BILL ANALYSIS                                                                                                                                                                                                    

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          (Without Reference to File)


          1602 (Committee on Budget)

          As Amended  June 13, 2016

          Majority vote.  Budget Bill Appropriation Takes Effect  

          |ASSEMBLY:  |      | (April 28,    |SENATE: |29-5  |(June 16, 2016)  |
          |           |      |2016)          |        |      |                 |
          |           |      |               |        |      |                 |
          |           |      |               |        |      |                 |
                    (Vote not relevant)

          Original Committee Reference:  BUDGET

          SUMMARY:  This is the Higher Education Trailer Bill for 2016-17.  
           It contains necessary changes related to the Budget Act of  
          2016.  This bill makes various statutory changes to implement  
          the 2016-17 Budget.


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          The Senate amendments delete the Assembly version of this bill,  
          and instead:
          1)Updates and modernizes the California Library Services Act to  
            reflect local libraries' increasing use of and sharing of  
            digital materials, and eliminates references to a  
            reimbursement program among libraries that is no longer  
            utilized.  Provides $3 million one-time for libraries for this  
            purpose and requires the State Library to report on the use of  
            additional funds.

          2)Implements the Innovation Awards for 2016-17, which will  
            provide grants to community college programs that reduce  
            students' time to degree or total cost of attendance in three  
            categories:  programs that redesign curriculum and  
            instruction, such as implementation of three-year bachelor's  
            degrees; programs that allow students to make progress toward  
            degrees by allowing credit based on demonstration of knowledge  
            and competencies, such as military training or prior  
            experiences; and programs that make financial aid more  
            accessible or reduce other student costs.  Grants will be  
            awarded by a committee, which will give preference to programs  
            that improve outcomes for students from groups that are  
            underrepresented in higher education.

          3)Amends the Middle Class Scholarship program to reduce funding  
            in 2016-17 and beyond by $42 million.  Funds available in  
            2016-17 will be $74 million; with the allocation growing to  
            $117 million in 2017-18 and beyond.

          4)Allows San Francisco City College to earn enrollment funding  
            for five years, beginning in 2017-18, if the college exceeds  
            the system-wide enrollment target during this period.

          5)Creates the Student Success for Basic Skills program and  
            eliminates the Basic Skills Initiative.  The new program  
            provides categorical funding to help improve outcomes for  
            students in pre-collegiate level courses.  Funding supports  
            the implementation of evidence-based practices and will be  


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            distributed, beginning in 2017-18, using a three-part formula:  
             50% will be based on colleges' ability to quickly move  
            students from remedial courses to college-level English and  
            math courses, 25% will be based on the percentage of  
            low-income students at a college, and 25% will be based on the  
            number of basic skills students at a college.

          6)Requires the University of California and California State  
            University to provide information in bi-annual reports to the  
            Legislature and Department of Finance regarding the costs of  
            educating a student based on a cost of instruction model  
            developed by the National Association of College and  
            University Business Officers.

          7)Amends the 2015 Budget Act to allow funding provided to  
            increase the number of full-time faculty at community colleges  
            to be distributed to all districts, including basic aid  

          8)Provides $31.7 million Proposition 98 of 1988 General Fund to  
            community colleges to backfill for local property tax revenue  
            that was less than anticipated in the 2015 Budget Act. 

          9)Provides $5 million Proposition 98 General Fund to support  
            technical assistance to adult education regional consortia.   
            Funding will allow a chosen community college district or  
            local education agency to provide statewide leadership  
            activities for consortia, including disseminating best  
            practices, providing professional development and evaluating  
            the adult education program.

          10)Provides $4 million one-time General Fund to the University  
            of California to develop online classes and curriculum for at  
            least 45 middle school and high school courses that align with  
            state Board of Education standards and University of  
            California (UC) admissions standards satisfying the "a-g"  
            subject requirements.


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          11)Provides $20 million one-time Proposition 98 general Fund to  
            expedite and enhance the development of online courses  
            available through the online course exchange of the Online  
            Education Initiative.

          12)Provides $7 million one-time Proposition 98 General Fund to  
            enhance network infrastructure at community colleges. 

