BILL ANALYSIS Ó SENATE COMMITTEE ON EDUCATION Alan Lowenthal, Chair 2011-2012 Regular Session BILL NO: AB 515 AUTHOR: Brownley AMENDED: RN 1122615 FISCAL COMM: Yes HEARING DATE: July 6, 2011 URGENCY: No CONSULTANT: Kathleen Chavira NOTE : This bill was previously heard by this Committee on June 29, 2011. No vote was taken. The author has proposed amendments to the bill. The revised analysis reflects these amendments. SUBJECT : Community College Extension Courses. SUMMARY This bill requires, until January 1, 2017, the Chancellor's Office of the California Community Colleges to establish a voluntary, pilot program for purposes of allowing eight community college campuses from eight different community college districts to establish and maintain an extension program offering credit courses at fee levels that cover the actual cost, as defined, of maintaining these courses. BACKGROUND Current law establishes the California Community Colleges as a part of public higher education. Current law establishes and differentiates the goals, missions and functions of California's public segments of higher education. (Education Code § 66010) Current law provides that the primary missions of the community colleges are to offer academic and vocational education at the lower division level for both recent high school graduates and those returning to school. Another primary mission is to advance California's economic growth and global competitiveness through education, training, and services that contribute to continuous workforce improvement. In addition current law provides that essential and important functions of the colleges include: AB 515 Page 2 basic skills instruction, providing English as a second language, adult noncredit instruction, and providing support services that help students to succeed at the postsecondary level. Community colleges are also authorized to provide community service courses and programs so long as their provision is compatible with an institution's ability to meet its obligations in its primary missions. To the extent funding is provided the colleges are authorized to conduct institutional research concerning student learning and retention as is needed to facilitate their educational missions. (EC § 66010.4) Current law requires the governing board of a local community college district to admit any California resident, (and authorizes them to admit any nonresident) possessing a high school diploma or the equivalent and authorizes the board to admit anyone who is capable of profiting from the instruction offered, as specified. (EC § 76000) Current law requires that community college students be charged a per unit fee and statutorily prescribes the fee level through the annual Budget process. Current law exempts the student enrolled in noncredit courses and in credit contract education courses, as specified, from these fee requirements. Current law also exempts from these requirements CSU and UC students enrolled in CCC remedial classes, as specified, and provides for the waiver of these fees for students who have financial need or meet other specified criteria. (EC §76300) ANALYSIS This bill requires, until January 1, 2017, the Chancellor's Office of the California Community Colleges to establish a voluntary, pilot program for purposes of allowing a community college district to establish and maintain an extension program offering credit courses. Selection of Pilot Participants 1) Authorizes any community college district to apply to be selected. 2) Limits participation to eight campuses from eight separate community college districts. AB 515 Page 3 3) Requires the Chancellor, in selecting the campuses, to: a) Consider all the following: i) Geographic, socio-economic, and demographic diversity. ii) Labor-Market Demand iii) The district's program and planning capacity b) Ensure that each of the campuses selected meet at least one of the following criteria: i) A campus with high transfer numbers ii) A campus with a successful core career technology education program iii) A campus with a high number of students currently utilizing the board of governor's fee waiver. iv) A campus with a low number of students currently utilizing the board of governors fee waiver v) Two rural campuses serving two separate geographical areas vi) A campus with high basic skills numbers vii) A campus of the Chancellor's choosing. 4) Prohibits the Chancellor from implementing the pilot program until the LAO certifies to the Chancellor, in writing, that at least six campuses meeting the criteria in #3 (above) also meet the following: a) An urban campus with a high board of AB 515 Page 4 governor's waiver population. b) An urban campus with a low board of governor's waiver population. c) Two campuses whose primary functions are transfer preparation. d) A campus whose primary function is career technical education. e) A campus that offers a significant number of basic skills courses. f) Two rural campuses that serve two different geographical areas. Requirements to be eligible to participate 5) Requires an applicant campus to meet the following requirements in order to be eligible for participation in the pilot program: a) Requires that the applicant campus either: i) meet its funding cap in the prior three academic years ii) Serve more students beyond its funding cap for the prior academic year, to be determined as specified. b) Meet transfer, basic skills, or career technical education objectives for all courses in the state-funded programs offered for credit. c) Not offer avocational courses for credit under the state funded program. d) Prioritize enrollment in the state funded programs as follows: i) Implement policies prioritizing enrollment for continuing students who are making satisfactory AB 515 Page 5 progress toward a basic skills, transfer or workforce development goal. ii) Prohibiting enrollment of students in classes for purposes of personal enrichment or avocational purposes. iii) Prioritizing enrollment of