BILL ANALYSIS Ó
SENATE COMMITTEE ON APPROPRIATIONS
Senator Ricardo Lara, Chair
2015 - 2016 Regular Session
SB 1460 (Leno) - Community colleges: funding: San Francisco
Community College District
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|Version: April 5, 2016 |Policy Vote: ED. 8 - 1 |
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|Urgency: No |Mandate: No |
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|Hearing Date: April 18, 2016 |Consultant: Jillian Kissee |
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This bill meets the criteria for referral to the Suspense File.
Bill
Summary: This bill provides that the San Francisco Community
College District (SFCCD) is entitled, for three years beginning
in the 2017-18 fiscal year, to restoration of any reduction in
apportionment revenue due to decreases in full-time equivalent
students (FTES) up to the level of FTES funded in the 2012-13
fiscal year.
Fiscal
Impact:
The California Community Colleges (CCC) Chancellor's Office
estimates that SFCCD will restore FTES between two and three
percent per year over the next few years. This would
translate to a cost between $2.5 and $3 million per year. The
incremental cost pressures attributed to this bill going
beyond the district's growth cap calculated by the
Chancellor's Office in a particular year, would likely be in
SB 1460 (Leno) Page 1 of
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the low millions based on the district's estimated growth.
(Proposition 98)
Background: Existing law requires the California Community Colleges (CCC)
Board of Governors (BOG) to develop criteria and standards, in
accordance with specified statewide minimum requirements, for
the purposes of making the annual budget request to the Governor
and the Legislature and allocating state general apportionment
revenues. These include, among other things, a requirement that
the calculations of each district's revenue level for each
fiscal year be based on specified criteria with revenue
adjustments being made for increases or decreases in FTES for
specified purposes.
The Chancellor's Office newly developed growth formula, which is
used to determine allocation of apportionment funding, uses
local demographic factors, such as unemployed adults, households
below the poverty line, and educational attainment, to determine
which colleges have more need for community college education.
The formula also considers the college's ability to grow. The
outcome of this calculation is a growth rate of between one and
four percent for most colleges which is considered a "cap" on
the FTES funding that can be received by the district.
Existing law provides a year of stabilization funding, during
which the district receives at least the same funding for
enrollment as the previous year (even if enrollment declines) or
higher funding if enrollment increases (up to an allowable cap).
This is because a district usually does not know that its FTES
count has declined until it begins its enrollment counts, which
occur at the same time the state is disbursing funds and after
the district has hired faculty and determined its class
schedules. If enrollment declines beyond the one year, the
district's revenues are reduced by the decrease in its FTES.
However, those reductions are restored if enrollment increases
during the subsequent three years, providing a district with a
buffer against fluctuating enrollments. (Education Code §
84750.5 et.seq.)
In June 2013, the Accrediting Commission for Community and
Junior Colleges (ACCJC) notified the San Francisco City College
that its accreditation would be terminated as of July 31, 2014.
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In June 2014, the ACCJC adopted a new policy that created a
"restoration" status under which an institution could submit a
request to restore its accredited status within a two year
period. The SFCCD submitted the required documentation and was
granted restoration status by the ACCJC in January 2015. Under
this process, if the SFCCD does not meet specified requirements
during the two year time period ending in January 2017, it would
lose its accreditation with no right to request further review
or appeal.
Since the 2012-13 fiscal year, the college has lost over 30
percent of FTES. SB 860 (Committee on Budget and Fiscal Review,
Chapter 34, Statutes of 2013) requires the BOG to provide the
SFCCD with specified revenues if the district is in jeopardy of
losing its accreditation and if the Chancellor's Office has
exercised its fiscal oversight authority to take specified
actions, including the appointment of a special trustee. The
bill provided the SSFD with additional funding, for three fiscal
years, as the San Francisco City College worked to restore
student enrollment and maintain accreditation. Pursuant to the
bill's provisions, for the 2014-15 fiscal year, the district
received FTES funding equal to the amount it received in the
2013-14 fiscal year, with the amount of funding for the district
being reduced by five, and 10 percent, in 2015-16 and 2016-17,
respectively. In order to receive the third year of funding,
the district is required to meet or exceed benchmarks related to
fiscal management and controls, as specified. This funding will
cease after the 2016-17 fiscal year.
Proposed Law:
This bill provides that the SFCCD is entitled for three years
beginning in the 2017-18 fiscal year, to restoration of any
reduction in apportionment revenue due to decreases in FTES up
to the level of FTES funded in the 2012-13 fiscal year.
Staff
Comments: This bill allows the SFCCD to grow enrollment beyond
the enrollment cap calculated by the CCC Chancellor's Office,
beginning in the 2017-18 fiscal year - the year after the SFCCD
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receives its last installment authorized under SB 860. The
enrollment cap for the 2015-16 fiscal year is currently
estimated to be 1.3 percent ($1.3 million). The Chancellor's
Office estimates the SFCCD will restore FTES between two and
three percent per year over the next few years. Therefore, cost
pressures attributed to this bill would be the incremental
amount above the growth cap established by the Chancellor's
Office, if the SFCCD experiences an increase in FTES.
This bill also authorizes the SFCCD to grow up to its funded
FTES level in the 2012-13 fiscal year, which would cost in the
mid tens of millions. However, based on the level that the
district is estimated to grow in the next few years, this is
unlikely. If the SFCCD does not experience an increase in FTES
in three years beginning with the 2017-18 fiscal year, then
neither the restoration funding up to the growth cap nor the
additional funding beyond the cap permitted by this bill would
be triggered.
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