Trade Technical Trade Technical College has been College has been offering Career offering Career

Technical Programs Technical Programs since 1925since 1925

Over the past 5 years, Over the past 5 years, Trade Technical Trade Technical

College has educated College has educated over 75,000 people in over 75,000 people in

Career Technical Career Technical Education and Education and

Training ProgramsTraining Programs

75% of Trade-Tech’s 75% of Trade-Tech’s programs are Career programs are Career

TechnicalTechnical

53% of students coming 53% of students coming to Trade Tech are here to to Trade Tech are here to

achieve two year or achieve two year or shorter…shorter…

Career Related GoalsCareer Related Goals

LA Trade-Tech is the number 1 LA Trade-Tech is the number 1 community college in the state for community college in the state for

awarding AA/AS degrees in:awarding AA/AS degrees in:

• Family and Family and Consumer Consumer SciencesSciences

• Fashion DesignFashion Design• CulinaryCulinary• ElectricalElectrical• CarpentryCarpentry• Labor StudiesLabor Studies

• PlumbingPlumbing• Diesel TechnologyDiesel Technology• TelecommunicatioTelecommunicatio

ns Technologyns Technology• HVACHVAC• Machining and Machining and

Machine ToolsMachine Tools

AT WHAT COST?AT WHAT COST?

High Cost Program High Cost Program CriteriaCriteria

29 Career-Technical Education (CTE) Programs 29 Career-Technical Education (CTE) Programs have been identified as “high cost” by meeting have been identified as “high cost” by meeting all of the following criteria:all of the following criteria:

• VATEA EligibleVATEA Eligible• Has required Lab SpaceHas required Lab Space• Assignable Square Footage (ASF) per Student Assignable Square Footage (ASF) per Student

> 30> 30• Requires specialized equipmentRequires specialized equipment• Requires equipment maintenanceRequires equipment maintenance• Requires consumable suppliesRequires consumable supplies• Requires instructional support staffRequires instructional support staff

Key Financial Factors Key Financial Factors ImpactingImpacting

CTE Program ViabilityCTE Program Viability

1.1. Direct Program CostsDirect Program Costs

2.2. Lost Revenue due to Class Lost Revenue due to Class Size LimitationsSize Limitations

Direct Program CostsDirect Program Costs

Direct Costs include the Costs of:Direct Costs include the Costs of:

1.1. Maintenance of lab spaceMaintenance of lab space

2.2. Specialized/Required Storage spaceSpecialized/Required Storage space

3.3. Equipment Equipment

4.4. Equipment Maintenance Equipment Maintenance

5.5. Consumable SuppliesConsumable Supplies

6.6. Specialized Staff required to maintain Specialized Staff required to maintain programprogram

(Costs are normalized in that they are over and above the (Costs are normalized in that they are over and above the cost to maintain a General Education Class)cost to maintain a General Education Class)

Lost Revenue Due to Lost Revenue Due to Class Size LimitationsClass Size Limitations

High Cost CTE Ave Class Size= 17High Cost CTE Ave Class Size= 17

General Education (GE) Ave Class Size = General Education (GE) Ave Class Size = 31.731.7

DefinitionDefinition

Lost Revenue equals FTES revenue that Lost Revenue equals FTES revenue that would have been gained if High Cost would have been gained if High Cost Programs had the same enrollment Programs had the same enrollment capacity and average class size of GE capacity and average class size of GE programs (e.g. 31.7 students per class).programs (e.g. 31.7 students per class).

Direct Program CostsDirect Program Costs (1 Semester) (1 Semester)

High Cost CTE Programs = $1,233,846 (above High Cost CTE Programs = $1,233,846 (above GE costs)GE costs)

GE Programs = $0 GE Programs = $0

1,233,846

00

200,000

400,000

600,000

800,000

1,000,000

1,200,000

1,400,000

High Cost CTEPrograms

General EdPrograms

Program Cost

CTE Program CostsCTE Program Costs and Lost and Lost RevenueRevenue (For 1 semester)(For 1 semester)

• Direct Program Costs, Salaries, andDirect Program Costs, Salaries, and• Lost Revenue due to Class Size LimitationsLost Revenue due to Class Size Limitations

