BILL NUMBER: AB 1318 AMENDED
BILL TEXT
AMENDED IN ASSEMBLY APRIL 2, 2013
AMENDED IN ASSEMBLY MARCH 21, 2013
INTRODUCED BY Assembly Member Bonilla
FEBRUARY 22, 2013
An act to amend Sections Section
66021.2 and 69432.7 of the Education Code,
relating to student financial aid.
LEGISLATIVE COUNSEL'S DIGEST
AB 1318, as amended, Bonilla. Student financial aid: Cal Grant
Program.
Existing law, the Ortiz-Pacheco-Poochigian-Vasconcellos Cal Grant
Program (Cal Grant Program) , establishes the Cal
Grant A and B Entitlement Awards, the California Community College
Transfer Cal Grant Entitlement Awards, the Competitive Cal Grant A
and B Awards, the Cal Grant C Awards, and the Cal Grant T Awards
under the administration of the Student Aid Commission, and
establishes eligibility requirements for awards under these programs
for participating students attending qualifying institutions, as
defined.
This bill would add provisions to the Cal Grant Program
that would set the maximum Cal Grant award levels for
students attending nonprofit, nonpublic postsecondary
educational institutions that are accredited by the Western
Association of Schools and Colleges, commencing with the 2014-15
award year. The bill would provide that a nonprofit, nonpublic
postsecondary educational institution headquartered in
the state, registered as a nonprofit public benefit corporation, and
accredited by the Western Association of Schools and
Colleges would not be deemed a qualifying
institution if the total amount of institutional aid , as
defined, provided to California resident students by
all institutions to which this clause is applicable, in the
aggregate that institution , in any award year,
is no less than 50% of the total Cal Grant awards
received by their students, except for institutions meeting
prescribed conditions.
Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: no.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. The Legislature finds and declares all of the
following:
(a) California relies on private nonprofit colleges and
universities accredited by the Western Association of Schools and
Colleges (WASC) to help meet the state's higher education needs,
educating 24 percent of the state's undergraduates.
(b) California provides Cal Grant support to approximately 26,000
students annually attending WASC accredited private nonprofit
colleges and universities, and additional California students
attending these institutions are educated at zero cost to the state.
(c) Eighty-five percent of all students attending California's
WASC accredited private nonprofit colleges and universities receive
institutionally funded student aid.
(d) California's WASC accredited private nonprofit colleges and
universities effectively educate a diverse state population, and have
a four-year graduation rate for Cal Grant students in excess of 60
percent.
(e) The maximum award for Cal Grant students attending WASC
accredited private nonprofit colleges and universities has not
increased since 1999:
(1) It was cut by almost 15 percent for the 2005-06 and 2006-07
cohorts.
(2) It was cut by 5 percent for new and renewal grants for the
2012-13 award year, and is scheduled to be cut an additional 1.5
percent in the 2013-14 award year and 11 percent in the 2014-15 award
year for new awardees.
(3) Even if the maximum award had not been cut, its value
has would have decreased by over 30 percent due
to inflation.
(4) In inflation-adjusted dollars, the maximum award for the
2014-15 award year will be the lowest amount California has invested
in academically qualified, financially deserving students that attend
private nonprofit WASC accredited institutions.
(f) Cal Grant students attending private nonprofit WASC accredited
institutions are a good investment for the state because of all of
the following:
(1) They have a high persistence and graduation rate.
(2) They free up capacity at public institutions.
(3) They are unlikely to need Cal Grant assistance for their
children.
(g) The Cal Grant program effectively and successfully helps
California's private nonprofit colleges and universities to recruit,
retain, and graduate historically underrepresented students from
low-income families. Cal Grants are a ladder of opportunity, and they
leverage nonpublic student aid to help students graduate from
college without excessive student debt:
(1) Cal Grant recipients are 33 percent Latino, 18 percent Asian
American, 6 percent African American, 1 percent Native American, 1
percent Pacific Islander, 4 percent two or more races, 13 percent
unknown, and 24 percent Caucasian.