students who receive financial aid. iv) Prioritizing enrollment of California residents and other students who qualify for resident tuition. e) Prohibits a district from receiving a stability adjustment to apportionment funding. Extension Program Requirements 6) Outlines the following requirements to be met by a community college district in order to maintain the authorized extension program: a) Requires that a campus selected by the Chancellor agree to the following: i) That the Chancellor: (1) Review programs established. (2) Monitor compliance with these requirements. (3) Have authority to rescind the ability to participate if the Chancellor determines that the campus or district is out of compliance with these requirements. b) Requires the program to be self-supporting, and that all actual costs for the program be recovered, and defines actual costs to include costs of instruction, equipment supplies, student services and institutional AB 515 Page 6 support costs, and other costs incurred by the campus or the district pursuant to 76140. c) Requires districts to minimize the costs of administration to the greatest extent possible. d) Requires that enrollment be open to the public. e) Prohibits a governing board from expending any general fund moneys to establish and maintain these courses. f) Prohibits extension courses from being offered at times or in locations that supplant or limit offerings of state-supported programs, nor in conjunction with courses funded with state apportionments. g) Requires each participating campus to ensure that state and federal financial aid is available to eligible students. h) Requires the programs to ensure that financial aid students receive same priority for enrollment as all other students. i) Requires that credit courses offered be developed in accordance with relevant provisions of the Education Code and Title 5 of the California Code of Regulations governing community college credit courses. j) Applies the following statutes relative to faculty and expenditures: i) Requires a goal of 75:25 ratio of full-time to part-time faculty in extension program credit classes. ii) Requires the inclusion of pilot program revenues and expenditures (which conform to the "current expense" of education) in the calculation/determination of the district's compliance with the 50% AB 515 Page 7 law governing program revenues and expenditures (50% of current expense of education must be for payment of salaries of classroom instructors). iii) Subjects the extension program to collective bargaining agreements. aa) Authorizes a governing board to establish fees that do not exceed the actual cost of maintaining extension programs and defines actual costs, for this purpose, to include: i) Actual cost of instruction, cost of necessary equipment and supplies, student services and institutional support costs. ii) Cost of an independent analysis to be done by the Legislative Analyst's Office iii) A fee to be assessed by the Chancellor's Office to recover its administrative costs for providing oversight. iv) Other costs of a district (76140) bb) Grants the local governing board the authority to redirect one-third of student fee revenues to establish an institutional financial aid program for participating students who demonstrate financial need according to the federal needs analysis. cc) Authorizes campuses to set higher levels of fees for nonresident students participating in extension programs in conformance with specified law. Reporting Requirements 7) Requires each participating district to comply with the following reporting requirements: a) Annually collect student information, as specified, and conduct an AB 515 Page 8 analysis of the program effects on district workload and financial status, and to submit this information to the Chancellor's Office by August 1 annually. b) Submit interim reports at six-month intervals. c) Submit a schedule of course fees to the Chancellor by August 1 annually. 8) Requires the Chancellor to forward the data and information submitted to the LAO. 9) Requires the LAO, on or before June 30, 2014, to provide to the Legislature a report evaluating the pilot program established drawing upon campus reports and visits, interviews with faculty, students and administrators, and any other source that LAO deems relevant. 10) Requires the LAO report to include: a) Summary statistics on course offerings, enrollment, financing, and student utilization of financial aid, funding, and completion rates. b) A discussion of full to part-time faculty hiring practices. (KC a discussion of the impacts of the applicable expenditure and faculty related provisions on the program). c) The extent of compliance with the 50 percent law. d) A determination of the extent of the pilot program's compliance with statutory requirements and the extent to which it expanded access for students. e) An assessment of the program's effect on the availability of, and enrollment in state-supported courses, with particular attention to the demographic make-up and financial aid status of student enrolled in the AB 515 Page 9 state-supported courses. f) Recommendations regarding the extension, expansion or modification of the program and consideration of alternative approaches that could achieve expanded access without increased state funding. 11) Sunsets the bill's provisions on January 1, 2017. STAFF COMMENTS 1) Need for the bill . According to the author, we are at a time of unprecedented cuts and budget shortfalls. Access to the community colleges exists for any person as long as there is state funding. Permitting community colleges to offer extension courses would enable local boards to expand course offerings beyond the limitations of state funding. Authorizing CCCs to offer extension credit courses would allow students to complete coursework and degrees faster and enter the workforce sooner, at no additional cost to the State. 