Budget Deal Protects Investment in Community Colleges

With the recent passage of a compromise 2005-06 state budget (SB 77), California’s community colleges are poised to receive a 9 percent increase in spending, including a significant increase in funding per student. The estimated 10.46% share of Proposition 98 for community colleges is the highest since 1991-92.

A major component of the final deal was an agreement to use what had been designated as Proposition 98 “settleup”funds to pay a portion of the state’s contributions to the State Teachers Retirement System. Because of advocacy from local school and community college districts, we avoided a permanent shift of $40 million in costs to local community college districts. Instead, funds that were to be allocated on a one-time basis to Proposition 98 will be allowed to be shifted back to the non-Proposition 98 General Fund to make the retirement contributions.

The only change to the community college budget from the conference committee version was the movement of $10 million from noncredit rate instruction to equalization, increasing equalization funding to $30 million. This action was taken when it became clear that the governor would veto the noncredit augmentation.

The highlights of the 2005-06 budget include:

• Restoration of $31.4 million vetoed from district base apportionments last year

• 4.23% cost-of-living adjustment for the general apportionment and selected categorical programs*

• 3% student enrollment growth (34,000 FTES)

• 1.76% growth for selected categorical programs*

• $30 million for credit equalization

• $20 million for career technical education

• $10 million to increase nursing enrollment and equipment

• $10 million to reimburse districts for mandates

• $1 million for the California Partnership for Achieving Student Success (Cal-PASS) program

• $33 million to backfill any shortfall in 2004-05 property taxes, with the unused balance available for credit equalization

• Continuation of the $200 million deferral

• No student enrollment fee increase