The 2022-23 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 2022-23 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 2022-23 education budget package. (The state’s budget package also augments spending for some workforce development programs, mostly in the health care area. We cover health care workforce initiatives, including those involving higher education institutions, in our Health Spending Plan post.)

Overview

Budget Notably Increases State Funding for Higher Education. As Figure 1 shows, ongoing General Fund support for higher education is $21 billion in 2022-23, reflecting an increase of $2.7 billion (15 percent) over the revised 2021-22 level. Ongoing augmentations in 2022-23 span many areas, including core operations, enrollment growth, student support programs, and financial aid expansions. The budget also includes a total of $3.7 billion for one-time higher education initiatives. These one-time initiatives likewise span many areas, including dozens of capital outlay projects and several higher education climate initiatives. In addition to higher spending in 2022-23, the state’s multiyear budget agreement intends to further increase higher education spending for various purposes (most notably, for student financial aid and student housing) over the 2023-24 through 2025-26 period.

Various Higher Education Actions Taken in Response to State Appropriations Limit (SAL). The California Constitution—under the SAL—restricts how the state can use revenues that exceed a certain limit. Revenues above the limit may be designated for (1) emergency-related spending or (2) capital outlay spending, among other options. Within higher education, the 2022-23 budget package enacted in late June contained one-time General Fund spending in these two areas totaling $72 million in 2020-21, $1.1 billion in 2021-22, and $2.2 billion in 2022-23. We list all this new higher education SAL-related spending in this EdBudget table. The state authorized additional one-time capital outlay spending as part of the September budget package, but the administration has not yet made associated SAL determinations. The administration will incorporate these and other SAL-related changes into its estimates released as part of the 2023-24 Governor’s budget.

Higher Education Budget Took Shape Over Several Months. Figure 2 highlights major higher education budget developments over the course of the year. In January, the Governor announced multiyear budget agreements (2022-23 through 2026-27) with each of the higher education segments. For the universities, the Governor’s “compacts” committed to 5 percent annual General Fund base increases in exchange for UC and CSU meeting certain expectations—including expectations relating to enrollment, student outcomes, workforce development, and intersegmental coordination. For the community colleges, the Governor’s “roadmap” included a similar set of expectations but, rather than committing to specific annual funding increases, it linked future CCC funding to available Proposition 98 resources. In May, the Governor provided more detail on some of the compact and roadmap expectations. In the May Revision, the Governor also proposed additional higher education capital outlay spending. In June, the Legislature developed its budget package—increasing higher education spending beyond the levels proposed by the Governor and adopting certain changes to the state’s financial aid system and student housing initiatives. In late June, the budget agreement between the Legislature and Governor returned total higher education spending closer to the May Revision level. Though the late June budget agreement still included many key elements of the legislative package, it reduced the financial aid augmentation and made Cal Grant reform subject to a future trigger. Budget legislation enacted in September made relatively minor changes to the late June package, primarily adding some one-time initiatives. The final budget package did not formally adopt the Governor’s university compacts and CCC roadmap.

California Community Colleges

Budget Provides $12.6 Billion in Proposition 98 Funding to CCC. 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). Due to higher General Fund revenues, the Proposition 98 minimum guarantee for 2021-22 was revised upward significantly (by $1.7 billion). As Figure 3 shows, Proposition 98 support for CCC in 2022-23 increases an additional $354 million. The enacted 2022-23 level is 2.9 percent higher than the revised 2021-22 level and 19 percent higher than the enacted 2021-22 level. On a budgeted per-student basis, the 2022-23 funding level is $1,760 (18 percent) above the enacted 2021-22 level. Growth in actual per-student funding is likely to be even higher (about 40 percent), as certain hold harmless provisions are effectively insulating districts from enrollment drops during the pandemic.

