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The 2023-24 California Spending Plan: Higher Education
The 2023-24 California Spending Plan: Higher Education
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October 19, 2023
The 2023-24 California Spending Plan
Higher Education
Overview
California Community
Colleges
California State University
University of California
Student Financial Aid
Student Housing
California State Library
This post summarizes the state s 2023 24 spending package for higher
education. It is part of our Spending Plan series. In this post, we
provide a short overview of the state s higher education spending
package, then cover spending for the California Community Colleges
(CCC), California State University (CSU), University of California (UC),
student financial aid, student housing, and California State Library.
The EdBudget
part of our website contains many tables providing more detail about the
2023 24 education budget package.
Overview
Budget Notably Increases State Funding for Higher
Education. As Figure 1 shows, ongoing General Fund support
for higher education is $21.8 billion in 2023 24, reflecting an increase
of $800 million (3.8 percent) over the revised 2022 23 level. Ongoing
augmentations in 2023 24 span a few key areas, including core
operations, enrollment growth, and student support programs. The budget
also includes a total of $535 million for one-time higher education
initiatives. Many of these one-time initiatives involve campus-specific
projects.
Figure 1
Enacted Budget Increases General Fund Support for Higher Education
General Fund (Dollars in Millions)
Ongoing
One Time a
2021 22 Actual
2022 23 Revised
2023 24 Enacted
Change From 2022 23
2023 24 Enacted
Amount
Percent
California Community Colleges b
$9,032
$8,873
$8,835
$38
0.4%
$14
California State University
4,606
5,050
5,417
367
7.3
38
University of California
4,011
4,374
4,721
347
7.9
144
Student Aid Commission
1,974
2,499
2,588
88
3.5
336
Scholarshare Investment Board
16
163
194
30
18.4
0
Other c
25
27
32
5
18.5
3
Totals
$19,664
$20,986
$21,786
$800
3.8%
$535
a Reflects non Proposition 98 General Fund appropriations for one time purposes.
b Consists of Proposition 98 General Fund that counts toward the annual minimum guarantee and non Proposition 98 General Fund except for state general obligation debt service payments. The state sometimes uses some Proposition 98 General Fund that counts toward the minimum guarantee for one time purposes. In addition to state General Fund, community colleges receive significant funding from local property tax revenues as well as various other state and local sources. When these revenues are included, ongoing funding for the colleges increases by $195 million (1.2 percent) between 2022 23 and 2023 24.
c Consists of funding for UC College of the Law, San Francisco; the California Education Learning Laboratory, which is administered by the Office of Planning and Research; and the California Medicine Scholars Program, which is administered by the Department of Health Care Access and Information.
In Response to Budget Deficit, State Shifts Capital
Projects From Cash to Debt Financing. As the state built
its 2023 24 budget package, it was facing a projected budget deficit. In
response, the state took various actions to reduce state spending.
Within higher education, the main way the state achieved budget solution
was by rescinding a total of $3.2 billion in upfront General Fund cash
originally provided for dozens of higher education capital projects. In
place of the upfront cash, the state signaled the segments were to issue
revenue bonds for the projects. The state budget includes ongoing
General Fund augmentations (totaling $240 million) intended to cover the
segments associated borrowing costs. Figure 2 lists the projects that
the state shifted from cash to debt financing. The state shifted all 35
affordable student housing construction projects, as well as nine other
university capital projects, to debt financing.
Figure 2
Enacted Budget Shifts $3.2 Billion in Higher Education Capital Projects
From Cash to Debt Financing
(In Millions)
Project Cost a
Debt Service b
Projects Shifted in January
CSU Bakersfield Energy Innovation Center
$83.0
$5.5
CSU San Diego Brawley Center
80.0
5.3
CSU San Bernardino Palm Desert Center
79.0
5.3
CSU Fullerton Engineering and Computer Science Hub
67.5
4.5
CSU University Farms
75.0
5.0
CSU San Luis Obispo Swanton Pacific Ranch
20.3
1.4
Subtotals
($404.8)
($27.0)
Additional Projects Shifted in May Revision
CSU student housing construction projects
$655.2
$52.0
UC student housing construction projects
489.0
33.5
UC Berkeley Clean Energy Project
249.0
16.7
CSU Humboldt polytechnic transition
201.0
16.0
UC Riverside campus expansion project
154.5
10.3
UC Merced campus expansion project
94.5
6.3
CSU University Farms (removed)
75.0
—
Subtotals
($1,768.2)
($134.8)
Additional Projects Shifted in June
CCC student housing construction projects
$1,010.7
$78.5
Modifications Made in September c
Intersegmental student housing projects (UC)
$236.8
$17.2
Intersegmental student housing projects (CCC)
236.8
17.0
Totals
$3,184.9
$240.5
a Reflects state cost of project (excluding nonstate costs). To generate near term budget solution, the state rescinds upfront one time General Fund for these projects (that is, it rescinds the amounts shown in this column).
b The segments are to issue revenue bonds for the projects. The state provides ongoing General Fund augmentations to cover estimated debt service costs (that is, it provides the amounts shown in this column).
c Under the final budget agreement, UC is to sell revenue bonds for the full cost of three intersegmental student housing projects (Merced, Riverside, and Santa Cruz). Under the June budget agreement, UC and each of the partnering community college districts were to sell revenue bonds separately for each of their respective portions of those projects.
