BILL ANALYSIS Ó
SB 451
Page 1
Date of Hearing: June 21, 2011
ASSEMBLY COMMITTEE ON HIGHER EDUCATION
Marty Block, Chair
SB 451 (Price) - As Introduced: February 16, 2011
SENATE VOTE : 35-0
SUBJECT : Student financial aid: Cal Grant C awards.
SUMMARY : Requires the California Student Aid Commission (CSAC)
to give priority for Cal Grant C awards to students pursuing
training in fields with high employment need, high salary or
wage projections, or high employment growth. Specifically, this
bill :
1)Requires CSAC to review and update the areas of occupational
and technical training for which students may utilize Cal
Grant C awards at least every five years, beginning in 2012.
2)Requires CSAC to give priority in granting Cal Grant C awards
to students pursuing occupational or technical training in
areas that meet at least two of the following criteria:
a) High employment need;
b) High employment salary or wage projections; and/or,
c) High employment growth.
3)Requires CSAC to determine areas of occupational or technical
training that meet the aforementioned criteria in consultation
with the Employment Development Department using projections
available through the Labor Market Information Data Library.
4)Requires the Legislative Analyst's Office (LAO) submit a
report to the Governor and Legislature on the outcomes of the
Program on or before April 1, 2015, and on or before each
odd-numbered year thereafter. Requires the report to include
information on the age, gender, segment of attendance, the
occupational and technical training program categories
prioritized, and the number and percentage of students who
received selection priority.
EXISTING LAW establishes the Cal Grant Program, administered by
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CSAC, to provide grants to financially needy students to attend
college. Cal Grant C awards assist with fees and tuition and
training-related costs such as special clothing or required
tools at occupational or vocational schools of four months or
longer and provides that grants may be renewed until the
completion of the training, up to a maximum of two years.
"Occupational or technical training" is defined as education
after the completion of a secondary school program, leading
toward recognized occupational goals approved by CSAC in
consultation with appropriate state and federal agencies. CSAC
is also required to take into account other state and federal
programs available to the applicant.
FISCAL EFFECT : According to the Senate Appropriations
Committee, pursuant to Senate Rule 28.8, negligible state costs.
COMMENTS : Purpose of this bill : According to the author,
current law is silent on how to best prioritize the awarding of
Cal Grant C funds to ensure that recipients are students seeking
jobs that track well with the state's most urgent labor and
employment needs. This bill seeks to require CSAC to
strategically direct Cal Grant C funds to recipients seeking
occupations with high employment demand, growth potential,
wages, and/or importance to California's strategic initiatives.
The author believes that this bill will maximize the
opportunities for Californians to acquire the necessary job
skills to gain and keep employment.
Background on Cal Grant C : The total number of Cal Grant C
awards is established in state law as the number awarded in the
2000-01 fiscal year (7,761). There are about 16,500 new and
renewal awards offered annually. The maximum award amount and
the total amount of funding are determined in the annual Budget
Act. However, the award amount has not increased since 2000-01,
remaining at $2,592 toward tuition and fees and an allowance of
$576 for training-related costs. According to CSAC, Cal Grant C
recipients make up 5% of all current Cal Grants, have an average
family income of $21,792, are an average age of 31, and have an
average entering grade-point average (GPA) of 2.75. CSAC
reports that, as of the 2009-10 academic year, Cal Grant C
participating institutions included all 109 of the California
Community Colleges, one University of California program, six
two-year non-profit institutions, seven four-year for-profit
institutions, one hospital school, and 42 distinct for-profit
institutions. Although the vast majority of students who
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receive the Cal Grant C are enrolled in community college
programs, almost two-thirds of the total funds awarded are paid
to students enrolled in vocational for-profit programs.
Current process : Students who meet general eligibility criteria
(citizenship, residency, enrollment, academic progress, and
income standards, among other requirements) for Cal Grants may
be considered for Cal Grant C. In addition to general
eligibility, Cal Grant C applicants must submit a supplemental
application documenting that they are enrolling at an approved
institution in a recognized program lasting at least four months
and leading to a recognized occupational goal and listing
information regarding the program of enrollment and work history
of the applicant. Effective with the 2009-10 grant cycle, CSAC
selects applicants for awards through a point scoring process
that examines educational history, occupational history, and
GPA. Point earners above a cut-off level receive award offers.
In the 2010-11 cycle, about 14% of students who submitted Cal
Grant C supplements made the cut-off and received award offers.
Under the provisions of this bill, student eligibility
requirements would not change. Committee staff understands that
CSAC would implement a procedure whereby additional points would
be awarded for applicants in the high-growth, high-need, and
high-wage training programs.
