BILL ANALYSIS Ó
Senate Appropriations Committee Fiscal Summary
Senator Christine Kehoe, Chair
AB 131 (Cedillo)
Hearing Date: 08/25/2011 Amended: 05/27/2011
Consultant: Jacqueline Wong-HernandezPolicy Vote: Education 7-2
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BILL SUMMARY: AB 131 establishes the California Dream Act,
expanding the existing exemption from non-resident tuition
established by AB 540 (Firebaugh, 2001) to include students who
graduate from technical schools and adult schools. Beginning
July 1, 2012, this bill expands eligibility for financial aid.
Specifically, this bill:
1) Requests the University of California (UC) and requires that
the California
State University (CSU) and the Board of Governors of the
California Community Colleges (CCC), and the California
Student Aid Commission (CSAC), establish procedures and forms
to enable AB 540 students to be eligible to apply for and
participate in all student financial aid administered by
these segments.
2) Expands eligibility for state administered student financial
aid programs to
include AB 540 students.
3) Requires the CCCs to waive the student fees of any AB 540
students who would otherwise qualify for such a waiver, as
specified.
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Fiscal Impact (in thousands)
Major Provisions 2011-12 2012-13 2013-14 Fund
CSAC administration
$733 $252* General
Cal Grants
$13,000* General
Institutional aid: UC up to
$2,300 $3,800 -$4,600* General
AB 131 (Cedillo)
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Institutional aid: CSU up to
$3,800 $7,600* General
CCC fee waivers
$3,750-$7,500* $7,500-$15,000* General**
*on-going, annual costs, based on current estimated undocumented
student enrollment rates.
** Counts toward meeting the Proposition 98 minimum funding
guarantee
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STAFF COMMENTS: SUSPENSE FILE. AS PROPOSED TO BE AMENDED.
Existing law (enacted by AB 540) exempts specified California
nonresidents from paying nonresident tuition at UC, CSU and the
CCCs if they meet all of the following: 1) attended a California
high school for three or more years; 2) graduated from a
California high school or attained an equivalent degree; 3)
registered or attended an accredited California higher education
institution not before fall of the 2001-02 academic year; and 4)
filed an affidavit, if an alien without lawful immigration
status, stating that the student has filed an application to
legalize their immigration status or will file such an
application as soon as they are eligible to so do. In general,
these students are not eligible for federal, state and/or
institutional financial aid.
This bill would make undocumented "AB 540 students" eligible for
all state-administered financial aid programs including the Cal
Grant programs, the Community College Board of Governors (BOG)
fee waiver, and a variety of systemwide and/or campus-specific
grant and/or loan programs, beginning July 1, 2012. Because of
the Cal Grant application calendar, these students would not be
eligible to receive Cal Grants until 2013-14. Institutional aid
and BOG fee waivers could be awarded as early as 2012-13.
CSAC administration: In order to implement this bill, the CSAC
will incur upfront technology costs to develop its own financial
need determination process separate from the federal (FAFSA)
process because undocumented students are not able to file a
AB 131 (Cedillo)
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FAFSA with the federal processor. The CSAC indicates it will
replicate the federal needs analysis in its existing Grant
Delivery System in order to determine Expected Family
Contribution and need for these students. The CSAC estimates
that it will incur $700,000 in upfront programming costs and
about $250,000 for ongoing information technology and program
support.
Cal Grants: The CSAC further estimates, based on enrollment of
AB 540 students at the UC, CSU, and the CCC and assuming similar
application and award rates, that this bill will incur costs of
$13 million General Fund in annual Cal Grants Entitlement Awards
beginning in 2013-14.
Institutional Aid: This provision does not result in direct
state costs, since the amount of institutional aid available is
set. It does, however, create cost pressure on public
postsecondary institutions by opening up that pool of aid to a
larger group of recipients and, thereby, on the General Fund to
backfill that aid to students who subsequently receive less.
The UC estimates (based on current numbers of AB 540 students,
their demographic profile, and average aid awards) that
approximately 390 to 488 students would be eligible for $3.8
million - $4.6 million in UC institutional aid. The CSU
estimates enrollment of about 3,600 AB 540 students system-wide.
If one-half of these students receive (the average CSU award of
$4,200 in) institutional aid, the amount of such aid going to AB
540 students would total about $7.6 million.
BOG Fee Waivers: Any CCC revenue loss from issuing additional
BOG fee waivers would be offset by increased General Fund
(Proposition 98) funding. The CCC Chancellor's Office estimates
were 36,000 AB 540 students taking courses in CCCs in 2009-10.
If the students each carried six units, the total fee revenue to
CCCs would be $15.6 million. If half of those students received
BOG fee waivers (the statewide average), the revenue loss would
be $7 million. To the extent that more AB 540 students qualify
for fee waivers, or have incentive to take more classes/units
because they qualify for fee waivers, the amount could increase
substantially.
This bill also expands eligibility for benefits under AB 540 to
include students who graduate from technical schools and adult
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schools. Expanding eligibility allows more students to pay
in-state tuition (under existing law) and be eligible for state
financial aid (under this bill), and could result in revenue
losses to the UC, the CSU, and the CCC. In the absence of the
expansion, this group of students would pay out-of-state tuition
in California public postsecondary institutions.
It is unclear how many students would be newly eligible for
in-state tuition and other benefits under this expansion, and
what the resulting enrollment pressures or revenue losses (if
students are currently attending those institutions and paying
out-of-state tuition) would be. The availability of state
financial aid to existing and expanded AB 540 students will
likely increase their UC, CSU, and CCC attendance, over time.
Thus, costs identified in the fiscal summary are likely to
increase in future years.
AS PROPOSED TO BE AMENDED: Proposed amendments would delete
provisions that expand the AB 540 population, and delay the
operative date to January 1, 2013.