Major Higher Education Budget Decisions Made at Key
Junctures. Figure 3 highlights major higher education
developments that unfolded throughout the state budget process. The
Governor launched budget negotiations in January by proposing to fund
the second year of his multiyear budget plans with each of the higher
education segments. He also proposed some higher education budget
solutions to address the projected deficit. As budget deliberations
advanced, the state enacted slightly higher ongoing increases for each
of the higher education segments. At the same time, however, the state
shifted more higher education capital projects from cash to debt
financing, with the amount of higher education budget solutions enacted
in June being about eight times greater than the amount proposed in
January.
California Community
Colleges
Budget Provides $12.5 Billion Proposition 98 Funding for
CCC in 2023 24. Proposition 98 funding (a mix of state
General Fund and local property tax revenue) is the primary source of
support for the community colleges (and K-12 education). After growing
significantly in 2020 21 and 2021 22, Proposition 98 funding since then
has leveled off. As Figure 4 shows, Proposition 98 support for CCC in
2023 24 increases by $125 million (1 percent) over the revised 2022 23
level. The annual growth is entirely due to higher local property tax
revenue, which is somewhat offset by falling General Fund revenue.
Figure 4
California Community Colleges Proposition 98 Funding
(Dollars in Millions)
2021 22
Final
2022 23
Revised
2023 24
Enacted
Change From 2022 23
Amount
Percent
General Fund
$8,678
$8,544
$8,453
$91
1.1%
Local property tax
3,515
3,787
4,003
216
5.7
Totals
$12,193
$12,331
$12,456
$125
1.0%
Funding on a Per-Student Basis Continues to Rise
Notably. Even though total Proposition 98 funding has
leveled off the past few years, funding on a per-student basis has been
rising as a result of budgeted enrollment counts dropping. On a budgeted
per-student basis, Proposition 98 funding increases from $10,974 in
2021 22 to $11,887 in 2023 24, reflecting a rise of $913 (8.3 percent).
Compared to 2019 20, budgeted per-student funding in 2023 24 is up even
more $3,500 (42 percent) reflecting historically high growth over this
period.
Package Includes Ongoing Spending Increases and One-Time
Reductions. As Figure 5 shows, the budget includes nearly
$1 billion in Proposition 98 ongoing spending increases for community
college across the 2021 22 through 2023 24 period. The budget, however,
also contains $500 million in reductions. Nearly all of the reduction is
to the CCC facility maintenance and instructional equipment categorical
program. This program had received a historically large augmentation as
part of the 2022 23 budget agreement. With the reduction enacted in
2023 24, this categorical program will receive a total of $347 million
in one-time Proposition 98 support (rather than the $841 million enacted
in 2022 23).
Figure 5
Total Changes in California Community Colleges Proposition 98 Spending
2021 22 Through 2023 24 (In Millions)
Ongoing Spending
Apportionments (8.22 percent COLA)
$678
Apportionment funding protection (stability)
154
Select categorical programs (8.22 percent COLA) a
112
Enrollment growth (0.5 percent)
26
FCMAT new professional development program
— b
Subtotal
($971)
One Time Initiatives
Forestry/fire protection workforce training
$14 c
LGBTQ+ centers
10 d
New entrepreneurship and innovation center at East Los Angeles College
3
Online education study
1
FCMAT new professional development program
— b
Subtotal
($27)
One Time Reductions
Facility maintenance and instructional equipment
$494 e
Student enrollment and retention strategies
5 f
Subtotal
( $500)
Total Changes
$499
a Applies to the Adult Education Program, apprenticeship programs, basic needs centers, CalWORKs student services, campus child care support, Disabled Students Programs and Services, Extended Opportunity Programs and Services, mandates block grant, mental health services, MESA program, NextUp foster youth program, Puente, rapid rehousing program, Umoja, and veterans resource centers.
b Consists of $200,000 in ongoing funds and $75,000 in one time funds.
c Uses reappropriated Proposition 98 funds (previously appropriated funds for other purposes that were not spent).
d The 2023 24 budget also indicates intent to provide $10 million for this purpose in each of the next two years (2024 25 and 2025 26).
e Reduces funding provided in the 2022 23 budget agreement for this purpose from a total of $841 million to $347 million.
f Reduces funding provided in the 2022 23 budget agreement for this purpose from $150 million to $145 million.
COLA = cost of living adjustment; FCMAT = Fiscal Crisis and Management Assistance Team; LGBTQ+ = lesbian, gay, bisexual, transgender, queer, and plus; and MESA = mathematics, engineering, science achievement.
Budget Prioritizes Funding for Core
Operations. The largest of the ongoing spending increases
($678 million) is to fund an 8.22 percent cost-of-living adjustment
(COLA) to community college apportionments. The 8.22 percent COLA in
2023 24 is the third highest COLA on record since the state assumed
primary control of K-14 funding in 1978 79. The budget also provides
$154 million for an apportionment funding protection known as
stability. This protection is intended to provide a cushion to local
budgets resulting from enrollment and other declines. The budget also
provides $26 million for 0.5 percent systemwide enrollment
growth representing about 4,900 additional full-time equivalent (FTE)
students. Provisional budget language continues to allow the
Chancellor s Office to allocate unused enrollment growth funding to
backfill shortfalls in apportionment funding (stemming, for example,
from enrollment fee revenue or local property tax revenue coming in
lower than budgeted). If not needed for an apportionment shortfall,
unused enrollment funds revert to the Proposition 98 Reversion Account
and become available for other Proposition 98 purposes.
