BILL ANALYSIS                                                                                                                    



                                                                  AB 552
                                                                  Page  1

          Date of Hearing:   April 22, 2009

                        ASSEMBLY COMMITTEE ON APPROPRIATIONS
                                Kevin De Leon, Chair

                AB 552 (Furutani) - As Introduced:  February 25, 2009 

          Policy Committee:                              Higher  
          EducationVote:7-0

          Urgency:     No                   State Mandated Local Program:  
          No     Reimbursable:              

           SUMMARY
           
          This bill: 

          1)Establishes a privately-funded, nine-member commission to  
            conduct a study regarding financing alternatives for career  
            technical education (CTE), vocational education, and high-cost  
            laboratory programs in the community colleges.

          2)Requires the commission to make recommendations to the  
            Legislature and governor regarding the financing alternatives  
            by July 1, 2011.

           FISCAL EFFECT  

          One-time costs of about $150,000 for 1.5 positions to staff the  
          commission and complete the required report and for commission  
          expenses related to travel and per diem. The bill specifies the  
          commission is to be funded from non-state sources.

           COMMENTS  

           Purpose  .  The state funds the community colleges through a  
          funding formula based primarily on an allocation per full-time  
          equivalent student (FTES).  This formula, which was simplified  
          by SB 362 (Scott)/Chapter 631 of 2006, generally does not differ  
          between general education and CTE courses.  The author believes  
          that, while the simplification provides a stable environment for  
          the colleges to plan and administer programs, it may  
          disadvantage CTE programs, which generally have a higher  
          per-FTES cost due to enrollment limitations and greater  
          facilities, materials, and equipment costs.  As a result, the  








                                                                  AB 552
                                                                  Page  2

          author is concerned that, if community colleges were to make  
          decisions about programs offering based solely on net revenues,  
          they would clearly choose to offer general education courses  
          rather than CTE programs.  

          The author believes a commission of policy experts and  
          practitioners can provide the Legislature with an independent  
          report of options and policy considerations to address the  
          funding of high-cost community college programs.  

           Analysis Prepared by  :    Chuck Nicol / APPR. / (916) 319-2081