(2) Cal Grant recipients are some of California's financially
neediest students, with an average family income for Cal Grant A
students of $40,896.
(h) Cal Grant students at California's WASC accredited private
nonprofit colleges and universities account for less that 2 percent
of California's postsecondary education budget.
(i) Cal Grant students at WASC accredited private nonprofit
colleges and universities deserve to be treated similarly to as
similar students attending public institutions.
(j) Predictable and stable funding formulas and eligibility
requirements ensure that the state maximizes its investment and
allows families to plan and pay for higher education.
(k) Legislative action is needed to adopt a reasonable formula
that supports predictability and supports parity for students at
private nonprofit colleges.
SEC. 2. Section 66021.2 of the Education Code is amended to read:
66021.2. Consistent with the state's historic commitment to
provide educational opportunity by ensuring both student access to
and selection of an institution of higher education for students with
financial need, the long-term policy of the
Ortiz-Pacheco-Poochigian-Vasconcellos Cal Grant Program established
pursuant to Chapter 1.7 (commencing with Section 69430) of Part 42
shall be as follows:
(a) Commencing with the 2001-02 academic year and every year
thereafter, an applicant for a Cal Grant A or B award shall receive
an award that is not in excess of the financial need amount
determined by the Student Aid Commission pursuant to Section 69432.9
if he or she complies with all of the following requirements:
(1) Demonstrates financial need under the criteria adopted
pursuant to Section 69432.9.
(2) Attains a grade point average, as defined in Section 69432.7,
meeting the requirements of Chapter 1.7 (commencing with Section
69430) of Part 42.
(3) Complies with each of the eligibility criteria applicable to
the type of Cal Grant award for which he or she is applying.
(b) (1) The maximum Cal Grant A award for a student attending the
University of California or the California State University shall
equal the mandatory systemwide fees in each of those segments.
(2) The maximum Cal Grant B award for a student to which this
subdivision is applicable shall equal the mandatory systemwide fees
in the segment attended by the student, except for community college
students who receive waivers from the Board of Governors of the
California Community Colleges, plus the access award calculated as
specified in Article 3 (commencing with Section 69435) of Chapter 1.7
of Part 42, except that in the first year of enrollment in a
qualifying institution, the maximum award shall be only for the
amount of the access award.
(c) The maximum Cal Grant awards for students attending nonpublic
institutions shall be as follows:
(1) The maximum Cal Grant A award shall equal the tuition award
level established in the Budget Act of 2000, or the amount as
adjusted in subsequent annual budget acts.
(2) The maximum Cal Grant B award shall equal the amount of the
tuition award as established in the Budget Act of 2000, or the amount
as adjusted in subsequent annual budget acts, plus the amount of the
access costs specified in Section 69435, except that, in the first
year of enrollment in a qualifying institution, the maximum award
shall be only for the amount of the access award.
(3) (A) Notwithstanding
paragraphs (1) and (2), the maximum and
notwithstanding Section 69432:
(A) The maximum Cal Grant award
for students attending nonpublic institutions
a student attending a nonprofit, nonpublic postsecondary educational
institution accredited by the Western Association of Schools
and Colleges shall be set and maintained at 80 percent of the
estimated average General Fund cost of educating a Cal Grant
eligible base funding per Cal Grant student at
the University of California or and the
California State University, as calculated by the
commission determined by the average state support per
student plus the average Cal Grant award for the University of
California and the California State University , except as
provided in subparagraphs (B) to (E) clauses
(i) to (iv) , inclusive.
(B)
( i) For the 2014-15 award year, the maximum
award shall be 70 percent of the amount calculated pursuant to
subparagraph (A).
(C)
(ii) For the 2015-16 award year, the maximum award
shall be 80 percent of the amount calculated pursuant to subparagraph
(A).
(D)
(iii) For the 2016-17 award year, the maximum award
shall be 90 percent of the amount calculated pursuant to subparagraph
(A).