Budget Partly Covers Ongoing Apportionment Costs Using
One-Time Funds. Proposition 98 funding in 2023 24 is
insufficient to fully fund all ongoing CCC spending authorized in the
budget package. As a result, the budget relies on $290 million in
one-time funds to cover the COLA for apportionments in 2023 24. This
creates an ongoing shortfall because COLA costs continue but the
one-time funding does not.
An Expanded Number of Categorical Programs Receive a
COLA. Historically, when the state provides a COLA to
apportionments, it also has provided a COLA to seven CCC categorical
programs, including Extended Opportunity Programs and Services and
Disabled Students Programs and Services. For 2023 24, the Legislature
placed a high priority on providing a COLA to a broader set of student
support programs, including for student mental health services and
veterans resource centers. In total, the budget provides $112 million
ongoing to provide an 8.22 percent COLA to 15 categorical programs. Of
this amount, $95 million is associated with the seven categorical
programs that traditionally receive a COLA, whereas $17 million is for
the additional eight programs that do not typically receive a COLA.
Colleges Receive New Flexibility in Spending Certain
Prior-Year Funds. Trailer legislation allows districts to
use funds remaining from three 2022 23 initiatives (facility maintenance
and instructional equipment, student enrollment and retention
strategies, and the COVID-19 block grant) for any of those initiative s
statutorily permitted spending purposes. For example, districts can use
deferred maintenance funding for enrollment outreach efforts and vice
versa. Districts are not required to report the extent to which they use
this newly provided flexibility.
Budget Agreement Contains New Nursing
Initiative. The higher education trailer legislation
appropriates a total of $300 million over five years ($60 million
annually from 2024 25 through 2028 29) for a new CCC nursing initiative.
The language indicates the funds are to expand CCC nursing programs and
bachelor of science in nursing partnerships. The language indicates that
specific development of the new initiative is subject to future
legislation. (Currently, CCC nursing programs are funded primarily
through apportionments. Since 2006 07, the state also has funded a CCC
nursing categorical program designed to expand enrollment and provide
supplemental student supports such as tutoring. In 2023 24, this program
receives $13 million ongoing Proposition 98 funds.)
Trailer Legislation Contains New Requirements Related to
Full-Time Faculty and Faculty Diversity. Consistent with
recommendations from a 2023 report by the State Auditor, trailer
legislation includes a requirement for the Chancellor s Office to report
annually on community college districts progress in increasing the
share of instruction provided by full-time faculty. Trailer legislation
also requires the Chancellor s Office to adopt a policy to verify
districts are using full-time faculty hiring funds (provided in the
2018 19 and 2021 22 budgets) for that purpose. In addition, trailer
legislation requires the Chancellor s Office to verify districts are
implementing certain best practices related to promoting faculty
diversity.
Budget Authorizes Many CCC Capital Outlay Projects
Supported With State Bonds. The 2023 24 budget includes
$232 million in general obligation bond authority to support 14 CCC
capital outlay projects. Of these 14 projects, 12 are continuing and 2
are new projects. This EdBudget
table lists all of these projects. These projects are supported with
remaining bond authority from Proposition 51 (2016) and Proposition 55
(2004).
California State University
CSU Ongoing Core Funding Is $8.6 Billion in
2023 24. Of this amount, $5.4 billion is state General
Fund, $3.1 billion is student tuition and fee revenue, and $65 million
is lottery revenue. Ongoing core funding increases $393 million
(4.8 percent) from 2022 23. Nearly all of the annual increase
($367 million) comes from the General Fund, with General Fund support
increasing 7.3 percent. Tuition charges remain flat in 2023 24, but
student tuition and fee revenue increases by $26 million (0.8 percent)
due to anticipated enrollment growth. In addition to these ongoing
changes, the budget includes $38 million in one-time General Fund
spending for various initiatives at CSU. Figure 6 shows all the General
Fund spending changes for CSU in 2023 24.
Figure 6
Changes in California State University General Fund Spending
2023 24 (In Millions)
Ongoing Spending
Operations
Base augmentation (5 percent)
$227
Retiree health benefit cost increases
37
Student basic needs
1
Support for students with disabilities
1
Student mental health
1
Other
— a
Facilities b
Student housing projects c
$52
Five previously approved capital outlay projects d
27
CSU Humboldt polytechnic transition e
16
CSU Chico Human Identification Lab
4
CSU San Bernardino physician assistant facility
— f
Subtotal
($367)
One Time Initiatives
CSU Dominguez Hills support
$15
Science and Technology Policy Fellows program g
10
CSU Northridge Basic Needs Suite
6
CSU Chico CalFresh Outreach Resource Hub
3
CSU San Diego Imperial Valley student housing
3
Federal Title IX implementation support
1
CSU Dominguez Hills Mervyn Dymally Institute
1
Subtotal
($38)
Total
$405
a Consists of a $300,000 augmentation for rapid rehousing and $148,000 for CENIC cost increases. The 2021 22 budget agreement included intent to fund these CENIC cost increases.
b CSU is to debt finance all the facilities listed using university bonds. Amounts shown reflect ongoing General Fund augmentations intended to cover the associated borrowing costs (principal and interest).
c In a conforming action, the budget removes $655 million one time General Fund provided or planned for these projects in 2021 22 through 2023 24.
d In a conforming action, the budget removes $330 million one time General Fund provided for these projects in 2022 23.
e In a conforming action, the budget removes $201 million one time General Fund provided for this project in 2021 22.
f The budget includes $290,000 ongoing to support borrowing costs for this project.
g The 2022 23 budget agreement included intent to provide these funds.
