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The Los Angeles Community College District Administrative Leadership Program December 14, 2007 Got Process Making To

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The Los Angeles Community College District Administrative Leadership Program December 14, 2007 Got Process Making To

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    1. The Los Angeles Community College District Administrative Leadership Program December 14, 2007 “Got Process? Making Tough Decisions in Complex Systems”

    4. “Who Cut My Cheese?” Shared Governance Decision Making: Myths and Realities

    6. RELATIONSHIP OF STATE BUDGET TO DISTRICT BUDGET

    7. SB 361 - New CCC Funding Formula Effective October 1, 2006, new state funding formula includes the following categories: Basic (Foundation) Allocation Credit FTES Non Credit FTES Tier 1 – ESL, Remediation and Basic Skills, Vocational and Occupational education Tier 2 – all other Non-Credit Courses

    8. SB 361 - New CCC Funding Formula Noncredit courses eligible for apportionment: Parenting classes in child growth and development and parent-child relationships Elementary and secondary basic skills and other courses such as remedial courses English as second language Workforce preparation courses in basic skills Educational programs for persons with substantial disabilities Short-term vocational programs with high employment potential Education programs for older adults Education programs for home economic Health and safety education Remember: Noncredit is only funded in these nine categories

    9. SB 361 - New CCC Funding Formula Noncredit courses eligible for Tier 1, if satisfy the requirements set forth in (a), (b), and ( c ) below: The course is approved by the college curriculum, the district governing board and by the State Chancellor’s Office and is part of either: A short-term vocational program which has determined to have high employment potential A sequence of courses involving: (1) elementary and secondary basic skills; (2) workforce preparation courses in the basic skills of speaking, listening, reading, writing, mathematics, decision-making, and problem solving skills that are necessary to participate in job-specific technical training; or (3) courses in English as second language and vocational English as second language The program or sequence of course is designed to result in either: A noncredit certificate of completion leading to improved employability or job opportunities; or A non credit certificate of competency in a recognized career field articulated with degree-applicable coursework, completion or associate degree or transfer to a baccalaureate institution Each program or sequence of courses must be submitted to, and approved by the State Chancellor

    10. SB 361 - CCC New Funding Formula Basic Allocation Revenue is a dollar amount based on the number and the size of colleges and centers for each district for 2006-07 (future year – adjusted with COLA): 2007-08 year Single District: - FTES>20,000 $5,296,000 - 10,000<=FTES<20,000 $4,236,800 - FTES<10,000 $3,177,600 Multi-College District: - FTES>=20,000 $4,236,800 - 10,000<=FTES<20,000 $3,707,200 - FTES<10,000 $3,177,000 Approved Centers: -FTES>=1,000 $1,059,200 -750<=FTES<750 $794,400 -500<=FTES<750 $529,600 -250<=FTES<500 $264,800 -FTES< 250 $132,400

    11. SB 361 - CCC New Funding Formula District’s Allocation equals: Basic Allocation (foundation), plus Credit FTES at equalized rate, plus Noncredit FTES at equalized rate, plus Enhanced Noncredit FTES at equalized rate

    12. SB 361 - CCC New Funding Formula FTES Funding Rates for 2007-08: Base Growth Rate -- Credit $4,367 $4,564.83 -- Noncredit $2,626 $2,744.96 -- Enhanced Noncredit $3,092 $3,232.07

    14. SB 361 - CCC New Funding Formula Rules for Enrollment Decline & Restoration: Decrease in FTES shall result in revenue reductions beginning in the year following the initial year of decrease in FTES. No loss of revenue in the initial year of decline. If all FTES are restored in the following year, no revenue shall be reduced. District shall be entitled to the restoration of any reduction apportionment revenue due to decrease in FTES during the three years following the initial year of decrease in FTES

    15. SB 361 - CCC New Funding Formula Growth Funding: 2007-08 growth caps are based on the following factors: Adult population change High school graduation rate change Minimum of 1 percent or 100 FTES 3 year over cap adjustment rate Adjustment for the district’s primary county’s unemployment rate in excess of 5 percent