Labor Market Information Data Library : The Labor Market
Information Division (LMID) of the California Labor and
Workforce Development Agency is the primary source of labor
market and occupational information for the state. It maintains
current labor market data as well as employment projections and
wage data. Projections of employment by occupation are
typically for a ten-year period. The Library provides access to
several regularly generated reports, including reports detailing
the information required by this bill for purposes of
prioritizing Cal Grant C awards. In addition, Labor Market
Consultants are available to assist workforce partners (such as
Workforce Investment Act boards and staff, educators, and those
engaged in economic development) and employers find, access, and
use labor market information and services, and can assist in the
development of customized reports, if necessary, for a nominal
fee.
Arguments in opposition : The California Association of Private
Postsecondary Schools (CAPPS) opposes this bill, arguing that
Cal Grant C awards are designated for vocational programs that
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students choose based on students' desired occupational interest
and this bill would inappropriately limit students' choices.
CAPPS argues that the labor market data this bill relies on is
often dated and not relevant to the students' geographic
location, and therefore should not be used to deny students
access to desired occupational training programs.
Prior legislation : SB 957 (Price, 2010), which was virtually
identical to this bill, passed this committee in June of 2010 on
a 9-0 vote. The bill was subsequently vetoed by Governor
Schwarzenegger, whose veto message read, in pertinent part:
I am concerned that this bill could limit students' choices
or eliminate the possibility of an award for lower income
students, simply because the occupational areas that they
have chosen to pursue were not deemed a priority by the
state.
Letter to the Senate File : After the passage of SB 957, the
author submitted a letter to the Senate File indicating intent
to request that as part of the process for developing and
implementing regulations, CSAC consider, to the extent allowable
under the law, the local and regional labor market needs and
program job placement rates of institutions. Additionally, the
letter expressed intent that the LAO include in the report to
the Legislature additional information regarding the impact of
displacing current Cal Grant C recipients, the institutions and
programs recipients are attending and the extent to which
recipients were successfully placed in jobs that met the local,
regional or state workforce needs. This bill does not currently
incorporate these issues.
1)Regional employment needs . While the Letter to the File
expressed intent to have CSAC look at regional employment
needs, it is unclear how this examination would be used in
granting priority. Further, committee staff notes that this
directive could result in an unfair advantage to students
based on where they choose to study. Committee staff
understands that occupational needs data is available by
county, but not necessarily by "region". Could this result in
students attending institutions just a few miles apart, but in
separate counties, being treated differently? Additionally,
would a student studying fashion design at an institution in
Los Angeles, where there is identified employment growth in
the industry, be prioritized over a student studying fashion
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design at an institution in Sacramento, even if the Sacramento
student ultimately plans to move to Los Angeles for career
opportunities? CSAC indicates that based on the information
that is available through the Data Market Library, CSAC could
create regional occupational needs lists, but that there would
likely be costs associated with the initial and on-going
programming and consultation. Additionally, CSAC would
request a one-year extension of the implementation date in
order to meet with the new data requirement.
2)LAO reporting requirements. Consistent with the Letter to the
File, committee staff recommends the following amendment:
69439. (h) The Legislative Analyst's Office shall submit a
report to the Governor and the Legislature on the outcomes of
the Cal Grant C Program on or before April 1, 2015, and on or
before April 1 of each odd-numbered year thereafter. This
report shall include, but not necessarily be limited to,
information on (1) the age, gender, and segment of attendance
for recipients in the two prior award years, (2) the
occupational and technical training program categories
prioritized, and (3) the number and percentage of students who
received selection priority as defined in paragraph (3) of
subdivision (f), and (4) the extent to which recipients in
these award years were successfully placed in jobs that meet
local, regional or state workforce needs. For the 2015 report,
the Legislative Analyst shall include data for two additional
prior award years, and shall compare the mix of occupational
and technical training programs and institutions in which
recipients enrolled before and after implementation of
subdivision (f).
3)Placement rates : As currently drafted, this bill aims to
maximize California's return on investment in the Cal Grant C
program through aligning students' fields of study with
workforce needs. In the Letter to the File, the author
expressed intent to have CSAC also examine the placement rates
of institutions; assumedly to prioritize high-quality training
providers. Consistent with this intent, the author may wish
to consider requiring CSAC to examine the retention rates,
graduation rates and job placement data of programs and
provide priority to students seeking to enroll in programs
that rate high in these calculations. This data will be
required to be reported to CSAC beginning in 2012 under the
recently enacted SB 70 (Committee on Budget and Fiscal Review,
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Chapter 7, Statutes of 2011).
REGISTERED SUPPORT / OPPOSITION :
Support
Community College League of California
Opposition
The California Association of Private Postsecondary Schools
Analysis Prepared by : Laura Metune / HIGHER ED. / (916)
319-3960