BILL ANALYSIS                                                                                                                                                                                                    






                         SENATE COMMITTEE ON EDUCATION
                             Alan Lowenthal, Chair
                           2011-2012 Regular Session
                                        

          BILL NO:       SB 1550
          AUTHOR:        Wright
          AMENDED:       April11, 2012
          FISCAL COMM:   Yes            HEARING DATE:  April 18, 2012
          URGENCY:       No             CONSULTANT:Kathleen Chavira

           SUBJECT  :  Community College Extension Courses.
          
           SUMMARY  

          This bill requires, until January 1, 2019, the Chancellor's 
          Office of the California Community Colleges to establish a 
          voluntary, pilot program for purposes of selecting up to 
          eight community college campuses from eight different 
          community college districts to establish and maintain an 
          extension program offering career and workforce training 
          courses for credit at fee levels that cover the actual 
          cost, as defined, of maintaining these courses.

           BACKGROUND  

          Current law authorizes the governing board of any community 
          college districts to establish contract education programs 
          within or outside the state by agreement with any public or 
          private agency, corporation, association, or any other 
          person or body to provide specific educational programs or 
          training to meet the specific needs of these bodies. 
          (Education Code  78021)

          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 




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          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: 
          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, 2019, the Chancellor's 
          Office of the California Community Colleges to establish a 
          voluntary, pilot program for purposes of selecting up to 
          eight applicant community college districts to establish 
          and maintain an extension program offering career and 
          workforce training courses for credit.  

           Pilot Participant Selection
           
          1)   Authorizes the governing board of any community 




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               college district to apply to be selected by the 
               Chancellor's office.

          2)   Limits participation to eight campuses from eight 
               separate community college districts.

          3)   Requires the Chancellor, in selecting the campuses, to 
               consider all of the following:

               a)        Geographic, socio-economic, and demographic 
               diversity.

               b)        Labor-Market Demand.

               c)        The district's program and planning 
               capacity.

                    d)             Potential support from funding 
                    partners in industry, labor, or other private 
                    funding sources to reduce cost of attendance for 
                    participating students.

           Requirements to be eligible to participate
           
          4)   Authorizes the Chancellor to review pilot programs, 
               monitor compliance with the provisions of the bill, 
               and grant the Chancellor's office the authority to 
               rescind authority to participate in the pilot if the 
               Chancellor determines that a campus or its district is 
               out of compliance with these provisions.

          5)   Requires a selected campus meet the following criteria 
               in order to be eligible to participate in the pilot 
               program:

                    a)             Serve a number of students equal 
                    to or beyond its funding cap for the two 
                    immediately prior academic years, to be 
                    determined as specified.

                    b)             Have not received a stability 
                    adjustment to state appropriations. 

                    c)             Meet transfer, basic skills, or 
                    career technical education objectives for all 
                    courses in the state-funded programs offered for 




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                    credit.

                    d)             Prioritize enrollment in the state 
                    funded programs by promoting policies that both:

                           i)                  Prioritize enrollment 
                         for fully matriculated students, as defined, 
                         and for continuing students who are making 
                         satisfactory progress toward a basic skills, 
                         transfer or workforce development goal.

                           ii)     Do not unfairly or 
                         disproportionately shift students eligible 
                         for resident tuition or who are eligible for 
                         a fee waiver to courses offered under the 
                         pilot program

                    e)             Prohibits a district from 
                    receiving a stability adjustment to apportionment 
                    funding.

           Extension Program Requirements
           
          6)   Requires a selected community college district to 
               comply with the following requirements in order to 
               participate:  

                    a)             Requires districts to minimize the 
                    costs of administration of the pilot program to 
                    the greatest extent possible.

                    b)             Prohibits the pilot program 
                    enrollment from being reported for state 
                    appropriation but requires that enrollment be 
                    open to the public.

                    c)             Prohibits a governing board from 
                    expending any general fund moneys to establish 
                    and maintain these courses, and specifies that 
                    these fees do not apply to fees generated in the 
                    extension program. 

                    d)             Prohibits extension courses from 
                    being offered at times, nor in locations that 
                    supplant or limit offerings of state-supported 
                    programs nor in conjunction with courses funded 




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                    with state apportionments.

                    e)             Requires each participating campus 
                    to ensure that state and federal financial aid is 
                    available to eligible students.

                    f)             Requires the programs to ensure 
                    that financial aid students receive same priority 
                    for enrollment as all other students.

                    g)             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. 

               h)        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% 
                         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.

                    i)             Prohibits supplanting of courses 
                    funded with state apportionments and further 
                    prohibits a community college district from 
                    reducing courses funded with state apportionments 
                    which are necessary for students to achieve basic 
                    skills, workforce training, or transfer goals, or 
                    to expand those courses as part of the pilot 
                    program.

                    j)             Authorizes a local governing board 




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                    to establish fees that do not exceed the actual 
                    cost of maintaining the pilot program and defines 
                    actual costs, for this purpose, to include all of 
                    the following: 

                           i)                  Cost of instruction. 

