Copyright© 1999 by School Services of California, Inc.

October 29, 1999

Task Force Recommends Changes in
Community College Funding Formulas

Legislation was approved by Governor Davis requiring the community colleges to report to the Governor and Legislature by January 15, 2000, regarding the public financing of community colleges. The community college system got a head start on the requirements of AB 734 (Romero, D-Los Angeles) as a result of the work of the Consultation Council's funding formula task force. The task force was appointed by Chancellor Nussbaum and Vice Chancellor Patrick Lenz provided the staff leadership. It has been more than 10 years since a comprehensive review of the system's program-based funding formula and what changes would be needed to improve and enhance funding for the system.

The primary funding formulas that have garnered the most attention are growth, COLA, equalization, non-credit instruction, and program-based funding. Most community college representatives believe that significant improvement in funding could be accomplished if California Community Colleges were simply funded at the national average. Currently community colleges are $2,000 per student below the national average. However, trying to convince the Legislature and Governor to simply fund the colleges at the national average is not a good strategy. The system needs to identify the programs and services they provide and the resources needed to improve student access. Thus, a stronger case can be made to improve community college funding.

The following is a summary of the funding formula task force's short- and long-term recommendations:

Program-Based Funding Criteria

Short-term recommendation:

• The task force is recommending a consolidation of the current five program categories (Instruction, Instructional Services, Institutional Support, Student Services, Maintenance and Operation) into three categories.

Long-term recommendation:

• Explore the availability of an education-based research group to review the current funding formula to determine if an alternative funding mechanism or significant revisions to the program-based funding model should be considered by the Task Force.

Growth Funding Formula

Short-term recommendation:

• Support the recommendation to increase the growth rate for underserved areas by a factor of 2, recognizing the historical inequity that occurred prior to the three-year "safety net" that was established in program-based funding.
  
• Adopt a change in the calculation to a district's growth cap to allow for a growth guarantee and advanced information to assist districts in their budget planning process.

Long-term recommendation:

• Research the potential for calculating the growth funding that would include a "workplace factor," recognizing that many students reside in one district but attend community college closest to their place of employment.

Equalization Funding Formula

Short-term recommendation:

• Support the recommendation of the Task Force and the Board of Governors to submit a 2000-01 Budget Change Proposal (BCP) to the Governor and Legislature for $15 million to fund equalization. This equalization proposal would allocate 50 percent of the funding on a "low revenue per FTEs" basis and 50 percent to be allocated on a program-improvement equalization funding formula.

Long-term recommendation:

• Review the budget allocations for all programs and services to the community college districts to determine if the current program-based funding formula should be revised to consider equalizing on a revenue per-FTE basis.

Cost-of-Living Adjustment

Short-term recommendation:

• Support the BCP task force recommendation to expand the current COLA base and request a 1 percent increase over a proposed statutory COLA. This recognizes that districts are unable to meet their local mandated and collective bargaining costs with a COLA of less than 2 percent.

Long-term recommendation:

• Review the potential for support of a national COLA index that more accurately reflects the growth in local mandated costs.

Non-Credit Instruction

Short-term recommendation:

• Support the recommendation of the task force to pursue an increase of non-credit funding based on an increased level of funding through the 2000-01 Partnership for Excellence Program.

Long-term recommendation:

• Monitor the work of the K-14 Joint Committee recommendations on improving the funding for K-12 adult education and community college, non-credit.

Editor's Note: The source for the recommendations summarized in this article was based on a report submitted by Patrick Lenz to the Consultation Council and Board of Governors.

- Arnold Bray