Senate Budget and Fiscal Review Subcommittee No. 1 on Education

We are waiting for another Member, but if they're not here in a minute or two, we will start because we are very delayed due to the Senate flight session. And I know people have other commitments. So let me just announce that the Senate Budget Subcommitee 1 on Education will come to order in 60 seconds.

I'm going to call Senate Budget Subcommitee 1 on Education to order. And this is our fourth hearing of the year, and we have heard Proposition 98 overview, University of California and Cal State University System student aid. Among the major items that we have heard.

Today we'll do proposals related to the California Community College System, including an update on the student Centered Funding formula, enrollment growth, the rising Scholars Program, and other issues. Next year, Next year, it seems like a year. Next week we will be doing a master plan on career education.

We have six issues on today's agenda, but the Chancellor is here and I'm going to recognize her first in a moment to make opening comments before we get to the first issue. And I want to let everyone know that we will be holding questions until after we hear. I mean, comments until after we hear all six issues.

And so we'll be going through each one individually. And the Committee welcomes comments. So if you are unable to stay for public comments or you're listening and watching remotely, we would take your comments by either visiting our website or writing the Committee Care of the address that's on the website.

With that, we will begin, and we're going to start with comments from Community College Chancellor Sonya Christian. And let me welcome you to the Committee. And we know you have Mr. Ferguson with you who is really well known to the Committee. So welcome, Chancellor. Let's see if that works. Works.

Always good to be in a Committee which you're Chairing. Senator Laird, I'm honored to be here representing our system, over 2.1 million students. We, as you know, are an open access institution.

We invite and support all learners, our high school students through dual enrollment, our foster youth, our undocumented students, LGBTQ students, working learners, student parents, incarcerated and formerly incarcerated students, and veterans, just to name a few. Each and every one of them belong in the California Community Colleges.

You mentioned enrollments, and I'm happy to report that our enrollment growth has been off the charts. Enrollments have increased by 9.6% in 2023-24. And if we stay on track with the enrollment growth we've seen in fall of 2024, we should return to roughly pre pandemic headcounts this year to put this growth in perspective.

While California represents 21% of the national Enrollment of community college students. Our Enrollment increase accounted for 37% of the national gain in Enrollment during the same time frame. So I wanted to make a few additional points when you're looking at it from a regional and a statewide perspective.

Now, when you compare all of our districts to pre pandemic levels, the enrollment growth has not been even. Some have double digit enrollment growth and some have not returned to pre pandemic enrollment. But I would say that most of our colleges, in fact all have shown increases since they reached the all time pandemic Low.

Taking college to the learners through our dual enrollment strategy and to our working learners and rising scholars. These have been strategies that we're going deeper into the populations we currently have and it's not tied into population growth.

So that was a finer point I wanted to bring to the discussion that even in regions that the population growth might be declining, the strategies we're adopting actually taps into our existing populations in new ways. Now to talk about the Governor's January budget. In my opinion, it does two things.

It leverages the strength of the California community colleges as workforce engines for California. I also believe that the confidence in the team that we have assembled in the Chancellor's office and from our colleges, we have lots of talented individuals.

So we have harnessed the talent from our colleges to set up a team to deliver, to rapidly deliver the necessary technology infrastructure to impact student outcomes at scale immediately. So the technology investment is a part of the January budget from the Administration.

So let me just talk about our team to give you a sense of why we believe that we can deliver on this investment. This includes the person who developed and implemented our current learning management system. You may ask, how did you do the learning management system across 72 different districts? This was in 2015.

And I remember I was President at Bakersfield College at that time and I heard all of the arguments of why taking on a big technology project would not be a good idea at that time. And now looking back, we're able to use AI interventions because we have a common learning management system.

This team we have assembled includes the individual who led the development of the intersegmental tool, the program pathways mapper that is between community colleges, UCs and CSUs. So this team knows how to develop and implement rapidly. The team includes data leaders who did the groundwork that led to the revolutionary AB705.

And when I started as Chancellor, we repurposed a very frugal budget within the Chancellor's office to change our positions. Repurposed positions to data and technology because we had the idea that this was the time we needed to use data and technology to look at student outcomes at scale and with equity.

We also cobbled together funding for the demonstration project on the Common Cloud, which is an integration technology. And our Board of Governors also is demonstrating this commitment by initiating the Digital Center for Innovation, Transformation and Equity.

Because they believe for us to take our success rates to the next level, we need to have this infrastructure in place bringing in smart AI technologies and tools into the California community colleges.

So I request that Chair Laird and Members of the Subcommitee that you help us keep the momentum going and retain the investments that we made in the January budget. Another big item that I'm super, super excited about is Credit for Prior Learning.

You know, CPL, or Credit for Prior Learning is not a new concept in community colleges, and you know that. But doing credit for prior learning at scale is new.

And with the technology infrastructure that we have been systematically building over the years, the $50 million investment in the January budget will help us systematize this work, bring it into the mainstream and not have it on the margins.

And it is going to be funding an outcomes based model that would be deployed to the colleges once they are able to demonstrate that the students are able to get the CPL recorded on the student's transcript. We have the details. We are in the weeds. This is not a conceptual idea.

And we are starting with veterans apprenticeships and industry certifications. And I want to express to Members of the Subcommitee that I am confident that we can do this. And we will report back to you on the progress we make every year in terms of our justice involved rising scholars, the 30 million.

When we had put forward the proposal from the Chancellor's office, we were being extremely conservative. We have needs that are actually over the 30 million number. It was a $10 million ask, but with the 30 million we can go into 150 more correctional facilities. This is the expansion.

And to give you some data snippets in the last three years, when you think about the rising Scholars Program, Chair Laird and Members of the Committee, you've got to think about an exponential curve. And you think about that. It starts slow.

But once the infrastructure is situated between the community colleges and with our prison systems and our jails now, the growth rate is going to increase rapidly. It's a really good growth curve. So we are expecting among our currently incarcerated Californians that we can increase the participation rate and the completion rate by 50%.

And the formerly incarcerated started off with a 64% growth. And we believe we can take it to about 150% growth. And this again, is not theoretical. We have the plans, we have the groundwork done to be able to move and execute.

So as a whole, we are very, very thankful that with the Proposition 98 funding for the investments that the Administration has made in the California Community Colleges, we have a team that is absolutely already moving and we just need to keep up with the momentum. As I wrap up my comments, I do have four additional requests.

So my first one is related to the tremendous enrollment increases that we have seen within our colleges. The budget does not fully fund colleges at the true level of growth. There are districts carrying unfunded FTEs from, from the current year. For example, in 24-25 we have unfunded FTEs totaling 22,566, which is approximately 126 million.

Now, with tight budgets, our presidents of our colleges are considering putting a cap on their enrollment. And we cannot turn away Californians who are seeking a program of study to advance their economic stake. So Chris Ferguson, whom you all know, has proposals for your consideration within the budget parameters, and I think you'll be happy to see them.

And he will give you more of the details. Ask number two is about the LA fires.

And I'm so happy to see Senator Sasha Renee Perez, who was at Pasadena City College last Friday just listening to the incredible work Pasadena City College has been doing with the community, with the county, with the city, with organizations like the YMCA in really rising to the moment and serving the community.

What the Chancellor's office is doing is trying to build a workforce. And by coordinating among the colleges, we're trying to bring efficiencies, the whole being larger than the sum of its parts. And we are putting together a proposal. This is an emerging proposal because we started this work in February.

We want to support colleges as well as we want to get the workforce. For example, construction workforce at LA Trade Tech, 100 people in a cohort. Got to increase it to 200 to be able to accelerate the recovery in the greater LA region. So we haven't yet put a number to it.

We are still working on the proposal. We should have it to you in about two weeks. Number three, the apprenticeship initiative of 60 million and the last one, and you hear this from me every year, and that's the Cal Grant Reform. We keep bringing that up. So with that, I conclude my remarks.

We have our entire team here to answer questions and to dig into some details. Thank you for your support at the California Community Colleges.

Well, thank you for your comments. They are a perfect introduction to the fact that I think every one of the major issues you listed we're about to go into in depth, whether it's enrollment or rising scholars. We had a hearing previously on the fires and schools and reconstruction, and we're just looking at every one of those issues.

And I know you're in a unique position because when we were talking about the K through 12 part of the fires, we weren't necessarily training the people that could respond in the way that community colleges in their workforce do so. And enrollment is just our leadoff issue.

When we are done with you, and I know Chris will represent you ably and we just appreciate the regular communication. And as an opening comment, I would have otherwise said what I sort of say to individuals.

Many in this room have come by our offices that when I was a community college trustee, the complaint all the time was about Proposition 98 and the fact that there wasn't the right historic split with K12.

But that seems to have changed because as we're seeing, seeing the Governor really go after this year, UC and CSU for cuts. Proposition 98 is protecting community colleges by getting the same cost of living increase that K12 has.

And while we all wish it would be higher, technically, the 2.4% is way higher than an 8% cut that the other two segments of higher education are proposed for. So we, we will work through those issues individually.

Let my with with it in in our heads that we are going to be going through each of these issues individually, let me still ask if my colleagues have any questions of the Chancellor before we move to issue number one. Thank you.

Then we really appreciate you being here and look forward to working with you through the budget process. And while we are having the panelists for item number 11 of whom is already sitting here, Chris Ferguson from the Community Chancellor's Office, Justin Hurst from the Department of Finance and Lisa King from the Legislative Analyst Office.

Let me ask that we call the roll. So let's call the roll before we go to the first issue.

[Roll Call]

We have a quorum and 100% attendance.

So with that, we're going to move to item number one, which is an enrollment update and proposal will go in the order that I mentioned. Chancellor's Office, Department of Finance, Legislative Analyst Office and we'll begin with Mr. Ferguson from the Chancellor's office. Welcome back to the Committee.

And I'm really looking forward to the Department of Finance being critical of your proposal or anything that you do. It's going to be a lot of fun.

Certainly. But before I jump right into enrollment, Chris Ferguson, Executive Vice Chancellor of Finance and Strategic Initiatives at the California Community College Chancellor's Office. Good morning, Senator Laird and members of the committee. I do want to start off my comments with a few things globally that we're doing to help districts and students respond to today's challenges.

