Legislature Passes Their 22-23 Budget: Student Housing & Capital Outlay
Monday, June 13, 2022
Today the Legislature passed SB 154, the FY 22-23 Budget Act, which serves as a “placeholder budget.” A final deal between the Legislature and Administration has not yet been reached, therefore the Legislature passed their version of the budget in order to meet the constitutional deadline of June 15. The Legislature is deferring action on trailer bills to implement key budget act provisions until after a final deal is reached with the Administration. On June 1, the Legislature provided details regarding their budget priorities as they entered final negotiations with the Governor.
While the Legislature and Governor recognize similar amounts of available revenue, they differ on how to prioritize the one-time and discretionary funds in numerous policy areas. In the Legislature’s budget, only 9% of new commitments in 2022-23 are ongoing, and the rest are for one-time or temporary purposes.
The Legislature’s budget includes General Fund expenditures of $235.5 billion and approximately $37.5 billion in total reserves. The Legislature’s budget keeps spending under the State Appropriations Limit by directing funds to infrastructure, COVID emergency-related spending, direct payments to families and businesses, and other solutions.
Capital Outlay Funding
The Legislature’s budget approves the Governor’s proposal to provide $403 million for 22 community college capital outlay projects, including the construction phase of 19 projects anticipated to complete design by Spring, the working drawings and construction phase for 1 project, and the design phase of 2 projects. This is the next installment of the $2 billion available to CCCs under Proposition 51.
CCFC requested $2.6 billion General Fund for the community college capital outlay program, as funds from Proposition 51 have been entirely committed to new projects. Neither the Legislature or Governor proposed a General Fund appropriation for the community college capital outlay program in FY 22-23. At this time, it does not appear that there is much interest from the Legislature or Governor to place a state school bond on the November 2022 ballot. The Legislature would need to pass a bond bill by the end of June to meet November election deadlines.
Student Housing
The Legislature’s version of the budget includes $1.2 billion General Fund in FY 22-23 for student housing projects at CCC, UC, and CSU. Of that amount, $750 million would be available to support the SB 169 Higher Education Student Housing Grant Program. This is $450 million more than the Governor proposed for FY 22-23. The Legislature would like to provide a total additional $2 billion General Fund over three years for the three segments ($450 million in 22-23, $1.05 billion in 23-24, and $500 million in 24-25), with an unspecified portion to be used for a revolving loan fund program. If successful, this would bring total student housing funding commitments to $4 billion.
We do not yet know which projects will be funded by the 2021 allocation or the proposed 2022-23 allocation. The Legislature would like to fund all eligible projects from the first round of SB 169 grant applications, which would include 12 projects for community college districts. CCFC has requested to fund all eligible projects submitted during the first round of the SB 169 grant program.
The Legislature is also proposing trailer bill language to make refinements to subsequent rounds of the program’s application process, including but not limited to, the Legislative Analyst’s Office recommendations to address cost overruns, contingency plans, and notification/reporting processes.
Deferred Maintenance
In summary documents, the Legislature indicates that their version of the budget includes $731.9 million in one-time Proposition 98 General Fund for facilities maintenance and instructional equipment. The Legislature’s budget bill does not specifically include this item; we expect more information in future trailer bills, where General Fund dollars could be programmed for community college deferred maintenance. This is less than the Governor’s proposed $1.5 billion for community college deferred maintenance and energy efficiency projects.
CCFC has requested additional flexibility in the use of these funds, including raising the dollar amount cap for architectural barrier removal and seismic retrofit projects, and allowing funds to be used for non-state-supportable facilities such as student housing, athletic facilities, bookstores, health centers, and parking lots/structures.
Next Steps
The Legislature and Governor will continue to negotiate toward a final budget agreement. Additional detail on programs and funding levels will be available in the days and weeks to come.
Rebekah Cearley
CCFC Legislative Advocate
|
|
Email to a Friend