    16. SB 361 - CCC New Funding Formula What happens if the state does not have enough funding? To fund Base Revenues: If the state general apportionments, local property tax revenues, student enrollment fees and other local tax revenues allocated to community college districts are less than the amounts computed for all district, the state Chancellor shall apportion the state funding to districts by applying deficit factor (ratio) to total computational revenue for each district. To fund all districts’ growth caps: If the state growth revenues are less than all districts’ computed enrollment growth caps, the districts’ growth revenue shall be funded to the extend funds are available to fully fund all FTES up to cap.

    17. General Apportionment Base Revenue +COLA (same as K-12) +Growth Funding (FTES) ----------------------------------------- = Total Computational Revenue Local Property Tax 98% of Student Fees -------------------------------------------- = State General Fund Apportionment

    18. Apportionment Schedules July 1 Advance Prior year P2 (April 30 Attendance Report) + COLA + ˝ Growth February (P1) January 15 Attendance Report + Recalculation of prior year (based on October report) June (P2) April 30 Attendance Report

    19. Categorical and Specially Funded Programs Unrestricted versus Restricted Funds (Programs) -- Unrestricted funds (programs) are used to account for resources available for the general purposes of district operations and support of its educational programs -- Restricted funds are used to account for resources available for the operations and support of the educational programs that are specifically restricted by outside agencies or by law and regulations Categorical Funds (programs) are restricted state funded programs through state apportionments such as CalWorks, CARE, DSPS, EOP&S, Matriculation, etc… A complete list of the district’s categorical and restricted programs are provided in Exhibit I.

    20. Other Revenue/Funding Local College Activities ?Dedicated Revenues generated by colleges. Enterprise Operations: Bookstores, Food Services, and Cafeteria Services Nonresident tuition, lottery revenue, and bond funds Other potential revenues ? Foundation, Grants, Scholarships, Community Partnerships, Sheriff Academy, Fire Department Academy, Prison Academy, Outreach programs, High School/Middle School/CASHEE programs, etc…

    21. Other Revenue (cont) Community Service funds Parking fees

    22. State Budget Anxieties Prop 92 Fails Inadequate growth in Prop 98 (based on K-12) Unfair Prop 98 split with K-12 State Budget Shortfall Nothing beyond COLA & growth No COLA and/or growth Mid-year cut Property Tax Shortfall

    23. State Budget Anxieties (cont) What to do Pay attention McCallum Group Sacramento Report Contingency plans for each possibility Build college and district reserves

    24. Take Home Lessons Avoid financial problems Dominates all college activities First maximize revenue, then control expenses Everyone must understand the cause of the problem and participate in the solution FTES rules! College’s first priority is to achieve base and growth FTES targets (credit and non-credit)

    25. Take Home Lessons (cont) Maximize Tier 1 non-credit FTES Develop FTES strategies with contingency plans Use categorical and restricted funds properly but liberally Maintain adequate audit trails Maximize “other” revenue sources

    27. District Budget Allocation Model Using SB 361 funding formula to distribute state general revenue to colleges Each college receives a basic allocation based on college size and funding for credit FTES, noncredit FTES, enhanced noncredit FTES with state funded rates Small colleges received supplemental basic allocation of $500,000 to its basic allocation in 2006-07 year, adjusted by COLA in future years Colleges are assessed for contingency reserve (at 3.5%), district-wide and district office services based on $/FTES Balances are retained by colleges and district office.

    28. District Budget Allocation Model Revenue and Allocation Assumptions FTES Targets X Funding Rates COLA, Growth, Non-resident Dedicated Revenues, Lottery, Interest Complete Budget Allocation Model Districtwide/District Office Assessments ($/FTE) Sheriff’s Contract Deficit Paybacks, Redistributions Budget Development Calendar and Preparation Processes

    29. The Planning and Budget Cycle

    30. Campus Planning and Budget Cycle

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