CENIC = Corporation for Education Network Initiatives in California.
Largest CSU Ongoing Augmentation Is for Core
Operations. The 2023 24 budget provides CSU with a
$227 million (5 percent) unrestricted General Fund base augmentation.
CSU may use this augmentation to cover employee salary and benefit cost
increases, as well as other operating cost increases. Provisional
language requires CSU to report to the Legislature on the use of these
funds by December 31, 2024. Beyond this base augmentation, the budget
provides $37 million ongoing General Fund specifically to cover CSU
retiree health benefit cost increases. The budget also provides a
combined increase of $2.4 million ongoing General Fund to CSU for its
student basic needs, mental health, and rapid rehousing programs,
representing a 5 percent augmentation for each program. The budget
provides $1 million ongoing General Fund to CSU to provide additional
support to students with disabilities.
Budget Sets Enrollment Growth Expectations for CSU
Through 2025 26. Provisional language states an intent for
CSU to increase resident undergraduate enrollment by 4,057 FTE students
(1.2 percent), bringing its total resident undergraduate enrollment
level to 330,080 FTE students in 2023 24. (With this budgeted growth,
CSU would remain below its 2020 21 peak resident undergraduate
enrollment level of 353,262 FTE students.) The provisional language
authorizes the administration to reduce funding for CSU if it enrolls
fewer students than expected. Funding would be reduced at the 2023 24
state marginal cost rate of $10,070 for each student below the expected
level. Provisional language also sets enrollment expectations for CSU in
2024 25 and 2025 26, as Figure 7 shows.
Figure 7
Budget Sets CSU Enrollment Growth Expectations Through 2025 26
Resident Undergraduate Full Time Equivalent (FTE) Students
2023 24 a
2024 25
2025 26
Growth
Amount
4,057
9,866
10,161
Percent
1.2%
3.0%
3.0%
Total Enrollment Level
330,080
339,946
350,107
a Growth is relative to the estimated 2022 23 enrollment level of 326,023 FTE resident undergraduates. CSU’s resident undergraduate enrollment level peaked in 2020 21 at 353,262 FTE students.
Budget Shifts Various CSU Capital Projects From Cash to
Debt Financing. As a budget solution in response to the
state s projected budget deficit, the budget package removes a total of
$1.2 billion one-time General Fund provided or planned for certain CSU
capital outlay projects over the 2021 22 through 2023 24 period. Instead
of receiving upfront cash for these projects, CSU is to debt finance
them using university bonds. The budget provides CSU with a total of
$95 million ongoing General Fund intended to cover the associated costs.
In addition, the budget provides $4.7 million ongoing General Fund to
support debt service costs for two new capital projects at the Chico and
San Bernardino campuses. Both of these new projects are also to be
financed using university bonds.
Administration Also Authorizes CSU to Debt Finance Other
Capital Projects. In addition to the capital projects
funded in the budget, the administration authorizes CSU to debt finance
certain other capital projects and cover the cost using its main General
Fund appropriation. The estimated state cost of these projects totals
$80 million. Of this amount, $53 million is for various infrastructure
improvements across the system. The remaining $27 million is for a pier
extension and other improvements at the Maritime campus to accommodate a
new federally funded training ship. The annual debt service associated
with these projects is estimated to be $5.4 million. CSU submitted final
proposals for these projects in November 2022, and the administration
provided final approval for them in July 2023. (This EdBudget
table provides basic information about these projects.)
Budget Funds Various One-Time CSU
Initiatives. The largest one-time CSU General Fund
augmentation is $15 million to support the Dominguez Hills campus. The
budget also provides one-time General Fund to several campuses for
specific initiatives related to student basic needs, student housing,
and other support programs. In addition, the budget provides $1 million
one-time General Fund to support CSU in implementing federal Title IX
policies and strengthening its associated practices.
University of California
UC Ongoing Core Funding Is $10.4 Billion in
2023 24. Of this amount, $4.7 billion is state General
Fund, $5.3 billion is student tuition and fee revenue, and $347 million
comes from other core funds. Ongoing core funding increases $592 million
(6 percent) from 2022 23. More than half of the annual increase
($347 million) comes from the General Fund, reflecting growth of
7.9 percent. The remainder ($244 million) comes from student tuition and
fee revenue. UC is in the second year of implementing its cohort-based
tuition policy, which increases tuition charges for new undergraduates
as well as all graduate students. Tuition revenue also increases due to
anticipated enrollment growth. In addition to ongoing funding increases,
the budget includes $144 million for various one-time initiatives at UC.
Figure 8 shows all the General Fund spending changes for UC in
2023 24.
