BILL ANALYSIS Ó Senate Appropriations Committee Fiscal Summary Senator Kevin de León, Chair AB 1358 (Fong) - Community Colleges: Student Representation Fee Amended: July 11, 2013 Policy Vote: Education 7-2 Urgency: No Mandate: Yes Hearing Date: August 12, 2013 Consultant: Jacqueline Wong-Hernandez This bill does not meet the criteria for referral to the Suspense File. Bill Summary: AB 1358 allows the current community college student representation fee (SRF) to be increased from $1 to $2, per semester, subject to an affirmative majority vote of a community college's students. This bill directs the additional $1 fee increase to be expended on the establishment and support the operations of a statewide community college student organization, as specified. Fiscal Impact: Revenue: Potentially significant additional revenue, to the extent that the student representation fee is increased on various community college campuses. That revenue would be primarily earmarked to fund the statewide student organization. Administrative fees: This bill allows the California Community Colleges Chancellor's Office (CCCCO) to reimburse itself for any administrative expenses from the fee revenue. It further allows a community college district (CCD) which collects the increased fee to reimburse itself for the actual costs of fee administration, up to 7 percent of the fee, which the CCCCO has opined will be sufficient to cover its costs (and is above the current allowable rate for the existing fee it collects). Background: Existing law permits the governing board of a CCD to authorize the students of a college to organize a student body association. (Education Code § 76060) Existing law provides that a student body association (SBA) may order an election be held for the purpose of establishing an SRF of $1 per semester, and that an affirmative vote of two-thirds AB 1358 (Fong) Page 1 of the students voting in the election shall be sufficient to establish the fee. However, the number of students who vote must equal or exceed the average number of students who voted in the previous three student body elections. The fee money collected is required to be expended to provide support of governmental affairs representatives who may be stating their positions and viewpoints before city, county, and district governments and before offices and agencies of state government. Students may refuse to pay the fee for religious, political, financial, or moral reasons. The chief fiscal officer of the community college has custody of the fee money collected, but the funds are disbursed to the student body association for the specified purposes. The CCD is authorized to retain a portion of the fees collected that is equal to the actual cost of administering these fees up to, but not more than, 7 percent. (EC § 76060.5) Proposed Law: AB 1358 increases the current community college SRF from $1 to $2 per semester, subject to an affirmative majority vote of a community college campus's students and directs the additional $1 fee increase to be expended on the establishment and support the operations of a statewide community college student organization, as specified. More specifically, this bill: 1) Clarifies that current and prospective SRF revenue may be expended on local or statewide student body associations. 2) Authorizes an SBA to call campus-wide elections to determine whether to assess a SRF of $2 per semester. 3) Reduces the affirmative vote from two-thirds to a majority of the students voting in the election, as specified, to establish the SRF. 4) Specifies that $1 of every $2 fee collected shall be expended to establish and support the operations of an independent statewide community college student organization with specified goals, that is recognized by the Board of Governors (BOG) of the California Community Colleges, to advocate before the Legislature and other state and local governmental entities. The measure specifies this provision only applies to SRFs adopted on or after January 1, 2014. AB 1358 (Fong) Page 2 5) Specifies requirements for the statewide community college student organization, if formed, including that it: a) is established as a legal entity registered with the Secretary of State; b) demonstrates compliance with all applicable state and federal laws and reporting requirements; c) exercises prudent fiscal management by establishing generally accepted accounting controls and procedures; d) completes an annual independent financial audit, the results of which shall be annually provided to the BOG for review; e) opens its meetings to the public and complies with the requirements of the California Public Records Act. 6) States that any community college SBA that has adopted a SRF before January 1, 2014 retains authority to continue to receive the $1 fee as authorized prior to enactment of this measure. The SBA may conduct an election to adopt a revised SRF - if the students pass the revised SRF, then $1 of every $2 collected shall be expended for purposes specified. 7) Requires a CCD to annually prepare a summary of all revenue collected from the SRF and the expenditures of the proceeds, as specified. 8) Permits a CCD to retain a portion of the fees collected that is equal to the actual cost of administering these fees up to, but not more than, 7 percent. Staff Comments: This bill is unlikely to have a significant fiscal impact on the state. To the extent the bill results in campus SBAs holding elections to authorize increasing the campus's SRF to $2 per semester, and the students vote to do so, there would be increased revenue held by the CCCCO for a specific purpose. Absent success in increasing the SRF, advocacy will likely continue as it is currently. The CCCCO and CCDs are likely to be able to recover any administrative costs they incur to administer the fee through their reimbursement authority in the bill.