Assembly Budget Subcommittee No. 2 on Education Finance

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Okay, I think we have everything squared away now. We'll begin today's Assembly Budget Subcommitee hearing on education finance. Today is the community college portion of the budget. As well. we'll hear from the Calbright College and their update. Our community colleges are the workhorse of the higher education system in California.

We used to always say 2 billion, and now the number is apparently 1.2 billion, which leads to one of the issues that we need to address the most, is enrollment and what's happening with our community colleges throughout California, not just the colleges, but the students that they serve, and what this means going forward. Of course, our community colleges focus on a lot of things, not just students who are looking to get an AA degree or transfer, but adult education, workforce training.

And so we'll get into the basics of that. But back to enrollment. Enrollment had been dipping in our colleges for a while, and certainly after the pandemic, they dipped a bit more, and they've stayed down. We have about 200,000 fewer students accessing higher ed from before the pandemic. That has impacts not only on their community colleges, but for the workforce, but also, as we've heard in our earlier hearings, it's an impact on UC and CSU as far as transfer.

So we're going to look as far as what we could be doing to address those, as well as going forward. I know this hold harmless thing is not potentially the answer forever. So what is the new normal for funding for community colleges? Some districts who are growing can see the benefit of that. Some may be on the flip side, and maybe that's just a reality that we need to live with. It's not like the monies for community colleges are going to go elsewhere.

Other places in the state budget, by law, Prop 98, 11 percent goes to our community colleges. So we have to look at creative ways to do that. Community colleges, of course, have the benefit this year of a COLA, a very generous COLA. And while a lot of colleges are saying they want more than 8%, I'm reminding them, how much does the childcare center across the street get with their COLA? 0%. So just be very mindful as far as the budget situation there.

Lastly, again, we're going to check in on the Calbright College. Certainly glad to see their enrollment is growing slightly, but it remains still one of the smallest colleges in the system, and we still have many questions whether or not this endeavor makes sense, particularly when so many colleges are offering online courses. And we'll get to that a bit later as well. So with that, let's get started. Issue number one, enrollment. Let's hear from the Department of Finance, LAO, and the Chancellor's Office.

Okay, Department of Finance, please proceed.

Thank you. Good morning, Chair and Members. Madison Sheffield with the Department of Finance. To start, I would like to quickly touch on the California community college's multiyear roadmap. The roadmap between the Administration and the Chancellor's Office focuses on equity and student success. Building upon the system's vision for success, the roadmap established at the 2022 Budget Act defined the shared expectations and ambitious goals.

Investing available Prop 98 resources for the colleges to support these efforts in expanding the Chancellor's Office capacity to better support colleges in meeting these goals. In particular, the multiyear roadmap focuses on goals related to intersegmental collaboration for timely transfer, reducing time to degree, closing equity gaps, and improving alignment with k-12 and workforce needs. I'll now turn to enrollment.

Enrollment at the California community colleges has dropped by over 16% in headcount enrollment since the beginning of Covid-19 pandemic, as you mentioned, mirroring a national trend of declining enrollment for higher education institutions, which has been particularly acute for the nation's community colleges. Local community colleges must continue outreach, recruitment, reengagement, and retention efforts. To address recent enrollment inclines, declines, excuse me, the budget includes an additional 200 million one time Proposition 98 General Fund to continue to support community college efforts and focus strategies to increase student retention rates and enrollment.

Further, the Governor's Budget includes funding for 0.5% enrollment growth coming to 28.8 million. This is more of a technical adjustment and provides funding which can be used by districts that are growing, and any unused growth funding is potentially available to cover increases to districts supplemental and success allocations. In addition to responding to enrollment declines in recent years, the recent Budget Acts have provided significant financial support to the community colleges, including student financial aid and basic needs, as well as for community college operations.

This includes providing a funding floor for the Student Centered Funding Formula's hold harmless provision beginning in fiscal year 25-26. To this end, the Administration will be monitoring district level enrollment trends as we move past the Covid-19 pandemic. It is imperative that districts regain some of the enrollment lost during the Covid-19 pandemic.

As such, the Administration will work with stakeholders to consider options to adjust district budgets should a district not display that they are regaining enrollment lost during the Covid-19 pandemic entering the 24-25 academic year. I'm happy to answer any questions you may have about these investments.

Okay, thank you. LAO.

Thank you, Mr. Chair. Paul Steenhausen with the Analyst Office. So there's a few issues before you in item one. First, enrollment for 2021-22 has been finalized by the Chancellor's Office, and data indicates that none of the $24 million provided by the Legislature for enrollment growth that year in 21-22 was actually earned by districts, and that was due to enrollment drops during the pandemic. So that $24 million from 21-22 is now available to the state to sweep and use for other Proposition 98 priorities.

So data on the $27 million in enrollment growth money for 22-23, the current year, is not going to be finalized until February next year, 2024, and there's likely going to be some unused enrollment growth money, and so the Legislature can sweep those funds at that time.

Now, by the time of May Revision in just a few weeks, the Chancellor's Office will provide the Legislature with updated preliminary enrollment information for the current year, and we recommend the Legislature use that data to make a decision on the Governor's proposal to provide enrollment growth money for the budget year 23-24. We may see, based on some preliminary information we've seen, there may be some districts that are actually in a position to grow, to grow beyond pre-pandemic levels. That's very good news for them.

And so providing enrollment growth money in the budget year would be good policy, we think. It would encourage districts to strive and improve their enrollment numbers, and also, if the money is not ultimately earned, the Legislature can always sweep that money at a later time. So it's pretty kind of low cost, low risk to provide enrollment growth money. So as the agenda also notes, the Legislature just provided $150 million one time for enrollment and retention funds. That's in the current year budget. That can be used for outreach.

Districts have through the budget year to actually spend that money. Unfortunately, there's no system wide expenditure data the Legislature can tap into. So what our office did was kind of the old fashioned contacting districts, as many districts as we could, and said, do you still have money from the current year budget that's available next year for outreach for enrollment and retention funds. And what we heard by and large was, yes, we have substantial money left over that we're going to have available to us next year.

They also pointed out there's money in the current year budget for Covid-19 Block Grants. That's state money, $650 million one time, that's available to districts through 26-27. Districts said we also have that money available next year for outreach purposes. So because of that, we don't see the rationale. It's unclear to us why the state would want to provide an additional $200 million one time for outreach purposes when there's all this remaining money that districts have for next year.

And of course, to the extent districts see this outreach, these outreach efforts, as effective, they have other fund sources such as their apportionments, their general purpose money. So we recommend the Legislature reject the Governor's proposal to provide an additional $200 million one time for outreach and retain those funds for facility maintenance projects. And you can hear more about that in this issue or in the later issues when the Legislature and this Committee discusses facilities maintenance. Thank you.

Thank you. Next, let's hear from our California Community Colleges Chancellor's Office.

Hi. Good morning, Chairman McCarty and Members of the Budget Subcommitee. My name is Lizette Navarette, Interim Deputy Chancellor of the California Community Colleges. I want to begin by just highlighting that April is California Community Colleges Month, and we're very proud of all of our students, faculty, and staff for everything that they do and our 1.8 million students across the state. As Chairman McCarty mentioned, we are California's community colleges by serving over 70% of public higher ed students.

A little bit about our students before I begin on addressing some of these issues. 69% of all of our students come from diverse backgrounds. They represent the rich cultures of our communities. I've included some additional data. I won't go over all of it, but to give you a sense of who are the students that we are serving right now.

This is very important context because it reminds us of our need to be adaptable, to be responsive to the individuals that we serve and their ever changing needs and the demographics and where they come from. 64% of our California community college students are working learners. That means that, as we think about enrollment and re-engagement, we need to consider their needs. And much of that includes the need to balance school and work and affordability.

Our students that are working aren't working for luxury, for internships, for experiential. Some of them are, and many are in apprenticeships and others. But most of them are working for survival, to put food on the table. And so we think about that a lot as we're considering enrollment and our strategies, not just bringing in new students, but how do we retain and help the students that are on our campuses persist. So a little bit about our students.

I also want to highlight that for every dollar that you spend on our community college students in financial aid and investments in their education, students gain $5 in their economic earnings. Community colleges are an effective strategy for addressing generational poverty and for socioeconomic mobility as we enter into economic uncertainty across the state. So, to the issue of enrollment, we conducted a statewide survey that had 90,000 respondents that highlighted some of what students need.

We targeted two populations, prospective students and students that had stopped out during the pandemic. And what we found, you'll see in slides 8 and 9, is that most students stopped out because of affordability needs. They needed to work and prioritize work. The cost of living was too extensive. And what we also found out is asked, is what would bring you back to our campuses? And what we found is that students need flexibility.

So many of the flexible modalities that our faculty have really championed and innovated has really served students because some students may find that they can come on campus for a class in the evening, but their morning class needs to be online so that they can go to work or tend to childcare. And so that flexibility sometimes is needed in one individual and they need two different modalities to address their educational needs. And it's something that many have found very helpful during this time.

And we see our faculty and staff leading. Some key opportunities that we identified in this data is that we need to make the connections to work and economic mobility very explicit. Students that come to our campuses, they want to know, when can I start? When will I complete? When can I start earning a living wage? The other is that we really need to consider student centered approaches to scheduling and offering pathways, and that really builds on our work around guided pathways and many others.

And then lastly is that colleges need to use state investments and connect all the various support services that have been offered to them. This includes block grant dollars, emergency grants, really effectively using the resources that the state has really put forward. Some high impact practices on slides 12 and 13 show that this work is beginning to pay off. Steady gains. We have more work to do, but we're starting to see the tides turn, and we're ahead of the national trends.

This fall we saw enrollment increase by 2.4%, and we expect spring to continue to bounce back even further. For our diverse and disproportionately affected communities, they're beginning to re enroll or come back to our campuses. And you'll see that this includes Latino students at 5.7% grew in enrollment, Native American and Alaskan Native 5.4, and Black and African American students 5.3% increase. So those are the student populations that we've been really targeting because we saw declines in those areas.

So we're glad to see that some of these practices are working. Those practices include forgiving debt and fees. So utilizing the block grant that the LAO mentioned to forgive debt and bring students back. Really think about how we offer courses, both hybrid and high flex, expanding dual enrollment, providing professional development for our faculty, and really investing in our faculty. One resource has been highly utilized is @ONE, it's an online teaching. And then the other is just reengineering how we provide student supports.

Some of our campuses have created a basic needs common app. So rather than going window to window to tell us that they need help or need assistance, colleges are really beginning to do that all as they onboard or begin the semester, so that they can identify them and connect them to all the basic needs and support services that are available to them for which they qualify.

So the last slide I'll end for this section is just highlighting where we've been explicit in connecting for our campuses, how they can leverage the various investments to really address what students are telling us they need. Again, it includes many of the efforts that the Assembly has championed that we are really glad to see implemented and working. So thank you very much. Happy to answer any questions.