2) Technical amendments . The author has offered several technical, clarifying and correction amendments which are attached as part of this analysis. Staff recommends these amendments be adopted 3) Recent changes . This bill was previously heard by the Committee on June 29, 2011. No vote was taken. The author has proposed amendments to the bill in response to concerns/issues raised in the prior hearing. In summary, the bill now: Creates a voluntary, four-year, competitive pilot program limited to 8 campuses from 8 different districts in six categories. Requires the Chancellor to ensure that selected campuses represent all six different categories of campuses. Prohibits the implementation of the program unless the LAO certifies that all categories are filled and other requirements have been met. Requires campuses to meet specified AB 515 Page 10 requirements regarding cap, course offering and enrollment priority conditions. Establishes a variety of requirements to be met by the extension programs established under the authority granted by the bill. Authorizes the Chancellor's Office to monitor compliance with requirements, to rescind participation in the program for non-compliance, and to assess a fee to recover administrative costs for providing oversight. Requires more extensive and independent evaluation and reporting of the program's implementation and effects. Sunsets the program in 2017. If it is the desire of this committee to implement a smaller scale pilot extension program, staff recommends additional amendments, as outlined in Staff Comments 4 through 8. 1) Need for clarity and streamlining . The author has amended the bill in an attempt to ensure that extension program participants reflect the diversity of campuses and populations served by the state prior to implementation of the pilot program. As currently drafted the bill needs clarification of this intent and also contains unnecessary duplicative language. Staff recommends the following amendments in 78280 subdivision (a): a) Replace subdivision (a)(2) with "The Chancellor shall ensure that the 8 campuses selected collectively represent the diversity of campuses and campus populations by selecting campuses in each of the following six categories:" b) Modify subdivision (a) (2)(A) to read "Two campuses with high transfer numbers serving two separate geographical regions of the state." and delete "(G) A campus of the chancellor's choosing." AB 515 Page 11 c) Replace subdivision (a)(3) with "The Chancellor shall not implement the pilot program established by this section until the Legislative Analyst's Office has reviewed the selections made and certifies compliance with the requirements for participation specified in (a)(2). The LAO shall submit its findings to the Chancellor's Office, the selected campuses, and the Legislature." d) Delete redundant provisions (3) (A) through (F). 2) Conditions to be met for participation . This bill establishes criteria to be met by applicant districts in order to be eligible for the pilot program. Staff recommends this language be clarified and strengthened to ensure that participating colleges have clear and ongoing demand for credit courses and programs that cannot be met with limited state support. a) Replace subdivision (b)(1) with "Have served more students beyond its funding cap (report unfunded FTES) for the two prior academic years as provided in the Budget Act and as reported by the Chancellor's Office." b) Replace subdivision (b)(2) and (b) (3), replace with: i) "(2) All courses in the state-funded program offered for credit must meet basic skills, transfer or workforce development objectives." ii) "(3) Limit the state-supported enrollment of students in "activity" courses, as defined in Title 5, California Code of Regulations Section 55041. The applicant shall not claim state apportionment for students who repeat either the same credit or non-credit physical education or visual/performing arts course that is part of the same sequence of courses. This provision does not apply to disabled students taking adaptive activity AB 515 Page 12 courses, students participating in intercollegiate athletics, or students with an approved educational plan majoring in physical education or the visual/performing arts." 3) Priority enrollments . This bill requires applicant campuses to adopt specified enrollment priorities. These provisions should be clarified to ensure that they are implemented as part of the local priority system, do not conflict with existing statutory or regulatory priorities, and to provide greater clarity of the intent to ensure enrollment management policies that target state funds to meet the state's highest priorities for the colleges. Staff recommends the bill be amended to replace subdivision (b)(4) with "Prioritized enrollment of students in the state-funded program in the priority system established pursuant to the legal authority of a community college local governing board and in conformance with Education Code 66025.8 and in accordance with Title 5 of the California Code of Regulations section 58108, through policies that provide for all the following: a) (A) Prioritized enrollment for students who are fully matriculated, as defined in Education Code section 78212, and making satisfactory progress toward a basic skills, transfer or workforce development goal." b) (4)(B) Prohibit enrollment of students in state-funded credit courses for students with a declared educational goal of personal enrichment. c) (4)(C) Prioritized enrollment of students who receive state financial aid under Education Code Sections 69430-69460, or are eligible for a waiver of fees under Education Code 76300. d) (4)(D) Prioritized enrollment of students who are eligible for in-state tuition" to ensure the inclusion of California residents, military dependents, and others who have met the requirements for in-state tuition rates. AB 515 Page 13 4) Institutional Aid . This bill provides for institutional aid, derived from fees paid by extension program students, for students desiring