BILL ANALYSIS                                                                                                                                                                                                    Ó



                                                                      



           ------------------------------------------------------------ 
          |SENATE RULES COMMITTEE            |                  SB 1402|
          |Office of Senate Floor Analyses   |                         |
          |1020 N Street, Suite 524          |                         |
          |(916) 651-1520         Fax: (916) |                         |
          |327-4478                          |                         |
           ------------------------------------------------------------ 
           
                                         
                              UNFINISHED BUSINESS


          Bill No:  SB 1402
          Author:   Lieu (D)
          Amended:  8/20/12
          Vote:     21

           
           SENATE EDUCATION COMMITTEE  :  8-0, 4/18/12
          AYES:  Lowenthal, Alquist, Hancock, Huff, Liu, Price, 
            Simitian, Vargas
          NO VOTE RECORDED:  Runner, Blakeslee, Vacancy

           SENATE APPROPRIATIONS COMMITTEE  :  7-0, 5/24/12
          AYES:  Kehoe, Walters, Alquist, Dutton, Lieu, Price, 
            Steinberg

           SENATE FLOOR  :  38-0, 5/31/12
          AYES:  Alquist, Anderson, Berryhill, Blakeslee, Calderon, 
            Cannella, Corbett, Correa, De León, DeSaulnier, Dutton, 
            Emmerson, Evans, Fuller, Gaines, Hancock, Harman, 
            Hernandez, Huff, Kehoe, La Malfa, Leno, Lieu, Liu, 
            Lowenthal, Negrete McLeod, Padilla, Pavley, Price, Rubio, 
            Simitian, Steinberg, Vargas, Walters, Wolk, Wright, 
            Wyland, Yee
          NO VOTE RECORDED:  Runner, Strickland

           ASSEMBLY FLOOR  :  78-0, 8/23/12 - See last page for vote


           SUBJECT  :    Community colleges:  Economic and Workforce 
                      Development Program

           SOURCE  :     California Community College Association for 
          Occupational 
                                                           CONTINUED





                                                               SB 1402
                                                                Page 
          2

                        Education
                      California Community Colleges of the 
          Chancellors Office


           DIGEST  :    This bill recasts and revises provisions of the 
          Education Code governing the California Community Colleges 
          (CCC) Economic and Workforce Development Program and 
          extends the program's sunset date from January 1, 2013, to 
          January 1, 2018.  

           Assembly Amendments  add intent language which specifies 
          that the Legislature in reauthorizing the CCC Economic 
          Workforce Development Program that the program work in 
          coordination with California's other workforce and economic 
          development programs and activities, as specified.

           ANALYSIS  :    Existing law establishes the CCC Economic and 
          Workforce Development (EWD) Program as a primary mission of 
          the CCC.  Existing law specifies the mission and goals of 
          the program, establishes an administrative structure for 
          the program that includes (1) the CCC Business Resource 
          Assistance and Innovation Network Trust Fund, (2) Centers 
          and Regional Collaboratives, and (3) the Job Development 
          Incentive Training Program.  

          This program is administered through the CCC Chancellor's 
          Office.  Existing law requires the Chancellor to implement 
          accountability measures for the program and annually report 
          specified information to the Governor and the Legislature. 

          Existing law requires the CCC Board of Governors to assist 
          economic and workforce regional development centers and 
          consortia to improve linkages and career technical 
          education (CTE) pathways between high schools and community 
          colleges in a manner that improves the quality of career 
          exploration.
           
          Existing federal law, the Workforce Investment Act, 
          provides funding for workforce investment activities, 
          including training, access to career information, 
          counseling, and other support services.  

          This bill recasts and revises the provisions governing the 

                                                           CONTINUED





                                                               SB 1402
                                                                Page 
          3

          CCCs Economic and Workforce Development (EWD) Program.  
          Specifically, this bill:  

          1. Establishes the program under a new Part of the 
             Education Code, moving the EWD program from Section 
             88500 et seq. to Section 88600 et seq.  

          2. Extends the sunset on the EWD program from January 1, 
             2013, to January 1, 2018.  

          3. Adds six principles to the mission of the EWD Program.  
             Specifically, the bill requires the EWD program to:  

             A.    Be responsive to the needs of employers, workers, 
                and students.  

             B.    Collaborate with other public institutions, 
                aligning resources to foster cooperation across 
                workforce education and service delivery systems, and 
                building well-articulated career pathways.  

             C.    Make data driven and evidence based decisions, 
                investing resources and adopting practices on the 
                basis of what works.  

             D.    Develop strong partnerships with the private 
                sector, ensuring industry involvement in needs 
                assessment, planning, and program evaluation.  

             E.    Be outcome oriented and accountable, measuring 
                results for program participants, including students, 
                employers, and workers.  

