Planning and Managing the Equitable Allocation of Community College Funds
Written by WestEd’s Kelsey Krausen, Ryan Lewis, and Patrick McClellan
The California Community Colleges (CCCs) are collectively the largest system of higher education in the country, serving over 2.1 million students across 73 districts. Among the graduates of California’s community colleges are nurses, firefighters, and electricians — critical members of the workforce who have the potential to help California address the current public health crisis and rebuild the state’s economy.
Despite the potential for California community colleges to serve as an important engine of economic recovery — by contributing to workforce development and greater economic prosperity through educational advancement — this role could be at risk.
First, enrollment in the California community colleges has fallen dramatically, mirroring enrollment declines across the country and contradicting an established trend of increased student enrollment during prior recessions (Hillman & Orians, 2013). Moreover, economic uncertainty in the state could lead to reductions in state funding for community colleges. The CCCs rely heavily on state funding, while keeping student fees low, to ensure greater access to higher education for students, including first-generation college students and students from low-income households.
To support the state’s efforts to strengthen the allocation of resources to community colleges and improve outcomes for students, WestEd staff has provided research and facilitation support for a twelve-member Student-Centered Funding Formula (SCFF) Oversight Committee (Oversight Committee) starting in early 2019. The purpose of this article is to share our research team’s learnings from our work with the Oversight Committee this past year with other higher education leaders, policymakers, and researchers. In particular, we believe it is important to share how the SCFF Oversight Committee framed their investigation of funding policy around the needs of those students who have been hit hardest by the pandemic and as a means to accelerate economic recovery in the state.
The SCFF Oversight Committee
The SCFF was adopted in the 2018-19 California state budget and was intended to improve outcomes for community college students by tying a portion of funding to student equity and success, rather than relying on a funding system focused primarily on enrollment. The 2018–2019 state budget also authorized the creation of the Oversight Committee, charged with reviewing and evaluating the implementation of the formula. As part of their charge, the Oversight Committee was tasked with making a recommendation to the California Legislature and Department of Finance on how to adjust districts’ revenue allocations in the event of a recession. When the legislature established the Oversight Committee’s charge, they had no way of knowing that just a year and a half later, the state would face a public health crisis and a pandemic-induced recession.
The Oversight Committee considered a variety of options in making their recommendation, appreciating, in particular, the fact that many California community college students are among those most impacted by the pandemic and poor economic conditions. A recent article by Tammy Kolbe from the University of Vermont and Rick Staisloff from the rpk GROUP suggests the need for universities and colleges to think differently about how to address budget shortfalls. Kolbe and Staisloff write that colleges and universities should focus on the needs of students, prioritize long-term solutions over short-term fixes, protect “economic engines” or programs and services that generate revenue for the college, and ensure a range of stakeholders are involved in the budgeting process, among other recommendations.
While Kolbe and Staisloff focus on actions colleges and universities should take, the Oversight Committee grappled with similar issues related to how the state should address budget shortfalls, including:
- Incorporating the concerns of a range of stakeholders
- Focusing on the needs of students hit hardest by the pandemic
- Balancing budget predictability and stability with a desire to maintain the formula’s intent to allocate funding based on student need
The Committee urged state policymakers to also consider how investments in California’s community colleges can contribute to economic recovery for the state through workforce development. As the Committee noted in their recent report to the legislature, “The California Community Colleges play a critical role as engines for economic recovery and growth in the state. In particular, California’s community colleges provide students of color and marginalized student groups with a critical access point to higher education and economic opportunity. Reductions in funding for the SCFF would put this critical role at risk and further marginalize low-income students and communities of color.”
The Committee argued that California’s community colleges not only have the potential to contribute in important ways to the state’s economic recovery but also have the potential to support advancement for students from communities that have been hardest hit by the pandemic. Accordingly, as part of their recommendation, the Committee recommended no cuts to funding for community colleges unless absolutely necessary.
Beyond the WestEd team’s support for the Oversight Committee, our research team sees an important opportunity for research on the root causes of this unprecedented reduction in enrollment and for investigations into ways to support student access to community college, particularly in those fields most likely to drive the state’s economic recovery.
In 2015, Ann Stevens, Michal Kurlaender, and Michel Grosz estimated that average returns to career-technical education degrees and certificates at California’s community colleges range from 12 to 23 percent. The programs with the highest rates of return were those in the healthcare sector.
The dynamics around transfer rates and equity gaps are also relevant. In 2014-15, while 51 percent of all California Community College students who declared a degree/transfer goal were Latinx, only 35 percent of all students who successfully transferred within four years were Latinx. African American students represented just 7 percent of students who declared a degree/transfer goal and 5 percent of students who successfully transferred within four years. It is still unclear how these trends will be affected by the pandemic-induced recession, but our research team believes these are crucial topics for policymakers, researchers, and practitioners to continue to investigate.
Fueled with information, community colleges can invest in those programs with the greatest return on investment, both in terms of creating budget stability for colleges during a perilous economic period, but also because of the longer-term economic returns of specific pathways for students, particularly disadvantaged students.
Community college districts across the United States have now encountered two seismic financial shifts within the last thirteen years, and given the nation’s system of state and local control, have responded to these recessions in a myriad of ways. The table is set for powerful, relevant research around the responses to shifting public funding for community colleges, and the impact those responses have on students. Studying the difference in outcomes amongst these different strategies, particularly those targeting student equity, is an essential next step.
As our work with the SCFF Oversight Committee continues, we will know more about the impact of the pandemic on student access and outcomes in the community college system. Accordingly, our research team will continue to support efforts by the SCFF Oversight Committee to strengthen and leverage the state’s funding formula so that community colleges can serve as engines of economic recovery for the state, and as a pathway to greater opportunity for students from communities hit hardest by the pandemic.