BILL ANALYSIS                                                                                                                                                                                                    



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          Date of Hearing:   June 22, 2010

                       ASSEMBLY COMMITTEE ON HIGHER EDUCATION
                                 Marty Block, Chair
                    SB 1460 (Cedillo) - As Amended:  June 2, 2010

           SENATE VOTE  :   24-9
           
          SUBJECT  :   Student financial aid: eligibility: California Dream  
          Act of 2010.

           SUMMARY  :   Establishes, beginning July 1, 2011, the California  
          Dream Act for the purposes of expanding eligibility for  
          state-administered financial aid to students exempted from  
          paying nonresident tuition through specified provisions of law  
          [created by AB 540 (Firebaugh), Chapter 814, Statutes of 2001]  
          and extends the AB 540 nonresident tuition exemption to  
          graduates of adult education and technical schools, provided the  
          individual spent at least one year in a California high school.   
          Specifically,  this bill  :   

          1)Makes AB 540 students eligible to apply for and participate in  
            any state-administered student financial aid program,  
            including institutional aid, to the full extent permitted by  
            federal law, beginning July 1, 2011.

          2)Makes AB 540 students eligible to apply for and participate in  
            the California Community Colleges (CCC) Board of Governors  
            (BOG) fee waiver program, beginning July 1, 2011, and declares  
            this provision to be consistent with specified immigration  
            law.

          3)Requests the University of California (UC) Board of Regents  
            and requires the California State University (CSU) Board of  
            Trustees and the CCC BOG, beginning July 1, 2011, to establish  
            procedures and forms to enable AB 540 students to apply for  
            and participate in all student aid programs administered by  
            these segments, to the full extent permitted by federal law.

          4)Makes, beginning January 1, 2011, AB 540 students eligible to  
            receive a scholarship that is derived from nonstate funds  
            received for the purpose of scholarships.

          5)Expands, beginning July 1, 2011, the AB 540 exemption to  
            include attendance and graduation from California technical  








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            and adult schools, provided the student attended a California  
            high school for at least one year. 

          6)Finds and declares that this bill is a state law within the  
            meaning of subsection (d) of Section 1621 of Title 8 of the  
            United States Code.

           EXISTING LAW  :

          1)Provides for a variety of student financial aid programs  
            including the Cal Grant programs, the CCC BOG fee waiver, a  
            variety of systemwide and/or campus-specific grant and/or loan  
            programs, and other state-administered financial aid programs.  
             Participation in these programs is, among other criteria,  
            typically needs-based and limited to California residents.

          2)Exempts specified California nonresidents from paying  
            nonresident tuition at UC, CSU, and CCC, also known as the AB  
            540 nonresident tuition waiver, if they meet all of the  
            following:

             a)   Attended a California high school for three or more  
               years;

             b)   Graduated from a California high school or attained an  
               equivalent degree; 

             c)   Registered or attended an accredited California higher  
               education institution beginning of after fall of the  
               2001-02 academic year; and,

             d)   If an alien without lawful immigration status, have  
               filed an affidavit stating that the student has filed an  
               application to legalize his or her immigration status or  
               will file such an application as soon as he or she is  
               eligible to so do.

          3)Designates secondary schools as high schools, technical  
            schools, and adult schools.

           FISCAL EFFECT  :   The Senate Appropriations Committee estimates  
          costs of more than $40 million per year in additional financial  
          aid awards when fully implemented. 

           COMMENTS  :    Background  :  Students who qualify for the AB 540  








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          nonresident tuition waiver are typically aliens without lawful  
          immigration status or United States citizens or Permanent  
          Residents who are residents of another state.  

           Martinez v. Regents  :  In 2005, Martinez v. Regents of the  
          University of California et al. was filed against UC, CSU, and  
          CCC, challenging the legality of AB 540.  In October 2006, a  
          California Superior Court ruled in favor of AB 540, stating its  
          provisions were in accordance with federal law.  In September  
          2008, a California Court of Appeal overturned the Superior  
          Court's ruling in Martinez v. Regents and held that California  
          state law authorizing in-state tuition to "illegal aliens" is  
          preempted by federal immigration law and, thus, void.  The  
          decision was appealed, and in December 2008, the California  
          Supreme Court agreed to review the case.  It is unclear when the  
          Supreme Court will begin its review.  The AB 540 exemption  
          remains in effect at UC, CSU, and CCC while the appeal is  
          pending review.  

           Need for this bill  :  Federal law prohibits undocumented students  
          from receiving any aid from the federal government, such as Pell  
          Grants and federal student loans, and prevents states from  
          offering public benefits to undocumented students unless the  
          state passes a statute expressly qualifying undocumented  
          students for such benefits.  The California Student Aid  
          Commission estimates the nine-month cost of education (which  
          includes books, supplies, food, rent, transportation, and other  
          miscellaneous items) in 2010-11 for California students living  
          off-campus to be $16,497, in addition to systemwide and campus  
          fees.  

