BILL ANALYSIS
SENATE JUDICIARY COMMITTEE
Senator Ellen M. Corbett, Chair
2009-2010 Regular Session
AB 1222
Assemblymember Lowenthal
As Amended May 6, 2009
Hearing Date: June 23, 2009
Education Code
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SUBJECT
California State University and University of California:
Disclosure of Alumni Personal Information
DESCRIPTION
This bill would extend the sunset date on current law which
permits the California State University (CSU) and the University
of California (UC) to disclose the names, addresses, and e-mail
addresses of alumni to their "affinity partners" (nonaffiliated
businesses with whom the university has a contractual agreement
to, among other things, offer commercial products and services
to alumni), subject to specified privacy requirements. These
provisions are scheduled to sunset on January 1, 2011; this bill
would extend the provisions to January 1, 2016.
BACKGROUND
In 2005, the Legislature passed and the Governor signed SB 569
(Torlakson, Ch. 498, Stats. 2005) which expressly allowed CSU
and UC to disclose the names, addresses, and e-mail addresses of
alumni to businesses with whom the university has an affinity
partner agreement. Tax-exempt organizations use affinity
programs to generate revenue by permitting the use of their name
or logo to endorse products or services. Both CSU and UC use
affinity programs to partner with commercial entities so that
alumni organizations can offer various financial products and
services to alumni. As part of the agreement, the affinity
partner pays a fee to the alumni association in return for
allowing access to alumni association mailing lists.
Under SB 569, alumni information may only be shared for
(more)
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specified purposes, and the universities must meet specified
privacy requirements including that they have a written
contractual agreement with the affinity partner business that
contains certain privacy protections. CSU and UC may not
disclose alumni information to affinity partners without first
offering alumni an opportunity to opt out of the disclosure.
Existing law provides a statutory notice form for this purpose
and requires that the form be provided to alumni in certain
communications, such as the alumni association magazine and Web
site. These provisions sunset on January 1, 2011; this bill
would extend this sunset date to January 1, 2016.
CHANGES TO EXISTING LAW
Existing law permits CSU and UC to disclose the names,
addresses, and e-mail addresses of alumni to businesses with
whom the university has an affinity partner agreement. (Ed.
Code Secs. 89090, 92630.) Existing law provides that alumni
information may only be shared for the following specified
purposes: (1) to provide alumni with commercial opportunities
that are beneficial to the alumni or the university; (2) to
provide alumni with informational materials relating to the
university; and (3) to promote and support the educational
mission of the university. (Ed. Code Secs. 89090(a), 92630(a).)
Existing law requires CSU and UC to meet specified privacy
requirements including that they have a written contractual
agreement with the affinity partner business that requires the
business to maintain the confidentiality of the alumni
information and provides that the business may not use the
information for any purpose other than the three purposes
permitted by the statute. (Ed. Code Secs. 89090(b)(1)(A),
92630(b)(1)(A).)
Existing law provides that CSU and UC may not disclose alumni
information to affinity partners without first clearly and
conspicuously notifying alumni that their personal information
may be disclosed and giving the alumni an opportunity to opt out
of the disclosure. If an alumni opts out of such sharing, his
or her information may not be disclosed. (Ed. Code Secs.
89090(b)(2), 92630(b)(2).)
Existing law prohibits CSU and UC from disclosing information
about any current students or an alumnus who, as a student,
indicated pursuant to the federal Family Educational Rights and
Privacy Act (FERPA) that he or she did not want his or her
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personal information disclosed. (Ed. Code Secs. 89090(b)(4),
92630(b)(4).)
Existing law provides for a statutory notice form that CSU and
UC may use to provide alumni with the opportunity to opt out of
sharing. (Ed. Code Secs. 89090(c)(1) and (2), 92630(c)(1) and
(2).)
