BILL ANALYSIS
AB 1971
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Date of Hearing: April 21, 2010
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Felipe Fuentes, Chair
AB 1971 (Lowenthal) - As Introduced: February 17, 2010
Policy Committee: Higher
EducationVote: 9-0
Judiciary 10-0
Urgency: No State Mandated Local Program:
No Reimbursable:
SUMMARY
This bill:
1)Extends the sunset date, from January 1, 2011 to January 1,
2016, on provisions permitting California State University
(CSU), the University of California (UC), and the Hastings
College of the Law (HCL) to release the names and addresses of
their alumni to businesses with whom the universities have an
affinity partner agreement, providing certain privacy
requirements are met.
2)Expresses legislative intent that UC, CSU, and HCL report
specific information regarding the affinity partnership
agreements to the Assembly and Senate Judiciary Committees,
respectively, by July 1, 2014.
FISCAL EFFECT
Any costs would be absorbable to CSU, UC, and Hastings alumni
and auxiliary organizations covered under the bill. Such
organizations operate with non-state funds.
COMMENTS
1)Purpose . SB 569 (Torlakson)/Chapter 498 of 2005, authorized
CSU, UC, and HCL to allow the controlled disclosure of alumni
names and addresses to businesses that are "affinity partners"
of those universities. In support of SB 569, CSU and UC
stated that "public universities throughout the country,
private institutions and non-profit organizations in
AB 1971
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California, commonly use affinity programs to help generate
non-state funded monies through partnerships that offer
benefits and services (such as credit cards, insurance
products, loans, extension classes, test-prep courses) to
alumni." They argued that SB 569 would address an inequity
between private universities and non-profits and California's
public universities. AB 1222 extends the authority provided
in SB 569 for an additional five years.
2)What are affinity programs ? An affinity program provides a
means whereby a tax-exempt organization may generate funds by
allowing the use of its name and/or logo to endorse products
or services. In the case of UC and CSU, through partnerships
with commercial entities, affinity programs allow alumni
organizations to offer a variety of financial products to
graduates and alumni members, such as group rates and
discounts for home and auto insurance, mortgage programs,
credit cards, and other credit lines. In return for allowing
access to alumni association mailing lists, the affinity
partner pays a fee to the campus association.
Sponsors CSU and UC state that the program has provided
important funding for their programs and that without the
affinity programs they would face serious problems in
supporting their activities, sustaining and attracting
membership, and facilitating future donations worth millions
of dollars. CSU states that it does not yet have a complete
breakdown of funding data. The system currently allows each
campus flexibility in how it spends the affinity funds. CSU
states that the Chico campus has about $45,000 in annual
affinity revenue and uses 2/3 of this for alumni outreach and
the remaining is used to pay for alumni outreach staff
salaries. Fresno State receives about $105,000 in revenue and
about $15,000 of this went out as scholarships, whereas the
rest went to alumni outreach including the magazine, online
social networking, and alumni programming.
3)Prior Legislation . This bill is identical to AB 1222
(Lowenthal) of 2009, which was vetoed for being deemed
premature by the governor because the sunset date under the
existing statute is not until January 1, 2011.
Analysis Prepared by : Chuck Nicol / APPR. / (916) 319-2081