Package Includes a Mix of Ongoing and One-Time Proposition 98 Spending. As Figure 4 shows, the budget provides $4.3 billion in Proposition 98 augmentations for community colleges across the three-year period. Of this total, $1.9 billion (44 percent) is ongoing and $2.4 billion (56 percent) is one time. The new ongoing spending is predominately for core college operations and student and staff support. The budget contains more than 30 one-time initiatives. The largest of these initiatives is for deferred maintenance projects. The budget also provides substantial one-time discretionary and student outreach funding to help districts recover from the effects of the pandemic. The remaining one-time initiatives include funding for additional student services, workforce and education pathways, and various campus-specific projects.

Proposition 98 Support for Core Operations Grows Notably. The budget provides two major augmentations to community college apportionments (general purpose funding). First, the budget provides $493 million for a 6.56 percent cost-of-living adjustment (COLA)—the highest Proposition 98 COLA rate ever provided to apportionments. Second, the budget provides a $600 million above-COLA base augmentation. Of this latter augmentation, $200 million is for districts’ basic allocation, which is designed to fund their fixed operating costs, and $400 million is for the Student Centered Funding Formula’s (SCFF) per-student rates. Additionally, the budget provides $26 million for 0.5 percent enrollment growth—representing about 5,500 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).

State Modifies SCFF’s Hold Harmless Protection. The 2022-23 budget package modifies a hold harmless provision relating to SCFF. The original temporary hold harmless provision provided districts no less than their total apportionment amount in 2017-18, adjusted by any state-provided COLA each year. The 2021-22 budget extended this hold harmless provision through 2024-25, after which districts generally were to be funded based on what they generated under SCFF. To address legislative concerns about certain districts potentially facing a sizeable “fiscal cliff” in 2025-26, the 2022-23 budget creates a new funding floor based on districts’ hold harmless level at the end of 2024-25. Specifically, starting in 2025-26, districts will be funded at their SCFF-generated amount that year or their hold harmless amount in 2024-25, whichever is higher. Whereas SCFF rates would continue to receive a COLA in subsequent years, a district’s hold harmless amount would not grow. The intent is to get all districts eventually funded under SCFF.

Budget Includes Additional Ongoing Support for Part-Time Faculty and Classified Staff. In addition to providing a COLA for the part-time faculty compensation and office hours categorical programs, the 2022-23 budget provides a $200 million ongoing augmentation for part-time faculty health insurance—representing a 400-fold increase to that program. Colleges can opt into this program, which is intended to subsidize up to half of districts’ costs for associated health care premiums (with up to the full cost covered under certain conditions). The large augmentation is intended to incentivize more districts to participate in the program and increase the subsidy for all participating districts. (In recent years, about half of districts have participated, and the subsidy has accounted for about 2 percent of districts’ premium costs—much lower than the statutory maximum subsidy rate of 50 percent.) The budget package also includes an associated requirement that colleges report by March 1, 2023 on their existing part-time faculty health care coverage for the 2021-22 academic year and report by March 1, 2026 on their expanded coverage for the 2024-25 academic year. In addition, the budget provides $10 million ongoing to create the Classified Employee Summer Assistance Program, which will provide salary enhancements to qualifying classified staff who choose to have salary withheld during the school year. This new community college program is modeled after a very similar program created for K-12 classified staff in 2018-19.

Student Support Programs Are Another Budget Priority. The budget provides a total of more than $250 million in ongoing and one-time funds for more than a dozen student support programs. These programs include augmentations to existing CCC programs such as Extended Opportunity Programs and Services, the NextUp foster youth program, and the basic needs initiative. In addition, the budget provides funds to create new initiatives aimed at various student groups, including African Americans, Native Americans, Asian Americans, and Pacific Islanders. As discussed in more detail in the “Student Financial Aid” section, the 2022-23 budget also includes several financial aid augmentations for CCC students, with a focus on students enrolling full time.

