BILL ANALYSIS                                                                                                                                                                                                    Ó

                              Senator Carol Liu, Chair
                                2015 - 2016  Regular 

          Bill No:             AB 1837            
          |Author:    |Low                                                  |
          |Version:   |March 17, 2016                          Hearing      |
          |           |Date:    June 15, 2016                               |
          |Urgency:   |No                     |Fiscal:    |Yes              |
          |Consultant:|Kathleen Chavira                                     |
          |           |                                                     |
          Subject:  Postsecondary education:  Office of Higher Education  
          Performance and Accountability

          NOTE:  This bill has been referred to the Committees on  
          Education and Governmental Organization.  A "do pass" motion  
          should include referral to the Governmental Organization  


          This bill establishes the Office of Higher Education Performance  
          and Accountability (OHEPA) as the statewide postsecondary  
          coordination and planning agency, outlines its responsibilities,  
          functions and authorities, and establishes an advisory board to  
          the office (comprised of legislative appointees) to examine and  
          make recommendations regarding its functions and operations, and  
          to review and comment on the office's recommendations to the  
          Governor and Legislature.  

          Existing law establishes the California Postsecondary Education  
          Commission (CPEC), a 17 member body representing the higher  
          education segments, the State Board of Education, and nine  
          representatives appointed by the Governor, Senate Rules  
          Committee, and Assembly Speaker, to be responsible for  
          coordinating public, independent, and private postsecondary  
          education in California and to provide independent policy  


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          analysis and recommendations to the Legislature and the Governor  
          on postsecondary education policy.  (Education Code § 66900, et  

          This bill establishes the OHEPA as the statewide postsecondary  
          education planning and coordination entity.  It:  

             1)   Establishes the OHEPA within the Governor's Office and:

                  a)        Places the OHEPA under the direct control of  
                    an Executive Director appointed by the Governor and  
                    subject to Senate confirmation.  

                  b)        Provides that the Executive Director is  
                    responsible for all duties, powers, and  
                    responsibilities vested in the OHEPA, including  
                    contracting for relevant professional or consultant  

                  c)        Requires the Director to appoint any staff  
                    positions authorized by the Governor.

             2)   Establishes an Advisory Board (Board) to the Office of  
               Higher Education Performance and Accountability (OHEPA),  

                  a)        Requires that the Board: 

                       i)             Meet at least quarterly,

                       ii)            Be subject to open meeting  

                       iii)           Review and comment on any  


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                         recommendations made by the OHEPA to the Governor  
                         and the Legislature. 

                       iv)            Develop an annual report on the  
                         condition of California higher education.

                       v)             Issue an annual performance review  
                         of the Director.  

                  b)        Provides that Board members shall serve  
                    without compensation, except reimbursement for  

                  c)        Prescribes its membership as follows:

                       i)             Three members with experience in  
                         postsecondary education appointed by the Senate  
                         Committee on Rules; 

                       ii)            Three members with experience in  
                         postsecondary education appointed by the Speaker  
                         of the Assembly; and, 

                       iii)           The chair of the Senate Committee on  
                         Education and the chair of the Assembly Committee  
                         on Higher Education to serve as ex officio  

             3)   Requires the OHEPA to actively seek input from and  
               consult with the advisory board and higher education  
               segments and stakeholders, as appropriate, in the conduct  
               of its duties and responsibilities.  

             4)   Declares that the OHEPA exists for the purpose of  
               advising the Governor, the Legislature and other  


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               appropriate government officials and institutions of  
               postsecondary education and outlines its functions and  
               responsibilities. It: 

                  a)        Requires, through its use of information and  
                    its analytic capacity, that it inform the  
                    identification and periodic revision of state goals  
                    and priorities for higher education consistent with  
                    the existing goals and metrics outlined in statute by  
                    SB 195 (Liu, Chapter 367, Statutes of 2013) and in the  
                    2013-14 and 2014-15 Budget Acts, and that it  
                    biennially evaluate both statewide and institutional  
                    performance in relation to these goals and priorities.

