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Latest News

January 08, 2021

CCFC Budget Update: Governor Releases FY 2021-22 Budget, Proposing Capital Outlay Funding and COVID-19 Relief

Today, Governor Newsom released the 2021-2022 budget proposal. The budget includes $227 billion in spending ($164.5 billion General Fund), and a one-time General Fund discretionary surplus of $15.6 billion. During his press conference, the Governor expressed a tone of hope and optimism that California is poised for an economic recovery, but cautioned that there are still risks given the uncertainty of our times. The Governor emphasized focusing on vaccine distribution, so that schools and businesses can reopen, and on wildfire preparedness.

The Proposition 98 minimum guarantee is $85.8 billion, the highest funding level ever for K-14 education, and $14.9 billion above the level funded in the 2020 Budget Act. The budget proposes investments to enable California Community Colleges to “close equity gaps, promote completion, fuel innovation, and support students’ upward economic mobility.”

Revenue Estimates

The budget estimates that General Fund revenue will be higher than the 2020 Budget Act projections by nearly $71 billion from 2019-20 through 2021-22. The Governor and his team cautioned that most of this is one-time funding, and that structural deficits are expected beginning in FY 2022-23, when the demand on existing state programs will outpace revenue growth. Given this, the budget favors the use of surplus funding for one-time purposes, to limit ongoing liabilities.

Capital Outlay and Proposition 51

This is a unique year for the community college capital outlay program budget. At the end of the 2020 legislative session, the Governor signed SB 115, a budget trailer bill that accelerated funding for 8 new capital outlay projects originally planned for FY 2021-22 into FY 20-21. This was done as an economic stimulus measure, to start projects sooner than anticipated and create jobs.

The FY 2021-22 budget proposes an increase of General Obligation bond funding of $355.8 million for the community college capital outlay program. This includes $2.2 million for one new start project at Riverside CCD, and $353.6 million for the construction phase of 17 continuing projects anticipated to complete design by spring 2022 (see below for a list of these projects). Additional continuing projects could be added during the budget process based on project schedules and preliminary plan approvals.

Proposition 51 provided $2 billion in bond authority for community college capital outlay projects. Most of this has already been committed to new projects. It appears there will be a small amount of funding available for new project proposals in FY 2022-23, at which time all authority for new projects would likely be exhausted.

Deferred Maintenance and Instructional Equipment

The budget does not appear to propose funding for Deferred Maintenance and Instructional Equipment for FY 2021-22. The FY 2020-21 budget did not include funding for this purpose.

Enrollment Declines and Supporting Students During the COVID-19 Pandemic

The budget indicates that the COVID-19 pandemic resulted in a decrease of approximately 8% in fall 2020 CCC enrollment compared to the prior fall term, and that this decrease is disproportionately attributable to underrepresented students. To combat this, the budget includes the following proposals to address student needs.

Early action proposals recommended for immediate adoption:

  • Provide $100 million (one-time Proposition 98 General Fund) to support emergency student financial assistance grants for full-time, low-income community college students and other students who can demonstrate an emergency financial need.
  • Provide $20 million (one-time Proposition 98 General Fund) to support efforts to bolster CCC student retention rates and enrollment, primarily to engage students who withdrew due to the COVID-19 pandemic or may be hesitant to remain or enroll.

Additional proposals:

  • Provide $100 million (one-time Proposition 98 General Fund) to address food and housing insecurity among CCC students.
  • Provide $30 million (ongoing Proposition 98 General Fund) to support student technological access to higher education by enabling students to have electronic devices and high-speed internet connectivity, as well as increase student mental health resources.
  • Provide $20 million (one-time Proposition 98 General Fund) for a systemwide effort to provide culturally competent online professional development for CCC faculty, including leveraging technology to improve learning outcomes.
  • Provide $10.6 million (ongoing Proposition 98 General Fund) to support the continuity of education and quality distance learning, including access to online tutoring, online counseling, and online student support services such as mental health services.
  • Provide an additional $150 million (one-time Proposition 98 General Fund) for emergency financial assistance for full-time, low-income community college students and other students who were previously working full-time or the equivalent of full-time (in addition to the $100 million identified above).