Cybersecurity Upgrades for Colleges Is Another Budget Priority. The 2022-23 budget provides a total of $100 million ($25 million ongoing and $75 million one time) for various technology and information security purposes. The ongoing funds are primarily for college cybersecurity staffing, whereas the $75 million one time is primarily for security network upgrades, general security software, and anti-fraud technology. The main goal of these funds is to enhance colleges’ information security to protect against enrollment scams and hacking, which have increased in recent years. A secondary goal is to improve the user experience for students applying to CCC.

Budget Enhances Funding for Apprenticeships. The budget provides an additional $65 million ($20 million ongoing and $45 million one time) for apprenticeship programs. Regarding related and supplemental instruction (RSI)—the classroom component of apprenticeship programs—the 2022-23 budget increases the RSI rate to the regular CCC credit rate ($8.98 per hour) and provides $20 million ongoing to cover the increased costs. Historically, apprenticeship sponsors (employers and labor unions) got reimbursed for RSI at the hourly rate set for regular CCC noncredit instruction ($7.21 in 2022-23). Due to the change in the basis of the rate, the new RSI rate is 25 percent higher than it otherwise would have been in 2022-23. Separately, the budget provides $45 million one time for a three-year apprenticeship initiative to create a workforce training pipeline for school food service workers.

Budget Authorizes Many Capital Outlay Projects, Provides Sizeable Maintenance Funding. The 2022-23 budget includes $403 million in general obligation bond authority for 22 capital outlay projects, the vast majority of which is from Proposition 51 (approved by voters in 2016). This funding supports almost exclusively the construction phase of continuing projects. This EdBudget table lists all of these projects. After funding these projects, virtually all Proposition 51 funds will have been spent. In addition, the budget includes a total of $125 million one-time Proposition 98 General Fund for eight other facilities-related projects at specified colleges. The budget also includes $841 million one-time Proposition 98 General Fund primarily intended to address CCC’s estimated $1.2 billion deferred maintenance backlog. These funds are allocated to districts on a per-student basis, with the Chancellor’s Office having authority to establish a minimum allocation per district.

Many New Positions Added at Chancellor’s Office. The 2022-23 budget provides $3.9 million ongoing non-Proposition 98 General Fund to support 26 additional positions at the Chancellor’s Office, bringing total authorized positions to 203 (a 15 percent increase). The new positions are intended to accommodate new workload demands and enhance the office’s systemwide leadership. This EdBudget table shows the cost and key responsibilities of each new position.

California State University

CSU Ongoing Core Funding Is $8.3 Billion in 2022-23. Of this amount, $5.1 billion (61 percent) comes from state General Fund, $3.2 billion (38 percent) comes from student tuition and fee revenue, and $73 million (1 percent) comes from lottery revenue. Total ongoing core funding per student increases by $694 (4 percent)—reaching $20,385. Ongoing General Fund spending increases by $468 million (10 percent) from 2021-22. The 2022-23 budget also includes $602 million in total one-time spending for various initiatives at CSU. Figure 5 shows the many specific General Fund spending changes for CSU in 2022-23.

Largest Ongoing Augmentation Is for Core Operations. The 2022-23 budget provides CSU with a $211 million (5 percent) General Fund base augmentation. CSU has discretion over how to spend this augmentation. It likely will use the funds primarily to cover employee salary and certain benefit cost increases. In addition to this base augmentation, the budget provides a combined $103 million for CSU pension and retiree health benefit cost increases.

Budget Funds Enrollment Growth Expectations Set Last Year. In accordance with an expectation set in the 2021-22 Budget Act, the 2022-23 budget provides $81 million for CSU to grow resident undergraduate enrollment by 9,434 FTE students from the 2021-22 level. This brings CSU’s projected resident undergraduate enrollment level to 349,903 FTE students in 2022-23 (approximately 3,000 FTE students below its peak enrollment level in 2020-21). Unlike for UC, the 2022-23 budget does not specify an enrollment growth target for CSU in 2023-24.

