority vote
HIGHER EDUCATION 6-0 APPROPRIATIONS 12-0
-----------------------------------------------------------------
|Ayes:|Portantino, Conway, |Ayes:|De Leon, Ammiano, |
| |Block, Cook, Galgiani, | |Bradford, Charles |
| |Huber | |Calderon, Coto, Davis, |
| | | |Fuentes, Hall, John A. |
| | | |Perez, Skinner, Solorio, |
| | | |Torlakson |
|-----+--------------------------+-----+--------------------------|
| | | | |
-----------------------------------------------------------------
SUMMARY : Requires the Legislative Analyst's Office (LAO) to
calculate the amount of General Fund dollars and the amount of
property tax revenues allocated to the California Community
Colleges (CCC) for the 1989-90 through 2009-10 fiscal years and
to analyze whether General Fund dollars or property tax revenues
provide the most stable funding source for CCC.
FISCAL EFFECT : According to the Assembly Appropriations
Committee the fiscal impact of the LAO study is negligible.
COMMENTS : In developing the annual CCC budget, the state
estimates how much local property tax revenue will be available
to CCC. For any individual CCC district, General Fund revenues
will be adjusted upward or downward from the budgeted level to
compensate for any surplus or shortfall in actual tax receipts.
However, if the systemwide level of local property tax revenue
turns out to be lower than budgeted, this shortfall will be
proportionally spread across all CCC districts. In some years,
legislation has been passed to augment General Fund support to
CCCs in order to make up for this shortfall. In other years,
CCCs were required to absorb the shortfall. The author argues
that under the current CCC funding process, CCC relies heavily
on property tax revenue projections that are rarely accurate,
and the lack of an automatic adjustment mechanism when property
tax revenues fall short creates budget uncertainty that severely
cripples the ability of a CCC district to plan accordingly to
meet the educational needs of the community. This bill requires
AB 551
Page 2
the LAO to examine funding levels for CCC and analyze whether
General Fund dollars or property tax revenues provide the most
stable funding source for CCC.
Analysis Prepared by : Laura Metune / HIGHER ED. / (916)
319-3960
FN: 0003615