The State Budget & Adult Education

1. The State Budget & Adult Education Legislative Analyst’s Office January 2010 www.lao.ca.gov

2. LAO Presentation Overview • Provide a general budget update. • Discuss categorical flexibility generally. • Discuss impact of budget and flexibility on adult education. • Consider related policy questions.

3. Overview of State Budget and Governor’s Solutions • Governor identifies $18.9b problem. • $6.6b at year-end in 2009-10. • $12.3b in 2010-11. • Governor’s plan contains $1b reserve. • Plan also contains $19.9b in solutions. • 40 percent in flexibility from federal government. • 40 percent reductions to state spending. • 20 percent in fund shifts and ballot measures. • Plan triggers additional cuts if federal funds don’t materialize.

4. Proposition 98 Funding Stays Virtually Flat Under Governor’s Proposal Overview of Proposition 98 Funding (In Millions) • Departs from July budget agreement on Maintenance Factor. • Seeks waiver of federal minimum spending requirement.

5. School Districts Face Funding “Cliff” in 2010-11 • Drop in 2010-11 from one-time solutions: • Federal stimulus money. • Deferrals. • Less in restricted reserves.

6. Governor’s Major Budget Proposals • Major midyear proposals: • Capture $340m in unspent Class Size Reduction Funds. • Recognize $228m in revenue limit savings. • Major budget-year proposals: • Includes $1.9b to restore one-time solutions. • Reduces revenue limits by $1.2b for reduced administration costs. • $300m linked to district flexibility to contract out.

7. State Tried to Help Manage Cuts By Increasing Flexibility • State tried to help LEAs manage cuts by providing flexibility related to: • Categorical funding. • Reserves. • Length of school year. • Governor’s budget includes additional flexibility. • Questions remain for Legislature: • What has the impact been? • Should it continue beyond current sunset?

8. Early Reactions to Flexibility Suggest Some Benefits • To what extent did flexibility affect your ability to develop and balance a budget?

9. Early Reactions to Flexibility Suggest Some Benefits • To what extent did flexibility affect your ability to develop a strategic plan?

10. Early Reactions to Flexibility Suggest Some Benefits • To what extent did flexibility affect your ability to fund programs for struggling/at-risk students?

11. …But Need to Weigh These Perceptions Against Programmatic Impact… • Results suggest at least some funds being shifted away from: • Arts and music. • Alternative education. • CAHSEE remediation. • Career technical education. • And, last but not least…

12. Early Results on Adult Education Suggest Funds Being Shifted Away • Our district is changing funding for adult education:

13. Early Results on Adult Ed Suggest Some Program Changes • Our district is changing its adult education program:

14. Adult Education Funding System Before Categorical Flexibility • Funding mechanism had several disadvantages: • Growth mechanism on autopilot. • Allocation method arcane. • No clear sense funds targeted areas with greatest need. • No clear sense of how fees contribute to local budgets. • General agreement the state could improve upon model. • Leaves state to answer several major policy questions.

15. What Is Adult Education’s Core Mission? • Data suggest California funds broader adult education priorities than other states. • Roughly one quarter of adult education students not enrolled in WIA courses.

16. What Is Community College’s Role in ABE, ASE, ESL? • Advantages and disadvantages to delivering these courses through either system. • Adult education system: • Courses cover K-12 content. • Coordination with CAHSEE and diploma requirements. • Geographically more diverse. • Community college system. • Could put students on a degree track. • More targeted focus on adults. • More opportunities for applied learning.

17. How Should CA Provide Career-Technical Education (CTE)? • What is effective CTE for adults? • Difference between technical training and basic employment skills. • Of K-12/CCC articulation agreements under Gov’s CTE initiative, almost 30 percent were for word processing. • Big difference in terms of funding requirements. • Who should deliver CTE for adults? • Again, CCC/adult ed systems need to be coordinated. • ROCPs in flexibility – no longer subject to limitations on adults served.

18. How Do We Provide Funding? • Once basic programmatic questions are answered, how do we fund programs? • Federal questions remain: • How can we best leverage federal funding? • What will happen with WIA reauthorization?

19. How Do We Determine Efficacy? • Data coordination insufficient. • As a result, data limited on: • Employment after completing adult education. • Postsecondary outcomes after adult education. • Accountability insufficient: • Who should be responsible if a student begins postsecondary education underprepared? • How do we tell if our adult ed system is helping to solve our demographic and economic challenges?

20. Contact Information • Jim Soland, Legislative Analyst’s Office (LAO): • jim.soland@lao.ca.gov • (916) 319-8327 • www.lao.ca.gov