             F.    Be accessible to employers, workers, and students 
                who may benefit from its operation.  

          4. Updates the mission of the EWD program to reflect the 
             need to implement sector strategies that align with 
             labor markets.  

          5. Updates the General Provisions to strengthen decision 
             criteria for allocating funds to ensure that education 
             and services are responsive to changing local markets 
             and to improve accountability of regional programs.  

                                                           CONTINUED





                                                               SB 1402
                                                                Page 
          4

             Requires funding to be based on each of the following:   


             A.    An evaluation of the relevance of the grant to the 
                labor market needs of the state and relevant region's 
                competitive and emerging industry sectors and 
                industry cluster, or to the state's need to plug 
                skills gaps and skills shortages in the economy, 
                including skills gaps and shortages at the state and 
                regional level.  

             B.    An assessment of the past performance of the grant 
                recipient.  

             C.    For grants providing direct services to employers 
                and industry, an assessment of the purported 
                beneficial impacts of the grant on the relevant 
                businesses, which may include a review of the grant's 
                purported impacts as specified.  

             D.    For grants involving direct education and training 
                services provided to workers and students, an 
                assessment of the educational and training goals of 
                the grant, the projected numbers of the students and 
                workers served and projected rates of course and 
                program completion or transfer-readiness, the 
                projected rate of skills attainment for certificates 
                and degrees, and the projected wages and rate of 
                employment placement for those entering the labor 
                market.  

             E.    For technical assistance and logistical support 
                projects, a concrete enumeration of the ways the 
                project will collaborate with the Chancellor's Office 
                to advance sector strategies, regional development, 
                accountability based on performance data, and the 
                adoption of effective workforce and economic 
                development practices.  

             F.    Authorizes the Chancellor's Office to terminate 
                programs for nonperformance.  

          6. Updates definitions to reflect current practices:  


                                                           CONTINUED





                                                               SB 1402
                                                                Page 
          5

             A.    Defines career pathways and career ladders or 
                career lattices to mean an identified series of 
                positions, work experiences, or educational 
                benchmarks or credentials that offer occupational and 
                financial advancement within a specific career field 
                or related field over time.  

             B.    Defines high-priority occupation to mean an 
                occupation that has a significant presence in a 
                targeted industry or sector or industry cluster, as 
                specified.  

             C.    Defines industry cluster as a group of employers 
                closely linked by a common product or services, 
                workforce needs, similar technologies, and supply 
                chains in a given regional economy or labor market.  

             D.    Defines industry sector to mean those firms that 
                produce similar products or provide similar services 
                using a somewhat similar business process.  

             E.    Defines sector strategies to mean prioritizing 
                investments in competitive and emerging industry 
                sectors and industry clusters as specified.  

             F.    Defines stackable credentials to mean a sequence 
                of modularized training or credentials where each 
                stack has employment or industry value.

             G.    Adds intent language which specifies that the 
                Legislature in reauthorizing the CCC Economic 
                Workforce Development Program that the program work 
                in coordination with California's other workforce and 
                economic development programs and activities, as 
                specified.

           Comments  

           The EWD Program  .  The purpose of the EWD Program is to 
          advance California's economic growth and global 
          competitiveness through education and services that 
          contribute to continuous workforce improvement, technology 
          deployment, and business development and are consistent 
          with the current needs of the state's regional economies.  

                                                           CONTINUED





                                                               SB 1402
                                                                Page 
          6

          Local colleges and business partners form consortia to 
          identify regional workforce needs and priorities, provide 
          assistance to small businesses in the region through local 
          Economic and Workforce Development Centers and train 
          workers.  The partnerships enable colleges to develop 
          curricula that address the training needs of local 
          industry.  

          Codified in 1991, the EWD program formalized earlier 
          efforts to coordinate statewide technical training and 
          programs for small businesses and economic development.  In 
          1996, SB 1809 (Polanco, Chapter 1057) further clarified the 
          legislative intent of the Program, defined regional 
          planning, priority setting and coordination and added 
          accountability and audit requirements.  The 1996 
          legislation also made economic development and continuous 
          workforce improvement a primary mission of the CCC.  

          The 2010-11 EWD Annual Report shows that community colleges 
          play an integral role in helping California build its 
          workforce despite budget cuts and stagnant economic growth. 
           The report noted that during the reporting period, 929 
          people received a job through an EWD program, while an 
          additional 9,475 people were able to retain their job 
          through EWD services.  A one-time return-on-investment 
          report conducted by Time Structures, Inc. found that from 
          2002-2009, the EWD Program assisted an average of 41,000 
          businesses, 107,000 students and trainees, and placed 4,300 
          individuals in jobs.  The report revealed that it cost the 
          state of California an average of $589 to train each worker 
          in a highly concentrated one-time course.  Each newly 
          trained worker earned a higher wage, subsequently paying an 
          additional $450 in state and local taxes over the next 
          three years.  The report indicated that the workers' higher 
          tax payments returned almost 80% of the state's costs for 
          the training.  

