Higher Ed Highlights of the New California Budget

California’s Largest Budget to Date Makes Bold Changes and Prioritizes Equity for Higher Education

Last Thursday, the California State Legislature sent a $200 billion spending plan for 2018-19 to Governor Brown for approval with significant augmentations for higher education. The plan increases funding for all three of California’s public higher education segments, provides targeted money for implementing two major policy initiatives at the community colleges, and includes several one-time apportionments to address specific challenges in higher education.

Highlights of the 2018-19 Budget

A new funding formula for the California Community Colleges that prioritizes student equity and success

  • $378 million in increased Proposition 98 apportionment is expected to cover the implementation of the formula
  • In year one, the formula allocates 70 percent of funding based on enrollment, 20 percent based on student need (based on students who are Pell or California College Promise Grant eligible), and 10 percent on performance (based on several student success metrics while at community colleges and the number of transfers and completions annually)
  • Extra funding is also provided for improved outcomes for low-income students
  • The formula would shift after a three-year phase-in from 70:20:10 to 60:20:20 and includes a three-year hold-harmless clause, which protects colleges from receiving less funding than currently apportioned for three years before the policy takes effect  

Start-up money for a new online community college specifically tailored to adult workers

  • $100 million in one-time funds and $20 million in ongoing funds have been approved to launch the new college
  • The California Online Community College will address the needs of “stranded workers” by providing workforce-connected certificates and credentials online
  • $35 million will also go to existing online programs offered through the Online Education Initiative that either lead to a short-term credential or enable students from the online college to continue in a pathway already offered at an existing campus  

Funding increases for the California State University and University of California, with funds earmarked for enrollment increases at both segments

  • The California State University will receive an ongoing $92 million base increase, $75 million to support its existing Graduation Initiative, $120 million to support an additional 3,400 students, and $30 million to support various university needs
  • The University of California will receive an ongoing $92 million base increase and $5 million to support increased enrollment
  • $35 million will be allocated to each four-year segment for deferred maintenance and building upgrades  

Financial aid augmentations for full-time community college students

  • The budget consolidates the Full-time Student Success Grant and the Community College Completion Grant into the Student Success Completion Grant, increasing the award amount to $1,298 for students taking 12-14 credits and $4,000 for students taking 15 or more credits  

One-time funds to support systemic challenges like student hunger and basic needs, legal support for DACA and immigrant students and staff, and diverse representation among faculty

Although this budget sets the stage for several bold changes, it is notably quiet on issues of data and innovation, despite calls from legislators and policy advocates to improve our data infrastructure to illuminate key challenges in California’s education-to-employment pipeline.

Nevertheless, the prioritization of student equity in the budget approved by the legislature is significant. While specific policy details will continue to emerge as bills go to the governor’s desk this week, we are encouraged that this budget will help improve the state’s college completion and degree attainment. A new student success funding formula prioritizing underrepresented students and a low-cost option for providing workforce credentials to low-wage adults, not to mention increased funding for public four-year institutions, are all steps in the right direction for higher education in California. 

May Revision Analysis

January Budget Analysis

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