Board Discussion on 50 % LAW

November 13, 2007

50% Law Compliance Education Code 84362: Requires Community College

Districts Spend at Least Half of Their Current Expense of Education

for Classroom Instructor Salaries and Benefits Classroom Instructional Aide Salaries and Benefits

Current Expense of Education Includes Unrestricted General Fund Only Actual Expenditures No Categorical Programs or Grants No Capital Projects, Equipment, Transfers Out

11/13/20072

General Fund Unrestricted OnlyObject Code TOPS Code Description Helps Hurts Numerator Denominator Not Included

Academic

1111 0100-5999 F/T Classroom Instructors X     X X  

1111 6000 Reassign Time*   X     X  

1111 6099 Faculty using Banked OSH**   X     X  

1111 0100-5999 Instructional Sabbaticals X     X X  

1312 0100-5999 Overload X     X X  

1313/1314 0100-5999 Fall, Spring, & Sum Inst OSH X     X X  

1317 0100-5999 Instr Banked OSH when earned X     X X  

1211 6120 Librarians   X     X  

1413/1414 6120 Part Time Librarians   X     X  

1211 6120 Librarian Sabbaticals   X     X  

1417 6120/6130 Libr Banked OSH when earned   X     X  

1211 6310 Counselors   X     X  

1413/1414 6310 Part Time Counselors   X     X  

1211 6310 Counselor Sabbaticals   X     X  

1417 6120/6130 Cnslr Banked OSH when earned   X     X  

1221 6610-6999 Academic Administrators   X     X  

1400 0100-6799 Stipends   X     X  

* Cost of time reassigned only

** Cost is reduced by amount of OSH banked

11/13/20073

General Fund Unrestricted Only

Object Code TOPS Code Description Helps Hurts Numerator Denominator Not Included

Classified

2100 0100-6799 Non Classroom Classified   X     X  

2131 6000-7999 Classified Managers   X     X  

2200 0100-5999 Classroom Lab Techs X     X X  

2200 6110 Learning Center Technicians X     X X  

2400 6110 Learning Center Tutors X     X X  

Benefits

Instructional Employees X     X X  

Non Instructional Employees   X     X  

Supplies

4300 0100-6799 Instructional Supplies   X     X  

4200 0100-6799 Books & Software   X     X  

4600 0100-6799 Non Instructional   X     X  

11/13/20074

General Fund Unrestricted Only

Object Code TOPS Code Description Helps Hurts Numerator Denominator Not Included

Other Operating Expense   X     X  

5270 0100-6799 Conferences   X     X  

5812 0100-6799 Software Licenses   X     X  

5830 0100-6799 Advertising   X     X  

5173 0100-6799 Consultants   X     X  

5810 0100-6799 Printing   X     X  

5811 0100-6799 Contracted Services   X     X  

5811 0100-5999 Contract Instruction*** X   X X  

5840 0100-6799 Postage   X     X  

5651 0100-6799 Maintenance Agreements   X     X  

5721 0100-6799 Legal Fees   X     X  

5691 0100-6799 Field Trips   X     X  

*** e.g. - Cosmetology

11/13/20075

General Fund Unrestricted Only

Object Code TOPS Code Description Helps Hurts Numerator Denominator Not Included

Capital Outlay

6120 Site Improvement           X

6220 Buildings           X

6410 Instructional Equipment           X

6410 Non Instructional Equipment           X

Other Outgo

7100 Debt Retirement           X

7390 Transfers to other funds           X

7400 Transfers-Categorical Matches           X

Ancillary and Auxiliary Programs

6991 Student Development           X

7091 Foundation Salaries           X

6890 Community Outreach           X

6960 Athletic Support           X

11/13/20076

50 % LAW

Three Different Laws Regarding Faculty Employment 50% Law Full Time Faculty Obligation 75/25 Full Time to Part Time Each Law Is Independent of the Other: One Does Not Relate

to Another Four Year History of 50% Calculation

2003/2004 - 53.38% 2004/2005 - 51.81% 2005/2006 - 50.31% 2006/2007 - 50.03%

11/13/20077

Compliance Work Fiscal Staff

Met With Coast CCD and Rancho Santiago CCD to Discuss Compliance Practices in Feb. 2007

Reviewed Practices With Auditors Implemented Practices of Surrounding Districts Made Preliminary Calculation During Year End Close Reviewed Expenditures During Year End Close and Made

