The 2020 Budget Act includes a plan to defer $1.45 billion in state general apportionment payments to community colleges. The Budget Act also established Education Code section 84321.7, which provides California Community Colleges up to $30 million per month, for February 2021 through June 2021, for hardship exemptions from deferrals for qualifying districts. Deferral exemption funds for the community college system are limited and should be considered a cash source of last resort. Districts are highly encouraged to pursue Tax and Revenue Anticipation Notes (TRANs), through participation in pooled TRANs programs, and other loan programs to meet cash flow needs. 

The Budget Act prescribes that if the total requested by community college districts exceeds $30 million in any given month, the Department of Finance, State Controller's Office, and State Treasurer's Office may authorize additional payments of up to $60 million in that month. 

Districts may submit a request for exemption from deferrals as described below. Upon Chancellor's Office approval, a district may receive the lesser of (1) the total additional funds needed to meet its financial obligations for the month or (2) the amount needed to meet the district's monthly apportionment of total computational revenue as determined by the Student Centered Funding Formula. If the total amount requested by districts in any month exceeds the amount available, payments to the districts will be prorated. 

Request for Hardship Exemption from 2020-21 Deferrals

To request an exemption, a district must submit a certification that the district cannot meet its financial obligations and a cash flow project summary to the Chancellor's Office on the Request for Hardship Exemption from 2020-21 Deferrals Form posted below. The cash flow projection summary must demonstrate that, for the month of the exception request, the district's cash inflow, including Tax and Revenue Anticipation Notes and other Loans, is insufficient to meet cash outflow needs. 

The Request for Hardship Exemption from 2020-21 Deferrals Form is an excel workbook that includes an application form for each month on a separate tab. A separate application form for each month an exemption is requested must be submitted by the due dates shown in the table below. If the request is approved by the Chancellor's Office, districts will be notified in writing according to the below schedule. 

Deferral Hardship Exemption Request Month  Due Date District Notification Date
February 2021 December 1, 2020 December 8, 2020
March 2021 January 1, 2021 January 8, 2021
April 2021  February 1, 2021 February 8, 2021
May 2021 March 1, 2021 March 8, 2021
June 2021 April 1, 2021 April 8, 2021

Please contact Rafael Artiga at rartiga@cccco.edu or fiscalstandards@cccco.edu to request an application form. Applications should be submitted by the due date above to fiscalstandards@cccco.edu. The memo is below.

FS 20-10 Hardship Exemption from 20201-21 Deferrals Memo