BILL ANALYSIS                                                                                                                                                                                                    Ó



                                                                      SB 81


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          (Without Reference to File)





          SENATE THIRD READING


          SB  
          81 (Committee on Budget and Fiscal Review)


          As Amended  June 16, 2015


          Majority vote.  Budget Bill Appropriation Takes Effect  
          Immediately


          SENATE VOTE:  Vote not relevant


          SUMMARY:  Contains necessary statutory and technical changes to  
          implement the Budget Act of 2015 relating to higher education.   
          This bill makes the following statutory changes to implement the  
          budget:


          1)Makes changes to California State University's capital outlay  
            program to better align its reporting to the Department of  
            Finance on proposed capital projects with the timing of Board  
            of Trustees' decisions. 

          2)Responds to new federal regulations by authorizing private  
            colleges and universities to operate in the state, and sets up  
            a complaint process for students through the Board of Private  
            Postsecondary Education.  









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          3)States that if the Commission on State Mandates determines  
            that acts in this bill are costs mandated by the state,  
            reimbursement would occur through the mandates process.

          4)Provides $48 million one-time Proposition 98 (1988) General  
            Fund for deferred maintenance, instructional equipment and  
            drought resistance projects at community colleges.  The  
            funding will be distributed on a per-student basis.

          5)Shifts $23 million in 2014-15 funding from the Innovation in  
            Higher Education Awards program from the General Fund to  
            Proposition 98 General Fund, to reflect the amount of awards  
            distributed to community colleges.

          6)Allows the University of California (UC) to use project  
            savings from the UC Merced Classroom and Academic Office  
            Building project to cover potential deficiencies in the  
            construction phase of the same project.

          7)Amends the Middle Class Scholarship program to exclude  
            students with family assets over $150,000, sets a four- or  
            five-year time limit for the program similar to limits imposed  
            in the Cal Grant program, and allows income and asset limits  
            to increase with the Consumer Price Index.  Also reduces  
            statutory appropriations for the program in the 2015-16,  
            2016-17, and 2018-19 years and states legislative intent that  
            those savings be redirected to other higher education  
            programs. 

          8)Expands the UC's capital outlay program by allowing it to use  
            its General Fund appropriation to make availability payments  
            on capital expenditures.  Also requires the university to use  
            this funding structure for the UC Merced 2020 project as long  
            as work traditionally performed by UC employees continues to  
            be performed by UC employees.   

          9)Creates the Basic Skills Partnership Pilot Program, which will  
            provide five community college districts with $2-million  
            grants to develop partnerships among schools districts,  








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            community colleges and California State University campuses to  
            develop improved strategies to provide remedial education for  
            underprepared college students.    

          10)Authorizes the Superintendent of Public Instruction (SPI),  
            for purposes of participation in federal Higher Education Act  
            of 1965 Title IV, which authorizes federal student financial  
            assistance programs, to:  a) certify by name, a regional  
            occupational center and program, or a county office of  
            education or an adult education program to legally authorize  
            the center, program or county office to provide an educational  
            program beyond secondary education, including an education  
            program that leads to a degree or certificate; b) adopt  
            regulations that authorize a complaint process under the  
            Uniform Complaint Procedures (UCPs) outlined in specified  
            regulations; and c) decertify any program no longer in  
            compliance with specified requirements consistent federal  
            regulations, among other provisions. 

          11)Requires the California Community Colleges or California  
            State University to exempt students from nonresident tuition  
            starting on July 1, 2015, if they the meet all of the  
            following requirements:  a) student resides in California; b)  
            student meets the definition of "covered individual," as  
            defined under United States Code Title 38, federal statute; c)  
            student is eligible for education benefits under either the  
            federal Montgomery GI Bill or Post 9/11 GI Bill program, and  
            are continuously enrolled at the campus they attend. 

          12)Eliminates a reduction in the maximum amount of the Cal Grant  
            A and B awards for students attending private, non-profit  
            colleges or accredited for-profit colleges for two years.   
            Students will receive $9,084 annually for tuition expenses for  
            2015-16 and 2016-17.  In 2017-18 and thereafter, the award  
            will be reduced to $8,056 annually.

          13)Requires funds appropriated to the board of governors for the  
            Foster Care Education Program to be used for foster parent and  
            relative/kinship care provider education as specified by the  








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            chancellor, in consultation with an advisory committee.   
            Specifies that each college receiving funds for this program  
            shall have a plan for foster parent and relative/kinship care  
            provider education that includes provisions of training, and  
            comply with all reporting requirements, guidelines and other  
            conditions specified by the chancellor. 