Okay, thank you. Questions for Committee Members? Mr. Alvarez.

Thank you very much for the presentation. I just wanted to get a little bit more clarity on the 200 million dollar one time Proposition 98 funding. So there's been two years now, 120 million and then 150 million in funding. Briefly, if you could just talk about what it was used for, and then what is the exact proposed use? I see here that there's some discretion given to the Chancellor's Office on the allocation methodology, but I want to know what the funds were used for and what the plan is going forward.

Thank you for the question. Madison Sheffield, Department of Finance. Yeah, so as you mentioned, we've had two years of this funding so far, and the intention with the 200 million is to really be, is very similar. The budget language is the same, and it provides very broad flexibility with just a really strong focus on retaining and enrolling students after the Covid-19 pandemic.

So there's a focus in the language around students who may have left during because of the pandemic, various impacts of the pandemic. In terms of how the funding has been used, I'll speak briefly, and of course Chancellor's Office can add anything. We provide broad flexibility for the language, and we defer to districts to tailor strategies for the local and regional markets. And we have seen a wide variety of strategies, both at the district level and then we've had certain money going to a statewide campaign.

So of the 2021 150 million allocation, 11.9 million went to an icangotocollege.com statewide awareness and enrollment campaign, and then 108 million went to California community colleges campuses to provide support to the statewide campaign and also to provide support local strategies.

Was it all for a campaign for outreach?

Yeah, please.

I am happy to jump in. Some of the strategies that we've seen used by colleges, I'll name five. One of them has been to deploy call centers so that we can look at students that stopped out, and then call them and really figure out how to bring them back to the campus.

The other has been around peer outreach or family engagement on campuses, and that includes both having individuals that will work with them to get them re-enrolled, but also sometimes applying for financial aid or CalFresh. The other is forgiving fees that may have been owed. These can be student fees, parking fees. And then others are emergency grants. And then lastly...

Emergency grants for students?

Emergency grants for students. And then another big one has been around technology. So a lot of campuses have provided laptops or other...

So every campus had their own plan and it submitted it to the Chancellor's Office for review or just for information?

Some campuses submitted their plans for review, and that's really where we based our data, but they did not have to. But we received at least two thirds of overall examples from colleges on how they used it.

Thank you. I think those are all good examples. But what I also heard here mentioned is that the levels of services and the levels of the need is beyond just outreaching to folks, that it's much deeper than that. And so I'm just curious why this new funding continues, basically. That important outreach, which is important, but doesn't allow or isn't planned to be used for the deep level of needs that students you just expressed have at the community college system right now.

We would be very supportive of strategies and investments that are ongoing that address some of these needs. One of them is the Assembly's commitment to Cal Grants. That would be one of the most effective policies that can be championed to really help students. Based on what they're telling us is affordability is still the biggest hurdle that they face coming back.

Thank you. Your answer is very helpful for us to try to make these decisions on what this funding could be used for. I also note that 10% of the funds will be set aside for the Chancellor's Office. What exactly would that be?

Yeah, so the Chancellor's Office utilized these dollars the prior, the 150 million. We used 2 million of those for statewide campaigns and multimedia efforts. So we launched, I can go to college campaigns in 10 different languages across the state so that we can leverage the buying power of the system rather than each of our 72 districts, 73 districts, really going out and doing media buys on their own, which becomes very expensive.

So that's a $20 million, though, potential amount for this next year. What is the anticipated utilization of those dollars for?

Currently, we're looking at those strategies. I think part of it, if this moves forward, we would work with our system partners to identify what works best and look at some of the data that we got from the current campaigns. And we're open to changing our strategy based on campus need if this moves forward.

One last thing. Mr. McCarty is co-author a bill with me that went through Mr. Fong's Committee, AB 91, which is looking to actually increase enrollment in the binational region. So it's not necessarily an outreach expenditure, but more of an enrollment expenditure. I'd be interested if a portion of this $200 million set aside at the moment for outreach actually gets set aside for enrollment increases at the community colleges that would be impacted by AB 91.

Again, this would only be the community colleges in the border region. Do either of Finance or community college system have any comments on setting aside some of those funds for actual enrollment growth as opposed to just outreach?

Thank you. Yeah, we are happy to take that back. Aware of the bill, and happy to review further and take that back.

Okay. I'd love to hear your feedback on that before Budget, obviously. And to the community college system, are you aware of AB 91, this binational student program that would allow enrollment from students in the border region into our community college system?

Yes. Aware of it, and we're happy to look at this and engage our system partners around this proposal.

If you could also provide some feedback before Budget on if that could be incorporated in this 200 million dollar one time appropriation, that would be great.

Happy to do that.

Thank you very much, Mr. Chair.

Thank you. Mr. Fong.

Thank you so much, Mr. Chair. And thank you so much to all of you for the presentation here today. When we look at the high impact practices to really grow our enrollment, bring students back, I know it's been a challenging few years in our community college system. And districts across the state have been vexed and challenged with bringing students back, whether it's call centers, whether it's direct student outreach, and then all the work around basic need support and financial aid, additional student debt forgiveness.

And I'm glad to see that there's 18 colleges that have experienced growth of 10% or more. And when we make the rounds of our local community colleges, we know that flex dynamic scheduling has seemed to be part of that growth. And I'm glad you mentioned that on slide 13. How do we share the best practices of enrollment growth amongst the different colleges? Are they in communication?

I know a lot of times, sometimes the community colleges nearby each other are competing with each other in terms of the work and efforts. But when we look at from a student perspective, we really want to make sure that those opportunities are available to them, meeting their needs, whether it's asynchronous or whether it's the flex scheduling and the shorter length of classes that has been purported for the growth in enrollment. So how do we share those best practices amongst the entire system?

Thank you, Assembly Member Fong. Dynamic scheduling really is one of the most effective strategies that colleges are seeing. Again, to Assembly Member Alvarez, like those deeper reforms. One of several upcoming efforts is, when we started seeing these enrollment declines, we convened a roundtable of colleges to identify what was working and analyze best practices.

I'll share with all of your offices a publication that is being released this week on 10 high impact strategies that release colleges are seeing have worked and that will circulate around the campuses. That's one start. The other is looking at ways that our colleges can offer shorter term courses that are aligned to a pathway, really addressing workforce needs. That more intensive work may require us to change our attendance accounting. So I won't bore you with those details, but that extensive work will begin this summer.

Great. Thank you so much. And then in terms of outreach for students who are not coming back, are we also, I read a social media mentioned outreach, but is the texting as part of that campaign as well, with the phone banks?

Texting has been very effective. The other really effective strategy that we've seen deployed by many of our colleges, in Southern California especially, is bringing families onto the campus. Because what we're seeing is that a student needs a support network. And if we can engage their families, you can also connect and address other needs that may exist. One big one that I keep highlighting is CalFresh. That has really helped students and their families as well address some of their needs. And so on campus efforts both create a welcoming environment for the students and their families, but it helps the family have an expectation around the time commitments and how they can be supportive of their student.

Thank you so much. And we know that you got to continue to meet the needs of our students in terms of basic needs, in terms of housing, financial aid reform implementation. So really appreciate all the comments here today. Thank you. Thank you, Mr. Chair.

Thank you. Good question. Assembly Member Ting.

Thanks, Mr. Chair. Just question to Finance, LAO. What reasons have you looked at as to the declining enrollment as well as the slight uptick in increasing enrollment coming back?

What was the last part of your question? Sorry.

What reasons do you attribute to the declining enrollment as well as the slight uptick in enrollment this last year?

Thank you.

Both to you and LAO. Go ahead.

Yeah. So thank you for the question. Madison Sheffield, Department of Finance. So we know that, and LAO has also reported on this, that one of the biggest factors in community college and higher education enrollment is the economy. So it's a big piece. And then, of course, the Covid-19 pandemic changing shape and students being able to come back to classes when they can in person is a big factor as well. So I'll defer to LAO to add.

The way we think about it is kind of two phases since March 2020 that really accounts for the decline. The first is the pandemic itself. You had the pandemic. You have this public health emergency, health concerns, classes canceled, schools closed, and that sort of thing. But then something interesting happened with the economy picked up. It wasn't so much the public health concern. That was still a concern. But it was more the economy improving, but inflation as well.

And so you had individuals saying, I need to decide between going to school and the cost of that versus I have an opportunity to work now and earn decent wage. And on top of it, housing costs have gone up and other things that have been mentioned on inflation. So there's really this cost benefit analysis we see of individuals and deciding what's the cost of college versus the benefit of working while they can, and the need to pay back some debt and that sort of thing.

There has been an uptick, it looks like, in certain cases, which is good news. I think it's about 2% in the fall. The Legislature won't know about California community colleges for a few weeks in terms of the spring, but based on some national data that's just been released at other community colleges, there's been an uptick in the spring of about 2% versus last spring. And California has been trending pretty closely to the national trend.

So it could be that California sees an uptick, and I think there's probably a number of reasons for that. It could be individuals deciding that there's more flexibility now with the colleges, more flexibility in their own lives with childcare and schools and that sort of thing. There's also been a lot of attention to more personalized outreach. Assembly Member Fong, you mentioned about texting.

Something that colleges have told us has been helpful is they look at individuals who've started a community college application but not completed it, and they'll contact that person and say, hey, we see you're interested. What's going on? Well, I got stuck on this, or I need help with basic needs, or okay, well, we can help you with that.

So more of that personalized attention and bringing in kind of more of the support services and understanding students and what they can benefit out of going to community college for themselves and their families, as Ms. Navarette mentioned.

Yeah, happy to address that. I want to begin by highlighting that what we're really seeing is some of the investments and the attention to certain reforms that the Legislature has really put forward are paying off. For example, the Assembly championed basic needs centers, and those have been crucial during the pandemic, both with basic needs centers as well as food pantries and other such investments that really help us target the financial instability that ensued during the pandemic.

The other is the flexibility to offer courses in different modalities, at different lengths, is really helping individuals that maybe can't make it at different times of the schedule. So those are the ones that are really paying off. The last one I'll highlight is being very intentional about creating caring campuses where we're welcoming to our most diverse students and our first generation students, essentially not assuming that all communities know how to navigate college.

I guess just a follow up question. If the economy is the big issue, how much of an impact can our enrollment dollars even make when you're putting that money, sort of, and it's sort of like sailing downwind or sailing upwind, whatever the right analogy is. But you got a big wind, and no matter how big a sailboat you got, you're not going to be able to fight that wind. So I'm just trying to figure out what the best use of that resource is.

I think going back to the points you illustrated, just talking about being just more supportive of students, I think makes a lot of sense whether it's food or sort of handholding through that enrollment process. But I'm just trying to figure out what really is the right investment in terms of enrollment.

I'll just mention real fast. That's absolutely right. Assembly Member Ting we had conversations with a number of colleges and some said that this outreach money has been helpful. Another example is college in the L.A. area that chartered a bus and went to the high school, to the high school seniors and actually brought the students to the college campus and toured, did outreach intake, and that sort of thing. They attribute that kind of activity as helpful, but you're right.

