Questions relating to the development of a classification of community college courses and services are discussed in this follow-up to a report submitted to the California Assembly in December 1979, which advised that funding of courses should not be based on credit/no credit status, and that further study of course classification and funding should be conducted. The follow-up report first examines several educational issues, including the categories to be used in describing the curricula and services at the California community colleges, the categories in which credit and non-credit courses should be placed, the types of credit to be awarded for various courses, and the competency-prerequisites, if any, that should be required of students in credit courses or transfer programs. The report then addresses six funding questions related to how course categories can be grouped to conform to the state's long-term finance plan, how such categorization can be used in funding decisions, the degree to which categories should be funded by the state, and whether state support for courses and services should be based on enrollment. Summary conclusions and appendixes are included. (JP)