Prepared for the Board of Governors of the California Community Colleges, this report provides an overview of the 50% Law (Education Code Section 84362), which requires the state's community college districts to spend 50% of the current expense of education each fiscal year (FY) on the payment of salaries for classroom instructors. The first of the four sections of the report presents the January 1981 report to the California legislature from the Board concerning the operation, effects, and extent of compliance with the provisions of the 50% Law by the community colleges in FY 1977-78 through 1979-80. This report includes a history of the law, the Board's regulations, and information on compliance, exemptions, and remaining issues. The second section provides statistical information on plant maintenance and operation costs for non-complying districts; faculty workload data for the lowest and highest workload districts and for non-complying districts; and districts with the highest and lowest percentages of expenditures for 50% Law purposes. The third section presents information on the application of the 50% Law in the Butte Community College District, which for several years had difficulties in complying with the regulation. The final section presents items on the law presented by faculty organizations. (HB)