The Chancellor has been in regular communication with our district CEOs. Our message is that we have a commitment to all Californians and all students and that we are there for them. Every student is welcome at a California community college, including our transgender and non-binary students, our undocumented students, our Black and Brown students, our English learner students, our veterans, and any number of student groups that attend a California community college.

We have worked to highlight California statutes and regulations, the current proposed budget investments, as well as our Vision 2030 goals. We have reminded districts to move forward with their important work relative to those laws and regulations. And I just want to highlight a couple of the laws that I'm referring to.

So under current statute, the Legislature has told our institutions that they should that they expect them to provide educationally equitable environments so that every student can reach their full potential. Under current education code, it also prohibits discrimination on the basis of disability, gender, race or ethnicity, sexual orientation, and among other characteristics.

In addition to those policies, we we have programs that the state has provided ongoing funding to support, including 11.6 million ongoing Proposition 98 to support our Dreamer resource liaisons as well as for the past couple of years, the state has established an LGBTQ-plus pilot program to equip this population with support such as mental health services.

And we want to thank the administration and the Legislature for their leadership on these issues. We maintain our focus on our diversity, equity, inclusion, and accessibility work. And we continue marching forward toward meeting our Vision 2030 goals. So at the end of it it would be although there are a lot of uncertainty out there, we're telling our field, we're telling our districts who are really on the front line of advancing our educational mission, serve students well, and ensure successful outcomes for our students.

So in terms of enrollment growth following as you heard in the Chancellor's remarks following the COVID-19 pandemic enrollment declines, California community colleges have been successfully reengaging students and re enrolling students. We've been building active partnerships in our colleges with our K-12 institutions to expand dual enrollment.

We've been working with our carceral partners to expand education to incarcerated individuals as well as formerly incarcerated individuals. We've been bringing baccalaureate programs forward. I would just highlight again. Between the fall of 2022 and spring of 2024, California community college enrollment increased by 9.6%, which accounts for 37% of the national gain.

Overall, our enrollment levels are roughly 2.1 million students in projected for the 24-25 fiscal year and academic year. What we would ask of the committee is that the Governor's Budget does put forward $30.4 million to support a 0.5% enrollment growth within the student centered funding formula.

We are projecting that there would be roughly 126.7 million in unfunded FTES that if funding was available, could support those students. Ultimately, those resources help scale up the innovative and intentional outreach, enrollment and student support practices on campuses and enabling campuses to serve students and serve them well.

In the event that we are unable to find a plan to fund that enrollment growth, what would likely occur is campuses would be unable to sustain long-term the number of course sections that allow them to continue serving that level of student population.

We are also requesting two policy changes within the student centered funding formula relative to growth that we would appreciate consideration for. The first is to use the greater of the three-year rolling average and the and current year FTES within the student centered funding formula. We project that to cost around 20 million ongoing. What that really does is for districts that are growing, it acknowledges that the growth is occurring and allows the funding to flow to those districts.

Without that, while the three-year average protects districts quite well in terms of a soft landing in the event of a decline, it also hampers their ability to ramp up as enrollment growth occurs rapidly. The second piece that we would ask for consideration is statutory change to lift the 10% local cap on enrollment growth. So within the student centered funding formula there's also statutes. There's also a requirement that a district can't grow by more than 10% from one year to the next.

We are seeing some districts coming out of the pandemic that are growing at a rate that is greater than 10% in terms of what might be available to help support that enrollment growth. Subsequent to the release of the Governor's Budget, we have identified several former appropriations that may be available for reappropriation to support these types of purposes and we'll look forward to working with your committee staff to and the administration to identify those resources. So with that I will conclude my remarks relative to enrollment.

Thank you. And we'll move to the Department of Finance. And let me just make one brief comment, which is our next item is the student centered funding formula. But it's pretty hard to talk about these discreetly, so we might ask some questions and get into some of that in the next item. But they are just inextricably linked. So, welcome to the committee.

Thank you and good morning, Chair and members. My name is Justin Hurst with the Department of Finance, and today I will be covering many of the Proposition 98 investments included at the Governor's Budget for the community colleges. For this panel, I will cover the governor's proposal for funding enrollment growth, which there is only one relevant proposal, and that is for funding enrollment growth at a rate of 0.5%, which amounts to 30.4 million ongoing Proposition 98 General Fund. Happy to take any questions.

Thank you. Welcome.

Thank you. Good morning, Chair and members. Lisa King with the Legislative Analyst Office.

I'm not sure that mic is working. Let's just make sure it is. Okay.

Lisa King with the Legislative Analyst's Office.

Why don't you take Chris's microphone there? There we go.

Lisa King with the Legislative Analyst's Office. Great. Thank you. Good morning again. I think the Chancellor's Office has done a good job summarizing recent enrollment trends, so I'll focus my comments on a few factors you may want to consider in deciding how much enrollment growth to fund for 2025-26. The first factor is demographic trends. Looking statewide, we aren't seeing a lot of growth in either the adult population or the number of high school graduates.

But we are seeing some strong regional trends with projected demographic growth continuing in certain regions, such as the Inland Empire and the Central Valley, places where we have seen strong enrollment growth trends in the colleges in recent years. A second factor you could consider is the labor market. Currently, unemployment rates are elevated above pre-pandemic levels.

Historically, there have been times where we've seen more students return to school when unemployment is elevated. A third factor you could consider is something that the Chancellor's office has spoken to. We do have a number of districts, about 25, that are on track to exceed their growth targets for 2024-25. Additional enrollment funding could be a way to allow these districts to continue growing rather than having to pull back on growth to contain their costs. A final factor you could consider is something that the subcommittee discussed earlier this month.

Right now, you face some constraints on the non Proposition 98 side of your budget that could make it more challenging to support growth this year at CSU and UC. And if that's the case, then supporting additional growth at the colleges could be one way to maintain overall student access. So taking these various factors into consideration, our recommendation is to Fund at least the 0.5% enrollment growth included in the Governor's Budget. You could consider funding more growth if you're able to redirect ongoing funds from other proposals that you deem a lower priority. Thank you.

Thank you. Let me start with a couple of questions here to try to tease this out and let me just comment. It would be our hope that we would not make as cuts as deep to UC and CSU and that we were not looking at community colleges to rescue that. But we talked about that at length at our previous hearing. And I don't know whether to start with finance or the community college office, but even though I know the answers to some of these questions, I think it's be good to hear them in sequence. How much unfolded unfunded enrollment do you estimate that there is?

Yeah, happy to assist here. So there's roughly 22,500 full time equivalent student enrollments that are unfunded right now as of the 24-25 first principal apportionment. That equates to approximately 126.7 million in ongoing cost. So last year's budget had roughly 28 to 29 million to support enrollment growth. We are deploying those resources to support enrollment growth. So that 22,500 is above and beyond what we're currently able to support.

But the bane of my existence is the fact that we talk in numbers and then other times percentages. So if we were to look at the proposal for the enrollment increase that's funded next year, the 0.5 or whatever it is, how does that percentage wise relate to that?

Yeah, so we equate the 22,500 to be roughly 2.2%. So if we were to add the 0.5% for true enrollment growth above the baseline, it would be about 2.5 to 2.7%.

And so when we say that half a percent which is recommended to be funded is 34 million and it would be 2.2% if we fully funded enrollment growth. You had another number. What was the total dollar number?

So that was on the three-year average the greater of. And that was 20 million.

No, no, I guess what I'm trying to. If you're saying 2.2% is the unfunded enrollment and we would pay 34 million for 0.5% increase in enrollment, what would we need to pay for 2.2%?

126.7 million

And 126 and does that include the 34? So really if we were to fund the difference between 0.5 and 2.2, we'd be funding the difference between 126 and 34, is that correct?

It is. But if you were to take that approach, what would happen is as we enter 25-26, there would be no proposed enrollment growth. So you would have to assume stagnant enrollment. We would actually recommend funding the unfunded enrollment that we're seeing today and having that half percent growth on top of the unfunded enrollment so that we can continue to push our colleges in our system to enroll more students, to continue to rebuild their enrollments and, and to see that they can be served well through our system.

I think what I'm trying to do is get to a dollar amount understanding of what we would do. And you keep shifting the option.

If I can be helpful, then what we would say is it's 126.7 million.

Just let me stipulate, I would like you to be helpful at any point in the process.

It'd be 126.7 million plus 30.4 million or roughly 157 million in total that that we would be requesting.

Okay, that's helpful. And if we were to change the statutory rule of eliminating the 10% cap and or going to the rolling, how would that affect this? You started to get into it just a moment ago, but how would that affect?

Certainly. So it's roughly 20 million to support a shift from the three-year rolling average to the greater of the three-year rolling average or current year FTES And our projection is that that would be on top of funding the currently unfunded FTES. Within that 157 million, 15.6 million is associated with the lifting of the 10% cap. So we have six districts throughout the state that we've identified that have unfunded enrollments that are above the 10% cap right now.

And if we were to start to move in the direction of funding above the governor's recommendation within the context of Proposition 98 and community colleges, are there ways in your view to do it that aren't dipping into one-time allocations that sort of provide the cushion in the fluctuation of Prop 98?

There are. We think there's some prior appropriations that were made for specified purposes that won't be needed ultimately for those purposes. The clearest example I can share today is for 23-24 student-centered fund. For the 23-24 student-centered funding formula we allocated as a state 140 million more than was needed to fully fund the SCFF that year. So those resources would be available to the state to use for another purpose. Those weren't known and available at the time of the Governor's Budget.

So those resources would be above and beyond what the administration has presented within its package. There are other categorical programs that will have similar amounts that should be available as well. I will share all of that detail with the committee staff.

And let me make sure I'm getting the fact that this is not apples and oranges. I mean if you're doing pieces out of categoricals and other things, that's on time ongoing money. So you could find ongoing money to deal with enrollment. Is that the deal?

Yeah. My understanding of the administration's investment package is such that there are some one-time investment in the budget year that could be funded with these other one time resources, thereby freeing up the ongoing resource for another purpose. So for example, the deferral repayment of 243 million is scheduled in the 25-26 fiscal year.

