BILL ANALYSIS                                                                                                                                                                                                    Ó



                                                                    AB 2412


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          Date of Hearing:  May 4, 2016


                        ASSEMBLY COMMITTEE ON APPROPRIATIONS


                               Lorena Gonzalez, Chair


          AB  
          2412 (Chang) - As Amended March 17, 2016


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          Urgency:  No  State Mandated Local Program:  NoReimbursable:  No


          SUMMARY:


          This bill establishes an incentive grant program for the  
          completion of industry-recognized credentials at the California  
          Community Colleges (CCC), commencing with the 2017-18 academic  
          year. Specifically, this bill: 


          1)Establishes an incentive grant program, to be administered by  
            the California Community Colleges Chancellor's Office (CCCCO),  








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            for the completion of credentials at CCC campuses. The  
            credentials would be in high-demand occupational areas as  
            identified by the CCCCO, working with local workforce boards,  
            businesses, industry, the Employment Development Department,  
            and the California Workforce Development Board.


          2)Requires the CCCCO to provide each participating CCC campus  
            with grants of $1,000 for each credential earned by a CCC  
            student in one of the occupational areas identified per (1).


          3)Requires grant funds to be used to improve its workforce  
            development and career technical education programs by  
            upgrading equipment, purchasing supplies, expanding programs,  
            or for any other use that would improve campus workforce  
            education and career technical education programs. Grant funds  
            cannot be used to fund the salaries or benefits of personnel  
            in recipient departments.


          4)Requires the CCCCO to report to the Legislature on the program  
            by December 1, 2018 and every three years thereafter.


          FISCAL EFFECT:


          1)Annual costs for the incentive grants would depend on the  
            number of occupations identified by the Chancellor's Office as  
            high-demand and the number of students completing credentials  
            in these occupations. Costs would probably be at least several  
            million dollars annually. According to the CCCCO, 90,821  
            students completed a CTE certificate or degree. If only 10% of  
            these degrees were in high-demand occupations, costs for  
            incentive grants would exceed $9 million (GF-Prop 98). 


          2)Administrative costs for one position at the Chancellor's  








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            Office would be about $120,000 annually. [General Fund]


           





          COMMENTS:


          1)Purpose. According to the CCCCO, employers currently struggle  
            to find workers who possess the necessary skills to fill job  
            openings, and this skills gap is projected to grow. By 2025,  
            30% of all job openings in California (1.9 million) will  
            require some form of postsecondary education short of a  
            four-year degree. California's education pipeline is not  
            keeping pace with the higher levels of skills and education  
            required by employers and must significantly increase the  
            number of individuals with industry-valued, middle-skill  
            degrees, certificates and credentials.


            The author argues that, "enactment of this legislation will  
            prompt important change within the community college system to  
            put greater emphasis on career technical education and  
            workforce development."


          2)Governor's Budget Proposal. The Governor has earmarked $200  
            million in the CCC's 2016-17 budget to establish the Strong  
            Workforce Program, which is designed to allow CCC campuses to  
            expand access to career technical education courses and  
            programs and to implement a regional planning and  
            accountability structure to meet regional workforce needs.


          3)Comments. The program envisioned in this bill seems to be  








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            ongoing, but this is unclear. While the program is  
            characterized as an incentive program, and is geared toward  
            high- demand occupations, a participating college's grant  
            amount appears to be based on past performance, i.e. the  
            number of students having completed credentials in the  
            identified occupations. There does not seem to be any  
            requirement that participating colleges increase the number of  
            students completing credentials in these occupations.


          Analysis Prepared by:Chuck Nicol / APPR. / (916)  
          319-2081