(E)
(iv) For the 2017-18 award year and each award year
thereafter, the maximum award shall be 100 percent of the amount
calculated pursuant to subparagraph (A).
(B) A nonprofit, nonpublic postsecondary educational institution
accredited by the Western Association of Schools and Colleges shall
be deemed a qualifying institution if the total amount of
institutional aid provided to California resident students by that
institution, in any award year, is no less than 50 percent of the
total Cal Grant awards received by its students, unless that
institution has fewer than 50 students receiving Cal Grant awards or
charges an annual tuition that is no more than 50 percent of the
average of the annual tuition charged by all institutions to which
this subparagraph is applicable.
(C) As used in this paragraph:
(i) "Average state support per student" means the total General
Fund support for the University of California and the California
State University divided by the number of California resident
full-time equivalent students for each four-year public segment.
(ii) "Institutional aid" includes scholarships and fellowships
granted and funded by a postsecondary educational institution or by a
department within that institution, and includes scholarships
targeted to certain individuals based on, for example, state of
residence, major field of study, or athletic team participation, for
which the institution designates the recipient.
(d) Commencing with the 2000-01 academic year, and each academic
year thereafter, the Cal Grant C award shall be utilized only for
occupational or technical training.
(e) Commencing with the 2000-01 academic year, and each academic
year thereafter, the Cal Grant T award shall be used only for one
academic year of full-time attendance in a program of professional
preparation that has been approved by the California Commission on
Teacher Credentialing.
(f) An institution of higher education in this state that
participates in the Ortiz-Pacheco-Poochigian-Vasconcellos Cal Grant
Program shall not reduce its level of per capita need-based
institutional financial aid to undergraduate students, excluding
loans, below the total level awarded in the 2000-01 academic year.
(g) The implementation of the policy set forth in this section
shall maintain a balance between the state's policy goals of ensuring
student access to and selection of an institution of higher
education for students with financial need and academic merit.
(h) It is the policy of the State of California that the
Ortiz-Pacheco-Poochigian-Vasconcellos Cal Grant Program supplement
the federal Pell Grant program.
(i) An award under the Ortiz-Pacheco-Poochigian-Vasconcellos Cal
Grant Program shall not guarantee admission to an institution of
higher education or admission to a specific campus or program.
SEC. 3. Section 69432.7 of the Education Code
is amended to read:
69432.7. As used in this chapter, the following terms have the
following meanings:
(a) An "academic year" is July 1 to June 30, inclusive. The
starting date of a session shall determine the academic year in which
it is included.
(b) "Access costs" means living expenses and expenses for
transportation, supplies, and books.
(c) "Award year" means one academic year, or the equivalent, of
attendance at a qualifying institution.
(d) "College grade point average" and "community college grade
point average" mean a grade point average calculated on the basis of
all college work completed, except for nontransferable units and
courses not counted in the computation for admission to a California
public institution of higher education that grants a baccalaureate
degree.
(e) "Commission" means the Student Aid Commission.
(f) "Enrollment status" means part- or full-time status.
(1) "Part time," for purposes of Cal Grant eligibility, means 6 to
11 semester units, inclusive, or the equivalent.
(2) "Full time," for purposes of Cal Grant eligibility, means 12
or more semester units or the equivalent.
(g) "Expected family contribution," with respect to an applicant,
shall be determined using the federal methodology pursuant to
subdivision (a) of Section 69506 (as established by Title IV of the
federal Higher Education Act of 1965, as amended (20 U.S.C. Sec. 1070
et seq.)) and applicable rules and regulations adopted by the
commission.
(h) "High school grade point average" means a grade point average
calculated on a 4.0 scale, using all academic coursework, for the
sophomore year, the summer following the sophomore year, the junior
year, and the summer following the junior year, excluding physical
education, reserve officer training corps (ROTC), and remedial
courses, and computed pursuant to regulations of the commission.
However, for high school graduates who apply after their senior year,
"high school grade point average" includes senior year coursework.
