• Embed Doc
  • Copy Link
  • Readcast
  • Collections
  • CommentGo Back
Download
 
BILL ANALYSISAB 656Page 1Date of Hearing: June 23, 2009ASSEMBLY COMMITTEE ON HIGHER EDUCATIONAnthony Portantino, ChairAB 656 (Torrico) - As Introduced: February 25, 2009AS PROPOSED TO BE AMENDED (RN# 09 17318) SUBJECT : California Higher Education Endowment Corporation:oil and gas severance tax.SUMMARY : Imposes a 9.9% oil and gas severance tax, effectiveJanuary 1, 2010, and directs the proceeds of this tax to theCalifornia Higher Education Fund (CHEF) to be allocatedannually, as specified, to the University of California (UC),the California State University (CSU), and the CaliforniaCommunity Colleges (CCC). Specifically, this bill :1)Imposes a new oil severance tax of 9.9% on the extraction ofoil from the earth or water within California's jurisdiction,effective January 1, 2010, and deposits those funds in theCHEF, created by this bill.2)Establishes the California Higher Education EndowmentCorporation (CHEEC) with the following responsibilities:a) Disperse CHEF funds accordingly: 60% to CSU, 30% to UC,and 10% to CCC.b) Exclusive control of the investment of CHEF monies, asspecified, and requires investment transactions made duringclosed session to be disclosed and reported at a public
 
meeting within 12 months of the close of the transaction.c) Authority to appoint a chief executive officer, whichshall be designated a confidential position exempt fromcivil service, as specified, and to whom the board maydelegate authority, as specified, and to hire employees.The chief executive officer may delegate any duties to hisor her designee.3)Establishes the CHEEC oversight board comprised of thefollowing 11 voting members for four-year terms, unlessotherwise specified:a) Two members appointed by the CSU Board of Trustees andAB 656Page 2at least one member shall be a CSU non-management employee.b) Two members appointed by the UC Board of Regents and atleast one member shall be a UC non-management employee.c) Two members appointed by the Speaker of the Assembly.d) Two members appointed by the Senate Rules Committee.e) One member appointed by the Treasurer.f) One member appointed by the CCC Chancellor.
 
g) One member who is a student enrolled at a publicpostsecondary educational institution, who must be enrolledduring the duration of his or her two-year term.h) Three nonvoting, ex officio members, as follows: the CSUChancellor, the UC President, the CCC Chancellor.4)States that nothing in this section shall cause appropriationsfor postsecondary education to be reduced below the amountappropriated by the Legislature during the fiscal yearimmediately preceding the CHEF's establishment.5)Includes an urgency clause to take effect immediately.EXISTING LAW :1)UC and CSU receive their funding through the annual BudgetAct. There is no funding policy in statute for theseinstitutions; thus, their funding is discretionary. However,UC and CSU have entered into system-specific "compacts" and"partnerships" with several Governors to ensure stablemulti-year funding in exchange for a commitment to deliver onspecific performance measures.2)Proposition 98, in general, provides K-14 schools with aguaranteed funding source that grows each year with theeconomy and the number of students through a combination ofGeneral Funds and local property taxes. The legislaturedetermines the allocation of Proposition 98 funds between K-12and CCC; in general, CCC receives approximately 11%.FISCAL EFFECT : According to the 2009-10 Budget Conference
of 00

Leave a Comment

You must be to leave a comment.
Submit
Characters: ...
You must be to leave a comment.
Submit
Characters: ...