But given that it's a one-time payment, you could use other one-time resources to make that payment, freeing up resources within that ongoing bucket. Ultimately that's a decision and a discussion for the administration and the Legislature to think through the mechanics. But we do think there is a way to do that.

Okay, let me ask if the Department of Finance or the Legislative Analyst wishes to comment on that exchange. The Department of, I mean the LAO is leaning in, so we will go with this here. Yeah, I bet you are.

Regarding the suggestion of using one-time savings to cover certain one-time proposals under the Governor's Budget, I think one reaction that we may have to that is it does mean that there would be a smaller one-time cushion under the Governor's Budget. So this is referring back to a conversation that you all had a few weeks ago as part of your Proposition 98 hearing.

But currently under the Governor's Budget, a portion of those ongoing resources that count toward the guarantee are being designated for some one-time activities and that creates a cushion in the budget because if the guarantee were to decline in a future year, the state could accommodate that just by letting the one-time funds expire as they normally would.

It wouldn't necessarily need to dip into ongoing programs. So we think that is a fiscally prudent approach and is something we would encourage you to consider as you structure your Proposition 98 budget, continuing to keep that one-time cushion.

Okay. Department of Finance, do you have comments on this?

Yes. Justin Hurst, Department of Finance. I was just going to mention that of course, as you're familiar with the Governor's Budget and the process for public budgeting, we'll be revisiting a lot of these items at the May revise. But just to confirm one thing that Mr. Ferguson said, there is some one-time funding that is scheduled in the budget year which could be used for ongoing purposes that are associated with some of our proposals, some of which are spoken for. But one example being there is some one-time funding in the budget year for the ERP project. So I just wanted to provide that clarification.

And what project is that?

My apologies. Collaborative ERP, Enterprise Resource Platform. That is item, I believe...

No, we're good. Just going after the acronym, that's all. Thank you, that was helpful. Let me ask my colleagues if there questions or comments. Senator Perez.

Thank you. Yeah, I had a question just in regards to the enrollment decline that I think several of the community colleges are, you know, seeing across the state. I know we just had the CSU here and they've been seeing some enrollment declines as well.

And I just wanted to hear about if there were any strategies that, you know, your colleges and specific community college districts were utilizing in order to increase enrollment. I know, for example, I think here in Sacramento, you know, they rolled out a program to basically send out acceptance letters.

We know that you don't have to apply to a community college in order to get in. But you know, receiving that in the mail, I think creates a lot of excitement for, you know, for students that could prospectively be incoming students. It gets their families excited and it lets them know that college is an option and a pathway for them, whereas maybe, you know, they weren't considering it before. We know there are so many pathway programs, transfer programs, you know, financial aid options.

And I know the state's done a lot to pass legislation to make it easier for students to sign up for those things, let them know that they're readily available. So what have you all been doing? What have you seen that's worked and how do you plan on continuing to increase enrollment other than I know some of the economic trends will maybe lead to enrollment growth, but I don't think that we should depend on that. We should be trying to look at innovative ways to encourage students to attend our institutions.

Yeah, certainly outreach at the local level does help, but from a system-wide perspective, a couple of the items that we absolutely focused on, number one, we do have as a goal trying to get every high school student to take dual enrollment courses.

Because the research behind dual enrollment also shows that it increases the likelihood that students that would otherwise not attend college attend college. It shows that to many students you are capable, more than capable of completing college courses and enrolling in college. So that's one of the most successful strategies from our perspective.

We know that there are many districts throughout the state that are pursuing additional dual enrollment opportunities with high schools in their districts. We know that there have been additional changes allowing, you know, greater access to dual enrollment across districts for students if they're unable to access through their residential their home district.

We've expanded carceral programs and trying to reach into our carceral system to serve additional students in those settings as well. And we can see that in, I don't have the specific numbers in front of me, but we can see that in our apportionment data that the number of dual enrollment students is increasing, the number of students being served through the carceral system is increasing. So those are some of the strategies that we're seeing.

But I'd be remiss if I didn't also note that within each one of those is also a focus on our Vision 2030 goals and encouraging districts to have successful outcomes for those students. The start is to get them enrolled in our system to see them begin their journey, but the end is to see them complete that journey successfully.

Yeah, thank you. And I appreciate you laying that out. Obviously, dual enrollment programs are excellent and I think a great opportunity to get our K-12 students informed about college and excited about college. You know, I'd be interested in seeing, and I know there's legislation right now moving to further enhance dual enrollment programs, but I do know that some community colleges work really hard to build out some of those partnerships that they have with local school districts.

And I think us looking at innovative ways that we can go above and beyond increasing some of those numbers of dual enrollment for Black and Brown students in particular would be really exciting. And you have really great examples within some of your community college districts already talking to them and understanding what they're doing to be effective so that other districts can mimic that I think would lead you to a lot of results.

Yeah, absolutely. And I would have been remiss. I'd be remiss if I did not also mention that we are trying to work with colleges. Credit for prior learning is certainly one of them to also engage returning students or students that might be looking for upskilling or reskilling opportunities, or even older students who are coming back to seek out college opportunities. So we were absolutely pushing the system on all fronts to serve Californians as well. We would love to be able to come to you at a future committee hearing and say, you know, we've got a great problem. We've got 3 million students enrolled in our colleges, and we're absolutely after that.

Did that complete your question? Any questions? We don't have further questions. So let me just make a little bit of a global comment, which is that I think we would be favorable to trying to figure out ways to fund more enrollment. And we just have to look at the sources to make sure that some of these competing concerns, how we address them or whether we feel we don't have to address them, and I think it's a legitimate concern to try to maintain a cushion in Proposition 98 that is one that could withstand a budget plunge. At the same time, we're asking everybody to increase enrollment, and if we don't fund it, then we're unclear on the concept. So I think we just have to take those practical things and try to.

Work through them. And the Department of Finance was very clear that they'll look at things and consider them before they may revise. But we really hope this is one thing they take a deep dive into and see if there's some ways to go on this.

As we move ahead, we'll move to item number two, which is the student centered funding formula, and miraculously, the panel of exactly the same. So let me ask each of you to make any introductory comments and we'll begin with Mr. Ferguson.

Certainly. So with our, with our recent projections from the 24-25 first principle apportionment, we are recognizing that there's about a 11 and a half to 2% deficit as it relates to the student centered funding formula. We would certainly appreciate consideration for resourcing that deficit so it doesn't occur.

What a deficit within the formula would mean is that colleges who were projecting to receive a certain level of resource would otherwise receive a lower amount of resource to serve their students. Again, that wasn't known at the time at the Governor's budget, but we now know that that is there.

We value that at around 150 million for the 24-25 fiscal year and we would assume that would carry forward into the 25-26 fiscal year. So fully funding the student centered funding formula is a priority for our office.

I would also add, you know, just as I previously noted, we do have those two policy components around lifting of the 10% cap as well as using the greater of the three year average or current year full time equivalent student metrics.

One piece that I did want to add as it relates to the Southern California wildfires, and that is that districts that are experiencing revenue declines due to the Los Angeles wildfires and it really is universal throughout the state, when you experience a natural disaster, they're eligible to receive what's called the emergency conditions allowance.

And our office is being proactive in reaching out to the 10 districts in the Los Angeles area that were impacted by the devastating Los Angeles wildfires and letting them know that we're here to help them through that process. It's a form that they have to submit. That form is about two pages long.

The intent is to protect districts against material declines in their full time equivalent student counts so that they have level of stability and ability to recover from those wildfires or those natural disasters. We are working with other districts in similar positions to provide that type of lead time and we can do this administratively.

The last piece that I would add is that the Governor's budget does propose 230 roughly 230 million to support a 2.43% cost of living adjustment for the Student Centered Funding formula.

We are in full support of that proposal and we'll just ask that whatever the cost of living adjustment happens to be at the May revision that that be fully funded as well.

We would note we do project for the Committee that in 25-26 that there would be around 21 districts that are on the hold harmless provisions of the Student Centered Funding formula and as a result of current statute those districts would not receive a cost of living adjustment heading into the 25-26 fiscal year year.

Thank you Department of Finance

Justin Hurst, with the Department of Finance. If I may, I'd like to begin with just a high level overview of the SCFF. As you may recall, the funding formula was enacted as a part of the 2018 Budget act to allocate apportionments to the community college system.

The SCFF is composed of three main components, a base allocation accounting for approximately 70%, a supplemental allocation for approximately 20% and a student success allocation for approximately 10%.

The SCFF also features a hold harmless provision that is meant to provide a baseline level of funding for college districts as they navigated onto the transition of the new funding formula as agreed to between the Legislature and the Administration and the 2018 Budget Act.

The hold harmless level for each district was pegged to their 2017-2018 funding plus the COLA for that given year.

Subsequent budget acts had the hold harmless sunsetting at the end of the 2425 fiscal year or current year and the 2022 Budget Act Agreement established a new funding floor starting in the budget year 2025-26 wherein the 202425 hold harmless level would become the new baseline funding floor.

This was done to provide districts with a soft landing as they continue to work towards being on the funding formula and regaining their enrollment from the pre pandemic. Now for the investments as part of the Governor's budget, Mr. Ferguson already mentioned one of them.

There is a cost of living adjustment in the amount of 230.4 million Proposition 98 General Fund at a rate of 2.43% for SCFF apportionments.

Similarly, there is also a cost of living adjustment proposed for certain categorical programs at that Same rate of 2.43% in the amount of 31.9 million Ongoing Proposition 98 General Fund and that's to support the following categorical the Mandate Block Grant, the Disabled Students programs and services, CalWORKS student services, extended Opportunity Programs and services, campus child care tax bailout, funding for related and supplemental instruction, rates for apprenticeships, and the adult education program.

With that, I'm happy to take questions.

Thank you. And then we'll move to the Legislative Analyst.

Thank you. Lisa King with the Legislative Analyst's Office. So we think the proposed cost of living adjustment or COLA for apportionments is reasonable. This would help community college districts address some of the key cost increases they face in 2025-26 including continued salary pressures, higher pension costs, and higher health care premiums.

As usual, the data that's used to calculate the COLA rate will be finalized in late April, so you will receive an updated rate at the May revision. Regarding the proposed COLA for categorical programs, we think that this is a reasonable starting point.

