Prepared to help community college planners and policy makers identify likely future conditions and draw implications from that information, this report focuses on those statewide trends and policy directions considered important to the development of educational programs and services. Specific areas covered in the report are: (1) demographics, including data on population growth, age, ethnicity, educational level, disability, and income level; (2) social and cultural changes related to families, children, teenage pregnancy, and values; (3) technological change and job markets, including information on job growth, labor market structure, and training; (4) the economy, including data on personal incomes, unemployment, and the consumer price index; (5) enrollment projections and assumptions; (6) public policy related to the Board of Governors, state-level reform, reform legislation and other recent legislation, the California Postsecondary Education Commission, other segments of public education, and federal actions; (7) new directions from the Chancellor's Office concerning academic programs, vocational education, student services education, financial aid, special aid programs, facilities and finance, and other programs and services; and (8) budget trends and projections, including community college trends, cost of living adjustments, budget change proposals, and an appropriation limit. (JMC)