           What aid would be available to AB 540 students  ?  This bill  
          provides eligibility for state-administered financial aid  
          programs, including Cal Grant Entitlement awards, Cal Grant  
          Competitive awards, CCC Transfer Entitlement awards, Cal Grant C  
          awards, as well as Assumption Program of Loans for Education  
          awards, State Nursing Assumption Program of Loans for Education  
          awards, Child Development grants, and Law Enforcement Personnel  
          Dependents grants.  In addition, AB 540 students would be  
          eligible for UC- and CSU-administered need-based financial aid  
          programs (which are funded by returning, on average, one-third  
          of student fees to the institutional aid programs), as well as  
          CCC fee waivers.  

           How many students would be affected  ?  According to the segments,  








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          AB 540 students make up less than 1% of enrollment at all three  
          systems, as follows: UC enrolled 1,941 students (3/10% of the  
          student body and 68% of the AB 540 students were U.S. citizens  
          or "documented" immigrants); CSU enrolled 3,633 AB 540 students  
          (less than 1% of the student body); and CCC enrolled 34,057 AB  
          540 students (less than 1% of the student body).  CSU and CCC do  
          not identify the immigration status of AB 540 students but  
          believe that undocumented students make up a larger proportion  
          of these students than they do at UC.

           Adding adult schools  :  Current law defines a secondary school as  
          a high school, adult school or technical school.  Since AB 540  
          considers only high school attendance in order to qualify for  
          the nonresident tuition waiver, high school students who combine  
          high school attendance with attendance at an adult or technical  
          school may jeopardize their eligibility for the nonresident  
          tuition exemption if their attendance at the high school is for  
          less than three years.  This bill addresses this situation by  
          allowing two of the three years of required attendance to be at  
          an adult or technical school, provided the student attends a  
          California high school for one year.  

           Private aid administration  :  This bill also includes a provision  
          to require UC, CSU, and CCC to administer private financial aid  
          awards.  According to the author, this section is intended to  
          assist eligible students in obtaining some type of aid-while the  
          other provisions that would allow them significantly more  
          financial aid go into effect.  In administering private  
          scholarships and aid, the segments comply with the provisions  
          determined by the entity/individual who establishes the  
          scholarship fund.  Unless otherwise specified, AB 540 students  
          should be eligible for private scholarships administered by the  
          segments. 

           Arguments in support  :  The author states that undocumented  
          students cannot finance their college education because they are  
          ineligible for federal grants and loans and are unable to  
          legally work.  Supporters argue that, in light of recent reports  
          highlighting the need for 1 million more workers with college  
          degrees to sustain our economy, the state cannot afford to  
          exclude people or prevent students from attending college.

           Arguments in opposition  :  Opponents argue that the state has  
          limited funds available to provide financial aid, this bill  
          would encourage illegal immigration, and increasing financial  








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          aid benefits will place greater burdens on California taxpayers  
          when we are facing a $20 billion structural budget deficit.

           UC amendment request  :  UC has requested an amendment to  
          indemnify UC, CSU, and CCC against legal damages resulting from  
          a successful legal challenge should this bill be enacted.   
          Following enactment of AB 540, AB 1543 (Firebaugh), Chapter 19,  
          Statutes of 2002, was enacted to indemnify UC, CSU, and CCC from  
          legal damages that could result from a successful challenge to  
          AB 540.

           Previous legislation  :  Since 2003, the Legislature has  
          considered several bills that were substantively similar to this  
          measure, including SB 160 (Cedillo) of 2005 and SB 1 (Cedillo)  
          of 2007, both of which were almost identical to this measure and  
          were ultimately vetoed by the Governor.  The most recent similar  
          bill to go before the Governor was SB 1301 (Cedillo) of 2008;  
          the Governor's veto message read:

               I share the author's goal of making affordable education  
               available to all California students, but given the  
               precarious fiscal condition the state faces at this time,  
               it would not be prudent to place additional demands on our  
               limited financial aid resources as specified in this bill.   
               For this reason, I am unable to sign this bill.

          In addition, SB 160 (Cedillo) of 2009, AB 2083 (Nunez) of 2008,  
          and SB 160 (Cedillo) of 2007 contained similar provisions to  
          this bill, and all were ultimately held under submission in the  
          Senate Appropriations Committee. 

           REGISTERED SUPPORT / OPPOSITION  :

           Support 
           
          American Civil Liberties Union
          California Catholic Conference
          California Communities United Institute
          California Federation of Teachers
          California Postsecondary Education Commission
          California State University
          California Teachers Association
          Community College League of California
          Hispanic Association of Colleges and Universities
          Los Angeles Community College District








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          Los Angeles Unified School District
          Rio Hondo Community College District
          San Jose-Evergreen Community College District
          University of California Student Association
           
           Opposition 
           
          Concerned Women for America
          Howard Jarvis Taxpayers Association


           Analysis Prepared by  :    Sandra Fried / HIGHER ED. / (916)  
          319-3960