The governor's proposal includes many of the categorical programs the Legislature has prioritized for a COLA in recent years. That said, the Legislature could of course, choose to provide Ecola for a different set of programs this year according to its priorities.

We would just note that given the limited room for ongoing spending increases, as we discussed in the previous item, the Legislature will likely face a trade off between providing more funding for categorical programs or providing more funding for other ongoing purposes such as enrollment growth. Thank you.

Thank you very much. Let me ask a few questions about the student centered funding formula. And let me begin with Mr. Ferguson, because we had an elaborate exchange in the last item about enrollment.

How would some of those actions affect the sort of the hold harmless groups if we funded extra enrollment or we did other things, how would that affect that list or the number of colleges on that list?

Yeah. So of the 21, if I recall correctly, roughly three would benefit from it. And they happen to be Basic Aid Districts. So they, they by, by and large the dynamic is such though that as districts increase in enrollment, they're increasing on the base supplemental and success metrics of the formula.

And what that does is it has the effect of pushing those districts from being hold harmless or on stability onto that base supplemental and success metric portion of the formula.

So over time, as districts grow, they would see, you know, much more likely to transition from the hold harmless provisions to the core provisions as it relates specifically to that unfunded FTEs. I think the of the 21, there were three that we identified that. But that's three of 21. That's right.

And the other thing is, is that that I have sort of observed doing this for four or five years in this incarnation is that it just changes every year. And I know we asked what's the list for this year and it turns out the list for next year is different than this year by bit.

What are the factors? Not that I don't know the answer, but there are people listening. What are the factors in sort of the rising and falling numbers of districts that are in hold harmless status?

Yeah, the core factor on the funding formula side, there are three core factors there that the base, supplemental and success metrics.

So within that it's full time equivalent student populations and specifically the types of students you're serving as the rates for serving more dual enrollment students or carceral students is higher than the rate for traditional credit enrollment, which is higher than the non credit rate.

Within the success metric it is looking at those students that are receiving promise grant fee waivers as well as Pell grant students.

And then in the success metrics, some of the metrics that we're looking at are completion of a degree or certificate program, looking at transfer rates to four year institutions of higher education, looking at the number of students that are earning a living wage coming out of their programs.

But the reason that you will see some shifts between the three categories, there's that core formula, there's what's called stability, which is A1, which is designed to be a one year revenue protection, very similar to the way K12 school districts think about declining enrollment. We do it on declining revenue.

So it's meant to say if you see a decline from one year to the next to provide a soft landing, you can end up in stability.

And then subsequently you can also be in the hold harmless provision which is we look at those three categories, we say the core formula stability and we look at the hold harmless provision to see where a district might be landing from one year to the next based on current statute without the application of a cost of living adjustment.

On the hold harmless provision, we should expect more districts to be funded on the core formula and the stability provisions from one year to the next moving forward as we roll from one fiscal year to the next.

However, to your point, because there are those stability provisions that those 20 plus colleges that I mentioned that could increase from one year to the next as districts come off stability.

And then you mentioned in your opening comments sort of three different things like taking off the 10% cap rolling average and the emergency conditions allowance, if we were to move in that direction, how would that affect the number of people on the list or the number of people that might not be favorably coming out of this formula?

Yeah, it's unlikely that we would see a significant impact from either of those two provisions. So the lifting of the 10% cap impacts six specific districts. And those six districts are not, none.

Of them are hold harmless.

Not to from what I recall. No, they are not hold harmless districts. From the greater of given that our projection is around $20 million, it's unlikely that it would have a significant impact on the number of districts that are on hold harmless or stability or on the core funding formula provisions.

For context, that $20 million is on a base of around 10 billion in total resources that support the student centered funding formula. So that's why it's, it's got a very muted impact.

The 126 million has some impact for a few districts, mainly Basic Aid Districts that we would are projecting, but it's just that context of the overall level of resource.

And you mentioned success and one of the factors in the formula. But how do we actually measure whether this formula is being effective? Is that just a numerical thing based on who enrolls, or is there a more empirical way of looking at whether or not we're actually reaching different students and successfully graduating them?

We could certainly further look at the descriptors, but one of the core things that we have been focused on is looking at those success metrics. And in particular we can tell between students receiving an AA degree or an ADT degree, which is associate degree or associate degree for transfer.

We can see that overall from the start of the funding formula to today, the number of students that are receiving a degree has increased.

We can see in our various success metrics, we can see improvements in those metrics from the start of the funding formula to today, even though we also know, as we can see in our data, that we're only now getting back to the enrollment levels that we saw pre pandemic.

So from our perspective, we've done quite well as a system on those success metrics and serving students well because despite having a lower student base during the pandemic, we've seen successful outcomes.

Well, my issue in many ways is the formula sort of thinks all districts are equal in how this affects. And if you have an incredibly high cost of living area, you're having trouble hiring people, you're having trouble with the students and your costs are higher and yet you're being cut in money.

And it doesn't seem to factor in the formula. And so a lot of the places, I mean it is not absolute, but a lot of the places that, that you look on the list in our agenda packet are in high cost of living places.

That is just not a factor that's considered here and it, in my view, unfairly disadvantages those districts. Has and I know there was a working group that tried to do this that sort of blew up whenever it was my term, didn't successfully come to an outcome of any recommendations about three or four years ago.

Could you comment on that?

Yeah, there was a. There was a group that was established with the start of the student centered funding formula that did look at this and they concluded that they did not have a recommendation that they would put forward to make an adjustment one way or another for this type of regional cost of living that you're referring to.

I think for us we would say the formula is working well in terms of it is allocating resources to colleges. Colleges are able to serve students well. We know that the conditions that each district and each campus face are different from district to district.

We do know, though, one thing that we would highlight right now is we do know that there is a strong correlation on the enrollment front between districts that are, on the whole, harmless provisions and where they were enrollment wise. Say, looking back to the 2015-16 fiscal year.

I have a closing comment, but Senator Perez would like to ask a question.

I appreciate this discussion. When I first began working at the campaign for College opportunity back in 2018, this was actually the first item that I ever got to work on with them was passing the student centered funding formula. So it's kind of amazing to see how it slowly rolled into effect.

I was there when the pandemic happened and I do think, and you can correct me if I'm wrong, that because we introduced a formula that did not focus purely on enrollment and instead took into account equity components such as the number of students that are Cal Grant recipients, and took into account success metrics such as the number of students receiving an adt, that it actually helped several districts during the pandemic when we saw drastic declining enrollment across the state for community college systems.

Would you say that's correct?

Yeah, I'd say that's an accurate description of, you know, the mechanics of what happened during the pandemic. And just overall, in terms of the structure of the funding formula being intentional around not being purely focused on just full time equivalent student enrollment.

Yeah, I appreciate that. You know, I'd also say too, I know that I met with some leaders recently who had wanted to talk about the student centered funding formula and had lots of different opinions about, you know, how we might change and improve things.

Some districts have more enrollment and are seeing increases, as you mentioned before, and other districts continue to decline. I noticed, for example, one of our largest districts in the state, the Los Angeles Community College District, is not on this hold harmless list.

I'm willing to bet, just based off the numbers that you show that they're probably seeing declining enrollment, but they're probably still serving a large number of students that are Pell Grant recipients, just given the population that LACCD typically serves. So it's hard to find a kind of a perfect method. Right.

I think that works for everyone and I certainly don't have answers right now to improve it.

But I do think that us moving away from just enrollment to take into account some of those districts that have seen declines has been positive and us taking into account the equity needs because we know that low income students, you know, first generation college students, they need more support than a, than other students do.

I had one question and that's just in regards to the hold harmless districts that were listed. I was really surprised to see Imperial Community College district listed listed here. Just given, you know, they are at the Mexicali Calexico border. The population that surrounds that district is one that's typically low income.

I would anticipate a lot of Pell Grant recipients attending that college. I noticed at the bottom that there's a note that there may be some FTS errors with this numbers, but it's quite large. I mean, they have one of the largest hold harmless percentages on this sheet. It's 24%, actually the largest of any district.

I'd wonder if you could explain that a little bit to me because I would actually expect for it to be the opposite for them to really. And maybe it's that the equity metrics aren't enough for them to see the benefit.

Your suspicions are accurate. So for two districts in the state, Palo Verde is the other. We identified missed submissions in terms of the data that they submitted for full time equivalent student enrollment.

So we think part of why you're seeing them on the hold harmless as of the 24-25 first principal enforcement isn't because they necessarily are a hold harmless district, but because the information that is used to compute their statutory entitlement was not reflective of what was occurring in the district, they ended up on those hold harmless provisions.

But what that does actually show from our perspective is it shows that the formula provides a level of predictability and stability for districts from one year to the next.

So even though there may have been a missed submission that will be corrected when we get to the second principal portion in June, districts were able to see that they had a reliance on a stable funding level.

I think he's setting up the data processing item that's later on the agenda. I think that's what just happened there. A couple of comments because I asked no questions there, just that I still.

There's lots of reasons why I think this formula needs some work and encourage you to work with the stakeholders forced to do it and happy to work on that as it moves forward. I suspect we'll have some comments in the comment period about it.

The other comment I wanted to make is on the categoricals and I appreciated the legislative analysts comment that this was a starting point. And it always intrigues me. I say this every year. The MESA program and the Puente project never seemed to make the, the cost of living increased. They're always left out of whatever it is.

And so I just hope that when we, we get to deciding what it is that there's just some consideration for that. But I get that this is a starting point and that you have to do different things if you pull people in or, or take them out. But that's just a comment I would make.

Is there any other comments before we move to the next item?

Senator Perez, one last thing I'd like to mention. I appreciated what you shared about the increase in production of ADTs, you know, after the implementation of the student centered funding formula. I know that that's not listed as an issue that we'll be covering today, but it would be really excellent, I think.

Should we take a deeper dive in the future to see some of those numbers and what's occurred since 2018. And you know that if these success metrics, if they've led to results, it's really excellent to hear that you're saying that it has.

Yeah, certainly we'll, we'll work with our team to work with your staff to set something up. I would also just like to add that we're fully supportive of a cost of living adjustment for all categorical programs as that ensures that districts don't lose pace on their ability to offer the same level of programming to students.