                           ii)     Cost of necessary equipment and 
                         supplies, student services and institutional 
                         support costs.

                           iii)    Administrative costs incurred by 
                         the Chancellor's Office for providing 
                         oversight of the pilot program. 

           Reporting Requirements
           
          7)   Requires each participating district to comply with 
               the following reporting requirements:

                    a)             Collect student information, as 
                    specified, and conduct an 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 a schedule of established 
                    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, 2016, 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.




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                    b)             A determination of the extent of 
                    the pilot program's compliance with statutory 
                    requirements and the extent to which it expanded 
                    access for students.

                    c)             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 students enrolled in the 
                    state-supported courses.

                    d)             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, 2019.

           STAFF COMMENTS  

           1)   Need for the bill  .  Recent budget reductions have had 
               a real and detrimental impact on the ability of the 
               CCC to maintain its "open access" mission under the 
               state's Master Plan. CCC enrollment has been 
               constrained by two major factors: (1) reductions in 
               course-section offerings as a result of state budget 
               cuts, and (2) strong demand for CCC services, 
               including by adults seeking retraining and other 
               skills. The CCC system reports that many students, 
               particularly first-time students, have been unable to 
               enroll in the classes they need to progress toward 
               their educational goals. This access problem may 
               become became even more serious given the magnitude of 
               enacted and potential budget reductions.
                
               In the 2011-12 budget, the CCC was cut by $400 
               million. In January 2012, mid-year "trigger" cuts 
               resulted in an additional $102 million reduction. The 
               CCC estimate that property tax and fee revenue 
               shortfalls may result in $149 million less than 
               projected. If the Governor's tax initiative is 
               rejected by voters, the CCC budget will face yet 
               another mid-year reduction of $292 million and $218 




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               million in apportionment funding would be deferred. 

               This bill, in an effort to expand access to career 
               technical and workforce development courses, would 
               establish a pilot program to authorize fees sufficient 
               to cover the actual costs of these classes at up to 
               eight community college campuses. It would also 
               establish conditions (consistent with budget actions 
               through which the Legislature has declared its intent 
               that community colleges implement workload reductions 
               in courses and programs outside of those needed by 
               students to achieve their basic skills, workforce 
               training, or transfer goals) which must be met 
               regarding the use of state general fund dollars 
               provided to the community colleges in order to 
               participate in the pilot program.

           2)   Summary of contents  .  In summary, this bill:

               a)        Creates a voluntary, six-year, competitive 
                    pilot program limited to a maximum of 8 campuses 
                    from 8 different districts.

               b)        Requires campuses to meet specified 
                    requirements regarding cap, course offering and 
                    enrollment priority conditions.

               c)        Establishes a variety of requirements to be 
                    met by the extension programs established under 
                    the authority granted by the bill. 

               d)        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. 

               e)        Requires independent evaluation and 
                    reporting of the program's implementation and 
                    effects by the Legislative Analyst's Office. 

               f)        Sunsets the pilot program in 2019.

           1)   Correct a drafting error  .  This bill establishes 
               conditions to be met by districts in order to be 
               eligible to be selected for participation in the 




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               extension program and then conditions to be met within 
               the extension program. Priority enrollment policies 
               which must be implemented by a district in order to be 
               eligible for selection are currently contained within 
               provisions outlining requirements for participation in 
               the extension program. Staff recommends the bill be 
               amended to delete lines 5-20 on page 6 and insert this 
               language between lines 33 and 34 on page 4. 

           2)   Under what conditions  ? Arguably, the intent of this 
               bill is to give districts that have clear and ongoing 
               demand for their credit courses and programs that 
               cannot be met with limited state support an 
               alternative source of funding to meet that demand. 
               While the bill establishes some conditions to be met 
               by districts to demonstrate that they are maximizing 
               the use of state funding to meet the state's 
               objectives, does it go far enough? 

               a)        Has the district restricted the enrollment 
                    of students in classes for purposes of personal 
                    enrichment under the state funded program? Is it 
                    reasonable to authorize the shifting of any 
                    student to a higher cost program if the 
                    state-funded program continues to enroll students 
                    in "activity" courses? 

                    Staff recommends the bill be amended to require, 
                    as a condition of selection that the applicant 
                    district have adopted policies that "Limit the 
                    state-supported enrollment of students in 
                    activity courses as defined in Title 5 of the 
                    California Code of regulations. 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 
                    courses, students participating in 
                    intercollegiate athletics, or students with an 
                    approved educational plan major in physical 
                    education or the performing arts." 

               b)        Does the district prioritize the enrollment 
                    of students who are eligible for "in-state" 




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                    tuition (California residents, military 
                    dependents, AB 540 students) to ensure that 
                    California's taxpayers, rather than foreign 
                    students, or non-residents are being served in 
                    the state-supported program? 