In a way, they're sort of swimming up current, so it is difficult. One conversation we had with a district expressed this concern about they're spending all this money on phone banks and social media campaign, and texting, that sort of thing. But with the economy such that it is, with the jobs available and the inflation, it's really hard to overcome individuals kind of cost-benefit concerns or calculus.

Just tell you one college leader said that the effectiveness of the outreach initiative has less to do with our outreach activities and more to do with the post-COVID economic climate. I thought that was a good way of putting it and expressing how the kind of mixed results from doing this outreach in light of the economic situation.

Go ahead. Yes.

I was just going to add that the enrollment funding is very broad and can be used for retention as well. So it can be used for helping students overcome barriers for staying enrolled and then also help them have enough supports and basic needs and other resources in order to enroll in more units and finish more quickly.

I think I'd really like what Ms. Navarette was saying around being much more student-centered. So it's like meeting the students where they're at, right? So if the students need food, the students need food. That's what you're trying to provide. I like the bus analogy, but the community colleges can do that in having setting up relationships with all the variety of high schools. Hopefully, a lot of that already is sort of there in the works.

I know a little bit easier for my city because we're one big district, we're one community college. It's a little bit easier where there is that relationship that's set up. I was curious. Just ask Ms. Navarette a question. Wth the slide on page eight when you talked to previously enrolled students, 19% said not enough online classes impacted their enrollment decision. But then just below that, 14% said most classes are online and I prefer in-person.

Yeah.

How do you figure out which classes? And you sort of alluded to it, but how do you figure out which classes you got to put online, which classes you put in person? I have been very concerned that the system overall has been really the last ones to really come back to class. I think online learning is okay for convenience, but I think it also has its limitations.

So I'm just trying to figure out how your different campuses figure out what to put online, what to do in person.

Yeah. Thank you. I'm really glad you caught that piece because it really shows the juxtaposition of how colleges have to decide what goes on. And so they have some students that will say, online classes is great, this is perfect. I'm driving down the 405. I can't make it to class on time, and others that I just need to be in a classroom. Right.

And so the reality is that our colleges are having to offer both now, and that adds to costs and expenses and complexity, but it's the reality of what we need to offer to be responsive to Californians. So what colleges will do is they'll often put the same class in an in-person format and an online format. And sometimes those online classes fill up fastest and they'll transition them or they'll turn it into a hybrid class.

I really commend our colleges, and our faculty and staff have been very adaptive.

So when you say hybrid, is it I'm the instructor, I'm in the classroom with 10 students, and then there's more students online as well? So I'm teaching the same class. But some people are there in person. Other people are online.

Yeah. And that also is a new term in higher ed. Note, high flex, where they'll have some in person students and some online. And then a hybrid one is some days it'll be in person, other days it'll be online.

And then who makes that decision? Is it the college? Is it the instructor? Because I guess to me, you're in this very challenging dynamic. You have, what is it? Over 120 campuses, they each have their own governing bodies. And I think part of the challenge is there's sort of this inconsistency going on based on faculty and individual faculty preferences. And I've seen this in my own college. Before COVID you had a certain expectation that this was the classroom experience.

Now, if I were going to walk into a community college classroom, in my mind, I'm kind of not really sure what the experience is.

Yeah, a faculty member will make that decision. They also should be getting data from their college administration and others to see where enrollment is lying and see where demand exists. But that really has to be the willingness of a faculty member to teach in that modality, because.

Is that really what's happening for the thousands of? I find that very difficult to believe, that I'm a tenured faculty Professor teaching English, and I'm going to sit there looking at data and debate how I'm going to teach this class I've been teaching for 20 years.

I can't speak for all of our colleges and every single course that's offered. We have seen that as a practice. But I can imagine that there are instances where a faculty member's preference, and rightly so, could be in person, and that's what they choose, or online, and that's what they choose.

My impression is that it's really being driven by individual faculty. So the problem I have is that your office is really in charge of statewide standardization. However, each of the campuses is fairly autonomous, but yet they need the resources from the state, and they're giving, I think, a very inconsistent experience. This is something that we would not tolerate in K12. There's no way, I mean, we would not let individual fourth-grade teacher decide, hey, they get to teach hybrid or high flex or this.

That's not the way that fourth grade can be taught. And I do think that because of this, lack of consistency is part of one of the reasons that the enrollment hasn't come back. I understand that the population of students very different because they have very different economic needs and situations. They're the most vulnerable students in our system. But there's a reason why, prior to this, individual faculty didn't get to just decide however they wanted to teach their class in whatever way they wanted.

There was a certain set way to do it. Now, by doing it this way, it's sort of like the wild west. So how do we? I appreciate the ideal that this should be data-driven and really understanding what's happening. It's not my experience that this is actually what's going on. So how do we rein this back in to get to a point of consistency? I guess so that this. This really is kind of student-centered, not based on perhaps individual preference from a faculty member.

A couple of things. We're very mindful of the expertise that faculty have, and so they know their subject area, they know their students, and they've been adapting to what students are asking them. And so I do believe that they're making student-centered decisions.

And it is a very complex time because, in one single classroom, they'll have a student that has two different preferences. At the state level where we can be helpful and we are investing in that work and we'll continue to do so as we learn more, is in professional development. To help faculty, to help colleges make those decisions.

So we will continue to do that and work with our colleagues across the state so that we can support them and strive towards that consistency while still respecting our faculty purview and their expertise in their classroom.

LAO? First, LAO wants to jump in here.

Just to respond also, and to add what Ms. Navarrette is saying, because I think what you said is really important to keep in mind. The way colleges districts are funded is primarily based on enrollment. And so in a typical year, districts have a strong fiscal incentive to offer the classes that students want, when they want them, and the modality they want, and to see them through to completion.

For the last several years, because of the pandemic, because of the transition of the new formula, there have been a number of funding protections put into place whereby districts are shielded no matter what their enrollment level they get the same amount of money. And so there has not been, the last several years, a strong incentive for colleges to make sure that this is exactly what they want. I think that's part of the reason why you have the Chancellor's.

This is probably discussed more in the next issue, but you have the Chancellor's Office that's saying we've had these emergency conditions allowance funding protections for the last several years. That's scheduled to end at the end of this year. And starting next year, colleges are going to be funded instead of phase-in, but based on actual enrollment, I think the intent there is to bring enrollment modalities more in line with the fiscal incentives that the state wants.

Got it. Quick question on this is just a Budget Committee chart, which I think came from the Chancellor's Office around the percent of distance and in-person education, where it's for fall 2022, it's 52% in person, 48% distance. Does that include all courses, or is that just primarily what I would say, sort of college track, college track traditional academic courses?

This would include all courses. And on the distance ed component, any class that has some element of online would be categorized as distance ed as well.

Oh, I see. Okay, so I could offer 10 classes in person, but I had one class online. It would be distance ed?

Or you could offer your class that's five of the sessions are in person and five are online. And we would categorize that as distance ed.

Okay, maybe nice to have more breakout. My experience, at least with my own community college, is that all the. I don't want to miscategorize, but I would say the more vocational courses, culinary, we have, like auto body shop, all of those are in person. And then the large majority of the what I would say more academic, social studies, history, English, those are online. Is that sort of what you're seeing as well across the system?

Correct. We're seeing our career education courses are predominantly in person. There are a few subject areas that really lend well to having some elements that are online and those have been more flexible.

What's the continued logic to keep all the academic, or keep, let's say, the majority of the academic courses online?

Some of it really lends to what the LAO shared is that we're seeing the same class offered and the online class will often fill first. And so it's really kind of driven by students voting with their feet on what they want. And that's not the same. Sometimes it's a matter of which course, the time of day.

And I appreciate that. If you gave a 17-year-old a choice whether they would go to 12th grade in person or twelfth grade at home, I guarantee you I know what choice they'd make. Right? Doesn't mean it's the right academic choice, but I know what the choice they make. So I understand why people are choosing online. The question is, academically, what's the right choice?

So that's the concern I have because especially when you're dealing with your student segment, which is again, the most vulnerable segment, the ones that need the highest amount of attention. And those are the ones that the irony is you look at UC, they're all back. I guess CSU is a little bit more hybrid. Right, Mark? They're mostly back. Right?

So ironically, the ones that have the most resources are all back in person, and the ones that have the least resources are online, the very students you actually probably need to have the most contact with, the highest touch with. So I guess it's concerning. So I understand that this is the choice they're making. I just don't know that this is the right academic choice.

So at what point do the academics get in there and say, hey, yeah, I get it, this is for flexibility the right way, but doesn't mean that you're really learning the subject in order to get to the next, because at some point you have to progress. So yeah, you can take the course, but you got to progress the next course, the next course to get to your end goal. So at what point do you start evaluating the efficacy of those classes?

We're looking at student persistence and success data constantly, but this really lends to a much deeper analysis, which we're happy to look at and identify and happy to bring something back and walk through. Looking at success in fall as well. That might help provide some additional context as well. That would be helpful.

Yeah, I'm just concerned. I mean, this is why we had this discussion with the other higher ed segments to make sure that they were. And also there was a big debate a couple of years ago about bringing K through 12 back. But I understand what the students are choosing and what they'd like. I just don't know that that's the right academic choice. So I would like to see some data about how that works because I just feel that this is just the.

I think it's good to have a certain level of flexibility. But I also think from an academic standpoint, you have to be able to teach the class and also make sure the students are retaining that material, not just taking the class and just getting through it. Okay. Thank you.

Thank you, Assembly Member Cervantes.

Thank you, Mr. Chair. This is promising to see the upswing in enrollment statewide. I'm trying to get a better understanding, though, of the landscape by region, and I'm wondering if you had any information to share on what do you see as the regional differences in the enrollment trends.

I can speak to that. A couple of things that we're seeing is that some regions have really bounced back much faster. Often, that is in high-population centers. So we are seeing some of our rural communities, their enrollment picking up much slower. And the other areas as well, that we're seeing is housing is really affecting some of that bounce back. And so, for example, areas previously affected by wildfires really struggling to come back. We see a combination of jobs or affordability or access to housing.

And so those are some of the regions that we're seeing mostly, but they're really driven by external factors.

Is there data to show just that we could see on our regional.

We can pull data from fall and do a breakdown for you for a region. Yeah. Happy to provide that.

Okay, thank you. Most of the issues have been raised and good questions from the committee members. I want to just focus on two issues. One is kind of the money issue and the finances. And this is for LAO. So let's start there. And this somewhat bleeds over to the next issue with the apportionment funding. So I get that some colleges are doing better than others, and it's a big family. There's 100 plus colleges, nearly 100 districts, and there's winners and losers.

Is that a bad thing that you pay for people by the work that you do? Whether it's a piecemeal job, you get paid by how much work you do. So community college, we pay you for how many students you serve. And so we have x amount of money in the budget. That's for Prop 98. And so we have of that 11 percent. That's for our community colleges.