Figure 8
Changes in University of California General Fund Spending
2023 24 (In Millions)
Ongoing Spending
Core Operations
Base augmentation (5 percent)
$211
Nonresident enrollment reduction/replacement a
30
Agriculture and Natural Resources division (5 percent)
5
Facilities b
Student housing projects c
$51
Three previously approved capital projects d
33
UC Riverside School of Medicine building
7
Other
Graduate medical education
$5
UC Riverside School of Medicine operations
2
Support for students with disabilities
2
Student mental health
1
Student basic needs
1
Rapid rehousing
— e
Subtotal
($347)
One Time Initiatives
UC Los Angeles Institute for Immunology and Immunotherapy f
$100
Cancer research relating to firefighters
7
UC Berkeley School of Journalism police records access project
7
UC Los Angeles Ralphe J. Bunche Center for African American Studies g
5
UC Davis Equine Performance and Rehabilitation Center
5
Cal Bridge initiative
4
UC San Diego Scripps Institution of Oceanography Coastal Ocean Pollution Pathogen Predictions model
3
UC Cooperative Extension fire advisors
2
Global Entrepreneurs program
2
UC San Diego Scripps Institution of Oceanography California Coastal Mapping Program
2
UC Los Angeles Center for Reproductive Health, Law, and Policy
2
Nutrition Policy Institute h
1
UC Davis Hypolimnetic Oxygenation Pilot Project to Revitalize Clear Lake
1
UC Irvine Inclusive, Diverse, Equitable, and Able Leaders for Water program
1
UC Berkeley School of Education/UC Los Angeles Center for the Transformation of Schools REACH Network
1
UC Merced Labor Center study of oil and gas industry
— e
UC Los Angeles Collaborative Neurodiversity and Learning Center for Public Engagement and Education
— e
Subtotal
($144)
Total
$491
a In 2023 24, UC is to reduce its nonresident undergraduate enrollment at three campuses (Berkeley, Los Angeles, and San Diego) by a total of 902 students. It is to backfill these slots with the same number of additional resident undergraduate students.
b The budget authorizes UC to debt finance various capital projects using university bonds. Amounts shown reflect ongoing General Fund augmentations intended to cover the associated borrowing costs (principal and interest).
c In a conforming action, the budget removes a total of $727 million one time General Fund for these projects over the 2021 22 through 2023 24 period.
d In a conforming action, the budget removes a total of $498 million one time General Fund for these projects over the 2022 23 through 2024 25 period.
e Less than $500,000.
f The 2022 23 budget plan provided $100 million for this project. The 2023 24 budget plan also includes intent language to provide an additional $300 million in 2024 25 for this project.
g The 2022 23 budget plan provided $5 million one time General Fund for this center. The 2023 24 budget plan states intent to provide an additional $3 million ongoing General Fund for this center beginning in 2024 25.
h The 2022 23 budget plan provided $2.4 million for this institute. The 2023 24 budget plan also includes intent language to provide an additional $2.4 million in 2024 25 and $1.3 million in 2025 26 for this institute.
REACH = Race Education and Community Healing.
Largest UC Ongoing Augmentation Is for Core
Operations. Similar to CSU, the budget provides UC with a
base General Fund augmentation as well as augmentations for select
student support programs. Specifically, the 2023 24 budget provides UC
with a $216 million (5 percent) unrestricted General Fund base
augmentation, of which $5 million is set aside for UC s Agriculture and
Natural Resources division. UC indicates it intends to use its base
augmentation for enrollment growth, employee salaries, benefit costs,
and other operating cost increases. As with CSU, provisional language
requires UC to report to the Legislature on how it used these funds by
December 31, 2024. In addition to the base augmentation, the budget
provides UC with a combined $2 million ongoing General Fund augmentation
(equating to an approximately 5 percent increase) for student basic
needs, mental health, and rapid rehousing programs. The budget also
provides $1.5 million in new ongoing General Fund to provide additional
support to students with disabilities.
Budget Sets Enrollment Growth Expectations for UC Through
2026 27. Provisional language states intent for UC to
increase resident undergraduate enrollment by 7,800 FTE students (over
the 2021 22 level), bringing its total resident undergraduate enrollment
level to 203,661 FTE students in 2023 24. If UC enrolls fewer students
than expected in 2023 24, provisional language allows the administration
to reduce funding for UC in proportion to the shortfall. For each FTE
student below the target, funding would be reduced at the 2023 24 state
marginal cost rate of $11,640. Provisional language also sets
undergraduate enrollment expectations for the subsequent three years, as
Figure 9 shows. Provisional language indicates that if UC enrolls more
resident undergraduates than the 2023 24 target, then those additional
students are to be counted toward the 2024 25 target. Consistent with
the most recent budget acts, the 2023 24 Budget Act does not
set expectations for graduate enrollment, though UC has committed as
part of the Governor s compact to grow graduate enrollment by a total of
2,500 students from 2022 23 through 2026 27.
Figure 9
Budget Sets UC Enrollment Growth Expectations Through 2026 27
Resident Undergraduate Full Time Equivalent (FTE) Students
2023 24 a
2024 25
2025 26
2026 27
Growth
Amount
7,800
2,927
2,947
2,968
Percent
4.0%
1.4%
1.4%
1.4%
Total Enrollment Level
203,661
206,588
209,535
212,503
a Growth is relative to the estimated 2021 22 enrollment level of 195,861 FTE resident undergraduates.