to attend the extension program and who demonstrate unmet financial need. However the bill also requires that Cal Grant and BOG fee waiver students be prioritized for enrollment and that extension programs ensure that state and federal financial aid is available to eligible students. Given these provisions, as well as the administrative challenge and increased cost to private pay students of implementing an institutional aid program, is this language necessary? If the committee desires to include an institutional aid provision, staff recommends the bill be amended to clarify these provisions as follows: In 78280 subdivision (c), Delete (c)(13)(A), "and shall include the authority to redirect one-third of student fee revenues to establish an institutional financial aid program for participating students who demonstrate financial need according to the federal needs analysis." and replace with: a) "and the cost to establish an institutional financial aid program for participating students pursuant to (c)(14)." b) "(c)(14)The campus shall have the authority to redirect one-third of student fee revenues to establish an institutional financial aid program for participating students who demonstrate financial need according to the federal needs analysis." 5) Faculty provisions . This bill requires the extension program to comply with specified statutes relative to faculty and expenditures. These provisions raise a number of questions. How will they be implemented and calculated? What is the effect of these provisions on the costs of these classes for students? Staff recommends the bill be amended in 78280.5, to consolidate LAO reporting language by deleting (b) (2) and (3) and insert "(2) The implementation and impact of provisions 78280 (c) (10), (11), and(12) in order AB 515 Page 14 to ensure an examination of these issues in their evaluative report. 6) Related Budget activity . The Governor's recently enacted budget for 2011-12, among other things, provides for a net reduction of $290 million for the CCC and fee increases from $26 to $36 per unit beginning in fall 2011. In addition, contingent upon revenue levels for the year, community colleges may realize a fee increase to $46 per unit, beginning winter term 2011, as well as an additional reduction in apportionments of $72 million. The Chancellor's Office estimates that the 2011-12 budget will result in at least 140,000 additional students losing access due to further course reductions and the elimination of some career training programs, and, absent increased revenues or another source of funding, could result in denying access to more than 400,000 students. The Chancellor's Office has also noted that a statewide unemployment rate of 11.9%, as well as budget reductions at UC and CSU, have created even greater demand for the CCC as individuals turn to the community colleges to access the training they need to return to work or to begin their higher education. 7) Paradigm shift . This bill proposes a small scale pilot program whose elements may signal the initial steps toward a significant departure from the open access mission established for the community colleges by the Master Plan and by state statute. Although the UC and the CSU offer self-support extension programs, these segments serve a defined population whereas the community colleges have traditionally served as California's way of ensuring that affordable access to education is provided for all others who can benefit. Is this the first step toward privatizing educational opportunity at California's community colleges and to linking access to the ability to pay? SUPPORT None received on this version. OPPOSITION None received on this version. AB 515 Page 15 AB 515 Page 16 AB 515 (Brownley) Technical, clarifying and correction amendments to RN11 22615 1. On RN 11 22615, delete Amendment #5 and modify Amendment #8 to read: "The districts also shall submit interim reports at six-month intervals to allow the Chancellor & LAO to review information submitted and adjust reporting requirements as necessary" to eliminate duplicative amendments and clarify the intent of interim reporting. 2. In 78280 subdivision (c) clarify that these requirements apply to the extension program. 3. In 78280, replace subdivision (c)(4) with "While not reported for state apportionment, extension program enrollment shall be open to the public pursuant to Title 5, California Code of Regulations, Section 51006" for clarification. 4. In 78280 delete subdivision (c)(5) and replace with "Governing boards shall not expend any general fund moneys to establish and maintain an extension program other than program revenues generated under this section" for clarification. 5. In 78280, subdivision (c) insert, "Extension credit courses shall not supplant courses funded with state apportionments. Districts shall not reduce state-funded course sections needed by students to achieve basic skills, workforce training, or transfer goals, in order to expand those course sections as part of the extension program" as this language was inadvertently omitted. 6. In 78280, replace subdivision (c)(9) "Courses offered through the pilot program for credit shall meet all the requirements, standards, and criteria for courses in subdivision (a) and (b) of Section 55002 of Title 5 of the California Code of Regulations, including, but not limited to, all criteria and procedures as prepared, distributed, and maintained by the Chancellor" for clarification. 7. In 78280 subdivision (c), delete "(2) The pilot AB 515 Page 17 program shall be self-supporting, and all actual costs associated with the program shall be recovered. Actual costs include... etc." as the provision is duplicative and conflicts with the definition of actual costs in 78280 subdivision (c) (13)(A). 8. In 78280 subdivision (d) delete "For districts operating more than one college, the evaluation shall be for each participating college" as author's amendments only allow for one campus per district.