BILL ANALYSIS Ó SENATE COMMITTEE ON EDUCATION Carol Liu, Chair 2013-2014 Regular Session BILL NO: AB 13 AUTHOR: Chavez AMENDED: June 24, 2013 FISCAL COMM: Yes HEARING DATE: July 3, 2013 URGENCY: No CONSULTANT:Daniel Alvarez SUBJECT : Nonresident tuition exemptions: veterans. SUMMARY This bill exempts a student attending a community college, the California State University, or University of California from paying nonresident tuition if that student was a member of the Armed Forces of the United States and discharged or released within the immediately prior year. BACKGROUND 1) Current law, requires a student who was a member of the Armed Forces stationed in California on active duty for more than one year immediately prior to being discharged to be exempt from paying nonresident tuition for the length of time he or she lives in the state, up to the minimum time necessary to become a resident. In addition, current law provides, for purposes of community college fees, a former member of the Armed Forces can utilize the one-year nonresident fee exemption within two years of being discharged provided the former member of the Armed Forces has filed an affidavit with the community college stating his or her intention to establish residency in California as soon as possible. (EC § 68075.5) 2) Current law establishes uniform residency requirements for purposes of ascertaining the amount of fees to be paid by students at the University of California, the California State University, the California Community Colleges, and establishes various exceptions to these residency requirements, including the following: AB 13 Page 2 a) A member of the Armed Forces who is stationed in the state on active duty, except a member assigned for educational purposes. (Education Code § 68075) b) A member of the Armed Forces who is transferred to another state but continuously enrolled at a college in California. (EC § 68075) c) A student who is a dependent of a member of the Armed Forces stationed in this state on active duty. (EC § 68074) d) A student dependent of a member of the Armed Forces may keep his or her resident classification until he or she has resided in the state for the minimum time necessary to become a resident in the event the member of the Armed Forces upon whom they are dependent is transferred outside of the state or retires as an active member of the Armed Forces. (EC § 68072) ANALYSIS This bill exempts a student attending a community college, the California State University, or University of California from paying nonresident tuition if that student was a member of the Armed Forces of the United States and discharged or released within the immediately prior year. STAFF COMMENTS 1) According to the author , the purpose of the bill is to encourage veterans to attend school in our state and to allow them to complete school without paying tuition out of pocket. If this bill does not pass it will bar veterans from being able to pay for California's colleges and universities with their GI bill benefits and will discourage them from moving to our state. 2) Benefits of California-resident classification for tuition and fee purposes . The University of California, California State University, and AB 13 Page 3 California Community Colleges are publicly subsidized with the proceeds of state taxes; the lower resident fees for students who reside in California reflect the contribution they and their parents have already made by paying taxes in California. The fees charged to non-California residents are intended to cover the cost of the subsidy that is generated by California taxpayers. 3) Reciprocity is not universal . This bill would extend a benefit to veteran members of the Armed Forces from other states that are not always provided to California veterans by other states. It appears that approximately 19 states currently offer similar, but not identical, residency waivers as envisioned by this measure; in addition, several states are considering similar types of legislation. Federal legislation has been introduced in both the House and the Senate to require institutions that are eligible for Post 9/11 G.I. Bill benefits to charge any veteran the resident tuition rate. The Committee may wish to consider whether California should wait to see if federal legislation is enacted to ensure that California veterans receive the same uniform tuition benefit in all 50 states that we would be providing to veterans from other states under this measure. 4) Further complicating matters, past Budget shortfalls. The recent passage of Proposition 30 has provided a modicum of fiscal relief for the segments of California's higher education systems. However, recovering from the hundreds of millions in General Fund reductions -- which translated into constrained access to the segments, fewer course offerings and larger classes, and reductions in student support services -- will take time and resources. Thus adequate funding for the varied educational priorities of our public higher education segments continues to be endangered and in some instances supplemented by ensuring that non-state residents pay for the actual AB 13 Page 4 cost of their education. This bill contemplates providing any student who was a member of the Armed Forces of the United States to be exempt from paying nonresident tuition. At present, there are approximately 1.5 million active military personnel in the Armed Forces that upon honorable discharge or release would be eligible, under this measure, to pay in-state tuition, irrespective of whether they were stationed in the state of California. It is unrealistic to believe all discharged personnel would come to California for a postsecondary education; however, by comparison, total enrollment for all of public higher education is 1.6 million students. At some point it is conceivable that a large number of California resident students could be displaced by a shift of state resources backfilling for the cost of educating non-resident veterans at California's higher education institutions. 