Existing law requires that the form be provided to alumni in the
following communications: (1) in the solicitation sent to
graduating students encouraging them to join the alumni
association; (2) in the alumni association magazine; (3) on the
alumni association's Web site; (4) in a one-time mailing sent to
all alumni on the university's list as of January 1, 2006; and
(5) in an annual electronic communication. (Ed. Code Secs.
89090(c)(3)(B), 92630(c)(3)(B).)
Existing law requires that alumni be provided at least two
alternative cost-free means to communicate their privacy
choices, such as calling a toll-free number or using electronic
means. (Ed. Code Secs. 89090(c)(4), 92630(c)(4).) Existing law
provides that an alumnus may opt out of sharing at any time and
CSU and UC must comply with this direction within 45 days of
receipt. (Ed. Code Secs. 89090(c)(5)(A), 92630(c)(5)(A).)
Existing law provides that the above described provisions sunset
on January 1, 2011. (Ed. Code Secs. 89090.5, 92630.9.)
This bill would extend this sunset date to January 1, 2016.
COMMENT
1. Stated need for the bill
The author writes:
Campus alumni associations have been established at all 23
California State University (CSU) campuses as well as the 10
University of California (UC) campuses. The primary purpose
of these associations is to maintain relationships and build
long-term connections to graduates with the ultimate goal to
support the University in the form of donations, scholarships,
and involvement. It is common practice among public
universities throughout the country, and private institutions
in California, to offer benefits and services through affinity
partnerships with commercial vendors to alumni as one way to
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stay connected to their university. Examples of these
affinity partnerships include group rates and discounts for
home and auto insurance, mortgage programs and travel
programs.
In light of California's recent revenue shortfalls and budget
reductions to public universities, the role of alumni
associations and the need for private funding of public
universities is more critical then ever to help University
leaders get non-state dollars necessary to maintain program
quality. . . .
Affinity programs must continue to support CSU and UC with
donations, scholarships, and community involvement. All 23
CSU campus associations currently use the funding they receive
from these programs to further their programming and outreach
to alumni as well as to provide both general and athletic
scholarships to students.
The University of California, a co-sponsor of the measure,
explains the benefits of affinity partner agreements to the
university, noting that "[r]evenues generated from UC campus
affinity partnerships generally provide funding to supplement
the operational costs of campus alumni programs. For example,
revenue generated by affinity partnerships at the University of
California, Santa Barbara account for almost 30 percent of the
total $12 million in construction costs for the Mosher Alumni
House. . . . [another] example is the UC Irvine alumni
association's affinity partnership revenues, of which almost 35
percent are used to support the cost of student programs and
scholarships. The funds generated by affinity partnerships
allow the UC campus alumni associations to provide services and
events to alumni and students that the campuses would otherwise
not be able to offer."
Co-sponsor California State University writes that "[t]hroughout
the first three years of implementation of this statute both
public universities have held the privacy of their alumni in the
highest regard, keeping meticulous record of all opt-out
information obtained from alumni as well as continually
following the letter of the law by ensuring ample opportunities
for alumni to have their information removed from records."
2. Have proponents made the case for extending the sunset?
By extending the sunset date to January 1, 2016 on the law which
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permits CSU and UC to share alumni information with affinity
partners, this bill raises the public policy question of whether
the sponsors of the measure have demonstrated that it is
appropriate to extend the sunset on this statute for another
five years. In general, sunset provisions are useful tools when
it appears that actual experience under the law may provide
empirical evidence of the statute's usefulness or its unintended
or undesirable impacts, if any. The following information
describes the sponsors' justifications for extending the sunset.
a. CSU Alumni Affinity Survey Results
The author provided this committee with a document entitled
"CSU Alumni Affinity Survey Results." This document provides
information on a campus-by-campus basis regarding the affinity
partnership agreements each campus has entered into, including
information on when the contract expires, the use of the
revenue, and how many alumni have opted out. For example, CSU
East Bay currently has two affinity partnerships, one with
Marsh and another with Liberty Mutual. Both of these are
insurance programs. The agreements bring in $10,000 which is
used for alumni outreach. According to the survey, 11,000
alumni have opted out.