So it shouldn't be a worry that this is going to go to prisons or some other thing or even the reserve. This is staying in the community college world. So I guess the question is, what's the problem? If some colleges have a drop, okay, they get what they serve. And if some colleges grow, we'll give them more through their apportionment.

And then the money that's not spent reverted back and it's washed, and we spend it the next year for community college priorities, whether it's deferred maintenance or buildings or a plethora of issues that we hear from your advocates for one time needs. So what's wrong with that scenario?

Yeah, we don't see that as something wrong. In the past, the Legislature has funded community colleges the same amount per student. And then about four or five years ago, the state changed that and said, that doesn't make sense that you should get extra money if you're serving a low income student, for example, because they might be harder to serve and need more resources. There should be funding based on outcomes so that districts change how they provide instruction.

In a way, this is maybe getting Assembly Member Ting's point, so that they have an incentive to serve those students better. So, we do have a different amount per student. In terms of what's going to happen with all of these funding protections that are kind of going away or getting phased out. I think there's a concern among, generally with the system about, well, the money is going to stay in community colleges budget because it's Prop 98. And historically, community colleges get a certain percentage of that.

But there's a concern that certain districts are getting to get more than others because they're serving more.

Yeah, I want to focus more on just the enrollment piece. The formula I'm fine with. We debated this and it's similar to what we embrace with LCFF. Certain students, it costs more to help them succeed and we're with that.

But the issue is should we be concerned that some colleges and some Members of the league or not really the chancellor's office, but will come up here and say the sky is falling, we are seeing our college enrollment drop by this and that we want some hold harmless. And I think my scenario is no, we need to just live with the reality.

Some are going to have fewer students, you're going to get paid per student and then some will serve more and you'll get more and not have any hold harmless for enrollment. I think we just need to turn the page on that. And I just want to ask LAO, if we can't do that, and what's the downside to doing that?

So it's a gradual step down for districts. If you talk to districts they'll tell you, look, we were once a 16,000 student institution and now we're 12,000 but yet we're staffed at 16,000. So how does the state get it so that the institution is staffed and funded based on students that they're serving, based on actual workload and that's what the formula is designed to do and the various laws.

So you have emergency conditions allowance going away but it's going to be a gradual step down for districts. So they're not going to lose the money overnight. They have couple of year period to step down and align their budgets with the reality of their work.

Yeah, and I support that. So whether it's my district here, Los Rios or others I think Los Rios is kind of stabilized, but you have to right size to your new operation. If you go from 16 to 12, that's reality. If you're a restaurant that used to serve 300 people a weekend, now you're served 200, you have to change your staffing. That's just the reality. Maybe not do it overnight, maybe a period of time, but we can't just hold harmless indefinitely.

It doesn't make sense for a state.

Because there are other districts that are growing.

That are growing.

Yeah.

So I just think we need to turn the page on that and districts need to just focus on the reality that we're not going to just keep it as is like you were before. But the flip side to that is that maybe we don't have to have this dramatic and precipitous drop. And it is a challenge because we were talking up here. It's just like views in politics.

I'm not going to name a person or whoever in politics, but some people love that person, 25 percent love that person, 25 percent can't stand that person. And they're just like, that's life. Like a quarter and a quarter have strong opinions and 50 percent are roughly in the middle. So that's kind of here. A quarter say, we want more online. We want more of that quarter. You're saying we got too much online. We want this and that.

So we need to just kind of focus on the reality, which is, I think smart have options so students can vote with their feet, but voting, speaking of voting with their feet, I think in addition to students just not going to school because we have a booming economy, we have three ish, 4 percent unemployment. Like we talked about a few weeks ago, if you're in the Tahoe region, you can make $30 an hour working for Taco Bell.

So why do you want to go enroll in a community college? You can make plenty of money doing other jobs up there. And so some of these for profit and other schools, I think are just smarter in their meeting, the students, their needs. They're setting up shop in malls. I went to Arden fair mall last weekend. Looked pretty dead. There's vacant spaces. So should community colleges look at storefronts more? Should they do things differently?

Because I think that we can't be like, well, we've been doing this forever. We have these colleges, a big parking lot. We're here between Monday and Thursday, between 10 and 4 for 80 percent of our classes. And that's great because we're losing to the others that are doing a different model, and people have other lives, and they're voting for that. They're voting for that option. Sometimes they're voting for that option even though it costs money and puts them in debt.

I mean, we have community college that's free. During the pandemic, we were paying students to actually enroll. We have our expanded Cal Grant options that pay for not just books, but cost of living now. And we're stepping it up there. And some students are saying, that's fine. I'm still going to pay money out of my pocket and go in debt because this thing is more convenient for me. So do we think we are doing enough to kind of change and have differential offerings for students? Let me ask Ms. Navarette.

I really appreciate what you're highlighting because it also gives us more impetus and knowing that we have the Legislature's support to do exactly that, do things differently, be more adaptive, be more innovative. And I think that's exactly what we're seeing across our campuses. We're seeing them try and test and launch. And so are we there yet, all the way? No. Do we have room to grow? Absolutely.

So one of the exciting things that we're doing to do just that and be competitive against some of our for profits is really looking at is the 16 week semester construct too long? And the reality is that for this generation of learners, it is too long. It doesn't show that value proposition of like, what's the value of education?

And so the work that we will be beginning this summer to think about how we offer more short term aligned pathways so that a student can come to our campus and ask, when do I start and when can I finish? I think that is one key piece. And we will continue to document other strategies that are really innovative, as you've highlighted, because our biggest competition is not our four-year institutions or others.

It's really the for profits that can outspend us four to one on marketing and outreach and being at the mall and a variety of other efforts. So we have our work cut out. But what we're seeing from lessons from the pandemic are really setting us up to have those tough conversations and to do that work ahead.

Okay. I think we're okay here with that to move on with our agenda. Okay, thank you. We'll hold this issue open. Go on to issue number two. And that is apportionment funding.

Great. Madison Sheffield, Department of Finance. To start, I'd like to signal the administration's ongoing commitment to the student centered funding formula, or SCFF, through the volatile fiscal conditions posed in the last few years we've been talking about, the formula has proven a resilient and stable source of funding for the colleges. Despite the revenue decline, the governor's budget does not propose cuts to the California community colleges apportionments.

As mentioned in the agenda, the governor's budget includes the statutory studentcentered funding formula, cost of living adjustment, or COLA, of 8.13 percent, which translates to 652.6 million ongoing Proposition 98 heneral fund. I'm happy to answer any questions you may have about these investments.

Thank you. Paul Steenhausen, again, with the analyst office. So, the apportionment proposal. This cost of living adjustment proposal is by far the largest community college proposal in the January budget, based on new data. Since the January proposal, the estimated COLA rate will be even higher than 8.13 percent. More in the neighborhood of 8.4 percent.

Now, districts currently are facing cost pressures for the budget year to increase employees salaries, given the high inflation that we've been talking about while facing other core operating cost pressures. As this subcommitee heard from our office back in February when discussing about K-12 and Proposition 98, despite these challenges, we are concerned with the state's ability to support a higher COLA rate given the state revenue outlook and budget condition.

So we recommend the Legislature treat the January proposal, the 8.13 percent COLA, as an upper bound for 2023-24, and were the estimate of the budget year Proposition 98 minimum guarantee to be significantly lower at May revise, the Legislature might even want to consider a lower rate than what the governor is proposing in January. So something lower than 8.13 percent. Again, given the concerns we have looking at the revenue outlook for the state. Thank you.

Just wanted to share briefly. Sorry, good morning again. Lizette Navarette with the California community colleges. I wanted to begin by sharing a brief overview of the student-centered funding formula. As was highlighted, any resources, particularly the COLA, really supports the student centered funding formula by increasing the rates at which we pay for enrollment, connections to financial aid through the supplement component and support along success in various metrics. And so the COLA really is fundamental for that. On page 19 you can see a little bit more detail.

It also covers costs of the operating through funding for colleges and centers. And so these are all the resources that help a college serve students, provide for operations. And what we are seeing right now is that 62 of our districts have fully transitioned to the student centered funding formula, something positive that really will help with the transition, and then a little bit about what the COLA really provides. It is essential.

We would urge that the Legislature provide the full statutory COLA in alignment with K-12 to community colleges. These resources provide, again, supports across both academic, career, education and support services. They fund the core operations of our colleges, which are primarily funding people, faculty, staff, students and that's what comprises most of our budgets. And it allows us to keep pace with growing cost of operations and especially inflation. And I'll end by highlighting that investments in community colleges really pay dividends for the state of California.

We are a workhorse not only in the number of students that we help educate and train in various fields but also on the return on investment for California. A $128 million return on investment to California. And so as you're thinking about your choices in allocating this COLA, it really is essential, and it helps California as it enters economic uncertainty. So happy to answer any questions.

Excellent. Thank you. I'll start it off and then turn it to our Committee Members for questions. What options does the Legislature have if there is not enough ongoing Prop 98 general fund dollars to fully cover a COLA?

So one option would be to provide as much of a COLA as the Legislature feels comfortable with. So a partial COLA. And that's been done in the past. It's not often, but during tighter fiscal times, the state will provide less than what the calculation kind of indicates. So instead of 8.40 percent COLA, maybe the 8.13 percent COLA that the governor has in January, or something less, maybe 6 percent COLA or something like that, which is still something districts very much appreciate.

Again, they have pension cost increases, they have their employees who have their own personal cost pressures at home with bills and housing. And so what the state can afford, I think would be helpful to districts they appreciate. As chair McCarty mentioned earlier, a number of other departments aren't even proposed to get any cost of living adjustment for the budget year. So colleges do recognize that something is better than nothing or getting at least 6 percent, 7 percent, 8 percent COLA. It's still pretty historic and large for the colleges.

On that question, Assembly Member said about this our recommendation would be to provide the full COLA. While it's not ideal, one option that the Legislature has is to issue a deferral that ensures that we get that buying power but don't lose that. As opposed or contrary to K-12, the Legislature is not required to backfill us when we don't get the full COLA.

But if you allow us to have that buying power, then that is carried forward and the Legislature and the state can pay back colleges for that gap.

Just if you can help me clarify if the figures for current year and projected next year on revenue are lower, isn't Prop 98 guarantee also lowered, which means less dollars via regular apportionment?

That's correct. If revenues go down, then that proposition minimum guarantee goes down as well. So that's our concern, is that if the Legislature were to provide, say, an 8.4 percent cost of living adjustment for the budget year, and if revenues came in lower, which in turn lower the guarantee, it would make it very difficult for the state to be able to afford that COLA that it already granted.

Is the COLA the only way to make the guarantee full?

