The 50 Percent Law (Section 84362 of the California Education Code) requires each California community college district to annually spend half of its "current expense of education" for "salaries of classroom instructors." District compliance with the provisions of this law is determined by the chancellor, based on information submitted to the districts after the end of each fiscal year. Districts that have failed to meet the Fifty Percent Law requirement may apply for exemption if, by complying, the district would have suffered "serious hardship" or if paid salaries of classroom instructors were equal to, or in excess of, those paid by other districts "of comparable type and functioning under comparable conditions." Four community college districts did not comply with the Fifty Percent Law requirement in the 1986-87 fiscal year. This report analyzes each district's application for exemption from the Fifty Percent Law and recommends actions. Procedures for the administration of the law and a technical description of the process for determining comparable districts are appended. (EJV)