And I just, I appreciate that going back a subject every time it says on the, the student centered funding formula that there's a soft landing. Just for the record, it's still very much a landing no matter how that happens.

And I, I just think it's so difficult when we're working on things now to have to do deal with that. So I'm just hoping we get there. We're going to move to item number three, which is the student housing program. And I think we're switching out the Department of Finance. But we still have Mr. Ferguson and Ms.

King from the Department of Finance. We'll have Alexandra Wildman and Alex Anaya Velasquez. And we'll go in the order of Chancellor's Office Department of Finance Legislation Legislative Analyst Office. So, Mr. Ferguson, welcome back to the Committee.

Thank you. So the. The Governor's budget continues to provide resources to support the transition from general fund resources to a statewide lease revenue bond program to support 13 community college district projects. Those projects represent just under 1 billion in available resources.

We would note that there are two community college districts, one that has officially withdrawn their application as well as one that is in the process of withdrawing as well. The first district that's officially withdrawn was the college of the Canyons that submitted a project.

Due to leadership changes on their in their district, they have opted not to move forward with their project. The second project is coming from a district that is considering an alternative way of constructing their project using, I believe it's my understanding, P3 model, and that is the San Diego Community College District.

So, you know, my understanding isn't that the project won't move forward so much as they've opted for a different structure to move forward.

Thank you. Move to the Department of Finance.

Good afternoon, Chair Members Alex Anaya Velasquez with the Department of Finance just echoing the comments made by Mr. Ferguson that the Governor's budget continues to provide general fund support for deb service.

Just want to note that for the Governor's budget, the budget year provides 1.3 million general fund to support debt service for completed community college projects in 2025-26. However, we did want to note that this amount should have been approximately 2.5 million for 2025-26 at the Governor's budget.

But we plan to fix this oversight at the May revision. Also lastly, the 2025-26 Governor's budget does not include any new proposals or projects related to the higher education student housing grant program. But the administration remains committed to the ongoing approved projects. This concludes my remarks and I'm happy to take any questions at the appropriate time.

Thank you. And then we'll move to the Legislative Analyst Office. Welcome.

Thank you.

If I may, Chair, make some additional comments for the Department of Finance.

Pardon.

If I may make some additional comments for the Department of Finance. Alexander Waldman with the Department of Finance.

That's. I'm just looking. Do we have four Department of Finance people?

Just confirming the Education Systems Unit is here along with our Capital LA colleagues as well.

Okay. Thank you for that clarification. Thank you. Welcome.

Thank you. Alexandra Waldman for the Department of Finance. Good morning or good afternoon, Chair Members. The budget act of 2024 included trailer bill language which established a new lease revenue bond program to maintain funding for 13 affordable student housing projects which were originally funded by the Higher Education Student Housing Grant Program.

Finance has been working with the Chancellor's Office to create a lease revenue bond program structure which serves the needs of the districts and have been working to develop a legal mechanism to facilitate the interim financing and sale of bonds for these projects.

Of the 13 projects eligible for this program, 11 are still actively involved with the program, with one campus having withdrawn and another yet to formally determine its status.

Of the 11 active projects, four are currently under construction, with five more due to begin construction in the budget year and the remaining two due to begin the next year in fiscal year 26-27. Thank you.

Thank you very much. We'll move to the Legislative Analyst.

Lisa King with the LAO. We don't have comments on this issue, but I am available for questions. Thank you.

Thank you. Let me ask, and I don't know who the appropriate person is to ask, what is the process for dealing with reverted money or unallocated money because somebody chooses not to move ahead with their project?

Alexandra Waldman with the Department of Finance. So the original analogy, you probably have.

To pull it up a little closer.

The original program included 81.3 million unallocated, which the intent is currently to Reserve it to maintain flexibility regarding return funding. We are still evaluating the disposition of those funds. It's unclear under statute whether they would automatically be available in the same way as the 81.3 million.

And I think it said in the staff report that there's cost overruns in various projects. Are they being covered by the individual colleges, or is that something that's going to be an issue here?

I would note that Finance has only received preliminary numbers and are still evaluating the effects of that. But under statute, cost overruns would be covered by the districts.

And will that information be readily clear by the May revise?

I'm not able to commit to a timeline, but that is the intent at this time.

Okay. And it. It's just that we had a lot of campuses that were interested after. And I know that there will be somebody that maybe in the Department of Finance is not sitting at this table that will be dying to claw that money back. And.

And so I would just hope that we would have the option of looking at another round if for the money from those two, just as an option or at least here's the trade off if you don't do it, rather than us just getting a recommendation that it's been clawed back. So I hope there's some consideration.

I don't know if you have a comment. People are nodding here, but that never registers.

Yeah, Alex. And I owe the Department of Finance. Just noting that I think the prior budget, the chancellor's office did submit a round three of applications that ultimately did not become part of the 2024 Budget Act. However, if a third round were to be resubmitted, that would be part of the budget process.

And the Department of Finance will work along with the Legislature, the LAo, to review those applications.

Okay. Thank you. And then let me ask, there was a, I don't know how to put it, a little bit of Hoo ha about moving to the bond financing part when that was happening. How is that going?

I mean, the money's in the budget for the bond service for this year, but is the that process actually going forward? Okay.

Alexandra Waldman with the Department of Finance. So finance is in the process of completing the legal agreements to facilitate the interim financing. Currently, two projects are due to complete construction this year. The debt service proposed in the Governor's Budget reflects the costs associated with those projects.

Okay. Because we just want to make sure it's continuing to work. That was such a big issue for a while and just like to make sure it is. And I congratulate all the colleges that are moving ahead. That's great news. Are there any other questions?

You asked my question with regards to the.

Great. Off mic, Senator Ochoa Bogh said I asked her question, so we're good then. We appreciate this and we know there'll be some more information on some of those topics. We're going to move to issue four, Proposition 2, facilities projects and capital outlay. Chris Ferguson, Alexandra Wildman, Lisa Qing. So let's begin with Mr. Ferguson.

Yeah. The Governor's Budget represents support for approximately 29 community college facilities projects. Over the, in terms of, you know, what that means from the recent bond, that bond provides 1.5 billion in total available resources over the course of the bond.

Those 29 projects would ultimately, you know, between all of the design, construction, closeout phases, represents a little over 750 million in the total resources. We're strongly supportive of all of the funding, all of the projects. We have a scoring matrix that we have been using for, I believe it's the past six years now.

That matrix was developed in partnership with all of our community colleges. We had a work group that looks through the matrix, the scoring, and, you know, took a couple years, you know, year to two to get there. But we did so collaboratively with the system, so we're strong supporters. We would note that due to timing, there was a late submission that we would request consideration for, and that is for a project at the American River College Campus to replace Davies Hall.

There was language in last year's trailer bill to prioritize that project, but for timing reasons, the budget change proposal to effectuate that as part of the list, it was delayed getting to the Department of Finance and ultimately to the Legislature for consideration. So certainly we'd hope for consideration come the May Revision.

Okay, we'll move to the Department of Finance.

Alexandra Wildman with the Department of Finance. The Governor's Budget proposes 29 projects for the Proposition 2 funding with a budget year state cost of 51.5 million and a total state cost of 728.8 million over the lifetime of the projects. The selection process at the Department of Finance was aligned with the Board of Governors priority criteria, which is a comprehensive point based categorization system. We utilize the system as a framework to assess the proposals.

The framework prioritizes capital outlay proposals based on criteria including including fire, life, and seismic safety, facility condition, and programmatic needs, among others. Safety projects are the highest priority, followed by growth and modernization. The Chancellor's Office plans to consult with the districts and submit proposals for the remainder of the Prop 2 funds in future years. Happy to take questions at the appropriate time. Thank you.

Thank you. And then we'll move to the Legislative Analyst Office.

Thank you. Lisa Qing with Leg Analyst Office. So, as the other panelists have noted, the 29 Proposition 2 projects included in the Governor's Budget were selected by the Chancellor's Office from a larger list of proposals using a scoring system. The scoring system was adopted back in 2020. However, Proposition 2 is the first influx of new funds since then, and so this year our office took a bit of a closer look at that system.

We think there are several positive aspects of the scoring system, but in the interest of time, I'll focus my comments on three areas where we think the Legislature may wish to further examine the system. The first relates to the share of funding between modernization projects and growth projects.

Under the current system, after any funds are allocated for safety projects, 65% of the remaining funding goes toward modernization projects to renovate existing space, and 35% goes toward growth projects to add new space. When we look at the system's most recent five year capital outlay plan, we see that the split of identified capital outlay needs is actually a bit more heavily weighted toward the modernization side. About 80% of the identified needs are for modernization.

We think in part what this might be related to is the increase in online education over these past few years since the criteria were adopted. We would expect that to reduce the amount of growth needs. And so we just raised this because it could create an opportunity to allocate more funding, greater share of funds for modernization.

The second issue we wanted to raise is that, of the 29 new projects included in the Governor's Budget, nine of them, so about a third, are gymnasiums. And this is a much higher share than we've seen in previous years. We think this is related to a shift from the old scoring system that was used for the previous education facilities bond to this new scoring system. As under the old system, gymnasiums competed in a separate category along with performing arts facilities and certain other facilities.

And that category was eligible for only 15% of available bond funds in a given year. Under the new scoring system, gymnasiums compete with all other academic facilities, and so there's a more direct trade off there between how much of the funding goes toward gyms versus facilities that more directly support instruction. The third issue we'd raise is related to the specific metrics that were used to rank projects. By and large, we think that these metrics are highly relevant, but there were a couple that we wanted to highlight as having a little bit less clear of justification.

One of those metrics provides greater priority to projects that are located at larger campuses versus smaller campuses. Another one provides greater priority to projects located in four specific regions of the state. In general, our recommendation is to direct the Chancellor's Office to provide further justification on these various issues we've raised. And if any of these issues raise notable concerns for the Legislature, you could direct the Chancellor's Office to adjust its scoring system accordingly and use that to select a revised set of projects. Thank you.

Thank you. Under questions, let me just ask is if either the system or Finance would respond to the 1/3 of the projects being gymnasiums. Is that something you wish to comment on?