Remaining Ongoing Augmentations Primarily Focus on Student Support. The largest of these augmentations is $35 million for CSU’s Graduation Initiative—a systemwide effort to increase graduation rates and close equity gaps. The budget also provides a $10 million augmentation for the Basic Needs Initiative, a component of the Graduation Initiative that addresses student food and housing insecurity, among other issues. In addition, the budget includes augmentations for programs supporting certain student groups, including foster youth and students who were formerly incarcerated.

About 90 Percent of One-Time CSU Funding Is for Facilities Projects. The budget provides a total of $553 million in one-time funding to CSU for facilities projects. Of this amount, $125 million is for deferred maintenance, seismic mitigation, and energy efficiency projects across the system. CSU has flexibility to determine the allocation of funding among these three facility areas and across campuses. Provisional language requires the administration, within 30 days after releasing the funds, to notify the Legislature of the list of funded projects and the overall process CSU used to prioritize among projects. The budget also provides one-time funding for many specific capital projects. The largest of these projects are to construct new academic facilities at the Bakersfield and Fullerton campuses, expand the off-campus centers of the San Diego and San Bernardino campuses, and upgrade facilities and equipment at CSU’s university farms.

Remaining One-Time Initiatives Cover a Variety of Activities. The largest of these initiatives is $10 million to support the California Science and Technology Policy Fellowships program, which places scientists and engineers in positions working with state policymakers. (Provisional language also states an intent to provide an additional $10 million one time in 2023-24 for this program.) Other one-time funds would support education, research, and outreach programs spanning a broad range of fields, including teacher education, marine science, wildfire science, health care, and cybersecurity.

Administration Also Authorizes Capital Projects Supported by CSU Bonds. Beyond the state cash-funded facility projects described above, the administration approved $80 million in CSU capital projects to be financed through borrowing. Of this amount, $67 million is for various infrastructure improvements across the system. The remaining $13 million is for the preliminary plans and/or working drawings phases for three projects—one each at the Dominguez Hills, Long Beach, and San Marcos campuses. CSU submitted final proposals for these projects in November 2021, and the administration provided final approval for them in August 2022. The annual debt service associated with the additional borrowing is estimated to be approximately $4 million. CSU is to cover this cost using its main General Fund appropriation. Together, the projects are estimated to have a total cost across all phases of $364 million, of which $342 million would be financed using university bonds and the remainder would come from campus funds. (This EdBudget table provides basic information about these projects.)

University of California

UC Ongoing Core Funding Is $10.2 Billion in 2022-23. Of this amount, $4.4 billion (43 percent) comes from state General Fund, $5.4 billion (53 percent) comes from student tuition and fee revenue, and $445 million (4 percent) comes from other sources. Total ongoing core funding per student increases by $879 (2.6 percent)—reaching $34,485. Ongoing General Fund spending increases by $361 million (9 percent) from 2021-22. The 2022-23 budget also includes $810 million in total one-time spending for various initiatives at UC. Figure 6 shows the many specific General Fund spending changes for UC in 2022-23.

Largest Ongoing Augmentation Is for Core Operations. The 2022-23 budget provides UC with a $201 million (5 percent) unrestricted General Fund base augmentation. UC may use this augmentation to cover employee salary and benefit cost increases as well as other cost increases and university budget priorities. The budget also provides a 5 percent increase for UC’s Agriculture and Natural Resources division.

Budget Funds Enrollment Growth. As Figure 7 shows, the 2022-23 budget funds growth of 7,132 resident undergraduate FTE students. A portion of this growth (1,500 FTE students) reflects higher-than-anticipated enrollment in 2021-22 that was not funded in previous budgets. Another portion (902 FTE students) reflects a multiyear enrollment agreement to replace some nonresident students at the Berkeley, Los Angeles, and San Diego campuses with resident students. The remainder (4,730 FTE students) reflects new growth through 2023-24. These components together effectively result in a funded resident undergraduate enrollment level of 201,481 FTE students in 2023-24.

