The Coast Community College District Board of Trustees adopted a $260 million spending plan for its fiscal year 2018-19 district budget during its regular meeting Sept. 5.

The plan estimates revenue increases of over $15 million, most of which will comes from non-resident enrollment, according to the budget’s staff report.

“Coast has been doing these great things for a long time,” Andy Dunn, vice chancellor of Finance and Administrative who also prepared the report said. “This (new state) model finally pays us for it.”

Gov. Jerry Brown released his last state budget proposal for 2018-19 in January, which the staff report says “speaks to his expectation for significant changes in both the delivery and the state’s financial support of education with increased attention to student outcomes.”

The budget’s proposal for the Coast district suggests revenue for the 2018-19 year is at about $200 million based on the current data from provided by the state, an 8 percent increase from the prior year.

A new state model for budgeting was signed into law in January and will begin this year with a three-year transition plan. Before the new model, funding was based on State Bill 361 which calculated funding by basic allocations plus full time equivalent student revenue.

The new model adds on need-based revenue and success-based revenue.

“Beginning in the 2018-19 FY, 70% of funding will be enrollment based, 20% will be need based, and 10% success based,” the staff report states. “In the 2019-20 FY, that framework shifts to 65% enrollment, 20% need, and 15% success,” the staff report says.

With the adoption of the district’s 2017-18 budget, an increase in revenue is shown, mainly due to an increase in non-resident enrollment, the report adds.

“We can see an increase of about $15 million year over year, a very significant increase for the district,” Dunn said regarding the “Major Revenue Elements” provided in the current Student Centered Funding Formula (SCFF).

He said, however, that the new model provides less certainty, compared to the previous formula, when it comes to predicting revenues.

According to Dunn, the district’s section counts continue to increase, adding more than 2,000 sections since the 2012-13 fiscal year while serving the same number of full-time equivalent students.

“It’s a very startling metric if you look district-wide,” Dunn said.

The district estimated roughly a $7.5 million deficit for last year, however revenues “went up a bit” over the course of that year, Dunn said, driven largely by non-resident enrollments “which have grown significantly.”

That deficit was reduced to about $4.5 million but will go away under the new formula.

The formula projects $15.3 million in new revenue for the district, while estimating about $10.5 million in new expenses, equating to $4.8 million balance.

“Against the $4.5 million carry-forward structural budget imbalance, for a moment in time we are structurally balanced,” Dunn said.

According to Dunn, demographic trends in Orange County as well as state-wide indicate that the district may see fewer students in the future.

“Looking at this process, I see a shift toward seeing more performance coming out of our classrooms,” Board Clerk Jim Moreno said. “The wind is blowing in that direction.”

A factor not reflected in the proposal is the state’s move to consolidate “basic skills, Student Equity and the Student Success program” into one entity, according to Dunn. This change, he said, is consistent with the state chancellor’s plan to give local districts more autonomy.

He added that while the governor, in his view, has been “very supportive” of the community college system, he is uncertain of “how the new governor is going to react to this (funding model).”

“Remember that the new state model brings dollars to the front door of the district, but it’s a multi-college district, we have to devise our own local allocation model and that will be an exercise I would imagine will stretch into fall and spring,” Dunn said. “Our goal is to have a new model in place for the adoption for the 2019-20 end-year budget.”

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