          13)Requires reporting from the Chancellor of the Community  
            Colleges and the Superintendent of Public Instruction no later  
            than August 1, 2017 on options for integrating the adult  
            education assessments into the common assessment system  
            developed by the community colleges.  Extends the deadline for  
            annual reporting on adult education outcomes from Sept 30th to  
            a two-part report due in October 30th and January 1st of each  

          14)Adjusts the interest rate on three Compton Community College  
            District emergency apportionments to 2.307%, which is  
            reflective of the rate recently provided to other K-12  

          15)Establishes the Zero-Textbook-Cost Degree Grant Program,  
            which provides $5 million one-time Proposition 98 General Fund  
            to community colleges that implement these programs.   
            Zero-textbook-cost degrees are community college associate  
            degrees or career technical education certificates earned by  
            completing courses that eliminate conventional textbook costs  
            by using alternative instructional materials, such as open  
            educational resources.  This bill provides a maximum grant of  
            $200,000 to community college districts for each degree  
            developed or implemented that eliminates textbook costs for  

          16)Provides $35 million one-time General Fund to the California  


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            State University to increase graduation rates, funding is  
            contingent upon the adoption of a graduation rate improvement  
            plan.  The plan must specify the time frame in which the  
            California State University (CSU) and each campus will  
            increase the four-year graduation rate for freshman students  
            and two-year graduation rate for transfer students above the  
            graduation rate of students at other postsecondary  
            institutions; and increase the four-year and two-year  
            graduation rates of low-income, students from underrepresented  
            minority groups, and first generation college students.  CSU  
            will be required to report legislative recommendations to the  
            Legislature and the Director of Finance to improve graduation  
            rates as specified in the plan. 

          17)Provides $200 million ongoing Proposition 98 General Fund for  
            community colleges to expand quality career technical  
            education and workforce development courses, pathways, and  
            programs.  Career Technical Education Regional Consortia will  
            collaborate with other public institutions, such local  
            education agencies, and relevant stakeholders to increase the  
            number of CTE offerings.  Each consortium shall submit a  
            regional plan by January 31, once every four years, to the  
            Chancellor's Office, regarding the governance model of the  
            consortium, analysis of regional labor market needs, wage data  
            for each industry sector, measurable regional goals that align  
            with the performance measures of the federal Workforce  
            Innovation Opportunity Act, among others.  Forty percent of  
            funds will be distributed to the CTE Regional Consortia, and  
            60% funds will be distributed directly to community college  
            districts.  In 2016-17, funds shall be allocated based on  
            local unemployment rate, the regions proportion of CTE  
            full-time-equivalent students, and projected job openings.   
            Beginning in 2017-18, funds will also be allocated based on  
            the proportion of successful workforce outcomes.  

          18)Extends the sunset date for the Career Technical Education  
            Pathways Program from June 30, 2016, to July 1, 2017.

          19)Establishes until January 1, 2020, the California Initiative  


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            to Advance Precision Medicine in the Office of Planning and  
            Research for the purpose of developing, implementing, awarding  
            funding to, and evaluating demonstration projects on precision  
            medicine in collaboration with public, nonprofit, and private  

          20)Specifies that as a condition of receiving funds in the  
            2016-17 Budget Act, the University of California approve a  
            plan and timeline, beginning in the 2016-17 academic year, to  
            increase the number of freshman admits, who meet admission  
            requirements, at each campus, including students who are  
            enrolled in high schools with 75% or more unduplicated pupils,  
            and expand services and resources to students who enroll at UC  
            from these schools. 

          21)Repeals the sunset date for UC Subject Matter Projects, which  
            is scheduled to sunset on June 30, 2017.

          22)States legislative intent to establish a center for research  
            into firearm-related violence at the University of California.  
             Its research shall include, but not be limited to, the  
            effectiveness of existing laws and policies intended to reduce  
            firearm violence, including the criminal misuse of firearms,  
            and efforts to promote the responsible ownership and use of  

          COMMENTS:  This bill is a budget trailer bill within the overall  
          2016-17 budget package to implement actions taken affecting the  
          University of California, the California State University, the  
          California Community Colleges, the California Student Aid  
          Commission and the California State Library.

          Analysis Prepared by:                                             
          Mark Martin / Budget / 916-319-2099  FN: 0003436


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