Budget Shifts Various UC Capital Projects From Cash to
Debt Financing. As a budget solution, the budget package
removes a total of $1.2 billion one-time General Fund provided or
planned for certain UC capital outlay projects (including three UC/CCC
intersegmental projects) over the 2021 22 through 2023 24 period. As
with certain CSU projects, these UC projects are to be debt financed
using university bonds rather than paid for upfront with cash. The
budget provides a total of $84 million ongoing General Fund to cover the
estimated debt service costs. In addition, the budget provides
$6.5 million ongoing General Fund for debt service costs associated with
the UC Riverside School of Medicine building, which UC also is debt
financing using university bonds.
Budget Funds Various One-Time UC
Initiatives. The largest one-time General Fund
augmentation is $100 million to support the UC Los Angeles Institute for
Immunology and Immunotherapy. This is the second year of state funding
for this institute, adding to the $100 million provided for it in
2022 23. Provisional language states legislative intent to appropriate
an additional $300 million General Fund for this institute in 2024 25.
The budget also includes one-time funding for 16 other initiatives, most
of which are focused on special research projects. The largest of these
initiatives is $7 million to research carcinogenic exposure among
firefighters. Other research projects span various areas, including
natural resources, health, and public safety.
Funding for UC Graduate Medical Education to
Increase. As part of a major state budget agreement
involving a tax on managed care organizations, UC is to receive
$75 million annually to expand graduate medical education programs.
These funds will come from a new special fund entitled the Medi-Cal
Provider Payment Reserve Fund, which will contain a portion of proceeds
from the new managed care organization tax. UC is to use the funds to
increase the number of primary care and specialty care physicians in the
state. Though not specified in the legislation, back-up information from
the administration and the legislative budget committees indicate the
funds will begin in 2024 and extend through 2029. This funding will
supplement the ongoing state funding UC currently receives for graduate
medical education. (In 2023 24, UC is to receive $30 million
Proposition 56 funds, together with $10 million General Fund, for
graduate medical education.)
UC-Affiliated Law School Also Receives Base Increase and
Some One-Time Funding. The 2023 24 budget provides UC Law,
San Francisco (UC Law SF) with a $2.2 million (12 percent) unrestricted
General Fund base augmentation to support operational costs. UC Law SF
may use these funds for hiring new faculty, providing salary increases,
covering higher benefit costs, paying other operating expenses, and
furthering other campus priorities. The budget also provides $3 million
one-time General Fund for the school s Urban Alchemy campus safety
program, with the funds available for expenditure over the next three
years (through 2025 26). This is the second time the state has provided
funding for the Urban Alchemy program. The 2021 22 Budget Act
provided $3 million for the program, with those funds available for
expenditure through 2023 24.
Student Financial Aid
California Student Aid Commission (CSAC) Total Spending
Is $3.4 Billion in 2023 24. Of this amount, $2.9 billion
is state General Fund, $400 million is federal Temporary Assistance for
Needy Families funding, and the remainder is from other funds and
reimbursements. Ongoing General Fund spending increases by $88 million
(3.5 percent) from 2022 23. The majority of the ongoing increase is due
to baseline cost adjustments in the Cal Grant and Middle Class
Scholarship (MCS) programs. The budget also includes a total of
$336 million in one-time General Fund, primarily for the MCS and Golden
State Teacher Grant programs. Figure 10 shows all the General Fund
spending changes for CSAC in 2023 24. Below, we describe major CSAC
spending changes as well as cover notable changes to financial aid
programs administered by other agencies.
Figure 10
Changes in California Student Aid Commission General Fund Spending
2023 24 (In Millions)
Ongoing Spending
Cal Grant baseline adjustment
$43
Middle Class Scholarship baseline adjustment
39
Middle Class Scholarship foster youth award increase
5
Program administration and outreach a
1
Other
— b
Subtotal
($88)
One Time Initiatives
Middle Class Scholarship one time augmentation c
$227
Golden State Teacher Grants d
98
Cybersecurity activities
1
Carryover funds
10
Subtotal
($336)
Total
$424
a Consists of $518,000 for five financial aid workload positions, $469,000 for two cybersecurity positions and related expenses, $120,000 for high school toolkits, $103,000 for Cash for College, and a reduction of $45,000 due to adjustments in employee compensation costs.
b Reflects baseline adjustment of $42,000 for the Law Enforcement Personnel Dependents financial aid program.
c The 2022 23 budget agreement included intent to provide these funds. The 2023 24 budget agreement indicates intent to provide $289 million one time in 2024 25.
d The 2021 22 Budget Act appropriated $500 million to be spent annually from 2021 22 through 2025 26. Amount shown reflects anticipated spending in year three.
Budget Funds Cal Grant Cost Adjustments.
The enacted budget includes $2.3 billion ongoing for Cal Grants a
$43 million (1.9 percent) increase over the revised 2022 23 level. This
increase aligns Cal Grant spending with CSAC s most recent cost
estimates. We summarize those cost estimates by segment and award type
in our Cal Grant
Spending EdBudget table. The budget makes no changes to the Cal
Grant reform provisions adopted in the 2022 23 budget agreement. (We
describe those provisions in The
2022 23 California Spending Plan: Higher Education .)
Budget Increases Funding for MCS Program.