5) Recent actions of the committee . At the April 24th hearing of this committee, SB 290 (Knight) initially was identical to the approach proposed in this measure. SB 290 as initially proposed exempted a student attending a community college, the California State University, or University of California from paying nonresident tuition if that student was a member of the Armed Forces of the United States and discharged within the immediately prior two years. However, the author of SB 290 accepted amendments to ensure a nexus between providing a fee waiver and being a member of the Armed Forces stationed in this state for more than one year immediately prior to being discharged. SB 290 as amended was voted out of this committee on a 9-0 vote and ultimately by the full Senate on a 39-0 vote. If the will of the committee is to pass this measure, staff recommends amendments that: (a) provide veterans with the one year exemption from paying nonresident tuition to any public institution of higher education (not just community colleges), AB 13 Page 5 contingent upon filing of an affidavit, as specified, within one year of discharge, and specifies the use of the one year fee exemption must occur within two-years from the time of discharge; and (b) Limit this benefit to a student who was a member of the Armed Forces of the United States stationed in this state for more than one year immediately prior to being discharged. These amendments would make this measure consistent with SB 290 as it passed this committee on April 24th. 6) Length of time to access and maximum time limit for benefits . According to the U.S. Department of Veteran Affairs, the Post 9/11 GI Bill education benefit program generally pays a total of 36 months of benefits for up to 15 years following active duty. This is generally the high-end of time to receive and activate earned benefits. 7) In recognition of the difficulties of military service and the sacrifices of service members, existing California law assists the discharged military student who wants to stay in California and go to school. Current California law says the military student, once discharged, can pay resident tuition until the student has stayed in California long enough to establish residency (normally one year). There may only be one legal state of residence, so in order to become a resident of California for tuition purposes, residency must be relinquished in the former state of residence for the student. Existing law strikes a balance, allowing students to pay resident fees while on active duty and for approximately a year after, giving time to establish residency. This existing one-year exemption applies however, only to students who were stationed in California for one year prior to discharge. In 2012, the Legislature (AB 2478, Hayashi) further allowed a member of the Armed Forces, who was stationed in California, up to the minimum time necessary to become a resident and the benefit of in-state tuition (one year) within a two-year time AB 13 Page 6 period from date of discharge - this was in recognition of providing veterans time to return to their home state after being discharged and settle personal affairs or for physical rehabilitation. This option, however, was provided for community colleges students only. 8) Measure is keyed with a possible mandate . To the extent the bill would require community college districts to exempt more students from nonresident tuition, Legislative Counsel has opined, this bill may impose state-mandated local program costs upon the community colleges that may be state reimbursable. 9) Related legislation . SB 420 (Walters) is similar to this measure, but also provides an exemption from nonresident tuition for children and spouses of veterans. At the author's request, the bill is a two-year measure in this committee and Senator Walters was added as a joint author on SB 290. SUPPORT AFSCME California Community Colleges Chancellor's Office California Catholic Conference Community College League of California Coast Community College District Student Council Office of the Deputy Assistant Secretary of Defense San Diego College Student Veterans Organization American Legion-Department of California AMVETS California Association of County Veterans Service Offices California State Commanders Veterans Council VFW - Department of California Vietnam Veterans of America - California State Council State Center Community College District Riverside Community College District Kern Community College District Rancho Santiago CCD North Orange County CCD Chaffey College College of the Canyons AB 13 Page 7 OPPOSITION None on file.