Budget Sets Two Additional Enrollment Growth Expectations. First, the budget expects UC to grow resident undergraduate enrollment by an additional 1 percent in 2023-24 over the 2022-23 level. Provisional budget bill language states that this additional growth will be funded from an unrestricted General Fund base augmentation provided in 2023-24. Second, the budget package anticipates UC will continue to implement its nonresident replacement plan, resulting in further additional slots for resident students in 2023-24. This additional combined growth could be up to 3,000 more resident undergraduate FTE students in 2023-24, though the exact number and associated funding will depend on UC’s actual 2022-23 enrollment level. Consistent with most recent budget acts, the 2022-23 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.

Remaining Ongoing Augmentations Focus on Outreach, Student Services, and Research Initiatives. Of these programmatic increases, the largest supports UC’s K-14 outreach programs, known as Student Academic Preparation and Educational Partnerships. (Last year, the state provided a one-time augmentation of $23 million for these programs. The action this year effectively makes that formerly one-time augmentation ongoing.) Other ongoing augmentations focus on UC labor and occupational health centers, UC student support programs, and certain research initiatives.

Of One-Time Funding, About Two-Thirds Is for Facilities Projects. The largest of these one-time initiatives supports construction of a new institute at UC Los Angeles focused on immunology and immunotherapy research. The second largest of these initiatives supports deferred maintenance, seismic mitigation, and energy efficiency projects across all UC campuses. As with the similar CSU initiative, UC has flexibility to determine the allocation of this funding among these three areas as well as across its campuses. Same as CSU, provisional language requires the administration to share the list of funded UC projects with the Legislature and describe the overall process UC used to prioritize among projects. The budget also supports expansion projects at the Riverside and Merced campuses and a clean energy initiative at the Berkeley campus. Additional funding for many of these facility initiatives is to be provided in subsequent years.

Remaining One-Time Initiatives Cover a Variety of Activities. The budget includes one-time funding for 19 other initiatives. The largest of these is a package of climate change initiatives supporting seed and matching grants for research projects; grants to UC’s innovation and entrepreneurship centers; and related activities at the Riverside, Merced, and Santa Cruz campuses. Funds for these activities are available through June 30, 2024. For the seed and matching research grants, provisional language specifies that both UC and non-UC researchers are eligible to apply. Provisional language also indicates that UC is to coordinate with state agencies to determine which climate change research areas to support. Among the many other initiatives are ones to support research on dyslexia, ethnic studies, and computer science professional development for K-12 teachers.

Administration Also Authorizes One Capital Project Supported by UC Bonds. Beyond the state cash-funded facility projects described above, the administration approved one UC capital project to be financed through borrowing. Specifically, the administration approved $22 million for certain seismic improvements at the San Diego campus. UC submitted the project to the state in September 2021, and the administration provided final approval for it in August 2022. The annual debt service associated with the additional borrowing is estimated to be $1.2 million. UC is to cover this cost using its main General Fund appropriation.

Student Financial Aid

California Student Aid Commission (CSAC) Total Spending Is $3.6 Billion in 2022-23. Of this amount, $3.2 billion (88 percent) is supported by state General Fund, $400 million (11 percent) is federal Temporary Assistance for Needy Families funding, and the remainder is from other funds and reimbursements. Ongoing General Fund spending increases by $608 million (28 percent) from 2021-22. The largest ongoing changes are related to the state’s Middle Class Scholarship and Cal Grant programs. The budget also includes $406 million for various one-time financial aid initiatives at CSAC. Figure 8 shows the many specific General Fund spending changes for CSAC in 2022-23. Below, we first describe major CSAC spending changes, then cover major student financial aid initiatives administered by other departments and segments.

