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A controversial California bill to pass off untold thousands of state college students to nontraditional providers of instruction, some of them for-profit or unaccredited, is dead for now. 

The bill, unveiled in March by a powerful California lawmaker, initially would have required the state’s 145 public colleges and universities to grant credit for low-cost online courses offered by outside groups, including for-profit companies, among them the providers of massive open online courses, or MOOCs. The legislation was the subject of massive media coverage, with many citing it as evidence that traditional higher ed models were doomed.

The plan's chief backer, Democratic State Senate President Pro Tem Darrell Steinberg, is no longer trying to advance the measure and will not do so until at least August 2014. Rhys Williams, the senator’s spokesman, said Steinberg is waiting to see the results of new online efforts by the state’s three public higher ed systems – the California Community Colleges, California State University and the University of California. The public college systems are working to expand their online offerings internally and without outsourcing their students to ed tech start-ups with little to no track record offering for-credit courses.

“The UC, CSU, and Community Colleges plans for online course access are a welcome and positive policy outcome,” William said in an e-mail Wednesday evening. “Senator Steinberg is willing to see how they develop and assess whether they’re effective, before making a decision on whether SB 520 remains necessary.”

The bill's current fate was first reported Wednesday by The Oakland Tribune. Williams said the bill, SB 520, is, “Alive, well, and waiting in the wings.” 

The immediate death of the bill is yet another setback to a wave of private companies hoping to play in the public higher education market. Steinberg's bill was intended to help end the so-called bottleneck of over-enrolled lower-level courses that prevents students from advancing, prompts some students to drop out, and consumes state resources. Outside companies that could have received students the public college systems couldn't handle might have included Coursera, StraighterLine and Udacity, whose CEO, Sebastian Thrun testified before California lawmakers in support of Steinberg's bill.

When it was announced in March, Steinberg’s bill immediately captured attention in and outside of higher education circles, among pundits and politicians across the country. It also received significant opposition. Faculty representatives almost uniformly opposed the measure. California, they warned, was preparing to outsource student learning to for-profit companies that have not proven their courses can pass muster.

The bill was heavily amended before it passed the Senate in late May and would have done little more than offer existing college faculty a grant to teach online courses. Then it stalled entirely in the state Assembly. Similarly, a pro-MOOC bill in Florida was watered down amid faculty union opposition before it was signed by Governor Rick Scott.

California's three college systems are planning to use a windfall of cash for education technology from Governor Jerry Brown's budget to boost their online offerings.

Cal State on Wednesday unveiled a first-of-its kind plan to allow students across the system’s 23 campuses to take fully online classes offered by other campuses. The first 36 classes are high-demand courses with a proven track record for students, said Michael Uhlenkamp, spokesman for the Cal State chancellor’s office.

“We want to be able to provide options, so this is another option for students, so this is not trying to replace anything,” he said.

The system is also working to develop virtual labs to free up physical lab space in undergraduate science courses and is working on using technology to improve its advising.

The UC system, likewise, has plans to create about 150 courses that will be offered either entirely online or in a form that will allow professors to use the online material to free up classroom time.

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