                  b)        Requires that it review and make  
                    recommendations regarding cross-segmental and  
                    interagency initiatives and programs in areas that  
                    include, but are not limited to, efficiencies in  
                    instructional delivery, financial aid, transfer, and  
                    workforce coordination.  

                  c)        Requires that it advise the Legislature and  
                    the Governor regarding the need for, and location of,  
                    new institutions and campuses of public higher  

                  d)        Requires that it review proposals by the  
                    public segments for new programs, as specified, and  
                    make recommendations regarding those proposals to the  
                    Legislature and the Governor. 

                  e)        Requires that it act as a clearinghouse for  
                    postsecondary education information and as a primary  
                    source of information for the Legislature, the  
                    Governor, and other agencies. 

                  f)        Requires that it develop and maintain a  
                    comprehensive database that ensures data  


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                    compatibility, supports longitudinal studies, is  
                    compatible with K-12 data systems, provides Internet  
                    access to data for the sectors of higher education in  
                    order to support statewide, segmental and individual  
                    campus educational research needs. 

                  g)        Requires that it review all proposals for  
                    changes in eligibility pools for admission to public  
                    institutions and segments of postsecondary education  
                    and that it periodically conduct eligibility studies. 

                  h)        Requires that it manage data systems and  
                    maintain programmatic, policy, and fiscal expertise to  
                    receive and aggregate information reported by the  
                    institutions of higher education in this state.

             5)   Authorizes the Office of Higher Education Performance  
               and Accountability (OHEPA) to require the governing boards  
               and the institutions of public postsecondary education to  
               submit data to the office on plans, programs, costs,  
               student selection and retention, enrollments, and other  
               specified information, and requires the Office to furnish  
               information concerning these matters to the Legislature and  
               Governor as requested by them. 

             6)   Requires the OHEPA to annually report to the Legislature  
               and the Governor regarding its progress in achieving the  
               aforementioned objectives and responsibilities by December  
               31st of each year. 

             7)   Requires the Legislative Analyst's Office (LAO) to  
               review and report to the Legislature regarding the  
               performance of the OHEPA in fulfilling its functions and  
               responsibilities by January 1, 2020.

             8)   Sunsets these provisions on January 1, 2021.



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          1)   Need for the bill.  According to the author, California's  
               education and workforce needs cannot be addressed by any  
               single segment and the state's approach to higher education  
               must become more comprehensive if it is to ensure  
               state-level workforce needs and priorities are being met.   
               Currently, there is no coordinating entity for higher  
               education in California, as Governor Brown vetoed funding  
               for California Postsecondary Education Commission (CPEC) in  
               the 2011-12 Budget Act, citing the agency's ineffectiveness  
               in higher education oversight.

               Numerous reports, including legislative reviews of the  
               Master Plan for Higher Education and more recent reports  
               from higher education experts, have called for California  
               to establish a central higher education body.  This central  
               body is an important element of the state's ability to  
               honor its promise of affordable, high quality postsecondary  
               education for all high school graduates and adults who  
               could benefit from instruction offered at California's  
               colleges and universities. Without such an entity,  
               California cannot systematically plan to address the  
               current and future needs of all its students and the  
               overall economy. 

               This bill represents the next necessary step in  
               establishing greater clarity and accountability for our  
               higher education system's performance in meeting the  
               statewide goals for postsecondary education (SB 195, Liu,  
               Chapter 367, Statutes of 2013) of equity, access, and  
               success; alignment with workforce needs; and the effective  
               and efficient use of resources.  

          2)   History of CPEC.   The 1960 Master Plan for Higher  
               Education in California articulated basic state policies on  
               higher education, such as assigning missions to the  
               different higher education segments, specifying eligibility  
               targets and expressing the state's intent that higher  
               education remain accessible, affordable, high-quality and  
               accountable. In addition, the Master Plan created an  
               oversight body, the CPEC tasked with providing fiscal and  
               policy recommendations to the Governor and Legislature;  
               monitoring and coordinating public institutions; and  
               ensuring comprehensive statewide planning for higher  


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               education and effective use of resources.  