Budget Provides Funding for Revamped Middle Class Scholarship Program. Consistent with the 2021-22 budget agreement, the 2022-23 budget provides an increase of $522 million ongoing General Fund to revamp the Middle Class Scholarship program. This augmentation brings total program funding to $632 million in 2022-23. We describe the program changes in The 2022-23 Budget: Middle Class Scholarship Program. Whereas the original program provided partial tuition coverage for CSU and UC students, the revamped program will assist CSU and UC students with their total cost of attendance. To determine each student’s award amount, CSAC will first determine each student’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 will determine what percentage of each student’s remaining costs to cover based on the annual appropriation for the program. In 2022-23, the program is estimated to cover 24 percent of each student’s remaining costs. The budget agreement includes intent to provide an additional $227 million one-time General Fund in 2023-24 to fund a higher percentage of each student’s costs that year.

Budget Funds Cal Grant Cost Adjustments and Smaller Augmentations. Under the enacted budget, Cal Grant spending increases $83 million (3 percent) over the revised 2021-22 level. This is the net effect of several changes. First, the budget increases baseline spending by $19 million based on CSAC’s projections of changes in recipients and award amounts. (We summarize these changes by segment and award type in our Cal Grant Spending and Cal Grant Recipients EdBudget tables.) Second, the budget adds $49 million on top of CSAC’s projections to account for a potential increase in Cal Grant recipients as more students are expected to return to college following recent enrollment declines. Third, the budget provides $16 million for Cal Grant augmentations at private nonprofit institutions. Specifically, the maximum tuition award for students attending private nonprofit institutions will increase from $9,220 to $9,358. Students with dependent children and foster youth attending these institutions also will become newly eligible for supplemental Cal Grant access awards. (Previously, these supplemental access awards were only available to students attending the public segments.) In addition to these 2022-23 changes, the budget agreement includes plans to potentially restructure the Cal Grant program in 2024-25, subject to a trigger provision, as the nearby box describes.

Budget Provides Funding to CSAC to Administer Program Expansions. The 2022-23 budget provides an $889,000 ongoing General Fund augmentation to support eight additional positions for CSAC to implement recent financial aid program expansions. (We list these positions in this EdBudget table.) In addition to these positions, the budget provides $500,000 one-time General Fund for CSAC to expand the Cash for College program (which provides financial aid application workshops) to assist with the implementation of a new requirement for school districts to verify that high school seniors submit financial aid applications. The budget also provides $500,000 one-time General Fund for CSAC to begin implementing Cal Grant reform.

Budget Includes One-Time Funding for Two Existing CSAC Initiatives. Consistent with the 2021-22 budget agreement, the 2022-23 budget provides $300 million one-time General Fund for the Learning-Aligned Employment Program, an initiative created last year to provide students from underrepresented backgrounds with work-study opportunities related to their academic or career interests. CSAC and its partnering campuses have until June 30, 2031 to spend these funds. The budget also reflects $98 million in one-time General Fund spending in 2022-23 for the Golden State Teacher Grant Program, which provides scholarships to students enrolled in teacher preparation programs who commit to teaching at a school with a high proportion of disadvantaged students (as identified under the Local Control Funding Formula [LCFF]). Trailer legislation also makes several changes to the program. Most notably, whereas the program previously was open only to teacher candidates in certain high-need subject areas, it is now open to teacher candidates in any subject area, as well as candidates for pupil personnel services credentials (which authorize individuals to work in school counseling, social work, psychology, and child welfare).

Trailer Legislation Makes Several Changes to Dreamer Service Incentive Grants. Most notably, trailer legislation increases the maximum award amount from $1,500 to $2,250 per semester (for those completing 150 hours of service), as well as removes the proration of awards for part-time students. (Dreamer Service Incentive awards provide nontuition aid to undocumented students receiving a Cal Grant award who fulfill the community service requirement.) Another notable new provision would authorize the Director of the Department of Finance to transfer unspent program funds to UC and CSU to support their Dream Loan programs (which provide loans to undocumented students with financial need).

