BILL ANALYSIS                                                                                                                                                                                                    Ó

                   Senate Appropriations Committee Fiscal Summary
                            Senator Kevin de León, Chair

          AB 386 (Levine) - California State University: Online Course  
          Amended: July 10, 2013          Policy Vote: Education 9-0
          Urgency: No                     Mandate: No
          Hearing Date: August 12, 2013                                
          Consultant: Jacqueline Wong-Hernandez                       
          This bill meets the criteria for referral to the Suspense File. 

          Bill Summary: AB 386 authorizes any California State University  
          (CSU) student enrolled at a CSU campus, who meets specified  
          requirements, to enroll in an online course provided by another  
          CSU campus. This bill requires CSU campuses to provide students  
          with specified information about online courses, and the CSU  
          Trustees to establish an easily accessible online database of  
          these courses by January 1, 2015. This bill further requires the  
          CSU Trustees to report key performance data on online courses,  
          as specified, to the Legislative Analyst's office (LAO) by  
          January 1, 2017, and for the LAO to report the status  
          information to the Legislature.

          Fiscal Impact: 
              Cross-enrollment system: The CSU estimates that  
              establishing a cross-enrollment system that meets the  
              requirements of this bill will cost $1,090,000 over two  
              years. Annual operational costs would be approximately  
              $250,000, primarily to maintain the course database,  
              enrollment system, and transcript integration (for grading).  

              Authority to cross-enroll: Once the system is established,  
              the authority for students to cross-enroll is unlikely to  
              result in significant costs to the CSU. Individual campuses  
              will have the authority to charge registration fees to  
              students who cross-enroll which should mitigate any  
              administrative costs. 
              LAO report: Potentially significant workload to produce two  
              required reports.

          Background: Existing law authorizes a student enrolled in any  
          campus of the California Community Colleges (CCC), CSU, or the  


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          University of California (UC) who meets specified requirements  
          to enroll, without formal admission and payment of additional  
          fees, in a maximum of one course per academic term at a campus  
          of either of the other systems on a space available basis, as  
          specified. (Education Code § 66751)

          Existing law provides that a student enrolled in any campus of  
          the CCC, CSU, or UC may cross-enroll if the student: a)  
          completed at least one term at the home campus as a matriculated  
          student and is taking at least 6 units at the home campus during  
          the current term; b) has attained a 2.0 grade point average; c)  
          has paid appropriate tuition and/or fees required by the home  
          campus for that academic term; and, d) has the appropriate  
          academic preparation for the course, as determined by the host  
          campus, consistent with the standard applied to currently  
          enrolled students. (EC § 66752)

          Existing law prohibits the host campus from counting the  
          cross-enrolled student in the calculation of its headcount or  
          full-time equivalent student (FTES) enrollment. The home campus  
          is authorized to count these students in its calculation of  
          headcount or FTES enrollment only for those units in which the  
          student is enrolled at the home campus. 
          (EC § 66753.5)

          Proposed Law: AB 386 authorizes, by the beginning of the 2015-16  
          academic year, a student who meets specified requirements to  
          enroll, without formal admission and without paying additional  
          tuition and fees, in a course provided entirely online by  
          another CSU campus on a space-available basis. This bill  
          establishes the following requirements and authorities for cross  
          enrollment in online courses at the CSU:

                a)        Authorizes nonresident and international CSU  
                students who meet the outlined conditions to cross-enroll,  
                but requires that these students pay the per unit fees for  
                the course at the host campus.

                b)        Authorizes a host campus to charge participating  
                students a reasonable administration fee and specific  
                course-based fees, as specified.

                c)        Requires the CSU Chancellor's office to  
                establish an online methodology to allow students to be  


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                informed of the online cross-enrollment option and to  
                simultaneously enroll in both home and host campuses.

                d)        Requires a matriculated CSU student to have  
                priority access to enroll in online courses at his/her  
                home campus, while requiring host campuses to adopt a  
                campus enrollment policy that encourages cross-enrollment.  

                e)        Requires that the course be accepted for credit  
                at the home campus on the same basis as that for a  
                matriculated student at the host campus. 

                f)        Requires each CSU campus to inform students who  
                may enroll in online courses of specified information  
                related to requirements of the courses.

                g)        Authorizes the host campus to count  
                cross-enrolled students in the calculation of headcount or  
                FTES enrollment at the host campus, but limits both the  
                home and host campus to counting a cross-enrolled student  
                only for those units in which the student is enrolled at  
                each respective campus.

                h)        Requires the CSU Trustees to establish an easily  
                accessible online database of online courses available at  
                all CSU campuses that provides a streamlined method of  
                finding and enrolling in courses that lead toward  
                graduation, general education and major requirements, as  
                well as plan for a 2015-16 operational cross-enrollment  
                process by January 1, 2015.

          This bill further requires that the CSU Trustees provide key  
          performance data to the Legislature every two years, beginning  
          on or before January 1, 2017. The CSU Trustees are also required  
          to submit key performance data to the LAO by January 1, 2017,  
          and the LAO must submit a status update to the Legislature by  
          October 1, 2017.

          Staff Comments: In order for the CSU students to be able to  
          cross-enroll in online classes at other CSU campuses, as this  
          bill authorizes, the CSU will need to build the technological  
          infrastructure to comply with the bill's requirements. The  
          initial costs will primarily be incurred to build a system  


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          which: 1) can authenticate student identity, and complete the  
          registration and enrollment process with available slots in  
          other campuses' courses; 2) contains a reliable and searchable  
          database of fully-online courses across the CSU system, and  
          which can be easily updated; and, 3) can provide reliable and  
          timely authentication of grading and integration into student  
          transcripts. The CSU estimates that it will cost approximately  
          $1 million to build the system (using a backbone of existing  
          technology). The CSU will also incur minor upfront costs to  
          inform students about the courses, including articulating which  
          courses fulfill graduation requirements for various majors, and  
          which satisfy general education requirements. 
          The CSU estimates ongoing costs of approximately $250,000  
          annually, to maintain and update the system and course  
          information, and to manage the component of the system that will  
          ensure accurate grades are integrated into transcripts.

          Staff notes that the CSU already has the authority to implement  
          this bill, and has indicated in a recent press release that it  
          intends to implement online course reforms that are conceptually  
          similar to what it described in this bill. The CSU indicates  
          that such implementation would use approximately $1.1 million of  
          the $10 million budget augmentation it received in the Budget  
          Act. That funding was initially earmarked to expand online  
          courses, but the language limiting the funding uses was stricken  
          by the Governor. This bill would, however, lock the CSU into  
          that plan.