Mike McGinness, Department of Finance. So the LAO is correct in that the change in the model in 2020 did have an impact on the increased number of gymnasium projects. Under the old model, gymnasiums were limited to a category which included performing arts buildings, childcare, child development related facilities, and a handful of other facilities that could receive no more than a maximum of 15% of the total allocation of funds granted.

And as a result, there was a effectively a backlog of need that resulted from having insufficient funding available for these facilities. So with the revised prioritization system that allows them to compete more evenly with some of the other facilities on campus, there's an opportunity for more of them to be selected. Additionally, these facilities do contribute to academic programs and are necessary to allow for certain degrees to be completed.

Okay, I'm going to ask a related question, and it might bring us back. But when the formula was revised, I was going to ask what kind of projects got pushed out or what are at the top of the didn't get funded list when we look at how this was redone? Is there somebody that can speak to that?

So the revised list reduced the number of categories down to the three categories that you see in the projects before you today. So we have the first category, which is focused on critical infrastructure. That's building safety, seismic improvements, that sort of thing, and then facility modernization and enrollment caseload, population categories.

So there were previously, I believe, three additional categories. I'll see if I can find that in my notes. That have simply been condensed into these broader categories because it's been recognized that there were too many categories and it was creating complications in terms of prioritizing projects.

I think the thing that's difficult here is just looking at the competing interests. And I mean, for example, in my Senate District, Cal Poly just made a big cut to the swimming pool diving program and all hell's breaking loose. And I might not have said that was central to school facilities, but it has really risen to the top. At the same time, if you... The President of the college where I once sat on the board is sitting in the audience, and the voters passed a bond because it was built on the side of a hill.

And for 30 years it was just inaccessible to lots of different people. And there were levels at each, you know, is evened out at each level. And there were elevators and different ways to get up and down, so it became accessible. To me, that's a priority. And I'm just...

And that's completely separate from in our enrollment discussion that somebody somewhere is having a lot of increased enrollment and doesn't have the facility to accommodate it. I just am concerned that maybe this formula isn't poking at the right directions and how to make the allocations and there might be some discussions the next couple of months to look at it. Let me ask if my colleague has any questions.

No.

Okay. Thank you. I think that discussion was our closing discussion, so appreciate that. We're moving to item number five, which is the Rising Scholars Program. And it's, Mr. Hurst is returning to join Mr. Ferguson and Ms. Qing. And we'll begin with Mr. Ferguson.

Sure. So the Governor's Budget proposes for our system a 30 million ongoing augmentation to support the Rising Scholars Network Program, which supports serving eligible adult justice involved students as well as students that are juvenile students in the juvenile justice system in county jails. So we have two components to the program to serve both.

We know today that there are around 93 programs in operation. Of those 93, we know that 80 are grant funded. Of those 80, we know that 15 are temporarily funded. There isn't an ongoing grant funding source to support them, and then 13 are non-grant funded.

So with these resources, we would be able to provide additional ongoing support to more campuses to operate Rising Scholars Programs. We also know, as the Chancellor mentioned, there's around 115 additional sites that we would love to expand dual enrollment opportunities to additional students to. And the focus is expanding dual enrollment for those students.

We know that we've served a significant number of additional programs since the program first began in 2021. We know that that's increased from, by 86.7%. So it's grown from about 45 institutions to the number of institutions covered today, which is just under 90. We know the headcount of students that we've been serving has increased by 28.4%.

So we're serving around 20,000 students enrolled as of the spring of 2024. So we know there's a lot of benefit from this program. I don't have it in front of me. We do know that these students are completing the programs. They are graduating. They are receiving certificates and degrees. They're completing their courses.

Since the juvenile justice system began, we've reached 567 students and we now have a little over 1400 enrollments for the spring of 2024. We see significant benefit also in that the majority of our Rising Scholars students come from underrepresented student groups that have historically experienced disproportionate impact.

So we're prepared to support additional campuses ongoing with these resources, provide additional resources to continue expanding and serving more students, and we see successful outcomes from the program. We just thank the Legislature for the strong support over the years and would recommend consideration for this investment.

Department of Finance.

Justin Hurst with the Department of Finance. The Chancellor's Office already mentioned the investment, but I'll just reiterate. The Governor's Budget includes an augmentation for the Rising Scholars Program, the Rising Scholars Network, in the amount of 30 million ongoing Proposition 98 General Fund, which would bring the total funding for the program up to 55 million.

I will also note that there is an associated trailer bill for this proposal, which would remove the cap on the colleges within the system that would be able to participate in the program. For context, statute currently limits that to 65 colleges. Happy to answer any questions on this item.

Thank you. Legislative Analyst.

Lisa Qing with Leg Analyst's Office. While we see benefits to increasing support for currently and formerly incarcerated students, we do have a basic concern with the Governor's proposed approach. The proposed increase for the Rising Scholars Program would more than double funding for the current program at a time when the state still has limited information on the outcomes of the current program.

State law directs the Chancellor's Office to report every two years on its efforts to serve currently and formerly incarcerated students. But the most recent report still covers a period that predates when the state began funding the Rising Scholars Network.

And so while we have some enrollment data, as Mr. Ferguson shared, we don't yet have as rich of data on completion, course success rates, and other factors that we think would really be key here. In addition, the state funded evaluation of the Rising Scholars Program in the 2022-23 Budget Act, but to date that evaluation has not yet begun.

We think the Legislature will be in a better position to revisit funding for the Rising Scholars Program after it receives this type of information on program outcomes. Having said that, recognizing that there is strong legislative interest in improving support for this student group, we wanted to mention a couple of other options for achieving this.

These options come from a report that our office released last summer focused on community college programs at state prisons. One of these options is to modify the student centered funding formula to include a performance component for incarcerated students, as it does for most other students.

We think this would create better incentives for districts to support the student group. The second option is our report also recommended leveraging federal Pell Grant funding to cover certain education costs incarcerated students at the community colleges. This is similar to the approach the state is already taking for incarcerated students at CSU and UC.

The benefit of this approach is that it would free up state funding that's currently being used for this purpose, and that freed up state funding could in turn be redirected toward other activities, including increasing support for this population. Thank you.

Thank you. Let me ask two quick follow up questions, and they relate to things that you just said. And one is I thought there was actually an evaluation that was called for coming out of budget language a year or two ago. When would that be done?

That's correct. So the 2022-23 Budget Act provided funding. I believe it was 750,000 for an evaluation of the Rising Scholars Program. My understanding is that the Chancellor's office is currently developing the request for proposals for that evaluation. The evaluation is intended to occur over a five year period, and so realistically, it would likely be several years before the state has that data in hand.

Well, it would be nice to have it. The other thing is, what's the process for deciding what campuses get this if the cap comes off and the additional money is approved?

From our perspective, the goal would be to fund every campus that's applying. And we think the resources would be there to do that. So I don't know that the process would require a significant evaluation on the front end so much as, you know, validating that they intend to operate the program as intended by statute.

Okay. Are there any questions or comments?

Yeah, just two things. So, one, I'm surprised to hear that the RFP is just going out if we went ahead and we requested the evaluation of the program in 22-23. Is there a reason for that delay? I know obviously things take time, but that seems like a lot of time for an RFP to just be going out.

And I'm assuming that that RFP and would then focus on gathering the data for completion, the enrollment updates, all of the things that the Department of Finance just suggested that we were missing. And then if you could just restate what you said about the modification to the SCFF.

I'd appreciate hearing that because I'm thinking about the students that would enroll into community colleges. They would probably automatically be Pell Grant recipients, I'm assuming, just based off of their income. And so that would immediately add onto that equity component. So what is this new suggestion? So I would appreciate hearing on both of those things.

Sure. I can take the second question and the Chancellor's Office may have additional detail on your first question about the request for proposals. So in our report, our recommendation regarding the modification to the Student Centered Funding Formula was really focused on that student success component. So the 10% that goes out based on outcomes.

So currently, for most students, you know this well, but districts receive more funding based off of outcomes such as completion of transfer level English or math, completion of certain certificates, associate degrees, associate degrees for transfers, and so on and so forth.

And so our thinking was that currently those metrics only apply to students who are enrolled in regular credit instruction. Our thinking was applying a similar set of metrics toward incarcerated students who are not currently receiving, generating additional funding based on those outcomes metrics that change could create incentives for districts to also help incarcerated students meet those types of educational goals.

Thank you.

Does that complete your questions or did you want others to respond? Yeah, there you go.

I can't quite hear you. I think we have one mic that's working. We'll just slide it around everybody.

Hi, Michelle Nguyen from the Department of Finance. Just to add on to the point about how incarcerated students are funded kind of within the current funding formula. While there isn't a specific carve out right now for incarcerated students in the sixth allocation portion of the formula, I believe Mr.

Ferguson alluded earlier that incarcerated students, along with dual enrollment students, they're funded at a higher rate for their, for the full time equivalent students than your normal credit or non credit FTEs. So that is one component.

And to the extent that, to the extent that these students would receive a Pell Grant or receive another, part of the supplemental allocation is the used to be called the Board of Governors fee waiver.

If these incarcerated or formerly incarcerated students received a Pell Grant or this waiver, then they would receive, the colleges would receive kind of additional funding under the supplemental allocation of the formula too.

But it's just, I believe what our colleague at the LAO was mentioning was there's not kind of a specific call out for incarcerated students within the supplemental and the success allocations of the formula. So just to add a little bit.

And our office will have to get back to you in terms of, you know, the delay in issuing the RFP, although I would note that it's likely because the program was started with the 21-22 Budget Act, so the data to do that evaluation would take time under that program. So that's likely why there's a delay.

But certainly we'll circle back with your office.

I would just note at the end, yes, the data takes time, but we're asked to augment this program without having any evaluation. And it would be really nice to have that in hand to make the decision about whether this makes sense, even though I'm very committed to the program and what this program does. Thank you.

Then we are going to move to issue number six, which is the data systems and we have the same panel. So let's just begin with Mr. Ferguson.

Sure. So I'll speak to it in two approaches given the investment was for two phases. The first, the Governor's budget is proposing to support our office with 162.5 million Proposition 98 General Fund, of which 29 million is ongoing to support the development and implementation of what we refer to as the Common Cloud data platform.