          14)Codifies various reporting requirements for the Student  
            Success and Basic Skills Students program, the Student  
            Financial Aid Administration program, technical assistance  
            provided to community college districts pursuant the Student  
            Success and Support Program, and the Telecommunications and  
            Technology program.  Requires the Chancellor to annually  
            submit reports for the prior fiscal year to the Department of  
            Finance and the Legislature by December 31.

          15)Authorizes the chancellor's office to adjust the general  
            apportionment formula to recognize funds appropriated to  
            address increased operating costs and to improve instruction.   
            Further, this section authorizes the Chancellor's Office to  
            make conforming adjustments to the community college budgetary  
            standards and criteria, and requires the chancellor to notify  
            the Department of Finance and the Legislature of the specific  
            adjustments made. 

          16)Provides the Department of Finance the authority to modify  
            and update Proposition 98 General Fund appropriations to  
            California Community Colleges based on updated revenue  
            estimates for redevelopment agencies and Education Protection  
            Account (Proposition 30 of 2012).  Proposition 98 General  
            Funds would be used to offset any difference between a)  
            estimated revenues for community colleges from redevelopment  
            agencies and the Education Protection Account (Proposition 30)  
            and b) the amounts distributed to colleges from these sources  
            by June 30.  This change will allow districts to have more  
            certainty when preparing their fiscal plans.

          17)Extends the sunset date for the Career Technical Education  
            Pathways Program from June 30, 2015, to July 1, 2016, and  








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            appropriates $48 million one-time Proposition 98 funds for the  
            program.  

          18)Increases the number of competitive Cal Grants by 3,250  
            awards for a total of 25,750 awards.  Eligibility for  
            Competitive Cal Grant awards is geared toward nontraditional  
            students who did not go to college right after high school, do  
            not depend on their family for financial support or are  
            returning to college for career training. 

          19)Provides $6 million to the Chancellor's Office to implement  
            Baccalaureate Pilot Program established pursuant to SB 850  
            (Block), Chapter 747, Statutes of 2014.  These funds may be  
            used to support professional development activities.  

          20)Provides $1 million from the General Fund to establish and  
            implement a new freshman eligibility study pursuant to  
            legislation enacted in 2015-16 to determine if admission  
            requirements at the University of California and California  
            State University are consistent with the state's 1960 Master  
            Plan for Higher Education.

          21)Requires the Community College Chancellor's Office to report  
            to the California Apprenticeship Council within 30 days of  
            each apportionment period information regarding the hourly  
            rate paid to local educational agencies and community  
            colleges, and the number of instruction hours allocated to and  
            reported by each local educational agency and community  
            college.

          22)Requires the Community College Chancellor's Office to notify  
            local education agencies and community colleges of upcoming  
            allocation amounts within 30 days of the enactment of the  
            Budget Act.

          23)Allows the Community College Chancellor's Office to work with  
            the Division of Apprenticeship Standards to develop and  
            implement innovative apprenticeship programs in high-growth  
            industries.








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          24)Creates the Basic Skills and Student Outcomes Transformation  
            Program, which will provide $60 million Proposition 98 General  
            Fund to assist community college districts in improving the  
            delivery of basic skills instruction.

          25)Requires the Legislative Analyst's Office to study and report  
            on whether there is a long-term need for a new California  
            State University or UC campus, and if there is a need, where  
            campuses would be needed.  

          26)Amends SB 174 (De León), Chapter 363, Statutes of 2014, and  
            SB 798 (De León), Chapter 367, Statutes of 2014, which allows  
            taxpayers, upon receipt of the California Educational  
            Facilities Authority's certification, to receive an income or  
            franchise tax credit for a specified percentage of cash  
            contributions made to the College Access Tax Credit Fund  
            (Fund) for the purposes of increasing the Cal Grant B access  
            award.  Amendments add a new College Access Tax Credit for one  
            year, tax year 2017 under the Insurance Gross Premiums Tax and  
            Corporation Tax, adds the College Access Tax Credit to the  
            list of tax credits that can reduce the Tentative Minimum Tax  
            under the Alternative Minimum Tax calculations for Personal  
            Income and Corporation Tax, continuously appropriates the Fund  
            to the California Student Aid Commission to award supplemental  
            Cal Grants, and other technical changes.



          Analysis Prepared by:                                             
                          Mark Martin / BUDGET /  (916) 319-2099  FN:  
          0000971















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