          Although the Governor vetoed funding for CPEC in the 2011-12  
          budget, his veto message acknowledged the well-established need  
          for coordinating and guiding state higher education policy and  
          requested that stakeholders explore alternative ways that these  
          functions could be fulfilled.  This bill proposes an  
          3)   Since the closure of CPEC?  

               a)        Performance and Accountability.  In the absence  
                    of a coordinating body, the Legislature and Governor  
                    have taken some steps toward developing, supporting  
                    and refining greater accountability for higher  
                    education.  These efforts include the passage and  
                    development of agreed upon goals for higher education  
                    through the passage of SB 195 (Liu, Chaptered 2014). 

                    SB 195 established statewide goals of improved student  
                    access, equity and success, degree/credential  
                    alignment with workforce needs, and the  
                    efficient/effective use of resources.  The 2013-14 and  
                    2014-15 Budget Acts added reporting requirements  
                    around specified performance metrics and required the  
                    University of California, California State University,  
                    and community colleges to set targets around these  
                    metrics consistent with the statewide goals outlined  
                    by SB 195 (Liu, 2014).  However, there has been no  
                    clear articulation around specific state goals and no  
                    specific entity charged with stewarding a public  
                    agenda to guide budget and policy deliberations. 

               b)        Data management.  The California Postsecondary  
                    Education Commission (CPEC) was able to obtain and  
                    maintain individual student records from the public  
                    higher education systems, link this data across the  
                    three segments using unique student identifiers, and  
                    used this information, as well as other publicly  
                    available datasets, to create useful data for the  
                    public and to respond to policymaker and legislative  
                    inquiries.  Additionally, the CPEC provided each of  
                    the segments access to the data to support statewide,  
                    segmental and individual campus educational research  


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                    needs.  The CPEC functioned as a data management  
                    entity independent of the public segments, enabling  
                    the CPEC to perform analyses and provide information  
                    on behalf of and in response to requests from the  
                    Legislature or others, without relying on the  
                    "approval" or framing of information by the entity  
                    whose performance was being studied, analyzed, or  

                    Prior to its closure, the CPEC transferred its data  
                    warehouse to the California Community College (CCC)  
                    Chancellor's Office where the existing data is being  
                    housed and stored under an interagency agreement  
                    between the University of California, California State  
                    University, and the CCC.  According to the  
                    Chancellor's office, the existing database is being  
                    maintained, and the CPEC Web site is available to the  
                    public for purposes of accessing existing reports  
                    posted on the Web site.  However, under the current  
                    arrangement, access to the data is limited, since each  
                    segment has control over access to its own student  
                    records and outside entities wishing to use the  
                    database information must secure the approval of each  
                    of the affected segments. 

               c)        Program and campus review.  The CPEC's role in  
                    program and campus review was to coordinate the  
                    long-range planning of the state's public higher  
                    education systems as a means to ensure that they were  
                    working together to carry out their individual  
                    missions while serving the state's long-range  
                    workforce and economic needs.  In its oversight  
                    report, the Legislative Analyst's Office (LAO) noted  
                    that no office or committee has the resources to  
                    devote to review of programs to identify long-term  
                    costs, alignment with state needs and institutional  
                    missions, duplication and priority relative to other  
          4)   Related reports/recommendations.  A number of recent  
               reports have cited the need for an independent body to  
               steward a public agenda for higher education.  These  
               include the following:


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               a)        Improving Higher Education Oversight (LAO,  
                    January 2012) - In this report, the LAO raised  
                    concerns that in the wake of CPEC's closure, the  
                    future of higher education oversight was unclear.  The  
                    LAO noted that while the public segments had stepped  
                    in to assume some roles previously performed by  
                    California Postsecondary Education Commission (CPEC),  
                    they expressed concerns about how institutional and  
                    public interests would be balanced.  The Legislative  
                    Analyst's Office (LAO) also noted that while CPEC's  
                    performance had been problematic, several important  
                    functions performed by CPEC had been lost.  Among  
                    other things, the LAO recommended the Legislature  
                    re-establish an independent oversight body and  
                    increase the body's independence from the public  
                    higher education segments, assign the body with  
                    limited and clear responsibilities, and develop a more  
                    unified governing board appointment process.

