BILL ANALYSIS AB 552 Page 1 Date of Hearing: March 31, 2009 ASSEMBLY COMMITTEE ON HIGHER EDUCATION Anthony Portantino, Chair AB 552 (Furutani) - As Introduced: February 25, 2009 SUBJECT : California Community Colleges: career technical and vocational education: financing. SUMMARY : Establishes the Commission on Adequate Funding for Career Technical and Vocational Education at the California Community Colleges (Commission), funded through private funds, comprised of specified members with specified powers and duties. Specifically, this bill : 1)Finds and declares that the existing financing structure for California Community Colleges (CCC) creates a disincentive to develop or continue career technical education (CTE), vocational education, and high-cost laboratory programs, and that the Commission will help provide recommendations on financing alternatives. 2)Provides that the Commission shall be composed of nine voting members with three members appointed by the Governor, three members appointed by the Senate Committee on Rules, and three members appointed by the Speaker of the Assembly; and each appointing entity shall include a CCC professor, a CCC administrator, and a representative of a local workforce investment board. 3)Provides that the Commission shall also include ex officio, nonvoting members representing the Legislative Analyst's Office, the Department of Finance, the California Workforce Investment Board, the Office of the Chancellor of the California Community Colleges (CCCCO), including the Chair of the Senate Committee on Rules or a member of that Committee appointed by that Committee, and the Chair of the Assembly Committee on Higher Education or a member of that Committee appointed by the Speaker of the Assembly. 4)Provides that the Commission shall elect a chair and vice chair among the members; the term of the chair, vice chair and all members shall be for the duration of the Commission; five members of the Commission shall constitute a quorum at any meeting for transacting business, but a lesser number may AB 552 Page 2 conduct hearings; members of the Commission shall serve without compensation but may be reimbursed for travel, subsistence, and other necessary expenses to the extent that funds are available. 5)Provides that state funds shall not be available to the Commission, except that private donations collected may be expended upon Legislative appropriation, to reimburse members for expenses and other purposes of the Commission. 6)Requires the Commission to gather facts and conduct a study regarding financing alternatives for CTE, vocational education, and high-cost laboratory programs at the CCC, for the purpose of making recommendations to the Governor and the Legislature in a written report to be submitted on or before July 1, 2011. 7)Provides that the Commission shall hold public meetings and hearings, may authorize a subcommittee to hold hearings, and may request the attendance and testimony of a witness and the production of records, correspondence, and documents that the Commission, any subcommittee of the Commission, or any member of the Commission deems necessary. 8)Provides that, subject to the approval of the Department of Finance, the Commission may solicit, and the Director of Finance may accept on behalf of the Commission, gifts, donations, and other financial support from private entities for the purposes of carrying out the duties of the Commission, and that private entities may deposit gifts, donations, and other financial support with the state for the purposes of this chapter. EXISTING LAW: 1)Establishes an allocation mechanism for CCC that generally provides a single rate per full-time equivalent students (FTES) for all CCC districts, with exceptions. 2)Establishes the CCC Economic Workforce Development Program to advance economic growth and global competitiveness through work with employers, advisory committees, and agency partners to identify workforce education and training needs and to assist CCCs in establishing educational programs that meet those needs. AB 552 Page 3 FISCAL EFFECT : Unknown COMMENTS : Purpose of this bill : The author believes that "CTE programs are central to California's economic vitality and without a mechanism that allows for adequate funding of CTE programs, the vitality of these programs is extremely dubious." The author believes that the Commission of policy experts and practitioners can provide the Legislature with an independent report of options and policy considerations that address the funding of high-cost CTE programs at CCC. The author notes that the current funding formula for FTES, set forth by SB 361 (Scott), Chapter 631, Statutes of 2006, simplified the funding mechanism for CCC primarily by reducing the number of workload measures and by establishing standard revenue allocations per FTES for instruction. The author believes that, while the simplification provides a stable environment for CCCs to plan and administer programs, it significantly disadvantages CTE programs because they generally have limitations on enrollment and greater facilities, materials, and equipment costs; as a result, if CCCs were to make decisions about which programs to offer based solely on the projected net revenues they would generate, the choice clearly would be to offer general education rather than CTE programs. CTE program funding : As noted above, the state funds CCC through FTES, and the funding rate does generally not differ between general education and CTE courses. However, in recent years the state and federal government have appropriated funding to CCC to specifically support the continuation and development of CTE programs, including: 1)SB 70 (Scott), Chapter 352, Statutes of 2005, allocated $20 million each year in 2005-06 and 2006-07 for the support of CTE programs at middle schools, high schools, regional occupational centers and programs, and CCCs. 2)SB 1133 (Torlakson), Chapter 751, Statutes of 2006, allocated $32 million in 2007-08 and $38 million annually from 2008-09 to 2013-14 to expand CTE in middle schools and high schools by hiring additional faculty to expand CTE program offerings. 3)The federal Carl D. Perkins Career and Technical Education Act of 2006 (Perkins Act) provides California approximately $140 million annually to develop and implement programs to expand, AB 552 Page 4 promote, and integrate academic and CTE programs and link secondary and postsecondary education. 4)Tech Prep, funded through the Perkins Act, will provide approximately $8.9 million for CCC to expand CTE programs in 2008-09. Other states funding mechanisms for CTE : Los Angeles Trade Technical College indicates that other states such as Kansas, Mississippi, Arkansas, Nebraska, Pennsylvania, Massachusetts, and Texas use various models of financing high cost CTE courses in both high schools and colleges. According to information complied by the Education Commission of the States, funding formulas vary from state to state. Some states have separate funding for CTE programs, while others have made no separate provisions. Seven states report enhanced FTES funding for CTE students, including Arizona, which provides up to 1.75 FTES (an additional 75% above a general education student), Kansas, which provides 1.5 FTES, and Florida, which provides 1.3 FTES for each student who completes the CTE program. REGISTERED SUPPORT / OPPOSITION : Support American Federation of State, County and Municipal Employees California Federation of Teachers California Teachers Association Opposition None on file Analysis Prepared by : Laura Metune / HIGHER ED. / (916) 319-3960