(i) "Instructional program of not less than one academic year"
means a program of study that results in the award of an associate or
baccalaureate degree or certificate requiring at least 24 semester
units or the equivalent, or that results in eligibility for transfer
from a community college to a baccalaureate degree program.
(j) "Instructional program of not less than two academic years"
means a program of study that results in the award of an associate or
baccalaureate degree requiring at least 48 semester units or the
equivalent, or that results in eligibility for transfer from a
community college to a baccalaureate degree program.
(k) "Maximum household income and asset levels" means the
applicable household income and household asset levels for
participants, including new applicants and renewing recipients, in
the Cal Grant Program, as defined and adopted in regulations by the
commission for the 2001-02 academic year, which shall be set pursuant
to the following income and asset ceiling amounts:
CAL GRANT PROGRAM INCOME CEILINGS
+--------------------+--------------+--------------+
| Cal Grant |
| A, |
| C, and T Cal Grant B |
+--------------------+--------------+--------------+
|Dependent and Independent students with |
|dependents* |
+--------------------+--------------+--------------+
|Family Size |
+--------------------+--------------+--------------+
| Six or more $74,100 $40,700 |
+--------------------+--------------+--------------+
| Five $68,700 $37,700 |
+--------------------+--------------+--------------+
| Four $64,100 $33,700 |
+--------------------+--------------+--------------+
| Three $59,000 $30,300 |
+--------------------+--------------+--------------+
| Two $57,600 $26,900 |
+--------------------+--------------+--------------+
|Independent |
+--------------------+--------------+--------------+
| Single, no $23,500 $23,500 |
|dependents |
+--------------------+--------------+--------------+
| Married $26,900 $26,900 |
+--------------------+--------------+--------------+
*Applies to independent students with dependents other than a
spouse.
CAL GRANT PROGRAM ASSET CEILINGS
+----------------------+-------------+-------------+
| Cal Grant |
| A, |
| C, and T Cal Grant B |
+----------------------+-------------+-------------+
|Dependent** $49,600 $49,600 |
+----------------------+-------------+-------------+
|Independent $23,600 $23,600 |
+----------------------+-------------+-------------+
**Applies to independent students with dependents other than a
spouse.
The commission shall annually adjust the maximum household income
and asset levels based on the percentage change in the cost of living
within the meaning of paragraph (1) of subdivision (e) of Section 8
of Article XIII B of the California Constitution. The maximum
household income and asset levels applicable to a renewing recipient
shall be the greater of the adjusted maximum household income and
asset levels or the maximum household income and asset levels at the
time of the renewing recipient's initial Cal Grant award. For a
recipient who was initially awarded a Cal Grant for an academic year
before the 2011-12 academic year, the maximum household income and
asset levels shall be the greater of the adjusted maximum household
income and asset levels or the 2010-11 academic year maximum
household income and asset levels. An applicant or renewal recipient
who qualifies to be considered under the simplified needs test
established by federal law for student assistance shall be presumed
to meet the asset level test under this section. Before disbursing
any Cal Grant funds, a qualifying institution shall be obligated,
under the terms of its institutional participation agreement with the
commission, to resolve any conflicts that may exist in the data the
institution possesses relating to that individual.
(l) (1) "Qualifying institution" means an institution that
complies with paragraphs (2) and (3) and is any of the following:
(A) A California private or independent postsecondary educational
institution that participates in the Pell Grant Program and in at
least two of the following federal campus-based student aid programs:
(i) Federal Work-Study.
(ii) Perkins Loan Program.
(iii) Supplemental Educational Opportunity Grant Program.
(B) (i) Except as provided in clause (ii), a nonprofit institution
headquartered and operating in California that certifies to the
commission that 10 percent of the institution's operating budget, as
demonstrated in an audited financial statement, is expended for
purposes of institutionally funded student financial aid in the form
of grants, that demonstrates to the commission that it has the
administrative capacity to administer the funds, that is accredited
by the Western Association of Schools and Colleges, and that meets
any other state-required criteria adopted by regulation by the
commission in consultation with the Department of Finance. A
regionally accredited institution that was deemed qualified by the
commission to participate in the Cal Grant Program for the 2000-01
academic year shall retain its eligibility as long as it maintains
its existing accreditation status.