No, there are other ways as well. The Legislature has a lot of options. The Legislature could provide just a programmatic increase. It's done that in the past. Last year the Legislature provided money for certain categorical programs. It wasn't a COLA. It was just providing additional money for programmatic increases. The Legislature could also provide one time money in the budget year, and the advantage of that from the state's perspective is that it's a one time.

Let me interrupt you. I'm thinking more of a smaller amount in the non COLA appropriations so that we can keep the COLA whole or full.

I see what you're saying. This budget, as proposed by the governor is mostly overwhelmingly COLA. So there's some money for enrollment growth, but basically the ongoing money is proposed in a COLA form. So there's not a lot to take off the table with regard to what's proposed in January.

There's always a possibility, however, this might be where you're going, Assembly Member, is to look at the community college's budget, what's already funded within the budget, that base budget, and looking at perhaps trimming there to fund a higher COLA.

I see, and I know there's nothing on paper from the Administration or finance before May 15, but the data is quite clear. Indicators are pretty clear. What has the administration done in the past? Maybe, since you can't probably give me what you're thinking of doing this year in the instances in which the guarantee is lower than what was proposed in a January budget.

Yeah. Hi, Michelle Nguyen with the Department of Finance. There's actually very recent examples of when the state has faced a large deficit. So leading up to the 2020 Budget Act, with pandemic upon us on both the community college and the k 12 side, there were pretty significant deferrals that were proposed at the time and in the 2020 Budget Act as well. I believe the COLA was maybe around 3% or so.

And so that was actually we lowered the COLA to zero and it also had to do deferrals, significant deferrals for the student centered funding formula and the LCFF.

What did we do to the community colleges? I'm aware of the comment made by community college chancellor's office about deferrals on COLA for K-12 get recaptured in future years, but they don't for community colleges. What did we do in those instances when we did deferrals? Did we make community colleges whole later or not?

Yes, so in 2020, as I mentioned, there was a 0 percent COLA. I believe in 2021, there was approximately additional 1 percent on top of the COLA that was provided, kind of as a nod to some of the COLA that hadn't been provided in 2020.

Was that for a K-12 or community college or all? Okay.

And then in 2022, on top of a fairly sizable COLA, 6.56 percent. Last year. The community colleges also approved, or, I'm sorry, the budget approved a $600 million ongoing base increase. So that was essentially money on top of the COLA. $400 million of that was to increase the rates within the funding formula. And then $200 million were kind of essentially provided kind of like,

Part of the formula is called the basic allocation, which is kind of like a fixed pot within the funding formula.

For future years or just that year?

It was ongoing.

Ongoing, yeah.

So there was a down year in 2020 and then pretty substantial, pretty substantive increases in 2021 and 2022. And in the proposed governor's budget, still a very substantive COLA of 8.13 percent. I think it may be the largest COLA, certainly, since I've been working here, and I think in the last couple of decades.

And the factors for that COLA determining that amount was that CPI and others?

So that's a statutory computation? I believe it is data from the US Department of Commerce on a local and state government price index. And it's a lagging indicator, which means it uses past data and it takes kind of like a year-over-year computation for the May revision. So typically, there's a governor's budget COLA. That's the 8.13 percent, the May revision. We use data that we don't fully get until the end of this month. So we don't have the full computation of the May COLA.

Okay. The other issue I have is, and it was pointed out in our report here, the auditor's report in February on the issue of increased apportionment that was tied to full-time faculty, which still seems to be not happening as robustly as I think the Legislature intended. Does the community college office, chancellor's office have any response into what's being done to address that desire in previous years and on a going-forward basis as it relates to the apportionment for this year?

Yeah, thank you very much for that question. Like you highlighted, we believe those dollars should absolutely be only used for full time faculty hiring and to make efforts towards having more full time faculty. A couple of considerations that we're looking at. We have a shared governance system across our system or across community colleges. And so one of the areas where we will engage in is in a conversation with our consultation council.

The state audit didn't include faculty, counselors and librarians, and we know that they're very important to the success of a student in the classroom. And so that's something that we're looking at. What definitions can we utilize that do include the contributions of our librarians and counselors who are also in edcode considered faculty. The other is we also will be reissuing a memo to remind districts that their responsibility is to utilize those dollars for full-time faculty. Happy to share a copy of that.

Thank you. If I recall correctly though, the augmentation was done in response to the research that demonstrated that full time faculty staff led to better outcomes from students. And I think that was related to faculty and staff that was in the classroom. Although would not at all argue with you that the other support staff is critical and important as well.

I guess my only question, and you don't have to answer it now, but as you look at redefining what the faculty is as it would be more aligned with the Edcode definition, is more specifically, what are we doing for instructional faculty? Again, from my reading of some of the history and of the audit, the reason the Legislature did the augmentation or the additional apportionment was as a result of wanting to see people in the classrooms become full-time.

So I definitely want to follow up with you on that, on what's being done to specifically address that and not to add additional full time. And I read that in the audit. I remember now other full time and important positions to essentially count as towards full time faculty from a teaching perspective. So I think I'll just leave that out there and we'll connect on that. Thank you very much.

Okay, thank you. I think I addressed my issues and comments about this during the prior item. With that, we will hold this issue open as well. Move on to issue number three, community college facilities. DOF, LAO, Chancellor's office.

Thank you. Madison Sheffield Department of Finance. The governor's budget includes a reduction of $213 million deferred maintenance across the three-year window of 21-22 through 23-24. This means the 2022 Budget Act's deferred maintenance appropriation of $841 million will be reduced to approximately $628 million. Also, similar to last year's inclusion of language with support for energy efficiency projects, we are including the proposed trailer bill language clarifying that these deferred maintenance dollars can be used for childcare centers in attempt to support these colleges looking to reopen or upgrade facilities.

Happy to answer any questions you may have about these investments.

Okay, thank you. LAO?

So, with regard to the proposal to reduce by $213 million already appropriated facility maintenance funds, we recommend the Legislature reject that proposal. Most of those funds have already been distributed to districts and earmarked for projects that would reduce college maintenance backlogs. And addressing deferred maintenance is important because it can avoid more expensive facility projects, including emergency repairs, in the long run.

And as this subcommitee discussed in the first item, districts could still conduct outreach activities to students using remaining funds from their current year appropriations for that purpose. The governor's proposal also would explicitly allow districts to use state facility maintenance funds for all campus childcare centers. Most community college campus childcare centers serve a dual purpose where children are taken care of, but it's also an instructional lab for community college students studying child development.

Now, there are a few just regular childcare centers on campuses that don't have an academic or instructional component for us. It's unclear why community colleges should be allowed to use state funds for maintenance on these buildings that are fully self-supported through fees. So we recommend the Legislature prohibit districts from using state facility maintenance funds for non-academic, self-supporting centers. Now that's only a small number of centers, is our understanding.

In most cases these are dual-purpose childcare centers on the campuses, so it provides academic benefits to community college students who are studying child development. We recommend the Legislature approve the governor's proposal allowing state facility maintenance funds to be used for those types of dual purpose centers. Now, keep in mind that these centers still collect fees from their clients who use the center. So it does have a self-support component.

So moving forward, the Legislature might want to think about establishing some sort of cost sharing expectation so that fees cover at least some of the facility maintenance costs. But that's something the Legislature can decide how it wants to proceed. Thank you.

Okay, thank you. Chancellor's office?

Good morning again. Lizette Navarette with the California community colleges. A little bit about our deferred maintenance dollars and how they have been appropriated and how they're utilized by our colleges. Around 75 percent of the funds provided to the colleges, as highlighted also in your agenda, are utilized for deferred maintenance projects, safety and facilities overall. 25 percent of those dollars roughly are utilized for instructional equipment, learning materials and other such purposes.

The allocation that was provided by the Legislature 22-23 of $841 million was very welcome because colleges could, for the first time, tackle some of the larger projects entire roofing of a building really address more substantive deferred maintenance projects. By the time the fiscal year concludes, all of the dollars will have gone out. They are included as part of a monthly apportionment schedule that is established in August of the new fiscal year.

And so of the projects that are currently on the deferred maintenance backlog list, we have about 5000. Around 1200 will be tackled by these dollars. And so we do have concerns in removing these dollars for these purposes, but we also see extensive value in the intent of the governor's proposal and the direction that they want to go to keep us focused on enrollment and re-engagement.

One option to consider is looking at ongoing funds that we could continually count on and plan towards for enrollment and persistence. Recognizing this lean year's budget, instead of sweeping enrollment dollars, one consideration could be to reappropriate those for enrollment and persistence and then preserve the deferred maintenance fund as is. Happy to explore other options, but want to highlight just overall the valuable uses of these dollars. Happy to take questions.

Okay, thank you. So what's the opinion from the chancellor's office on this swap? So finance is proposing it, LAO is saying they don't like that. And I guess the community college league is saying something in the middle that maybe it's like a flexible block grant you could use for either or. So what's the official position of the chancellor's office?

We see merit in the direction that the governor's office wants to go in the Department of Finance to get us to keep focusing on enrollment retention and persistence. But what we're really seeing that colleges need is a reliable funding source that is potentially ongoing so that our engagement with communities or campuses isn't every time we see massive enrollment declines or we see statewide emergencies, that it's consistent and then we could plan and predict.

But that's not an option. This is one-time money.

So one option would be, again, instead of diverting the enrollment dollars that didn't get utilized, only several of our campuses had funds that they actually captured enrollment. So you'll have those dollars available instead. And so that could support the governor's direction, which is very needed, but not sweep the deferred maintenance dollars.

20.

But how much is that? It's not 200 million?

No, it's a much smaller amount. Around 20. The available funds would be around $21 million or so, but it would provide at least consistency and potentially ongoing dollars that could go to all districts without taking a cut.

You had the choice of these two. You're not giving me. It's a non-answer. You're being like Department of Finance.

No, I think we would propose a different alternative. Right? That we don't want to sweep these dollars. By the time you approve this budget, we will already have given them out. By next year, we would have to pull them back. So it would be more of a deficit. And so that's very difficult for colleges to absorb, especially if they've already planned. But we do see merit in keeping us on task to keep focusing on enrollment and retention.

So one alternative that you may want to consider is dollars that we are not likely to utilize in enrollment growth.

Yeah. That's just 20 million, though. So this is 200. Okay, I hear it. Mr. Fong, questions?

Thank you so much, Mr. Chair. And thank you for this presentation. We know that there's a lot of deferred maintenance in our system, and these dollars are critical. And so I have the similar line of question that Mr. Chair just asked, but really looking at the priorities in terms of enrollment, retention, and versus deferred maintenance, and really appreciate the LAO's comments as well.

So I think you're trying to navigate that thread and really look into how we continue to grow enrollment, retention, from what I hear, and really with facilities with potential bonds and really look at how we continue to maintain our facilities and to modernize our facilities. That's a critical infrastructure that we need here for our community colleges to maintain world-class classrooms and facilities. So this is something that I think with deferred maintenance, it's critical, and with the childcare centers that are mentioned as well. So is there anything else you'd like to add in terms of the rationale for the possible reducing of the deferred maintenance in order to fund recruitment and retention to anyone? Thank you.