CCC Budget Also Includes Several Financial Aid Augmentations. In addition to CSAC, several other agencies are receiving funds for student financial aid. Most notably, the budget includes three financial aid augmentations at CCC. First, the budget provides $200 million ongoing Proposition 98 General Fund to double award amounts for the Student Success Completion Grant (SSCG) program, which provides additional nontuition aid to CCC Cal Grant recipients who enroll full time. This increase would bring the maximum SSCG award (for students enrolled in at least 15 units) to $4,000 per semester. Second, the budget provides $25 million ongoing Proposition 98 General Fund to expand eligibility for the California College Promise. This program allows colleges to waive enrollment fees for certain students who do not have financial need. Whereas these fee waivers were previously limited to first-time students who enrolled full time, trailer legislation expands eligibility to include returning students who enroll full time. Third, the budget provides $20 million one-time Proposition 98 General Fund for emergency financial aid grants to undocumented students who meet certain criteria, including being enrolled at least half time and demonstrating an emergency financial need (such as loss of employment).

Budget Includes Several Augmentations Related to College Savings Accounts. The budget includes several augmentations for the Scholarshare Investment Board (SIB) related to the California Kids Investment and Development Savings (CalKIDS) program, which provides college savings accounts to newborns and children. Consistent with the 2021-22 budget agreement, the 2022-23 budget provides $170 million ongoing General Fund to SIB to add at least $500 to the college savings account of each low-income first grader (as identified under LCFF). The budget also includes the following new augmentations associated with this program:

• $5.9 million General Fund to SIB for CalKIDS program administration. These funds are to cover the costs of: two new positions (associate governmental program analysts), participant notifications and marketing, an information technology platform, and call center services. (The amount declines to $2.5 million ongoing beginning in 2023-24, primarily due to reduced program notification and marketing costs after the initial year.)

• $5 million ongoing General Fund to SIB for financial literacy outreach to CalKIDS participants and their families.

• $5 million one-time General Fund to SIB for contracts with entities that operate local college savings account programs to conduct outreach and coordinate with the CalKIDS program.

• $3 million one-time General Fund to UC Los Angeles to establish the CalKIDS Institute. The funds would be used over three years to support research, policy development, and direct services related to improving the financial capabilities of families and communities.

Budget Extends California for All College Service Program. The budget provides the Office of Planning and Research with an additional $146 million for this program ($73 million each in 2024-25 and 2025-26). Administered as part of AmeriCorps, this program provides students at public and private higher education institutions with service opportunities in areas such as education and youth development, health, and disaster response. The two years of additional funding will allow for the continuation of stipends (up to $7,000 each) and scholarships (up to $3,000 each) for 6,500 students.

Budget Provides Funding for Student Loan Borrower Assistance. The 2022-23 budget provides $10 million one-time General Fund to the Department of Financial Protection and Innovation for this purpose. Of this amount, $7.25 million is for grants to legal aid and community-based organizations to provide education and assistance to borrowers, $2 million is for a statewide marketing campaign to provide information to borrowers, and $750,000 is for program administration. All of the funds are available through June 30, 2025.

Student Housing

Budget Awards First Round of Affordable Student Housing Grants. The budget package increases total funding for the Higher Education Student Housing Grant Program from $2 billion (as agreed upon in last year’s budget package) to $2.2 billion. (Specifically, the new package provides $700 million, rather than $500 million, in 2021-22, $752 million in 2022-23, and $750 million in 2023-24.) Of this funding, trailer legislation awards $1.5 billion in first-round grants (nearly exhausting the first two years of funding). The funds cover all eligible first-round applicants—supporting construction grants for 25 projects and planning grants for 75 projects. As Figure 9 shows, $750 million in unawarded funding remains for the program. (This EdBudget table lists all the projects receiving construction grants, whereas this EdBudget table lists all the projects receiving planning grants.)

Trailer Legislation Changes Project Review and Ranking Process. Moving forward, the CCC Chancellor’s Office, the CSU Chancellor’s Office, and the UC Office of the President will act as the program’s administering entities. Trailer legislation tasks these offices with reviewing their respective campuses’ applications and ranking the applications based on six factors (including state funding per affordable bed, project time line, and unmet housing demand). The central offices are to submit their ranked lists of projects to the Legislature by February 1. Upon receiving these lists, the Legislature and Governor are to decide which projects to fund, with grant awards included in the annual budget act or other legislation.