CSU Fresno reported that it had four affinity partnerships-a
credit card program with Bank of America and insurance
programs offered by Marsh, Liberty Mutual, and AIA. Revenue
from the Bank of America partnership was $1,621, Marsh
$33,252, Liberty Mutual $70,000, and AIA $578. The university
uses the revenue for programming, its alumni magazine, online
social networking, and scholarships. The survey indicated
that 4.1 percent of alumni opted out in the initial mailing
and 22 alumni have opted out on a quarterly basis. CSU Long
Beach reported that its two affinity partnerships-a Bank of
America credit card program and Marsh insurance
program-brought in $135,000 (Bank of America) and $30,000
(Marsh). The revenue was used to support alumni outreach,
communications, and scholarships. 18,000 alumni, or nine
percent, opted out.
b. UC Alumni Association Affinity Programs
In response to committee staff requests, UC provided similar
information concerning its alumni association affinity
programs. The document provided indicates that the UC
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campuses offer affinity programs for various products and
services including credit card and insurance products and
hotel, rental car, and jewelry discounts. At UC Berkeley,
35,000 alumni have opted out of disclosure, and the programs
brought in $1.35 million which was used for operations. At
UCLA, the Bank of America affinity program (credit cards) had
38,142 open accounts and brought in $1.17 million while the
campus' affinity program with Marsh (insurance) had 6,247
policies in force and total annual revenue equaled $168,000.
The revenue from the programs funded alumni and student
programs, salaries of full-time alumni association staff, and
technology and infrastructure improvements.
UC Irvine's alumni association also has an affinity program
for various products and services, including credit card,
insurance, and travel programs. 5,054 alumni participate in
the program and 15,386 opted out. The programs raise
$111,000, which goes to fund programs and operations.
c. Other questions regarding sunset extension
While the above information is helpful and provides a snapshot
of the use of affinity partnership agreements at CSU and UC
campuses, it does not necessarily answer the question of
whether the case has been made for a sunset extension.
Notably, when SB 569 was first considered in the Legislature
it did not contain many of the privacy protections that are
now included in the law. However, as a result of negotiations
with committee staff from this committee as well as the Senate
Education Committee, the author, and interested parties, the
bill was amended to include these various privacy protections.
Those included expressly providing alumni with notice that
their personal information may be disclosed to the
university's affinity partner and giving them the opportunity
to opt out of that disclosure. SB 569 was also amended to
require a statutory notice form. In addition, CSU and UC were
required to provide the form to alumni in certain
communications such as the alumni magazine and in a one-time
mailing to alumni.
As a result, it would be helpful to know the following
information: (1) whether alumni are currently receiving their
opt out forms and, if so, when and in what manner, and is the
form included in the alumni magazine on an annual basis, as
required; (2) are alumni receiving an annual electronic
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notice; and (3) several CSU campuses indicated in their survey
that they did not like the language of the statutory form. As
a result, the question arises as to whether CSU or UC campuses
are using the form provided in the statute or another form
that meets the statutory requirements. In response to these
inquiries, the sponsors provided the committee with the
following information:
1) Are alumni currently receiving their opt out forms and, if
so, when and in what manner? Is the form included in the
alumni magazine on an annual basis, as required?
In response to this question, CSU indicates that all new
alumni receive the opt out form upon graduation and prior to
the release of any of their information to third party
vendors. Existing alumni who have received the initial opt
out form also receive a notification annually. CSU also
states that all of its campuses that have magazines include
the opt out form in those magazines on an annual basis. Those
campuses which do not have magazines include the privacy and
opt out information using the method they normally use to
contact their alumni (e.g., e-mail, e-mail newsletters).
UC states that its alumni associations send out forms and
notifications when they have addresses or contact information
for alumni. UC also provided the committee with examples of
opt out forms contained in alumni magazines.
2) Are alumni receiving an annual electronic notice?