Obviously, the intention with the shift to the enrollment dollars is just to have a priority on enrollment. It's the majority of how the community colleges are funded, and it's their most flexible use, and it's student-centered. So we know that after the Great Recession, it took a while for students to come back. So we just want to be really focused on that, and that's why we've included this in the governor's budget.

Thank you.

Okay. Thank you all right? We'll hold this issue open. Issue number four, other miscellaneous proposals.

Yes. Madison Sheffield, Department of Finance. I'll just give a brief summary of the other proposals. We have included categorical program flexibility, which is to support a continued focus toward the goals of the roadmap. The administration intends to introduce a mechanism this spring to provide community college districts that are making progress towards the roadmap goals with additional categorical program spending flexibilities and the ability to streamline reporting requirements.

We have also included an increase of 14,000,000 one-time Proposition 98 general fund to support the administration of workforce training grants in collaboration with the California Department of Forestry and Fire Protection, or CAL FIRE. This program supports forest health and forest industry economy by building up the workforce in these fields.

Next, I have a summary of the 275,000 Proposition 98 general fund, of which 200,000 is ongoing, to develop a community college chief business officer, or CBO, professional learning program run through the fiscal crisis and management assistance team, or FICMAT. This is to improve community college district leadership capacity and fiscal accountability. On the facility side, we are continuing existing projects. We have general obligation bond funding of 143.8 million one-time for the construction phase of 10 projects anticipated to complete design by spring 2024.

This allocation is 90.2 million Proposition 51 and 53.6 million older bonds. And then we have a service learning proposal. This is a $0 proposal. In furtherance of the community college's roadmap and compacts with the UC and CSU, the administration will request that community colleges establish dual enrollment agreements with all applicable LEAs within their service area if they have not done so already.

In addition, the administration will request that all community colleges develop and offer a one-unit service-learning course that all high school students will have the ability to access through dual enrollment opportunities. The goal here is to encourage and enable high school students to volunteer in their local communities and participate in civic engagement. And with that, I have completed my presentation. I'm happy to take any questions.

Okay, thank you. LAO.

Thank you. I'll just mention a couple of the proposals here. First, we don't have any concerns with the 10 continuing capital outlay projects that are in the January budget. We also don't have concerns with the chief business officer program, the FICMAT program. The idea is, as we understand it, to focus on aspiring chief business officers as well as current chief business officers to help them understand more about district budgeting and financing.

Our understanding is that this could be open to other employees of the college who want to be more informed. We think that's actually probably a good idea. We hear a lot from districts about faculty and classified staff and others that are in influential positions of the district and the importance of getting them to understand better about district financing and the formula and reserves and that sort of thing. So providing a program for them, we think, could be a good idea.

With regard to the CAL FIRE forestry workforce proposal, we think the proposed fund shift is reasonable. It's worth considering given the state's non-Proposition 98 budget deficit and given the community college's role already in developing the forestry workforce. So using Proposition 98 funds could exclude other workforce providers but the proposal would take advantage of the college's existing expertise and experience in the forestry area. So we think it is worth considering and approving. Thank you.

Good morning again. Lizette Navarette with California Community Colleges. Just briefly, want to support the COLA that's been proposed for various categorical programs. These are essential, especially as we consider recovering and engaging students back on our campuses. Want to also express support for the projects that have been included from Prop 51 bond funds. Those are in their final stages and very important to colleges and bringing back students to safe environments.

Around the CAL FIRE proposal, we believe that this leverages an area of expertise that California community colleges have, which is around fire training and management. And so this would allow an expansion of more partnerships. Right now, only two colleges have that direct partnership, and we believe others have that expertise across the state. And given the uncertainty and the growing fire season in California, this is an important area to be investing and great jobs for our students. With that, happy to take any questions.

Okay, thank you. Questions? I just have one question on the COLA that I support what we're doing with the coals for both community colleges and K-12. Not sure what the final number is going to be with the May revised, but why do we exclude some categoricals that we know are so critical in helping not quite basic needs, but helping students with those populations we're trying to succeed? Like Puente, Emoja, part-time faculty. They're so small. A COLA means that people need it because costs are going up and so just doesn't seem right that you're like, oh, you get a COLA and you ever hear the same type of costs and everything? Don't warrant a COLA?

Yeah, certainly hear you. The categorical programs that receive COLA in this governor's budget are the same ones that have received them in the past or statutorily required to receive COLA. So there's no change to policy in the cycle.

I get that. But does that make it right just because it's got? I mean, we could slightly adjust the 8.3. What's the goal?

8.13.

Okay. We could make it to 7.9 and save that difference and give the others of COLA who have zero seems. Why wouldn't we do that, all things being equal? Okay, well, we'll recommend that. Okay. Issue number five, Calbright College update. So, this is an informational item. There's no new budget action here, but with us, we have the president and CEO of the college, as well as the vice president. So please begin.

Good morning, Chairman McCarty and members of the Budget Subcommittee on Education. Thank you for the opportunity to speak with you today. We have taken our past discussions to heart as we continue to move through the seven-year startup period. In less than two academic years, our enrollment has grown by nearly 400%. In 2022, the college doubled the number of certificates awarded, and only months into 2023, we are on pace to more than double again.

Equally critical, we have met or exceeded the milestones outlined in our founding legislation and are on track to complete every recommendation from the state auditor's report. As the auditor noted, we are nonduplicative and a valuable part of the CCC system. Calbright is not only a new college but also the first district in more than 40 years. This work takes time, and today we're a different institution than the one launched under previous leadership.

We are a college that is positioned for growth and expansion, and it is critical that the state continue to invest in our work to identify solutions to the shared challenges and equity goals of our California community colleges. Building a new college from the ground up takes time, and growth for a new college takes many forms.

We are more than a year ahead of schedule on our accreditation process, and earlier this year, we were thrilled to ratify our inaugural agreement with our local chapter of the California School Employees Association and are now on track with our classified staff, as well as our local California Teachers Association faculty union. Both labor leaders are here with us this morning, as well as the president of the Academic Senate. I just wanted to thank them for being here.

And our Calbright team is expanding quickly to meet the growing demands of our programs. We are developing 10 new programs to launch in 2024 and beyond, and I am fiercely proud of our accomplishments. I am proud of the model we are building, and I am proud of the Calbright team and the organization that we have become. We are a student-centered college, which means our competency-based design and decision-making. It prioritizes our unique students and their needs.

We have come to know and to actually see ourselves through the eyes of our students. More than 90% are at least 25 years of old years old. 40% of our students are at least 40 years old. Our student body represents 47 of 58 counties in California. 27 rural counties, 22% identify as Black, 36% Hispanic, and 22% as Asian Pacific Islander.

A strong majority are either unemployed or working part-time, and they come to Calbright sharing a common desire to create a better life for themselves and for their families. Our students validate the importance of Calbright's flexibly paced programs. They continually highlight that our model creates the environment in which they don't have to make these impossible decisions as to whether to take an extra shift at work or pick up their kids or attend a class.

A third of our students are parents or caregivers, triple the rate in the CCC system. And again, it's our design that provides the opportunity for students to engage in their curriculum after they've put their kids to bed or to step back when they're out of school. Jeremy Cox, who's the president of our student body organization, is but one example. He led a 30-year career in the restaurant industry, which was acutely impacted by the COVID pandemic.

Jeremy has two young children at home, and in his own words, he says, if I'm going to train for a new career, I need to be able to do it around the schedule of my young kids. For some Californians, it may be their family's chaotic schedule, a long commute, or maybe an unpredictable work schedule that makes attending a traditional institution seem impossible. Before my current role, I served as President Obama's higher education advisor.

And in that capacity, it became very clear to me that higher education's traditional models are not positioned to serve adult learners well, resulting in decades of inequitable outcomes. This is a narrative we hear from partners and collaborators across the state as well. And so it's really disheartening to hear arguments against Calbright that assert that there's already a statewide solution for the learning and support conditions that improve outcomes for all adult learners. Calbright is expanding the capacity of the system.

Our learner enrollment for adults is more than double the CCC rate. And as you've discussed in this committee, it's students who are 25 years and older that have left community colleges, both here in California and across the country at very high rates. Research from California competes highlights this. 35% of adults in the Inland Empire, for example, would like to enroll in higher ed.

Yet only 6% actually are. This is a shared challenge, and the data clearly shows that our students seek out Calbright because of the way we operate. When we ask them, why have they enrolled, you'd think they would highlight that our programs are free. But what stands out in their response is that nearly nine in 10 cite our model as the leading reason.

The standard academic calendar, the rigid schedules, these are hurdles adult learners face as they navigate a system that was built for a younger demographic and, frankly, a simpler economic time. There is an urgency in this moment. Despite headlines of low unemployment rates, there is a clear gap in opportunity and the way that many Californians are experiencing the labor market.

PPIC research notes that residents of the Central Valley and the Inland Empire are more likely to express concern over being able to afford their rent or pay their bills. Adult learners are rarely the beneficiaries of evidence-based efforts to nurture their success. But California is our nation's innovation state, and as the leading edge of the learning curve, it's Calbright's role in the community colleges system to identify solutions to this complex equation and to share what we learn to create a more equitable and accessible system.

I wanted to thank you for your time this morning. I'm joined by Michael Younger, our vice president of workforce innovation and strategy, and we're here and happy to answer any questions.

Okay, so I'm still not sold on this. I know you are. That's your job. And I have a job too. I just know that if you look at our return on investment, it doesn't make sense. We've spent, I think, roughly $93.0 million on this endeavor. 15 million a year times five years. $75 million. 18,000,000 one time, 93 million divided by 234 people who succeeded, completed. It's like $400,000 per student, $400,000. So does that sound like a good return on investment to you?

I think what's really important about the numbers you cited is to remember and recognize that this is a part of a seven year startup period. And we always knew it was going to take time to build aspects of the college.

So there's ongoing funds and there's one time funds, and in particular, the one time funds are really designed to ensure that we have the infrastructure in place, we have the ability to launch the programs that need to be launched, and that we are positioned for scale over that period. In that respect, we are doing very well.

I'll give you that. So knowing that you say that's ongoing, are you on track to reach your December 23 goals? Which are the goals that were outlined in our budget report two years ago, was enrolling of 5,000 students and 1,200 students completed the Calbright program. So this is April. So that's in eight months from now.

Yeah, it's a great question. The goals you're referring to are ones that we set as an institution, as the part of our strategic vision process. We set them early in the pandemic period and our growth. What we've demonstrated is we have the capability to grow very aggressively and to maintain our demographics. As an institution, we've made a conscious decision to think about when the best time to turn the dial on enrollments is.

So while we'll hit 3,000 students this summer, likely 5,000 in the 2024 time period, we want to do so and condition our growth and our scale in the 10 new programs that will be launching post accreditation. We made an intentional decision to prioritize accreditation because it was in the best interests of the students attending our institution to see that growth realized in that way.