Trailer Legislation Enacts Several Other Modifications. These modifications include:

• Allowing campuses to annually increase rental charges for their affordable beds to account for inflation.

• Requiring campuses to set aside funds for project contingency and develop a plan to cover cost overruns.

• Requiring UC to use its own employees for the operation and maintenance of state-supported student housing buildings.

• Adding specificity to the program’s existing reporting requirements.

• Requiring the segments to report by March 1, 2023 on student housing insecurity at each campus.

Trailer Legislation Establishes Housing Revolving Loan Fund. Trailer legislation states intent to provide $1.8 billion one-time General Fund over two years ($900 million each in 2023-24 and 2024-25) for a new housing revolving loan program. Campuses at the three public higher education segments are eligible to participate in the program. The California School Finance Authority is to administer the program for community colleges, whereas California Educational Facilities Authority is to administer it for CSU and UC campuses. Under the program, these administering entities will give loans to campuses for new housing projects that serve students, faculty, or staff. Though the loans are interest free, campuses are required to repay the principal, which they may do using housing rental fees. As loan repayments replenish the revolving loan fund, new loans would be made for additional housing projects. By March 15, 2025, the administering entities are to submit a report that includes the number of projects receiving loans, the total associated dollar amount, the specific dollar amount of each loan, and the terms of each loan.

Budget Funds New Housing Project at UC Hastings College of the Law (Hastings). The budget provides Hastings with $90 million one-time General Fund to support the seismic renovation of its McAllister Tower building, which primarily contains student housing. (The budget funds this project outside of the Higher Education Student Housing Grant Program. Hastings originally applied for a grant to support this project, but the Department of Finance determined that the project’s scope did not align with that program’s statutory parameters.) The project is anticipated to raise the building’s seismic rating from a Level V or VI to at least a Level IV, the minimum rating considered acceptable under Hastings’ seismic safety policy. According to Hastings, the project also will add five beds to the building, bringing the total number of beds to 272. At the time the budget was enacted, the total cost of the project was estimated to be $219 million. Hastings anticipates supporting the project’s remaining costs by issuing debt and covering the associated debt service with student housing fee revenue. Hastings anticipates completing the project in January 2024.

California State Library

California State Library Funding Is $338 Million in 2022-23. Of this amount, $316 million comes from General Fund, $18 million comes from federal funds, and the remainder comes from various state special funds. The budget increases the California State Library’s ongoing General Fund support by $11 million (28 percent) and provides $266 million General Fund for one-time initiatives. This EdBudget table shows all the ongoing and one-time General Fund spending changes for the California State Library in 2022-23.

Budgets Increases Ongoing General Fund Support for Various Purposes. The largest ongoing increase is $4.7 million for the Lunch at the Library program, bringing the program’s total General Fund support to $5.5 million. The budget also includes a $3.4 million ongoing General Fund augmentation for 25.5 associated permanent positions at the California State Library. Of this amount, 17.5 positions are new and generally intended to help the California State Library implement various new and expanded state and local assistance programs. The remaining eight positions were previously supported with federal funds. Other ongoing augmentations include $2.2 million to cover the California State Library’s increase in rental costs and $570,000 to purchase more online database subscriptions for state employees.

Budget Supports Various One-Time Initiatives. The largest one-time initiative provides $150 million over two years ($50 million in 2022-23 and $100 million in 2023-24) for local library infrastructure grants, building upon a similar $439 million initiative funded in the 2021-22 budget. The grants can cover capital projects that address critical maintenance issues, improve energy efficiency, or expand access to library resources. Other major one-time initiatives include establishing a Statewide Imagination Library, implementing a multiyear plan to digitize historical resources at the California State Library and other state agencies, supporting various capital projects and initiatives at specific local libraries, and funding library-based workforce programs.