The Common Cloud will greatly accelerate our system's ability to analyze, understand and make system wide student outcomes more urgently available.

So this includes having better data available to our counselors to provide advice to students and it would enable real time data to be available to our office to provide to state policymakers as they look to make make decisions around investments or understand what trends may be occurring in our system.

You know, for example, had we had the system available today, we would be able to see or more rapidly see enrollments around AB540 students to see if there is a change in the trend of students that are enrolling from the fall semester to the spring semester and understand what might be occurring with that student group.

The system would include the Common Cloud includes a dashboard that will provide real time enrollment and success trends. It would allow for improved tracking of student course taking units and progress across the system and enable real time student analytics that enhance degree certificate mapping and student pathways facilitating program completion.

Under the Common Cloud, each institution would continue to have control over their own data sets, but it would allow for access in a unified way across campuses, allowing system level operations and tools to seamlessly find, access and use data without altering it.

The Common Cloud student data platform would better serve all students and especially adult working learners and equip them with personalized support for them to thrive. It would enable us to do this and then lastly for the Common Cloud student data platform, it would help us achieve system wide efficiencies that can be redirected towards students.

The platform would transform how community college data is collected, organized and analyzed across the system. Currently we have different data systems tracking different components of data and it makes it hard to manage and report that data causing extra workload on staff.

The Common Cloud would address this concern and then shifting to the collaborative enterprise resource program or project. The collaborative ERP would provide an integrated and holistic technological foundation for managing district data resources and operations. The Collaborative ERP would develop an integrated foundation that includes student finance and human resources information Systems across the 116 colleges.

There are currently three major or core vendors that provide services for enterprise resource planning systems to colleges and they have a wide variety of customizations or integrations. We know that outdated technology can hinder system performance.

We also know it also makes it more challenging to integrate that information with newer technologies and newer tools including machine learning or artificial intelligence and artificial intelligence student supports in particular.

So this system would reduce a lot of manual processes, could help protect against cybersecurity vulnerabilities or this approach, and would create, you know, further equitable student faculty and staff experiences and it would allow us to leverage economies of scale. One thing that I would highlight within both of these projects.

We did look at this in a robust way. We developed the approach in a very robust manner that in many ways mimics the state's project approval lifecycle process.

We've been working on this with our stakeholders, with our chief information officers, our chief technology officers, other representatives for our community colleges and our system office to develop these this approach.

We know with collaborative ERP, it's my understanding that there are around 15 community college districts today that would opt to avail themselves and be part of that initial opt in cohort. We do believe that once available, other districts will see the benefit and choose to opt in as well.

It is an opt in approach that we are recommending from our office and we can say with, you know, Certainty of the 15, a number of them are in rural areas or from smaller college districts or colleges in the state where it's traditionally a bit harder to operate or implement or update an enterprise resource program, just giving the staffing constraints that smaller districts face.

Thank you. Let's move to the Department of Finance.

So we think this would also allow for a lot of ability for our system to our system office to provide support to the system and would also better enable districts to support each other if they're opting into the collaborative enterprise resource program. With that, I would conclude my remarks.

Justin Hurst with the Department of Finance. As noted, the Governor's budget includes two significant technology investments to support the community college system. These are both Proposition 98 funded investments and are as follows, all go in the same order.

The first is the system wide common cloud data platform, which is 162.5 million Proposition 98 General Fund, as mentioned, 29 million of which is ongoing.

Without recovering a lot of the same ground, we'll just note that some of the primary benefits that we see with this investment are the near real time data aspect of it, uniform data governance policies, as well as improved fraud monitoring for enrollment across the system.

The second investment is for a common enterprise resource planning platform, otherwise known as an ERP. And this investment is a 168 million one time Proposition 98 General Fund investment.

Some of the other benefits we see with this investment include improved data security throughout the system, economies of scale for system procurement, and consistent user experience across the system on both the front end and back end for students and staff. With that, I'll be happy to take any questions.

Thank you. We'll move to the Legislative Analyst's Office.

Lisa King with the Legislative Analyst's Office. So I'll start with our comments on the common cloud data platform and then I'll turn to our comments on the Common Enterprise Resource Planning or ERP system. Regarding the Common Cloud data platform, our main concern with this proposal is that we think it's premature.

The Chancellor's Office recently launched a demonstration project for this platform and is working with an initial cohort of six districts to work on that demonstration. We think this provides an opportunity to develop and test the platform, assess the outcomes, and use the associated findings and lessons learned to decide whether to expand the platform system wide.

The demonstration, however, is not expected to be complete until June 2026.

And so rather than fund system wide expansion now before the demonstration is complete, our recommendation is to instead require the Chancellor's office to report on this demonstration project upon its completion, report specifically on the outcomes and any additional information it can provide on the projected benefits and costs of scaling it statewide.

We think the Legislature could then use this information to make a decision about whether to fund system wide expansion in a future budget. I'll turn next to the Common Enterprise Resource Planning, or ERP system. We have several concerns with this proposal. The first concern relates to a general lack of planning. So as Mr.

Ferguson noted, most state IT projects go through a planning process administered by the California Department of Technology, and this process typically requires departments to identify project objectives, analyze alternatives to meeting those objectives, and prepare a detailed fiscal analysis. And typically the state would have all of this information before it begins providing funding for project development and implementation.

Now, to be clear, the Chancellor's office is not subject to this process. They're not required to go through it, and although they have undergone a stakeholder engagement process, the information that came out of that process is not equivalent to what we would typically receive coming out of CDT's process.

So to provide a key example here, right now the Legislature doesn't have information on the project scope, schedule or cost for the common erp. And under the proposed trailer belanguage, the Chancellor's office would not be required to provide this information to the Legislature until January of 2027. So significantly after the funds would have been appropriated.

Right now we're particularly concerned about the limited information on the project costs because we think that this project is likely to have high costs in the out years.

The Chancellor's office estimates that the 1681,000,001 time included in the Governor's Budget would likely be enough to implement this project for a first wave of districts about 15 or so that have opted in today. However, as Mr.

Ferguson noted, the intent is to eventually expand it to additional districts that opt in and the Chancellor's office has indicated this would require additional funding, likely in the range of hundreds of millions of dollars in future years. And that's not yet accounted for in the Governor's proposal and we don't yet have a precise estimate of those costs.

We would also note that the project comes with some other key risks. Districts use their enterprise resource planning systems for numerous aspects of their business operations. So beyond just storing student information, they also use it for finance, for human resources. So really a change to an ERP system affects everything from accounting to payroll.

Moving to a common system would require 72 districts to take a close look at, potentially revisit these processes, and that generates a lot of costs and risks related to change management. We also think there could be some risks associated with moving to one vendor, relying on one vendor for a system wide project of this scale.

For all these reasons, we recommend rejecting the proposed funding for the common ERP project. Thank you.

Thank you. Let me ask two questions. First, let me ask either finance or the Chancellor's office to respond to the concerned that the demonstration project hasn't been completed and yet we're moving ahead with the program without the benefit of seeing what happened in the demonstration project. Why is it being recommended to go ahead before you have that?

Justin Hurst with the Department of Finance. While the demonstration project for the Common Cloud has not concluded it has completed the first phase of the project. The Chancellor's office may offer more detail on the outcomes of that first phase, but we believe that this investment is both timely and important for many reasons.

Some of the things that we see that are particularly valuable are the better fraud, monitoring, mitigation in financial systems, real time student data showing if a student is disengaging or otherwise needs some assistance, and then in addition to uniform policy around the use.

We understand that during the pandemic there was a strong desire for more real time enrollment data that could have been used for responding to the enrollment declines throughout the state. And as mentioned earlier, there are similar needs for that near real time data for policymakers.

Mr. Ferguson, anything to add?

Yeah, I think what I would add is we have seen success to date in terms of the demonstration project. I think because of that we feel confident that it can be scaled system wide with success.

We know that there will be more work to develop some of those data dashboards platforms to ultimately convey the information to the Legislature.

But we see significant value in being able to provide real time data and real time information to inform student advising and to inform our policymakers of trends that we may be seeing, you know, it gets very concerning for office when we have to come to you during the pandemic and say, well, anecdotally we're seeing enrollment declines or anecdotally we're seeing enrollment increases.

And we're having to say that because the data that we can provide you today is all lagged.

Then let me ask a semi snarky follow up question and that is that when we do this by hand or however you want to call it, people submitted and it's not in a Common Cloud platform. The thing that happened is even in the years where it wasn't the pandemic, there might be 10 campuses that didn't submit.

And we're sitting here having a hearing trying to decide and we haven't heard from 10 campuses. Now we, we're moving to an advanced data system. What requires those 10 campuses to enter it in time so that we don't have this wonderful elevated system and still don't have full reporting from the decentralized campuses.

Yeah, I think the goal of the project is to allow that data to automatically be uploaded into their systems to be pulled together into this centralized approach. Campuses again would still control that data, but it would make it much easier to request, much easier to provide and much more real time as a result.

But you can guarantee that it'll all be there. It'll just be easier for them not to put it up.

Certainly it's our intent to leverage as best we can all campuses to provide data. We do that today. You are correct, that does not always happen in a timely manner and it's part of our approach. We will push all of our districts to have timely reporting within these systems.

We might, I think we might want to talk about that over time because I don't know, there's just been no penalty and it's not like I want to establish a penalty system, but there's got to be some incentives so that we can have a hearing and have the information in front of us. Any questions or comments?

And I think in closing there have been lots of legitimate questions raised here and I think we just have to discuss them between now in the may revising into the budget. And thank you for that. That completes our six issues.

We're going to move to public comment and I'm going to do what I usually do is I'm going to take a handful of who wants to make public comment? 1, 2, 3, 4, 5, 6, 7, 8. Running in from the hallway. 9. Okay, I see 10, I see 10.

So I'm really sorry because we were supposed to adjourn a while ago. So I'm going to give everybody a minute and please come to the microphone and then we will allow people to revise and extend their comments. So welcome to the Committee.

Thank you. Chair and Members. Tiffany Mok with CFT, a union of educators and classified professionals. Thank you for your insights, insightful questions, particularly around CFF formula. We have seven of the 21 districts represented with the Hold Harmless formula and are seeking the goals of stability and ensuring the best path to have our students reach their outcomes.