               b)        Charting a Course for California's Colleges:  
                    State Leadership in Higher Education (California  
                    Competes, February 2014) - The report noted that  
                    California is one of only two states nationwide (the  
                    other being Michigan) without comprehensive oversight  
                    or coordination of higher education.  The report  
                    opined that the state needs an independent agency to  
                    develop a public agenda for higher education that  
                    links the needs of the state's economy to the degree  
                    attainment outputs of the state's institutions.  
                    Further, that independence means that the entity would  
                    not have representatives of the segments on its  
                    decision-making body to allow it to maintain its  
                    impartiality.  Finally, the report recommended that  
                    the state's priorities be focused on the goals of  
                    access to quality programs and outcomes from those  
                    programs; that the entity should be a coordinating  
                    agency and the segments should remain autonomous; and  
                    that its primary functions should be planning and  
                    policy development, data collection, analysis and  
                    monitoring, and administration of state financial aid  

               c)        A New Vision for California Higher Education: A  
                    Model Public Agenda (Institute for Higher Education  


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                    Leadership and Policy, March 2014) - The report  
                    highlights the challenges faced by California and  
                    offers a model public agenda centered on these goals:  
                    addressing access and attainment; equity,  
                    affordability and efficiency; and state policy  
                    leadership. As regards policy leadership, the report  
                    opines that this function is best filled by an  
                    executive branch entity, such as a California Office  
                    of Higher Education, that reports to the Governor.   
                    The responsibilities of this office would be to, among  
                    other things, provide policy leadership and advise the  
                    Governor on higher education budget and policy  
                    development, administer financial aid programs, manage  
                    a coordinated higher education data system that allows  
                    for analysis of enrollments, progression, and  
                    completion across all public segments, manage a higher  
                    education accountability process, and conduct analysis  
                    of goals and targets to assess how well regional  
                    efforts aggregate to meet statewide goals.

          5)   Related and prior legislation.  Several bills have been  
               introduced in an effort to improve higher education  
               performance and accountability, and to re-establish CPEC's  
               most important functions.  These include the following:

               a)        SB 42 (Liu, 2015), in its final form, was  
                    essentially identical to this bill.   Although SB 42  
                    was heard and passed by both houses, it was ultimately  
                    vetoed by the Governor, whose message read, in  
                    pertinent part:

                         "While there is much work to be done to  
                         improve higher education, I am not convinced  
                         we need a new office and an advisory board,  
                         especially of the kind this bill proposes,  
                         to get the job done."

               b)        SB 1196 (Liu, 2014) would have established a  


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                    process for setting specific educational attainment  
                    goals for the State.  SB 1196 was held in the Assembly  
                    Appropriations Committee.

               c)        AB 1348 (John A. Pérez, 2014) which would have  
                    established the California Higher Education Authority,  
                    its governing board and its responsibilities, as  
                    specified, phased-in over a three-year period. AB 1348  
                    was held in the Senate Appropriations Committee.

               d)        SB 1022 (Huff, Chaptered 394, Statutes of 2014)  
                    requires the California State University and requests  
                    the University of California to provide labor market  
                    outcome data on their graduates.

               e)        AB 2190 (John A. Pérez, 2012) would have  
                    established a new state oversight and coordinating  
                    body for higher education.  AB 2190 was held in the  
                    Assembly Appropriations Committee.

               f)        SB 721 (Lowenthal, 2012) would have established  
                    statewide goals for guiding budget and policy  
                    decisions. SB 721 was ultimately vetoed. 

               g)        SB 1138 (Liu, 2011-12) would have established a  
                    central data management system for the higher  
                    education segments.  SB 1138 was held in the Senate  
                                                   Appropriations Committee.


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               h)        AB 2 (Portantino, 2011) and AB 218 (Portantino,  
                    2009) essentially identical bills, required that the  
                    state to establish an accountability framework to  
                    biennially assess and report on the collective  
                    progress of the state's system of postsecondary  
                    education in meeting specified educational and  
                    economic goals.  Both bills were heard and passed by  
                    this Committee and were subsequently held in the  
                    Senate Appropriations Committee.

          California Competes
          Campaign for College Opportunity

           None received. 

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