Under major program changes implemented in 2022 23, MCS awards for UC
and CSU students are now based on total cost of attendance. To determine
each recipient s MCS award amount, CSAC first calculates the recipient s
remaining cost of attendance after accounting for other available gift
aid, a student contribution from part-time work earnings, and a parent
contribution for dependent students with a household income of more than
$100,000. Then, CSAC determines what percentage of each recipient s
remaining costs to cover based on the program funding level. In 2022 23,
CSAC determined that program funding was sufficient to cover 26 percent
of each recipient s remaining costs. Consistent with last year s budget
agreement, the 2023 24 budget provides an additional $227 million
one-time General Fund for the program, bringing the total funding level
to $864 million. CSAC estimates this funding level will cover about
35 percent of each recipient s remaining costs. The budget agreement
also includes intent to provide $289 million one-time General Fund in
2024 25 to cover a similar percentage of each recipient s costs that
year.
State Makes a Few Changes to MCS Program
Rules. Trailer legislation changes how emergency basic
needs grants and institutional merit scholarships are treated when
calculating a student s MCS award amount. Formerly, receiving these
types of aid reduced a student s MCS award amount. Under the new rules,
students may instead apply these types of aid toward their student
contribution or any applicable parent contribution before their MCS
award amount is affected. The new rules take effect for emergency basic
needs grants beginning in 2023 24 and institutional merit scholarships
beginning in 2024 25. As discussed next, trailer legislation also
changes MCS rules for foster youth.
Budget Increases Financial Aid Awards for Foster
Youth. Under the new rules, MCS awards for foster youth
attending UC and CSU are to cover 100 percent of their remaining costs,
rather than a prorated percentage based on the program funding level.
The budget act includes $5.2 million ongoing General Fund to support the
higher MCS award amounts for foster youth. The budget also funds higher
Student Success Completion Grant (SSCG) award amounts for foster youth
attending CCC. The SSCG program provides additional nontuition coverage
for Cal Grant recipients attending CCC who enroll full time. Trailer
legislation increases the maximum SSCG award amount from $1,128 to
$5,250 per semester for foster youth enrolled in 12 to 14 units and from
$4,000 to $5,250 per semester for foster youth enrolled in 15 or more
units. These changes are estimated to cost $14 million (which would be
covered within the total SSCG program funding level of $363 million
ongoing Proposition 98 General Fund in 2023 24).
Budget Includes Several Changes to Golden State Teacher
Grants. The budget includes $98 million one-time General
Fund spending in 2023 24 for this program, in accordance with the
2021 22 budget agreement. The program provides scholarships of up to
$20,000 to students in teacher preparation programs who commit to
working at a priority school for at least four years. ( Priority school
is defined as a school where at least 55 percent of students are
low-income, English learners, or foster youth.) The budget also adds
$6 million one-time federal Individuals with Disabilities Education Act
funding for this program to provide more scholarships for prospective
special education teachers. In addition, trailer legislation makes
several changes to the program. Most notably, it makes awards of up to
$10,000 available to in-state students enrolled in certain online
teacher preparation programs based outside California, with spending on
these awards capped at 8 percent of total program funding. It also
allows recipients to complete their service requirement at either a
state- or federally funded preschool or a priority school.
Golden State Education and Training Grants Are
Discontinued. As a budget solution, the 2023 24 budget
package reverts $480 million in unspent one-time General Fund provided
for this program in 2021 22. The state originally created the program to
provide grants of up to $2,500 to individuals who lost employment due to
the pandemic and were seeking additional education and training. Given
the end of the California s pandemic-related state of emergency, the
state deemed the program no longer among its highest priorities. The
program is to be discontinued as of June 30, 2023.
Budget Funds Launch of Public Interest Attorney Loan
Repayment Program. The budget provides CSAC with $451,000
from the Public Interest Attorney Loan Repayment Account for this
program. Chapter 881 of 2001 (AB 935, Hertzberg) established the
program, which provides up to $11,000 in student loan repayment for
selected attorneys who practice in public interest areas of the law. The
program is supported by a special fund consisting of money reverted from
certain trust accounts used by attorneys. The special fund recently
accumulated enough money to launch the program in 2023 24 and sustain it
for at least a few years.
Budget Increases Funding to CSAC for Program
Administration and Outreach. The budget provides a total
of $1.4 million ongoing and $962,000 one time for the following
purposes.
$518,000 ongoing General Fund and five new positions to address
workload associated with recent financial aid expansions. (We list new
CSAC positions in this EdBudget
table .)
$469,000 ongoing General Fund, $962,000 one-time General Fund,
and two new positions to improve cybersecurity at CSAC.
$216,000 Public Interest Attorney Loan Repayment Account funds
and one new position to administer the Public Interest Attorney Loan
Repayment Program.
$120,000 ongoing General Fund to distribute toolkits providing
information on financial aid to high schools.
$103,000 ongoing General Fund to support the Cash for College
outreach program.
Budget Includes Several Provisions Related to College
Savings Accounts. These provisions affect the California
Kids Investment and Development Savings (CalKIDS) program administered
by the Scholarshare Investment Board (SIB). This program provides
college savings account deposits to all newborns, with additional
deposits made for low-income first graders. The first change the budget
makes is to increase deposits for newborns from $25 to $100. This action
is supported by $30 million ongoing General Fund redirected from
first-grader deposits, as the cost estimate of that program component
has been revised downward. Second, trailer legislation directs SIB to
use $8 million in unspent funds provided for CalKIDS in 2019 20 to
establish a statewide marketing campaign for the program. Third, the
budget provides $158,000 ongoing General Fund and one new Staff Services
Manager to SIB to help administer the CalKIDS program as well as an
associated financial literacy program established in 2022 23. Fourth,
trailer legislation directs SIB to partner with the Los Angeles Unified
School District and the Riverside County Office of Education in 2023 24
and 2024 25 to explore ways to increase participation in the CalKIDS
program.