Well, just a correction. The goals were outlined at the end of the pandemic. 2021 was the end of the pandemic. So that wasn't during the 2020.

2020 was the development of the strategic plan. 2021 was the release of the plan. That's right.

You said in the middle of the pandemic. The end of the pandemic is 2021. Regardless, two years ago, you've set some lofty goals. And even if you take out the one time money, we're still spending $15 million a year. And you've had 230 total awardees certificates. So how many are we getting per year?

So I don't have my calculator at hand, but what I can tell you is that number is continually increasing and the pace of completion is increasing.

Let's say you've had 234 to date. Let's say I give you 234 this year. So I'll give you the benefit of doubt. That's still $64,000 per individual. Is that worth the state's investment?

Each year that number will get lower as we dial enrollments and as students progress through our programs. What we know is we're persisting at higher rates than we see for adult learners in the community college. We know that those students in our programs themselves, with the many improvements and supports and the team supporting them, have accelerated the pace of our completion. This is in sharp contrast to the standstill and regression that we're seeing across the rest of higher education for this community of learners.

So what we're doing is working and it's set to scale and the cost will reduce over time. I like to think about it as like a hockey stick when we're talking about building a startup and we're talking about scaled growth. What we want to be sure in this place is that we're perfecting the model, that the conditions for the outcomes are there.

And we have all those early indicators that demonstrate that we're exceeding the benchmarks that exist relative to our colleagues in the system serving a similar population. And this is true in higher education problems, a very difficult, intractable problem to solve. And we're not only on course to setting it. We are exceeding many of the progression metrics that we're seeing for students here. And this is the same community of learners that has left higher education at significant rates because the model is not working for them.

This is a model that is working for them. And it's not just our perspective on it. We really rely on the perspectives of our students, on the input of our students, on their experiences, to design further and to continue to improve on that outcome. So this is something they're telling us they need, and we're responding as an institution. And it's not just our success that's important.

It's really important because this is important to solving the challenges that we're seeing across the community colleges and across higher ed for this population of learners. I think we're excited at the potential impact of this work relative to some of those challenges as well.

Well, I still think you have a lot of selling to do. Two years in a row, there was unanimous votes in the assembly to eliminate Calbright. When this was proposed in 2018, it was before the pandemic. And one of the notions was a lot of the community colleges don't do a lot of these virtual online programs. And now we spent an hour earlier. That's pretty much what colleges do now across California. And I know you could come here and say, we've had tremendous success, 400% improvement.

Well, it's easy to go from 10 to 40 and say, look at us. I know that we're throwing good money after bad, and I think this is just an albatross. I think this is high speed rail 2.0, and it's a terrible use of taxpayer money. And I, for one, think that we should call the day and terminate this program, and we'll be recommending accordingly. Further questions from Committee Members. Mr. Muratsuchi.

Thank you. I'll try to be a little nicer than the Chair. No, I mean, Chair makes an important point that we have to figure out where to spend our limited state taxpayer dollars. And I think we all agree. I heard you spending most of your time talking about the concept of making it easier for working adults to be able to participate in your programs. What I'm not sure if you talked about, and forgive me if you did, I want to make it clear in my head that question, why do we need a standalone Calbright college versus our community colleges offering the online programs? Why can't we just go with the community colleges offering more online programs?

Yeah, it's a great question. I think it's one we get often. And I think it reflects a little bit on the discussion that you had in this Committee earlier about quality and efficacy in online learning. What's fundamentally different about putting content online in the form of courses and designing a digital environment based on the needs of your learners? It's a fundamentally different exercise.

And so we are online, but most importantly, we are centered around the adult learner student, and we are conditioning our growth and development and building of the college based on that learner's needs. And to put it in real and more practical terms, it is really building a community of success for the leaders. That's true in the way that we organize ourselves and the way that we participate and engage with learners.

When a student first comes to our college, that first receipt is not that first connection we make with them is the first opportunity to build an important relationship with them. And so we don't treat it as just an enrollment exercise or a student acquisition exercise. It's our opportunity to begin to know our learner, to begin to understand, to be able to anticipate their needs so that a whole team of folks behind the scenes can support them over time.

So when we talk about engaging with adult learners and we talk about bringing them into our institution, and we talk about it in the context of an enrollment challenge, it misses the mark just a little bit. In order to not just enroll these students, but to make sure that they see continued progress and success, we have to stay our engagement with them. So what we are set up to do is build that relationship.

We engage with our student support specialists across the lifecycle and our relationship with the learner. We have counselors, we have faculty, we have IT support. We have career services. All of those things are integrated. They're not existing in silos in the institution. But it's an experience and we anticipate their needs. We listen to their needs and we respond to them more nimbly and accurately.

This is many of the things that actually condition the difference between how a student can be successful in an online environment and how not. And the other piece of it that's most important is actually the building of student community, especially in a flexibly paced program. Right. It is very isolating. I remember in the CalMatters article, Jeremy Cox, our student body organization president, mentioned the fact that asynchronous or flexibly paced can be a double edged sword. And we spend a lot of time with that question.

How do we balance the flexibility for the learner with making sure the scaffolding is in place to support that learner to the end of their goals based on the time that they have available to them. So when we say we have faster time to completion, that's true on the norm, we also recognize, and that's true because we have established a very set schedule and set of interactions, really planned efforts for the time a student tells us they have available.

So we scaffold that learning in a sample schedule, and we're moving to actually do that across multiple different schedules. And a large part of that is not driven by our guesses and assumptions. And it's not even just the gap of listening to students, because sometimes something gets lost in the translation, right? What we hear are their needs, and we wonder how to design to them. But we're getting help in terms of building our capacity to do that.

So we have a multi year partnership with UC Irvine School of Education, Nudge Labs and ideas42 to really focus on what's important in service of this community of learners, which is making sure that we're understanding their behavioral motivations, their needs, the ways in which we communicate with them.

That's building the capacity of our team to approach the design of supports and interventions in an iterative manner on an ongoing basis so we can continuously be at the forefront of getting ahead of what our students need and responding when we see a need that's being unmet.

Okay, that's a lot of explaining. I think the bottom line is the data, the numbers that- I wasn't on the Subcommitee during much of the discussions on the Calbright College, but I'm just looking at the Committee analysis, the summary of the 2021 California State Auditor. One of their findings was that what I heard you saying was that you provide this holistic support system for students to try to ensure that they complete the programs and not just enroll.

But one of the findings of the audit, apparently, was that Calbright's methods for ensuring that students succeed are inadequate. Most students have either dropped out or stopped progressing. Can you just respond to that?

Absolutely. So we leaned into the Auditor's recommendation and took them as an important opportunity for us to really dive in. And you probably know, or may not know that I was not the first leader of this institution. So the observations of the Auditor reflected the prior leadership primarily, but they did identify core areas and made recommendations that were important for us to address.

And so, with respect to that in particular, we have done a lot of work, and you can see it actually when you track our change in persistence. So sometime in roughly middle of 2021, we had persistence rates in the low seventies. Right now, our term to term persistence rate is at 94% in the community college system as a reference point, it's about 50%. And we're talking with the community of learners that we serve.

So this is not insignificant, but I point that out because that's a direct result of the effort, the commitment, the dedication, and the meticulous way in which we've tested and created the efficacy of our support and intervention model. The other piece that the Auditor highlighted, which is very important to us and feeds into the earlier conversation that you all were having, was this question of, how do we know it's effective, how do we know it's working, or how do we know what's not working?

And we are very well instrumented from a data perspective where that's not sort of rhetorical reporting quarterly exercise. It's a real time exercise for us. So the teams that are supporting the learners are viewing what is happening to students at different points in the program. They all have visibility into that in order to be able to provide those supports. None of those things were in place at the time that the Auditor evaluated us on the heels of my predecessor's exit.

All right, thank you. Thank you, Mr. Fong.

Thank you, Mr. Chair. And thank you, colleagues for your comments. And thank you to both our representatives here from Calbright. Just echoing the concerns, I know that the Auditor has made a number of recommendations, and I know that there's a number of information in terms of the growth in enrollment to 5000 students. A couple of questions I had is, in terms of the accreditation process, how is that proceeding?

Yes, we are midway through the accreditation process, and we anticipate learning about the outcome of that process. It's not in our control but later this year.

Usually there's a physical site visit, but has the site visit already happened?

Yeah, site visit happened in September, and it's a pretty close process, but we will await that determination from the Auditor sometime this year. In the meantime, we have the 10 programs that were slated will be designed and validated according to the statutory deadline by July 1. And then we're preparing to launch those in a post accreditation environment in 2024.

Thank you. And when Calbright was first brought forth in 2018 and that cycle, obviously the pandemic hadn't happened yet. We couldn't have foreseen in terms of how it changed higher education forever in terms of this space, in terms of online learning. So how are Calbright's offerings currently? Let's look at the certificate training programs I know we discussed before as well. How are these offerings, such as IT support, cybersecurity, data analysis, medical coding, how are those offerings different from what's offered at local community colleges?

In a number of different ways. And just sort of hearkening back to the Auditor's report, it's the nature of the model. It's the fact that it's self paced, it's decoupled from time in the academic calendar. It's a competency based approach. But there's also a very important difference in the way that we consider which programs to offer and our plan for building out programs in the new year.

We're primarily looking at areas, and I'm going to tag Michael in here for a second to describe this a little better than I can, I think is really around different occupational areas. So often in what's traditional, non credit vocational ed. We talk about a single certification, and here we're looking at the sublevel of that. We're actually looking at the skills and competencies associated with that underlying certification. We are set up to support a student towards the mastery of those things.

So not just the time they spent in terms of how long they've been at the institution, but actually the progression across the skills that they're demonstrating mastery on. I point out to those differences, and I'm hoping Michael can describe a little bit about our process for doing this, because these are skills that actually are not just relevant to a single certification. They are within occupational clusters that have relevancy in multiple different industries and in multiple different career paths.

So a good example of that is one of the first programs we launched after I became President was the CRM program, the Customer Relationship Management program. And that is an important program because essentially, small and mid sized businesses, all the way up to large firms, across every major industry, that has point of sales activities, they need this set of technologies.

And so that certification helps a student get to a Salesforce Administration opportunity, but that certification also can open up the door for them to do a program that's in design first at the institution now, which is on junior developer. That foundational set of skills can also build into data analytics. So the way that we look at the way we design programs is to make sure we understand how those can cluster as occupations and how that gives students, over time, more range of motion in the economy.

And Michael, maybe you could just touch a little bit on how we do that programmatic work and the engagement with industry.

Absolutely. Thank you. And as President Menon has spoke about our research, our kind of research and development is really informed by our partnership with industry. Right. And so both community partners, but also private and public sector, where are the gaps in the workforce today? Where Calbright can kind of fill those gaps to upskill and ensure we have a higher skilled workforce. And so we dive into the details in terms of understanding different regional economies.

