Overview of the 2018-19 Governors Budget January 2018 Amy Costa - - PowerPoint PPT Presentation

Overview of the 2018-19 Governor’s Budget

January 2018

Amy Costa

Chief Deputy Director, Budget Department of Finance

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Summary of the 2018-19 Governor’s Budget

One-time budget surplus, but massive uncertainty Full Implementation of Local Control Funding Formula Fully fills the Rainy Day Fund to 10 percent of tax revenues Creation of online community college Extension of Cal Competes and hiring tax credits First full year of SB1 transportation funding Cap and Trade funding plan to come at State of State

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Uncertainties and the 2018-19 Governor’s Budget

Federal Government

• Implications of Tax Bill
• CHIP Reauthorization
• Potential for Federal Cost Shifting

Next Recession?

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Budget Assumes Current Recovery Would Match Longest Ever

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Annual Revenue Could Drop by Over $20 Billion in a Recession

(Dollars in Millions)

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Filling Up the Rainy Day Fund Before the Next Recession

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School Funding Has Increased by 66 Percent Since 2011

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Online Community College

0.00% 2.00% 4.00% 6.00% 8.00% 10.00% 12.00% 14.00% 16.00% 18.00% 20.00%

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

Unemployment Rate California Residents Age 25-34

LT High School Grad Civ Emp Estimate HS Grad Some College No Degree AA Degree Bachelors +

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Student-Focused Funding Formula

New Student-Focused Formula Apportionments: 50% based on full-time equivalent student enrollment 25% based on students receiving California College Promise Grants and Pell Grants 25% based on short and long-term student success metrics (degrees, certificates, awards, and ADTs) Hold Harmless Provisions

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Proposed Community College Budget

One-time Deferred Maintenance and Instructional Equipment California College Promise Financial Aid Consolidation Apportionments Innovation Awards