This case study, part of the State Structures for the Governance of Higher Education study, focuses on governance and related issues in California's higher education system. The study's overall purpose was to examine differences among ustates in their governance structures, and to determine if differences in performance were related to governing structures and whether structure affects strategies of state policymakers. The study is based on analysis of documents and interviews conducted in 1996 with state officials, education administrators, faculty, and staff. The first section reviews the state's economic situation, political context, and higher education issues. Section 2 examines the system's characteristics and history, including current perspectives, the California Postsecondary Education Commission, the California Education Roundtable, and the Student Aid Commission. Section 3 looks at the Board of Governors and local districts within the California Community College system. Section 4 looks at the University of California; subsections address the Board of Regents, the Office of the President, faculty influences and the Academic Senate, the budget process, academic programs, information systems, and performance evaluation. Section 5 looks at California State University, including the Board of Trustees, the Office of the Chancellor, faculty influences, budgeting, program planning and review, articulation, information systems, and performance. Private universities and colleges are briefly covered in Section 6. Sections 7 and 8 examine coordinating processes (budgeting, program review, articulation, and information) and system performance (access, efficiency, and quality).(Contains 32 reference notes.) (DB)