In Support of AB 656 (Torrico) California Higher Education Endowment Corporation: oil and gas severance tax

AS-2899-09/FGA

ATTACHMENT TO AS-2899-09/FGA

RESOLVED: That the Academic Senate of the California State University (ASCSU) support AB 656
(Torrico), California Higher Education Endowment Corporation (CHEEC) which would annually allocate monies from the Higher Education Fund to the California Community Colleges (CCC), California State University (CSU) and University of California (UC); and be it further

RESOLVED: That this resolution be sent to the Chancellor CSU, Board of Trustees CSU, campus
academic Senates and Assemblyman Torrico Chairs of the Senate Appropriations and Budget committees, Chairs of the Assembly Appropriations and Budget committees, Chairs of the Senate Education Committee, and Assembly Higher Education Committee, Chair of the Assembly Budget Sub-committee on Education finance, and Legislative Leadership.

RATIONALE: It is generally acknowledged that higher education in the state of
California has received a declining share of general fund appropriations for several
decades. This underfunding has created an educational crisis that has resulted in
California funding for higher education decaying from one of the highest per student to
one of the lowest. Citizen initiated legislation has obligated an increasing percentage of
state revenues to specific areas of the budget. The remaining small discretionary portion
of the budget must be spread across many critical state services.

AB 656 would provide for a “continuously appropriated Higher Education Fund” which
is not dependent on general fund revenue and dedicated exclusively to public higher
education in California. The legislation would establish an oversight board to govern the
California Higher Education Endowment Corporation (CHEEC). This body would be
charged with annually allocating an unspecified percentage of moneys derived from a oil
and gas severance tax in the continuously appropriated California Higher Education
Fund to the CCC, CSU and UC.

A number of states across the United States have created dedicated endowments funded
from severance tax revenues (e.g. Texas). This legislation would enable California to
leverage one of its rapidly declining natural resources to provide a lasting benefit to its
citizens and a larger tax base in the future through higher education.

Approved Unanimously – May 7-8, 2009



 
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