9,801,359

4,230,409

0

1,000,000

2,000,000

3,000,000

4,000,000

5,000,000

6,000,000

7,000,000

8,000,000

9,000,000

10,000,000

High Cost CTE Programs General EducationPrograms

Direct Program Cost + Salaries

Lost Revenue (Class Limit) Cost

Total Costs

Effects on Revenue Effects on Revenue Using all 3 Cost VariablesUsing all 3 Cost Variables

(1 Semester)(1 Semester)

CTEGE

CTE

GE

CTE

GE

-1,000,000

0

1,000,000

2,000,000

3,000,000

4,000,000

5,000,000

6,000,000

7,000,000

8,000,000

9,000,000

10,000,000

Revenue Total Cost Net Revenue ($)

CTE

GE

New - High Demand New - High Demand ProgramsPrograms

A key priority for Trade-Tech is to A key priority for Trade-Tech is to develop new programs that are in high develop new programs that are in high demand to meet the needs of the demand to meet the needs of the business community.business community.

This includes:This includes:• Starting new programs, andStarting new programs, and• Expanding existing programs to meet Expanding existing programs to meet

industry demand.industry demand.

Startup CostsStartup Costs(examples)(examples)

Culinary Program Culinary Program expansion/renovation:expansion/renovation:

• $13 million to expand the Culinary $13 million to expand the Culinary program at Trade-Tech to meet program at Trade-Tech to meet student demand.student demand.

New Automotive Paint Program:New Automotive Paint Program:• Approx $4.5 million to start up a new Approx $4.5 million to start up a new

Automotive Paint Program that would Automotive Paint Program that would meet industry standards.meet industry standards.

New High Cost Program New High Cost Program AnalysisAnalysis

Developing new programs to meet the Developing new programs to meet the needs of the community is a needs of the community is a fundamental goal.fundamental goal.

However, the cost of developing such However, the cost of developing such a program is so prohibitive, it is a program is so prohibitive, it is nearly impossible without a nearly impossible without a mechanism to fund such programs.mechanism to fund such programs.

Other High Cost Program Other High Cost Program StudiesStudies

Other states, based on comprehensive Other states, based on comprehensive cost study results, have recognized the cost study results, have recognized the necessity to fund CTE programs at a necessity to fund CTE programs at a higher rate to compensate for both higher rate to compensate for both higher direct costs and revenue higher direct costs and revenue limitations. These states include:limitations. These states include:

Kansas, Mississippi, Arkansas, Nebraska, Kansas, Mississippi, Arkansas, Nebraska, Pennsylvania, Massachusetts, and Texas.Pennsylvania, Massachusetts, and Texas.

Examples of CTE Examples of CTE Differential Funding Differential Funding

FormulasFormulasStateState Differential Differential

Funding Funding FormulaFormula

ArkansasArkansas 1.5 1.5

KansasKansas 1.751.75

MississippiMississippi 1.191.19

NebraskaNebraska ““light” – 1.5light” – 1.5

““heavy” – 2.0heavy” – 2.0

5 other states5 other states Varies by Varies by program or fieldprogram or field

Summary of Cost Study Summary of Cost Study AnalysisAnalysis

• 58% of Trade-Tech’s disciplines are Career-58% of Trade-Tech’s disciplines are Career-Technical – 29% of which have been Technical – 29% of which have been identified using the 6 aforementioned identified using the 6 aforementioned categories, as high costcategories, as high cost

• Net revenues for high cost CTE programs at Net revenues for high cost CTE programs at Trade-Tech are 68.7% lower than GE Trade-Tech are 68.7% lower than GE programsprograms

• Total costs of high-cost CTE programs are Total costs of high-cost CTE programs are 5.9 times greater than GE programs5.9 times greater than GE programs

• Other states have implemented differential Other states have implemented differential funding multipliers for CTE programs funding multipliers for CTE programs ranging from 1.19 to 2.0 (an average of 1.59)ranging from 1.19 to 2.0 (an average of 1.59)

RecommendationRecommendation

• To approve and implement a funding To approve and implement a funding differential multiplier of 1.59 / FTES differential multiplier of 1.59 / FTES for high cost CTE programs.for high cost CTE programs.

[Note: this multiplier equals [Note: this multiplier equals bothboth the total cost the total cost difference between CTE and GE programs at the difference between CTE and GE programs at the college college ANDAND the average CTE multiplier of other the average CTE multiplier of other states with differential funding]states with differential funding]