Some of our collaborations and partnerships span northern, far state, rural communities all the way down to imperial and the Inland Empire. Really being able to inform us on the needs of various regional economies and really understanding what are those occupational clusters that are not just high demand, but will, over the course of time, withstand any type of digital transformation.

And so that's really the value add of a Calbright, is that we're looking at entry level employment to get our student population into the beyond the entry level rungs of the economy. But in career ladder fields. Right. And so President Menon spoke about data analytics, CRM, some of our computer technology courses, but we're also expanding 10 new programs around design innovation, very much talking through project management, HR in terms of talent acquisition.

These are disciplines that industry continues to inform us by way of our business advisory councils.

And you mentioned the business advisory councils now and the workforce Development Board. So I think Calbright, as you heard from my colleagues, there's a lot of concerns about the number of dollars that have been spent on this. So making sure that there's the value for the funds expended, and so the work around the future of work and workforce training programs and how Calbright is that added value.

I think that's going to be critical for Calbright going forward to really make sure that there's something that distinguishes itself from all the other offerings from the 73 community college districts and 116 community colleges in California. And so I think that's obviously, it's in the audit recommendations and everything else there. And so I know that you're working on that, but I just really want to echo my colleagues concerns as well, but appreciate the updates and appreciate the work here. So, thank you.

Thank you. Maybe I can just, if it's okay, I'll offer one more thing. In terms of, it's important to be distinct from the community college. That's a mandate of our legislation. It's also important for us to have complementarity to it. And so one of the programs that I think really illustrates this well is a program that we're building with SEIU United Healthcare Workers around licensed vocational nursing. That's a program where there is a bottleneck in terms of production in our higher education institutions in California, period.

It's very severe underproduction relative to the dramatic shortages that we're seeing in the field. And this is an area through the way that we're designing the partnership, SEIU, us doing the content and the learning, and then SEIU partnering on the clinical placement sites.

This is important because it allows for us to create a net new number of clinical placement opportunities, sort of building the piping for the clinical placement infrastructure that has a benefit, because if we were doing this in a corner of the universe somewhere and we were not connected to the community college system, that would be something we need to own entirely. But this is something that can unlock resources and opportunities for those types of things, for other community colleges offering healthcare programs in the future.

So when we think about the importance of our work, it's not just what we do as an institution. But it's the ways in which we can also work to collectively solve some of the core challenges that unlock the scale potential of the system. So all of this is important to us largely because in my history in public education, I understand that these are the critical system level pieces that we need to solve for.

And so we look forward to close engagement with the chancellor's office throughout our development cycle to ensure that that value is being realized by other system institutions as well.

Thank you so much. Thank you, Mr. Chair.

Thank you. Again, this is an informational item, no action item here today. Potentially, we'll take a look at doing so at the conclusion of our Subcommitee process. With that, we've concluded the items on the agenda. We'll now go to public comment.

Thank you.

Okay. Thank you. Mr. Macdonald, 1 minute, please. 1 minute.

Sure. Thank you, Chair and Members, I'll be brief. Mark Macdonald, MGI advocacy on behalf of the Los Angeles, San Diego, San Bernardino, and Peralta Community College districts. I will say on the COLA we would request Prop 98 parity, meaning that we be treated the same way that K 12 is, and if it can't be fully funded this year, that we be made whole in future years.

As Mr. Alvarez noted, we don't get made whole like K 12 does. On the 200 million, we would ask for flexibility because bringing students back on campus requires that our facilities are in good shape. And so we would appreciate flexibility on that 200 million. Thank you.

Good morning. Kyle Hyland, with the behalf of the Association of California Community College Administrators. We appreciate the very robust conversation today around the COLA. We do support applying the statutory COLA to the student center funding formula.

And we agree with you, Chair McCarty, that there should be more categorical programs included in that COLA. We'd like to see all of them actually have that COLA if we could. And ACCCA also opposes the governor's proposal to cut deferred maintenance by $213,000,000 over this next year. And we align our comments with the LAO to reject that proposal and make sure that important funding is included. And we appreciate your time and appreciate working with you on these issues. Thank you.

Chair McCarty, Members. David Hawkins with the California Community College Independents. A few brief comments. One, on the outreach funds that have been allocated to districts. We would ask that you consider putting a higher percentage in the chancellor's office and that we do a system wide approach. We think it's less costly. We think it'll be more effective in letting students know that community college education is not only accessible, but affordable. In regards to Calbright, you've heard our position before. We think this is a failed experiment.

If I didn't know that we were giving state money to Calbright, I think that we just had a hearing on a private vocational corporation. The intention is good, but the actuality is embarrassing, I think for California. When you spend $93 million for 234 certificates. I think albatross, Mr. Chair, was really the appropriate statement on that. And then finally, we were the sponsors of the state audit, looking at the funding, full time faculty allocations.

You're aware that we have had a 75% goal in statute for 35 years with the intent of having 75% of instruction taught by full time faculty. We have not come close to that figure in 35 years. And on top of that, we've spent $450,000,000. Now, the Auditor looked at this per our request, and we're very appreciative of the author for asking for it. But the Auditor concluded that funds were misused or funds simply weren't spent.

You have to wrap it up, Mr. Hawkins.

You bet. Primarily, I wanted to comment on the chancellor's office statement that this is really a shared governance issue. It's not. And the Auditor was very clear on this. Our audit identifies the lack of progress towards a state goal for instruction by full time faculty, the improper use of state funding, and the failure to implement certain EEO practices that have resulted from the chancellor's office's insufficient oversight.

It's very critical of the lack of oversight and accountability, and we would be very supportive of having a Joint Hearing from the Auditor's office to discuss this further. Thank you.

Thank you. Okay. One minute or less, please. Let's try this again, because we have an off site caucus meeting, and I'm going to probably have to shut this down earlier. Thank you.

Can we go? Good morning. My name is Michael Stewart. I'm the Academic Senate President at Calbright College, and I'm here in favor of the school. Thank you.

Thank you. Well done.

Hello. Good afternoon. I'm Wendy Brill-Wynkoop. On behalf of the Faculty Association of the California Community Colleges, we want to recognize and thank the Legislature for the investments in full time faculty hiring and part time faculty supports. I can make this brief. Thank you to Mr. Hawkins. But we hope that the Committee will continue to build on those investments and continue adopting the recommendations of the State Auditor on the accountability for the full time faculty hiring funds allocated in prior year budgets. Thank you very much.

Thank you.

Good morning, Chair, Committee. My name is Zachariah Wooden from the Student Senate for California Community Colleges Vice President of legislative affairs and I just want to say with regards to the earlier discussion today about enrollment, I just want to emphasize that the two things that are really students keeping in mind with regards to enrollment are basic needs and that has to do with the Cal Grant reform.

We want to make sure that the commitment to Cal Grant reform continues and also that student housing funding also continues. One in five California community college students face housing insecurity at any given time. So we want to make sure that that need is met and that students are given the dignity to have somewhere to live in order to continue their education. That is all Chair. Thank you. Thank you.

Morning Chair McCarty and Members of the budget Subcommitee. My name is Molly Maguire and I'm the state and federal policy Director with The Campaign for College Opportunity regarding the $200,000,000 million enrollment and retention proposal, given the previous enrollment and retention investments, plus the lack of confirmed need across districts, any supplemental funding increases should be accompanied by performance guardrails to ensure funding is expended quickly and on effective strategies.

The campaign published a report in December analyzing the decline in community college enrollment, the reasons for the decline, how that decline is distributed across campuses and region, and its impact on the state's public four year institutions. Something we are particularly interested in is its impact on transfer and what strategies UC and CSU can employ to meet their transfer goals, as captured in the compax. If Members are interested in information on community college enrollment, we stand ready as a resource. Thank you.

Thank you.

Good morning, Chair McCarty and Members. Melissa Bardo on behalf of The Education Trust - West we are pleased to support the 8.13% COLA for SCFF apportionments and select categorical programs. The significant COLA will help the community colleges navigate post pandemic challenges, but we continue to emphasize the importance of accountability, oversight, and setting race conscious goals, or metrics to ensure campuses are making progress.

Given that this COLA is unrestricted, there may be room for the Legislature to link the funding to certain priorities as suggested by the LAO, and there were several requests in the chancellor's office budget requests that have the greatest potential to enhance racial equity, including teacher preparation programs, support for implementation of equitable placement, and expanding and enhancing childcare on college campuses.

In terms of the governor's onetime proposal for student enrollment and retention, we recommend that the state prioritize new funds for implementation of equitable placement and completion reforms, establishing or expanding dual enrollment programs, and providing additional support to pregnant and parenting students via childcare and financial aid. Thank you.

Andrew Martinez, Community College League of California. We appreciate the conversation today on the COLA. Recognize there are some pressures on that. We are just as Mr. Mcdonald said earlier, we encourage a consistent share with k 12, whatever decision you make on the COLA. And then additionally, we appreciate the conversation on the deferred maintenance and enrollment, and we encourage as much flexibility as you can to provide to our colleges on that issue. And then lastly, we are very supportive of affordable housing loans for our programs. Thank you so much.

Thank you.

Good morning Chair Mccarty and Members of the Budget Subcommitee on Education Finance. My name is Hector Ledesma, student trustee of Cerritos College. I'm speaking to express my support for maintaining current budget levels to fund the higher education Student housing grant program. I believe it's really unfair to overlook community college students and the housing that is needed to support them. We need more housing because we have greater need than CSUs and UCs. We cannot delay housing.

Cerritos College and other colleges know how to be innovative. Our college is always finding solutions to meet students needs, and that includes housing. In 2020, Cerritos College opened The Village, California's very first community college housing development, exclusively for students facing homelessness. I urge the Committee not to dismiss our students and to support more housing for the students who need safe, affordable place to live. I support maintaining the current 2023-24 budget levels without delaying the funding into 2024-25 to offer more students affordable housing.

Thank you.

Chair, Austin Webster with W Strategies. On behalf of the academic Senate for California Community Colleges, we want to thank the Committee for its ongoing funding to the Academic Senate and continue to engage with staff on conversations related to the online educational resource initiative. Additionally, on behalf of the California Community Colleges Association for Occupational Education, we urge the Committee to continue funding the strong workforce program, including the k 12 strong workforce component. Thanks so much.

Hi, my name is Anya Elder. I'm the Strategic Initiative Specialist as well as Chapter 53 CSCA President representing Calbright College, and I want to urge you to continue to support Calbright. I have been at Calbright since 2019, and I have seen the transformational work and the changes under the current administration. We are trending in the right direction. We are reaching unserved and underserved adult learner populations who, without our assistance, are in jeopardy of being left behind. We hope to get your continued support.

Good morning. My name is Cindy Carney. I am the Calbright Faculty Association President, and I would like to urge you to continue funding for Calbright. Thank you.

Okay. Thank you. Thank you for participating. With that, we are adjourned.