Professional and Continuing Education (PaCE) Guidelines

Updated to incorporate the SJSU PaCE Financial Framework and AB 2395 (Effective January 1, 2025)

Background

Effective January 1, 2025, SJSU administers Professional and Continuing Education (PaCE) funds in alignment with Assembly Bill 2395 (AB 2395), CSU systemwide guidance, and the SJSU PaCE Financial Framework.

AB 2395 amended California Education Code Sections 89704 and 89721 to expand the allowable support and development of California State University instructional programs through extension, special session, and self-supporting instructional revenues.

PaCE revenues remain non-state, self-supporting funds and must fully recover program costs while maintaining financial sustainability, transparency, and compliance with CSU policy and legislative reporting requirements.

PaCE Financial Framework

Core Financial Principles

  • Self-Supporting Model: Programs must fully recover all instructional and administrative costs.
  • Positive Net Position: Programs should maintain ongoing positive cash flow.
  • Reserve Adequacy: Programs and colleges should maintain reserves sufficient to address enrollment fluctuations, instructional continuity, and operational risk.
  • Transparency: Financial activity must be appropriately documented and reportable.
  • Strategic Use of Revenue: Funds may be used to support instructional capacity, workforce-responsive programming, and student access initiatives.

Fund Structure (CSU Fund 441)

All PaCE operations remain within CSU Fund 441. Fund 441 serves as the primary operating fund for:

  • Revenue collection
  • Expense tracking
  • Program-level financial reporting
  • Reserve management

PaCE funds are non-state revenues and may not rely upon state General Fund support.

Allowable Uses of PaCE Funds

Instructional Support

  • Faculty compensation for PaCE and state-supported instruction
  • Course and curriculum development
  • Instructional delivery costs

Academic Program Expansion

  • Development of new workforce-aligned programs
  • Expansion of high-demand instructional offerings
  • Online and hybrid program development

Student Support

  • Advising and enrollment support services
  • Career services and workforce placement support

Infrastructure and Operations

  • Learning management systems and instructional technology
  • CRM and online delivery tools
  • Marketing and recruitment
  • Administrative support services necessary for program delivery
  • Facilities improvements and capital projects

Reserve Guidance

Colleges and departments with PaCE activity must maintain sufficient reserves to support instructional continuity, enrollment variability, operational sustainability, and unforeseen expenditures.

Reserve planning should incorporate:

  • Multi-year sustainability planning
  • Break-even analysis
  • Enrollment forecasting
  • Scalability considerations
  • Technology and infrastructure replacement needs

Programs should maintain reserve practices consistent with SJSU and CSU reserve policies.

Compliance and Reporting

PaCE financial activity is subject to:

  • CSU policy guidance
  • California Education Code
  • CSU annual legislative reporting requirements
  • Campus financial review and audit procedures

AB 2395 requires annual CSU reporting regarding revenues and expenditures associated with extension, special session, and self-supporting instructional programs.

Departments and colleges are responsible for maintaining appropriate supporting documentation for revenue generation, expense allocation, fund transfers, reserve balances, and cost recovery methodologies.

Updated Compliance Statement

PaCE funds are to be used for the support and development of instructional programs of the California State University, consistent with California Education Code §89704 as amended by AB 2395 (effective January 1, 2025).