On Monday, December 7, 2020, Assembly Member O’Donnell introduced AB 75, which would place a new state school bond on the ballot in 2022. Community college facilities are included in the proposed K-14 bond. The bond authorization dollar amount and the election date (primary or general in 2022) are both left blank. Under the bill as introduced, funds for the community college capital outlay program would be subject to appropriation by the Legislature in the annual budget act, which is the same process that is currently used to allocate funds.
This bill introduction is the starting point for a dialog and negotiations between the Administration, Legislature, and stakeholders. These conversations will likely play out over 2021 and possibly into 2022. We expect other education segments may request to be included (preschool, UC, CSU).
Bond dollars authorized by previous state school bonds are almost entirely exhausted. There is approximately $60 million in remaining bond authority for new community college projects to be funded in future budget acts.
On December 7, the Legislature introduced a number of other bills. CCFC will review these for possible impacts to community college facilities. We expect that the Legislature will continue to be impacted by the challenges of lawmaking during the COVID-19 pandemic, with potentially fewer bill introductions, committee hearings, and floor sessions in 2021. Senate and Assembly leadership have indicated they will focus their efforts on COVID-19 response and pressing issues such as emergency preparedness and wildfire, the environment, affordable housing, expanding broadband access, and addressing systemic racism.
Legislative Analyst’s Office Issues Economic Outlook for FY 20-21
On November 18, 2020, the Legislative Analyst’s Office (LAO) issued two promising reports on the state of the California budget and economy (The 2021-22 Budget: California’s Fiscal Outlook and The Fiscal Outlook for Schools and Community Colleges). LAO indicates that the state has experienced a quicker economic rebound than expected. It estimates that the Proposition 98 minimum guarantee will be up by $13.1 billion over the June Budget Act level for FY 2020-21, due to stronger-than-anticipated tax revenues. LAO expects the minimum guarantee to grow slightly in FY 21-22 by another $695 million. If LAO’s projections hold, the Legislature and Governor will have the opportunity to spend approximately $13.7 billion for K-14 activities, such as one-time funding for programs or paying down the deferrals that were adopted for FY 20-21. Budget conversations will pick up when the Legislature returns in January, coinciding with the Governor’s release of the FY 21-22 budget proposal.
Despite this relatively positive outlook for schools and community colleges, LAO anticipates that employment will not recover to pre-pandemic levels until 2025 (with low-income workers the hardest hit). LAO expects the state to face operating deficits beginning in FY 21-22, due to slow anticipated revenue growth compared to current state spending levels.
CCFC Legislative Advocate