CSU indicates that "all campuses send out an annual electronic
notification to all addressable alumni in their database. For
new alumni they also wait the 45 day waiting period prior to
releasing any information to third party vendors and also
remove any names that opt-out past the 45 day window with
their vendors upon receipt of the opt-out."
UC indicated that it notifies alumni of the affinity programs
and their opt out rights "to the extent we have e-mail
addresses."
3) Are campuses using the statutory form provided in the
statute or another form that meets the statutory requirements?
CSU indicates that its campuses are using a form that was
developed through the Chancellor's Office of General Counsel
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that complies with the statutory requirements. CSU also
provided committee staff with examples of these forms.
UC states that some campuses are using the statutory form
while others are not. UC also provided the committee with an
example of the alternative form which contains the required
information.
d. Form required to be available on alumni association Web
site
SB 569 required the Web site for each alumni association to
include a link to the opt out form. Committee staff was
unable to find the form on the Web sites of alumni
associations on some campuses, and, upon learning that the
link to the opt-out form is not prominently posted on some of
their alumni association Web sites, UC acknowledged that while
a majority of campuses had posted the opt-out link the link
was not "as prominently posted as it should be." As a result,
UC staff brought the issue to the attention of the Office of
the President to "ensure each association displays the link
more prominently."
CSU indicates that four of its campuses, including
Bakersfield, do not participate in affinity programs and
therefore do not have opt out forms on their Web sites. In
addition, CSU provided the committee with links to the opt out
forms posted on the campuses' Web pages.
Although the forms are available online, they are not always
easy to find. In some cases, committee staff was easily able
to locate the form on the association's Web site. For
example, both the CSU Sacramento State Alumni Association and
Fullerton Alumni Association Web sites contain a link to the
form on their homepage. CSU Long Beach also has a link to the
form under its FAQ Web page, and alumni associations at both
the University of California, Los Angeles and San Diego have
links to the form in their privacy policies. CSU Dominguez
Hills has a link to the opt out form under its "Contact Us"
Web page.
Because there does not appear to be consistency in where the
opt out forms are located on the campuses' Web sites and
alumni may therefore have a difficult time locating the forms,
the committee may wish to consider amending the bill to
require that the form be located either on the homepage of the
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alumni association or in the association's privacy policy.
Suggested amendments
1) Amend Education Code Section 89090(c)(3)(B)(iii) to read:
(B) The form shall be provided to alumni in each of the
following
communications: . . .
(iii) The Web site for the alumni association shall include a
link to the form, which shall be located on either the
homepage of the association's Web site or in its privacy
policy.
2) Amend Education Code Section 92630(c)(3)(B)(iii) to read:
(B) The form shall be provided to alumni in each of the
following
communications: . . .
(iii) The Web site for the alumni association shall include a
link to the form, which shall be located on either the
homepage of the association's Web site or in its privacy
policy.
e. Report
In order to fully evaluate the UC and CSU affinity partnership
programs, which under this bill would sunset on January 1,
2016, the committee may wish to consider amending the bill to
require a report from the universities due by July 1, 2014 to
allow time for evaluation before the bill introduction
deadlines in 2015.
Suggested amendment
Amend Education Code Sections 89090 and 92630 to require
reports from CSU and UC regarding implementation of the
affinity partnership programs including information described
above in Comment 2(a), (b), and (c).
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Support : San Jose State University; California State University,
Fullerton Alumni Association; California Postsecondary Education
Commission (CPEC)
Opposition : None Known
HISTORY
Source : California State University; University of California
Related Pending Legislation : None Known
Prior Legislation : SB 569 (Torlakson, Ch. 498, Stats. 2005) See
Background and Changes to Existing Law.
Prior Vote :
Assembly Higher Education Committee (Ayes 9, Noes 0)
Assembly Judiciary Committee (Ayes 10, Noes 0)
Assembly Appropriations Committee (Ayes 15, Noes 0)
Assembly Floor (Ayes 76, Noes 0)
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