                    Staff recommends the bill be amended to require 
                    as a condition of selection that the applicant 
                    district have adopted policies that prioritize 
                    enrollment of students who are eligible for 
                    in-state tuition.

               c)        The bill currently requires that an 
                    applicant district promote enrollment priority 
                    policies that do not unfairly or 
                    disproportionately shift students eligible for 
                    state financial aid programs from the 
                    state-funded program to courses under the pilot 
                    program. Shouldn't the district more 
                    affirmatively ensure that students supported by 
                    state financial aid programs (which are also 
                    strained under the current budget) be served 
                    primarily via the lower cost state-funded program 
                    where possible? 

                    Staff recommends this language be strengthened to 
                    require that an applicant district promote 
                    enrollment priority and student support policies 
                    that ensure that students eligible for state 
                    financial are not disproportionately shifted from 
                    the state-funded program to the pilot program. 

           3)   Smaller pilot, easier administration/oversight  .  This 
               bill currently authorizes up to 8 campuses be selected 
               for participation in the pilot program. While the bill 
               authorizes the collection of fees sufficient to cover 
               the cost of oversight by the Chancellor, it is 
               unlikely that the Chancellor's Office has sufficient 
               staff/fiscal resources to conduct the level of 
               administrative work involved in establishing, 
               implementing and overseeing a program for eight 
               campuses.   Staff recommends the bill be amended to 
               reduce the maximum number of campuses that may 
               participate from 8 to 5. 

           4)   Supplanting  . This bill proposes creation of an 




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               extension program to offer career and workforce 
               development courses. Could districts shift high cost 
               workforce development programs to extension programs 
               while still maintaining and expanding lower cost basic 
               skills or transfer courses in the state funded program 
               without technically "supplanting" existing courses? 
               Could the bill result in a "maintenance-of-effort" in 
               the state funded program while encouraging new or 
               expanded programs for students who pay more in the 
               extension program? 

               Staff recommends the bill be amended to require, as a 
               condition for participation in the program, that 
               "Extension credit courses shall not supplant courses 
               funded with state apportionments. Districts shall not 
               reduce state-funded courses sections needed by 
               students to achieve workforce training goals in order 
               to expand those course sections as part of the 
               extension program." In addition, staff recommends the 
               bill be amended to define "career and workforce 
                                                       development courses" to ensure that courses required 
               to meet transfer or basic skills goals are not shifted 
               to the extension program.

           5)   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? If so, should 
               the Legislature clarify the means by which this 
               unprecedented shift should occur?

               Historically, districts have interpreted Education 
               Code section 78021 to authorize the offering of 
               courses at fees sufficient to cover the cost of 
               courses for contract education purposes only. In March 
               2012 the Santa Monica College Board of Trustees passed 
               an initiative to have a nonprofit foundation offer 




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               high-demand core classes such as math and English at a 
               higher price during the summer and winter sessions 
               alongside the same state-funded courses. Following 
               student protests and a request from the Chancellor of 
               the California Community Colleges, Santa Monica 
               College postponed its proposed two-tier fee plan to 
               obtain further input from students, faculty and staff 
               on ways to increase access to classes, which have been 
               reduced significantly due to insufficient funds. 

               This bill presents an opportunity to clarify the 
               conditions under which the Legislature would recognize 
               that a district has maximized its ability to meet the 
               Legislature's priorities with state funding and to 
               authorize pursuit of additional fee revenue to meet 
               enrollment demand. 

               Staff recommends the bill be amended to state, 
               "Education Code section 78021 shall not be construed 
               to authorize the implementation of a multi-tiered fee 
               system in the California Community Colleges through 
               the creation of a foundation or other affiliated 
               entity. The California Community Colleges shall not 
               charge a per unit fee for courses it, or an affiliated 
               entity or foundation, offers in excess of that 
               authorized by the Legislature pursuant to Education 
               Code 76300, except as expressly authorized to do so in 
               Education Code section 78130."

           6)   Prior legislation  - AB 515 (Brownley, 2011), heard by 
               this committee on June 29, 2011, would also have 
               established a California Community Colleges Extension 
               Pilot Program.  That bill, however, authorized 
               extensive participation by community colleges 
               throughout the state since any community college that 
               certified that it met the requirements of the program 
               would be eligible to participate. Although the bill 
               was heard by this committee, no vote was taken, and a 
               subsequent hearing on the bill was cancelled at the 
               request of the author. 

           SUPPORT  

          Cerritos College

           OPPOSITION




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           Antelope Valley Community College District 
          California Teachers Association
          Kern Community College District 
          Los Angeles College Faculty
          Los Angeles Community College District 
          Los Rios Community College District 
          Peralta Community College District 
          San Diego Community College District 
          Yosemite Community College District 
          Faculty Association of California Community Colleges