Transfers to Restricted Accounts Where Permitted to Help Calculation

11/13/20078

Compliance Work Calculation is “A Moving Target”

Difficult To Project % Until Books Are Closed Based On Actual Expenses Salaries (our largest expense) Vary From Month to Month Final Payrolls Are Posted June 30th and July 10th

Encumbrances Not Reversed Until June 30th

Final Expenditures Not Recorded Until Mid July After Year End

Full Time Faculty Hiring Process Requires One Year

11/13/20079

Reasons for Decline in Calculation %

Account Coding Changes State Chancellor’s Office Requires Auditor Review Reassigned Time Recoded to Non-Instructional (2005-2006) Instructional Aide Recoding – Resulted from Auditor

Testing in Spring 2007 Increased Reassigned Time/Stipend Costs Reduction in Full Time Faculty Ratio

Exceeded Full Time Faculty Obligation by 24 in Fall 2006 Enrollment Was Declining Early Retirement Incentive (Spring 2004)

Cost Savings of the Plan Yielded Lower Faculty Salaries Resulting in a Reduced Faculty Salary and Benefit Expense

Start-Up of ATEP

11/13/200710

Actions When Less Than 50% Governing Board

May File Application for Exemption Filing Deadline Sept. 15

Copy of Application Must Be Sent To District’s Academic Employees’ Representative College Academic Senates

11/13/200711

Exemption Process Governing Board

Hold a Public Hearing to Determine the Basis for Exemption Serious Hardship [Title 5, section 59204(c)]

SOCCCD = Basic Aid District District Pays Salaries of Classroom Instructors Higher Than Cohort [Title

5, section 59204(d) and (e)] SOCCCD = #4 Average Tenure Track Salary per CCCCO Report on Staffing

Transmit Findings of Local Governing Board to System Office (form CCFS 350B)

Deadline – Dec. 1st

Academic Organization May Submit Written Statement Opposing Application Request a Hearing by the System Office Within Two Weeks of Public Hearing or Dec. 1st

11/13/200712

Non Exempted Deficiency Districts With a Deficiency Not Entirely Exempted by

the State Board of Governors Are Subject to Title V, Section 59213 Must Submit a Plan by June 30th

How the Amount Not Exempted Will Be Expended for Salaries of Classroom Instructors

Failure to Provide Plan Amount Not Exempted Will Be Withheld From State

Allocations Basic Aid Districts

State Will “Find A Way”

11/13/200713

Steps to 2007-08 Compliance Chancellor’s Establishment of Advisory Council on

Compliance with 50% Law Council Members

Deputy Chancellor – Chair Vice Chancellor, Technology and Learning Services Vice Chancellor, Human Resources Vice Presidents, Instruction

Saddleback and IVC Vice President, Student Services - IVC Directors, Fiscal Services

District, Saddleback, and IVC

11/13/200714

Steps to 2007-08 Compliance Chancellor’s Establishment of Advisory Council on

Compliance with 50% Law Council Members

Academic Senate Saddleback College – Two reps IVC – Two Reps

District Faculty Association Two Reps

CSEA Two Reps

Total Members - Seventeen

11/13/200715

50% Law Advisory Council Develop Plan for Compliance

2007-2008: Recommendations Due to Chancellor by Nov. 1st

2008-2009: Recommendations Due to Chancellor by Dec. 15th

11/13/200716

50% Law Remedies Increase Classroom Salary and Benefit Expenditures

Hire Additional Full Time Faculty Hire Additional Instructional Aides A Combination of the Above 1% Increase = $2.25 million Increase in Classroom Salary and Benefit

Expenditures

Reduce Non Classroom Expenses Non Classroom Salaries and Benefits Supply and Operating Expenses 1% Increase = $2.15 million Reduction in Non Classroom

Expenditures

11/13/200717

50% Law Remedies Convert Non Classroom Expense to Classroom Expense

Increase Classroom Salary and Benefit Expense Decrease Non Classroom Expense

Non Classroom Salaries and Benefits Supplies Operating Expenses 1% Increase = $1.1million Shift from Non Instructional to

Instructional Greatest Impact on the Calculation

Incremental Increase of One Additional Full Time Faculty Estimated at $60,000

11/13/200718

50% Law Summary Consider 50% Law Implications in All Expenditure

Decisions Everyone is Committed to Resolve

11/13/200719