Workforce and Work-Based Learning

The budget includes:

  • $15 million (ongoing Proposition 98 General Fund) to augment the California Apprenticeship Initiative, which supports the creation of apprenticeship opportunities in priority and emerging industry sectors.
  • $20 million (one-time Proposition 98 General Fund) to expand work-based learning models and programs at community colleges, including working with faculty and employers to incorporate work-based learning into curriculum.

The budget also sets aside $250 million (one-time General Fund) to support forthcoming proposals focused on workforce development, segment alignment, and improving linkages between higher education institutions and employers.

Deferrals

Given expected increases in the Proposition 98 guarantee relative to the 2020 Budget Act, the budget proposes to reduce apportionment deferrals for the Student-Centered Funding Formula by more than $1.1 billion, to $326.5 million for 2021-2022. This pays down approximately two-thirds of the deferrals implemented last year.

Climate and Wildfire

The budget proposes $1 billion to support the Forest Management Task Force’s Wildfire and Forest Resilience Action Plan. These funds would be used for programs that expand forest management to reduce catastrophic wildfire risk and restore the ecological health of forests, secure fuel breaks around vulnerable communities, and support the hardening of homes and infrastructure in communities to mitigate wildfire damages.

Additional Items of Interest

  • CENIC Cost Increase – The budget proposes an increase of $8 million (ongoing Proposition 98 General Fund) for cost increases associated with continued broadband access provided by the Corporation for Education Network Initiatives in California (CENIC).
  • CCC Apportionments:
  • $111.1 million ongoing Proposition 98 General Fund for a 1.5 percent cost-of-living adjustment for apportionments.
  • $23.1 million ongoing Proposition 98 General Fund for 0.5 percent enrollment growth.

Federal Stimulus

The budget does not include the additional $2.9 billion in anticipated Federal COVID-19 relief funds for higher education, approximately $1 billion of which could be available for CCC. These funds will be in addition to what is proposed in the Governor’s FY 21-22 budget released today.

Next Steps

The Legislature will now begin reviewing the Governor’s proposal in-depth at hearings over the course of the next few months, as they work to meet a constitutional deadline of adopting the budget by June 15. This year, we expect early action by the Legislature and Governor to accelerate funding for COVID-19 response. Budget hearings start on Monday, January 11.

Continuing Projects

Below are the 17 continuing projects proposed to receive construction funding in the FY 2021-22 budget:

  • Cerritos - Cerritos College - Health Sciences Building #26 Renovation 
  • Chaffey - Chino Campus - Instructional Building 1
  • Kern - Delano Center - Learning Resource Center (LRC) Multi-Purpose Building 
  • Kern - Porterville College - Allied Health Building
  • Long Beach - Liberal Arts Campus - Music/Theatre Complex (Building G&H)
  • Los Angeles - Los Angeles City College - Theater Arts Replacement
  • Los Rios - Natomas Education Center - Natomas Center Phase 2 and 3
  • Los Rios - American River College - Technical Building Modernization
  • Los Rios - Folsom Lake College - Instructional Buildings Phase 2.1 
  • Peralta - College of Alameda - Replacement of Buildings B and E (Auto and Diesel Technologies) 
  • Peralta - Laney College - Modernize Theatre Building 
  • Peralta - Merritt College - Horticulture Building Replacement
  • Redwoods - College of the Redwoods - Physical Education Replacement 
  • San Bernardino - San Bernardino Valley College - Technical Building Replacement 
  • Santa Barbara - Santa Barbara City College - Physical Education Replacement
  • Santa Monica - Santa Monica College - Arts Complex Consolidation  
  • Yuba - Woodland College - Performing Arts Facility

Rebekah Cearley
CCFC Legislative Advocate