At this point, we are looking for a solution for those districts who are facing pretty dire circumstances. So we look forward to that continued discussion. We also would like to note that we support $7 million for ongoing funding for a part time faculty to receive compensation for office hours.

We thank the Legislature for last year extending the reimbursement to 90%. We hope to keep that going. And finally we support fully funding the growth formula. As we have heard from our members that districts are already cutting classes in anticipation of the cap.

And so it's not even that they're waiting to hit the cap, but knowing that it's there is having them project cuts to their existing courses. So thank you so much.

Thank you for jamming a lot in your minute. Welcome to the Committee.

Good afternoon, Chair and Members. I'm Zong Lore with the California School Employees Association. My comment is regarding categorical programs, specifically the Classified School Employee Summer Assistance Program. It's the only program that is targeted at supporting classified employees. Due to some eligibility factors, we are seeing some savings from this program.

However, we know that our classified staff at community colleges still have basic needs that go unmet, similar to our community college students.

So for these reasons, we're asking that $8 million of that savings from the Summer Assistance Program be transferred over to the Basic Needs Center program to allow our classified staff access to food pantries at their colleges. This will really help with hunger and insecurity issues that our classified staff have. Thank you.

Thank you very much for your comments.

Welcome Anna Matthews with the Faculty Association of California Community Colleges. Good afternoon. The SCIF is held together by band aids like Stability, Hold Harmless eca, the three year rolling average and more. Small drops in Enrollment and unpredictable changes can shift a community college's funding model from year to year and drastically reduce its funding.

This isn't sustainable and makes planning ahead difficult. Colleges on hold harmless have been moved to a funding floor and will lose their COLA this year despite rising costs. We urgently need universal COLA. There are Many structural issues with the SCIF. Senator Laird, as you mentioned, there are clear winners and losers.

And the supplemental allocation is the Pell Grant threshold doesn't accurately reflect poverty in colleges at high cost of living areas. The student success allocation doesn't invest in all the missions of the California community colleges equally disadvantaging programs like CTE. We need a different funding formula. The SCIF is too complex and unstable.

We suggest a universal basic allocation with FTEs instead. Thank you.

Thank you very much.

Welcome, welcome. Thank you, Mr. Chairman. I'm Matt Wetstein. It's my pleasure to be the President of Cabrillo College and appreciate the opportunity today. I'm here also to advocate for changes to the SCIF funding formula.

Since its start in 2018, it's featured some flawed measurement of poverty and success metrics that have disproportionately impacted districts like ours in terms of funding and educating poor students. It impacts districts like ours, the Bay Area, Central Coast and high housing cost regions.

The formula, for example, enshrined funding and equities from its inception in 2018, for example, the gap between the best funded district and the lowest funded district, measured as per FTE funding, was around $6,000. Last year, that gap had nearly doubled to $11,600 between the highest funded and the lowest funded district.

That gap is now larger than what was in existence in 1976 in Serrano versus Preece, which struck down inequitable funding for K12 schools. This is not good public policy, so I'm here to advocate for change. I'm willing to participate in that change and help recommend changes to it.

As a almost eight year CEO in the system, and while that change is happening, the system needs to ensure that there's a fair funding floor and a ceiling that's rationally connected between the high and the low districts that guarantees, at a minimum, COLA while these changes and reforms are worked out. Thank you for the opportunity.

Thank you very much. Welcome.

Good afternoon. Michelle Underwood, on behalf of the Association of California Community College Administrators, we sent a letter last week, so I'll just hit some of the highlights. We support adequate growth funding. As you heard today, the 0.5% is likely inadequate.

We support the cost of living adjustment for all categorical programs, not just those that historically receive the cost of living adjustment. Two items that we would ask for, parity between community colleges and K12 are some of the restorations from block grants that were cut when we were going through difficult budget years for community colleges.

That would be deferred maintenance to reinstate deferred maintenance that was cut along the lines of the Learning Recovery Emergency Block Grant that we're seeing proposed in K12 and then also in terms of parity for discretionary funds, again on the K12 side, discretionary funds are being proposed and we would like that to be considered for community colleges as well.

Thank you very much. Appreciate your comments.

Welcome. Good afternoon, Chair Laird, Committee Members. My name is Mark Sanchez. I'm the Superintendent President for Southwestern College which is in Chula Vista, California. Southern San Diego County runs right along the U.S. Mexico border. Great to be here with you all.

And I'm here to speak on the fact that despite expanding access, Southwestern College, like many other districts in the state, has served more students than the state funds. With more than 11,500 unfunded full time equivalent students. That was more than what was budgeted in the 23-24 fiscal year and twice that this year.

To meet the demand, we are requesting consideration for fully funding the past unfunded growth with one time dollars. Increase future growth funding to at least 1.5% and adjust the student centered funding formula based funding to be the average of three years or the most recent year, whichever is greater.

The Legislature directed community colleges to regrow post pandemic and we have delivered. So with that we need the resources to ensure that every student, whether they are training to be nurses, engineers or educators, have has access to the opportunities that they deserve. Thank you for your consideration. Thank you for your time. Thank you very much.

We appreciate your comments.

Welcome honorable Chair and Committee Members. Thank you for the opportunity to speak today. My name is Alexander Slutin. I serve as the student trustee for Southwestern College. Students across California's community colleges face increasing uncertainty such as rising costs, food and housing insecurity and threats to critical support programs.

Given the instability at the federal level, we need the state to step up. This is why I'm asking you to include an unrestricted block grant for student support services in the budget for community colleges.

This funding would give colleges the flexibility to address the most urgent student needs such as Dream Resource Centers, LGBTQ support, mental health services, rapid rehousing and legal aid for undocumented students. The Governor has already proposed a $1.8 billion block grant for K12. Community college students deserve the same investment to ensure we can stay in school and succeed.

California's community college students need to know that their state stands with them. A community college block grant will provide security in uncertain times, giving students the confidence that their basic needs will be met so they can Focus on learning. That is why I urge you to include this funding in the budget. Thank you.

Thank you very much. Your minute exactly.

Thank you. Chair Laird and Members, Mark McDonald on behalf of the San Diego, Los Rios and Los Angeles Community College districts. And I'll make this easy. I will associate my points with the previous two speakers, especially what we just saw in the federal Education Department this morning. We need a block grant.

Also, on the categorical programs, I will. Add a cost of living adjustment as needed for the Student Equity and Achievement. Program that funds all our counselors. So thank you.

Thank you very much. Appreciate your comments.

Good afternoon. Andrew Martinez, the Community College League of California. We are deeply appreciative of the COLA. That's consistent with the K12 received. We'd also encourage funding for growth as a top priority for ongoing investments and for one time investments.

We encourage putting money into deferred maintenance and instructional equipment to ensure that we can support our students as they come back to our campuses. And then finally, the block grant proposal is something that we would also encourage you to consider to make sure that. We have enough funding to support our.

Students as they come back to campus and the challenges that they face going forward and also the natural disasters additionally. Thank you very much.

Hi, good afternoon. Carol Gonzalez. On behalf of Long Beach City College, a district that has been working to secure state funding for student housing since funds were made available in 2021. Since then, the district has applied at every opportunity and has had the opportunity to move up in ranking every time.

They have also kept the momentum going and have done everything as possible to be as shovel ready as they can. Long Beach would respectfully ask for your consideration of the reappropriation of funds. Given that districts have returned some of that funding. They were listed at the top ranking for future projects.

They intend to stay true to the requested amount of 60.5 million. They plan to invest more of their local funds to meet some of that increased cost of building. Given their intersegmental collaboration, the regional needs. We really ask for you to consider this project and are happy to have individual follow ups. Thank you.

Thank you very much.

Hello. Maria Flores with the Mesa Verde Group on behalf of the Gavilan College.

You're going to have to speak up just a little. Maybe move closer to the microphone.

Does that work?

I can hear you. Hopefully people can at home. So keep going.

So, Maria Flores with the Mesa Verde Group on behalf of the Gavilan College, which has surpassed pre Covid enrollment numbers and reached unfunded growth, we advocate for additional enrollment funding to support efforts to increase educational opportunities in particular. Additionally, additional funding to continue growing dual enrollment.

We also believe the LACCD's request to create a block grant to support basic needs and other support programs would help. And lastly on student housing, we encourage additional funds to be allocated to colleges with pending projects.

We request that the criteria for applying for future funds be different for basic a districts versus non basic age districts to ensure equity in the ranking process but encourage funding all the third round applicants. Thank you.

Thank you very much. Welcome.

Good afternoon Chair Laird and Senator Perez. Melissa Bardo, on behalf of the Education Trust West. First want to thank Senator Perez for your comments around expanding access to dual enrollment, particularly for underserved students. We definitely support that and are working towards that goal this year.

In regards to the Governor's budget proposals, we appreciate the state's commitment to providing predictable operating increases for the community colleges that helps them address local spending priorities and incentivize campuses to make strides toward equity for their students.

It is critical that the Legislature continue to support support to protect and grow the community college funding as this segment serves the largest share of low income students. We respectfully urge the Legislature to approve these proposals and continue to emphasize the importance of accountability and oversight to ensure campuses are making progress on student success and equity.

Regarding the proposed technology projects, the Chancellor's office currently struggles to collect data from colleges and districts because of differing platforms and general lack of uniformity and how data is collected collected. This makes it difficult for education stakeholders and advocates to understand opportunity gaps as well as the impacts of policy change.

So if implemented with Fidelity, these projects could transform the way we understand and track student success. Particularly by providing stakeholders with access to real time data that would drive evidence based policymaking.

For these reasons, we respectfully urge the Legislature to approve these proposals with a particular attention to producing accessible public facing results and tools that track Vision 2030 goals. Thank you.

Thank you very much. That completes our public comment and that completes our business. I want to thank everyone who participated today. I want to thank the people that were patient to waiting to make a comment and then didn't have extensive amount of time to make it.

We would welcome any additional comments to the website of the Committee or mailed to the Committee because it'll go in the record and we really value your testimony. It's been a good hearing. We'll be back next week on career education. That completes our business today. Budget Subcommitee 1 on Education will stand adjourned.