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Assembly panel reviews COLA and modest enrollment growth proposal for community colleges
Summary
State officials and the California Community Colleges Chancellor's Office told the Assembly budget subcommittee the governor's budget proposes a 2.43% COLA for apportionments and 0.5% enrollment growth funding, while the system urged larger funding to meet uneven local demand.
Assemblymember Jose Medina Alvarez opened the California State Assembly Budget Subcommittee No. 3 hearing on community college finance by focusing members on graduation and enrollment challenges at California Community Colleges. He said Proposition 98 makes some augmentations possible but pressed panels on how proposals would improve graduation rates and access.
Justin Hurst of the Department of Finance summarized the governor's proposal for the Student Centered Funding Formula (SCFF). "The governor's budget proposes a cost of living adjustment at the rate of 2.43% in the amount of $230,400,000 Proposition 98 General Fund for apportionments," Hurst said. He added the budget proposes funding enrollment growth at 0.5% with an associated $30,400,000 Proposition 98 General Fund allocation.
Lisa King of the Legislative Analyst's Office (LAO) told the committee the COLA recommendation is reasonable and noted the final COLA rate will be finalized in the May Revision. King pointed to important factors the Legislature should weigh on growth funding, including regional demographic trends and elevated unemployment that can increase college enrollment. "Taking these various factors into consideration, we recommend funding at least the 0.5% enrollment growth included in the governor's budget," King said.
Chris Ferguson, Executive Vice Chancellor for Finance and Strategic Initiatives at the Chancellor's Office, said enrollment recovery has been uneven across districts and asked the Legislature to consider fully funding higher growth. He told members the system estimates roughly $126 million in unfunded enrollment growth for 2025–26 and described a requested policy change to compute apportionments using the greater of current year or three‑year average; the office estimated that change would cost about $20 million annually. Ferguson also described lifting a 10% local growth cap, which the Chancellor's Office estimates would cost roughly $15.6 million of the $126 million total if removed.
Members questioned whether the two requested changes (using the greater of the current year or three‑year average and removing the local 10% cap) were both required, how they would interact, and what the net fiscal impacts would be. The Chancellor's Office and LAO agreed to provide further modeling and district‑level impacts for the committee before final decisions.
The panel discussed regional variation: the LAO noted enrollments are up in the Central Valley and Inland Empire and generally down in other regions, including some Bay Area districts. Committee members asked for additional analysis on the distributional effects of the SCFF and scenarios that show the budgetary effects of 0.5% versus 2% growth and the separate or combined policy changes requested by the Chancellor's Office.
No formal votes were taken during the hearing; members directed staff to follow up with additional fiscal modeling and to return with more detail at the May Revision.
Ending: The subcommittee held the item open and requested staff and the Chancellor's Office supply district‑level impacts and scenarios (0.5% vs. higher growth, effects of lifting the 10% cap, and the three‑year average change) ahead of May budget planning.
