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February 21, 2007 - In response to a recent settlement, the state agreed to pay an additional $2.5 billion over a seven-year period for a new K-12 education reform program. We have concerns with the structure of the new program and recommend small changes that could yield big payoffs. Specifically, we recommend (1) converting the program to a pilot project in which schools could self-select one of three teacher-oriented reform options and (2) funding an independent evaluator to assess the performance of the groups over the seven-year life of the program.
February 21, 2007 - We have serious legal and policy concerns with the Governor’s transportation and Proposition 98 rebenching proposals. Specifically, we are concerned the proposal is unconstitutional and sets bad policy precedent. We also are concerned that the Public Transportation Account might not have sufficient funds to support the program in the future. For these reasons, we recommend rejecting the proposals. Instead, we recommend a series of other actions that would generate about the same level of savings but without the risk and with minimal programmatic impact.
February 21, 2007 - Current law requires our office to evaluate Soledad’s educational program and make a recommendation to the Legislature about whether to extend the statutory authorization that permits the school to operate as a community day school. We recommend extending the school’s statutory authorization by two years. This extension is designed to give Soledad time to transition to a new funding system that we propose in our recent report, Improving Alternative Education in California.
February 21, 2007 - We review recent actions taken to increase transparency of the California Research and Education Network (CalREN), which serves the higher education segments as well as K-12 education, and the High Speed Network (HSN), which serves K-12 education. Most importantly, Chapter 552, Statutes of 2006 (AB 1228, Daucher), increased transparency and strengthened accountability of HSN. We recommend the Legislature further protect the state’s interests by enacting legislation that extends these transparency and accountability measures to CalREN and the higher education segments.
February 21, 2007 - Our review raises significant questions about the state’s approach to implementing the program and the proposed $52 million budget-year expenditure plan. We think the Legislature could strengthen local implementation of the program by using these funds to establish a seven-year grant program to improve CTE at the county or regional level.
February 21, 2007 - Our five-year forecast shows Proposition 98 funding is to increase much more than needed to cover baseline costs. Thus, we think this is an opportune time to develop a long-term roadmap for K-14 education. Such a roadmap could help the Legislature establish long-term funding priorities, coordinate investments, and maximize potential benefits by linking new monies with policy improvements.
February 21, 2007 - Although K-14 obligations have increased in 2007-08, they have dropped by slightly more than $600 million in 2006-07. We recommend the Legislature reduce current-year spending by a like amount. This would generate major one-time and ongoing savings while still providing enough funding to support a K-14 baseline budget in 2007-08.
February 21, 2007 - Compared to the Governor’s budget, we estimate less General fund revenue in both the current and budget years. Given the particular formulas that drive Proposition 98, our revenue estimates result in a higher minimum guarantee in 2007-08. This counterintuitive result means the Legislature is likely to face more challenging trade-offs in its budget deliberations. In this section, we also (1) provide an update on outstanding Proposition 98 “settle-up” obligations, (2) describe the effect of a declining K-12 student population on the Proposition 98 minimum guarantee, and (3) discuss factors that might lead to the Proposition 98 Test 1 factor becoming operative in the near future.
February 21, 2007 - The Governor’s proposed budget bill language directs the California Postsecondary Education Commission (CPEC) to recommend a new methodology that compares total faculty compensation at the University of California and the California State University, as well as options for assessing the appropriateness of these compensation levels. We agree that CPEC’s current approach to faculty compensation is flawed. However, we recommend the Legislature rethink the basis for comparing faculty compensation and direct CPEC take an alternative approach to collecting and reporting specified faculty compensation information.
February 21, 2007 - Enrollment at the California Community Colleges (CCC) has been declining over the past several years. At the same time, CCC’s budget has been increased annually to accommodate enrollment growth. For the current fiscal year, we estimate that CCC will likely be unable to use more than $100 million in enrollment funding. We recommend that the Legislature delete this funding for CCC’s budget in order to improve the state’s overall fiscal health. For 2007-08, we recommend the Legislature fund modest anticipated growth. At the same time, however, we recommend the Legislature shift its budget and policy emphasis from increasing enrollment to increasing success rates for students that are enrolled.
February 21, 2007 - The Governor’s budget contains several augmentations for registered nursing programs at the University of California, California State University, and California Community College systems. We recognize the need to increase the number of registered nurses in the state, and find merit with some of the Governor’s proposals. Other proposals, however, lack adequate justification. We thus recommend approval of some proposals and reductions in others, as well as additional steps the Legislature could take to improve nursing programs.
February 21, 2007 - The Governor’s budget assumes that the University of California and the California State University will enact fee increases of 7 percent and 10 percent for resident students at their respective campuses. We recommend lower fee increases of 2.4 percent for both systems. The 2.4 percent fee increase would match the increase in overall costs experienced by the segments due to inflation, and would ensure that students continued to pay the same share of their educational cost as they are paying in the current year. We also recommend that the Legislature not “buy out” any portion of the Governor’s proposed fee increase because such an approach confuses the role of fees and undermines the Legislature’s role in budgeting. We do not recommend any change to the Governor’s proposed fee level for the community colleges, which would maintain the $20 per unit fee that went into effect in January 2007.
February 21, 2007 - The Governor’s budget proposes about $120 million to fund 2.6percent enrollment growth at the University of California (UC) and 2.5percent enrollment growth at the California State University (CSU). This amount would provide $10,876 in General Fund support for each additional student at UC and $7,837 for each additional student at CSU. The proposed budget also provides $109 million for a 2 percent enrollment increase at the California Community Colleges (CCC). In this write-up, we analyze the Governor’s proposed enrollment growth and funding rates for UC and CSU in 2007-08 and recommend alternatives to those rates.
February 21, 2007 - Currently, the state provides over $83 million in funding to the University of California (UC) and the California State University (CSU) to support over 20 different K-14 outreach programs that focus on preparing and encouraging students from disadvantaged backgrounds to attend college. For 2007-08, the Governor’s budget proposes a $26.3 million General Fund reduction to these programs. In this write-up, we (1) provide perspectives on UC and CSU’s outreach programs and efforts to evaluate their effectiveness and (2) present different approaches for the Legislature to consider in funding and evaluating these programs.