Spring Open Forum April 26, 2017

Governor’s Budget Review The Governor’s budget proposes significant investment in student success at California’s community colleges with on-going support for the Student Success Program, Student Equity Plans, and the redesign of basic skills education. Notably, the Governor proposes $150 million in one-time Proposition 98 funds to support “guided pathways”; a much-needed redesign of the way community colleges serve students. Apportionments $94.1 million for a 1.48% COLA to apportionments. $79.3 million for a 1.34% growth in access. These funds will be allocated through the recently revised growth formula. $23.6 million for a base increase to cover increasing operating costs, especially due to rising employer pension cost. KCCD FY18 Budget Premise Facilities and Equipment $43.7 million for the Physical Plant and Instructional Equipment program. (one-time) $52.3 million for energy efficiency projects through the Proposition 39 program. (one-time) Bakersfield College Cerro Coso Community College Porterville College Base Apportionment Adj. Inc./(Dec.) 2,342,321.91 855,654.87 211,840.96 COLA & 2016-17 Special Base Adj. 1,385,528.35 278,776.98 285,293.23 $ 3,727,850.26 $ 1,134,431.85 $ 497,134.19

CalSTRS/PERS Update The previous school employer contribution schedule called for steady increases each year up to 21.1% in the 2020-21 year. This new release projects even further increases hitting 24.9% in 2020-21 and setting a continued climb up to 28.2% by the 2023-24 school year. These ongoing CalPERS rate increases come on top of established CalSTRS rate increases each year through 2020-2021 that more than double the costs over 7 years. CalSTRS decided to lower its discount rate from 7.5% to 7.0%, which will increase employer contributions from 19.1% to 20.1% in 2021-2022, and 20.25% in 2022- 2023. An additional recommendation from CalSTRS’ actuarial consultant Milliman calls for CalSTRS to change demographic assumptions to account for longer life expectancies. Milliman added that, “changes in actuarial assumptions are expected to increase the unfunded liability and will likely result in the need for higher contributions in the future.” The District continues to evaluate these ongoing new contribution rate increases and strategizes how to absorb the costs. As CalPERS/CalSTRS Rates Continue to Rise – An Approach to Address the Costs --- Community College League of California

FY17-18 Proposed Budget Labor Adjustments Non-Labor Adjustments Step & Column and Benefits Adjunct Faculty % FTES Increase (?) FON Compliance Retirement Replacements New Faculty Hires (2.0 FTE) M&O Classified Position (0.5 Grounds & 0.5 Custodian) Safety & Security Program Manager Non-Labor Adjustments Dual Enrollment Annual Conference Travel – Banner 9 Implementation