Early Action Legislation Clarifies Tax Treatment of
Certain Types of Financial Aid Awards. In a May early
action budget decision, the state enacted Chapter 5 of 2023 (AB 111,
Committee on Budget) related to how certain forms of financial aid are
treated for state personal income tax purposes. Most notably, this
legislation specifies that student loans discharged in 2021 through 2025
are to be excluded from taxable income, in conformity with federal tax
law. The legislation also clarifies that emergency financial aid grants
supported by the federal Higher Education Emergency Relief Fund and
unpaid fees discharged by CCC using a state COVID-19 block grant are
excluded from taxable income. The amount of foregone revenue associated
with the legislation largely depends on actions the federal government
takes relating to student loan forgiveness.
Student Housing
Budget Approves New Affordable Student Housing
Projects. The budget package approves a second round of
affordable student housing construction projects (using all remaining
program authority for CSU and UC and all but $81 million in remaining
program authority for CCC). Our EdBudget tables show all the student
housing construction projects approved for CCC , CSU ,
and UC . As
a budget solution, the state shifts $2.2 billion from non-Proposition 98
General Fund cash to debt financing. Under the new arrangement, UC and
CSU are to issue revenue bonds for these projects. UC s revenue bonds
are to include the full cost of three intersegmental projects involving
community colleges (in the Merced, Riverside, and Santa Cruz areas). For
the remaining community college projects, districts may issue local
revenue bonds or wait for a state financing alternative to be developed
as part of the 2024 25 budget process. Beginning in 2023 24, the state
provides each segment with an ongoing non-Proposition 98 General Fund
augmentation intended to cover estimated debt service costs on the
approved projects. In total, the state provides $164 million ongoing
General Fund for these costs ($61.5 million for CCC, $52 million for
CSU, and $50.7 million for UC).
Budget Provides First Seed Deposit for Housing Revolving
Loan Fund. Trailer legislation enacted last year created
the California Student Housing Revolving Loan Program. This program is
to provide campuses with no-interest loans for the purpose of
constructing affordable housing. The original trailer legislation
enacted in 2022 included intent language to provide $900 million for the
program in 2023 24 and an additional $900 million in 2024 25 (for total
program funding of $1.8 billion). Trailer legislation adopted this year
changed that funding schedule appropriating $200 million for the program
in 2023 24, with intent to provide $300 million annually over the
subsequent five years (through 2028 29), for total program funding of
$1.7 billion. Of the annual allotments, 75 percent is available for CSU
and UC projects and 25 percent is available for CCC projects. If funds
are unused from one of these annual allotments, they may subsequently be
shifted to another segment.
California State Library
California State Library Funding Is $596 Million in
2023 24. Of this amount, $574 million is General Fund,
$18 million is federal funds, and the remainder comes from various state
special funds. Ongoing General Fund support for the California State
Library increases by $395,000 (0.8 percent). The budget includes a large
amount of one-time General Fund carryover ($506 million) from previous
library initiatives, along with a total of $17 million in new one-time
spending associated with more than a dozen new library initiatives. This
EdBudget
table shows all the ongoing and one-time General Fund spending
changes for the California State Library in 2023 24.
Budget Increases Ongoing General Fund Support for
Additional Personnel. The largest ongoing General Fund
increase is $462,000 for the Witkin State Law Library to support a new
Senior Librarian, two Librarians, and a Library Technical Assistant II.
The additional staff largely are intended to help address an increase in
research workload. The State Library also is receiving $357,000 ongoing
General Fund to support three new positions for the California History
Room. In addition, the California State Library is receiving $168,000
for a full-time auditor position to establish an audit program. These
ongoing cost increases are partially offset by a shift of $664,000 from
the General Fund to the Central Services Cost Recovery Fund to ensure
that the correct fund source is paying for central services.
Budget Funds More Than a Dozen One-Time Library
Initiatives. All but two of these initiatives were added
in the legislative package or three-way agreement. These initiatives
(totaling $14 million) provide operational support or facility funding
for specific local library projects. One initiative, originally included
in the Governor s budget, is $240,000 one time for the California
History Room to acquire additional special collection materials to make
its offerings more reflective of California s unique historical
diversity. A second initiative, originally included in the 2021 22
Budget Act , is $2.4 million for the third year of a four-year
agreement to help protect cultural artifacts from natural disasters.
Budget Shifts Funding Schedule for Additional Local
Library Infrastructure Grants. Of the $506 million in
one-time carryover funds, $439 million is from local library
infrastructure grants. Partly due to these available carryover funds,
together with an additional $50 million provided for infrastructure
grants in the 2022 23 Budget Act , the state delays further
funding for this purpose. Specifically, rather than providing
$100 million in 2023 24, the budget package includes intent to provide
the $100 million spread over three years beginning in 2024 25
($33 million in 2024 25, $33 million in 2025 26, and $34 million in
2026 27).
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