           FISCAL EFFECT  :    Appropriation:  No   Fiscal Com.:  Yes   
          Local:  No

          According to the Senate Appropriations Committee:

            Sunset extension  :  $22.9 million - $46.7 million, 
            annually; bill language specifies that funding is subject 

                                                           CONTINUED





                                                               SB 1402
                                                                Page 
          7

            to an appropriation in the Budget Act, as the program is 
            currently.

           SUPPORT  :   (Verified  5/23/12)

          California Community College Association for Occupational 
          Education (co-source) 
          California Community Colleges Chancellor's Office 
          (co-source)
          Aerospace Dynamics International, Inc. 
          Barstow Community College 
          Bayless Engineering & Manufacturing 
          Biotechnology Initiative of the California Community 
          Colleges 
          Boston Scientific 
          Business & Entrepreneurship Center at Cuesta College 
          Butte-Glenn Community College District 
          California Asian Pacific Chamber of Commerce 
          California Association for Local Economic Development 
          California Chamber of Commerce 
          California Hospital Association 
          California Manufacturers & Technology Association 
          California State Association of Electrical Workers 
          California Workforce Association 
          Cerritos Community College District 
          Coast Community College District 
          College of the Canyons 
          Community College League of California 
          Desert Community College District 
          El Camino Community College District 
          Envision Education 
          Faculty Association of California Community Colleges 
          Long Beach City College 
          Los Angeles/Orange County Biotechnology Center 
          Los Rios Community College District 
          Mendocino College Nursing Program 
          Mt. San Antonio College Center for Excellence 
          National Electrical Contractors Association - California 
          Chapters 
          Palomar Health 
          Powder Coating Plus 
          Prosperity Research Institute 
          Saddleback College 
          San Bernardino Community College District 

                                                           CONTINUED





                                                               SB 1402
                                                                Page 
          8

          Santa Clarita Valley Aerospace Defense Coalition 
          Santa Clarita Valley Economic Development Corporation 
          Shasta-Tehama-Trinity Joint Community College District 
          Sierra College
          Silicon Valley Leadership Group
          South Orange County Community College District 
          Southern California Biotechnology Center at San Diego 
          Miramar College 
          Southern California Regional Transit Training Consortium  
          Valley Industry Association of Santa Clarita
          Ventura County Community College District 
          Wright Engineering, Inc. 
          Yosemite Community College District

           ARGUMENTS IN SUPPORT  :    Supporters argue that the EWD 
          program has provided services and training to meet the 
          needs of regional economies for more than 20 years and is 
          scheduled to sunset on January 1, 2013.  This bill extends 
          the sunset date of the program to January 1, 2018, and 
          recasts and revises the provisions governing the program to 
          ensure the program continues to advance the state's 
          economy.  According to the author's office, the revised 
          program would improve the functions of the EWD program in 
          three primary ways:  (1) making the program more nimble and 
          better able to respond to changing economic conditions, (2) 
          making the program more accountable for investments and 
          performance by strengthening the evaluation framework for 
          EWD grants and programs, and (3) encouraging better 
          integration and communication of EWD programs with CTE 
          programs.


           ASSEMBLY FLOOR :  78-0, 8/23/12
          AYES:  Achadjian, Alejo, Allen, Ammiano, Atkins, Beall, 
            Bill Berryhill, Block, Blumenfield, Bonilla, Bradford, 
            Brownley, Buchanan, Butler, Charles Calderon, Campos, 
            Carter, Cedillo, Chesbro, Conway, Cook, Davis, Dickinson, 
            Eng, Feuer, Fletcher, Fong, Fuentes, Furutani, Beth 
            Gaines, Galgiani, Garrick, Gatto, Gordon, Gorell, Grove, 
            Hagman, Halderman, Hall, Harkey, Hayashi, Hill, Huber, 
            Hueso, Huffman, Jeffries, Jones, Knight, Lara, Logue, 
            Bonnie Lowenthal, Ma, Mansoor, Mendoza, Miller, Mitchell, 
            Monning, Morrell, Nestande, Nielsen, Norby, Olsen, Pan, 
            Perea, V. Manuel Pérez, Portantino, Silva, Skinner, 

                                                           CONTINUED





                                                               SB 1402
                                                                Page 
          9

            Smyth, Solorio, Swanson, Torres, Valadao, Wagner, 
            Wieckowski, Williams, Yamada, John A. Pérez
          NO VOTE RECORDED:  Donnelly, Roger Hernández


          PQ:m  8/24/12   Senate Floor Analyses 

                         SUPPORT/OPPOSITION:  SEE ABOVE

                                ****  END  ****
          


































                                                           CONTINUED