(ii) No postsecondary educational institution headquartered in the
state, registered as a nonprofit public benefit corporation pursuant
to Part 2 (commencing with Section 5110) of Division 2 of Title 1 of
the Corporations Code, and accredited by the Western Association of
Schools and Colleges shall be deemed a qualifying institution if the
total amount of institutional aid provided to California students by
all institutions to which this clause is applicable, in the
aggregate, in any award year, is less than 50 percent of the total
Cal Grant awards received by their students, unless that institution
has fewer than 50 students receiving Cal Grant awards and charges an
annual tuition that is no more than 50 percent of the average of the
annual tuition charged by all institutions to which this clause is
applicable.
(C) A California public postsecondary educational institution.
(2) (A) The institution shall provide information on where to
access California license examination passage rates for the most
recent available year from graduates of its undergraduate programs
leading to employment for which passage of a California licensing
examination is required, if that data is electronically available
through the Internet Web site of a California licensing or regulatory
agency. For purposes of this paragraph, "provide" may exclusively
include placement of an Internet Web site address labeled as an
access point for the data on the passage rates of recent program
graduates on the Internet Web site where enrollment information is
also located, on an Internet Web site that provides centralized
admissions information for postsecondary educational systems with
multiple campuses, or on applications for enrollment or other program
information distributed to prospective students.
(B) The institution shall be responsible for certifying to the
commission compliance with the requirements of subparagraph (A).
(3) (A) The commission shall certify by October 1 of each year the
institution's latest three-year cohort default rate and graduation
rate as most recently reported by the United States Department of
Education.
(B) For purposes of the 2011-12 academic year, an otherwise
qualifying institution with a three-year cohort default rate reported
by the United States Department of Education that is equal to or
greater than 24.6 percent shall be ineligible for initial and renewal
Cal Grant awards at the institution, except as provided in
subparagraph (F).
(C) For purposes of the 2012-13 academic year, and every academic
year thereafter, an otherwise qualifying institution with a
three-year cohort default rate that is equal to or greater than 15.5
percent, as certified by the commission on October 1, 2011, and every
year thereafter, shall be ineligible for initial and renewal Cal
Grant awards at the institution, except as provided in subparagraph
(F).
(D) (i) An otherwise qualifying institution that becomes
ineligible under this paragraph for initial and renewal Cal Grant
awards shall regain its eligibility for the academic year for which
it satisfies the requirements established in subparagraph (B), (C),
or (G), as applicable.
(ii) If the United States Department of Education corrects or
revises an institution's three-year cohort default rate or graduation
rate that originally failed to satisfy the requirements established
in subparagraph (B), (C), or (G), as applicable, and the correction
or revision results in the institution's three-year cohort default
rate or graduation rate satisfying those requirements, that
institution shall immediately regain its eligibility for the academic
year to which the corrected or revised three-year cohort default
rate or graduation rate would have been applied.
(E) An otherwise qualifying institution for which no three-year
cohort default rate or graduation rate has been reported by the
United States Department of Education shall be provisionally eligible
to participate in the Cal Grant Program until a three-year cohort
default rate or graduation rate has been reported for the institution
by the United States Department of Education.
(F) (i) An institution that is ineligible for initial and renewal
Cal Grant awards at the institution under subparagraph (B), (C), or
(G) shall be eligible for renewal Cal Grant awards for recipients who
were enrolled in the ineligible institution during the academic year
before the academic year for which the institution is ineligible and
who choose to renew their Cal Grant awards to attend the ineligible
institution. Cal Grant awards subject to this subparagraph shall be
reduced as follows:
(I) The maximum Cal Grant A and B awards specified in the annual
Budget Act shall be reduced by 20 percent.
(II) The reductions specified in this subparagraph shall not
impact access costs as specified in subdivision (b) of Section 69435.
(ii) This subparagraph shall become inoperative on July 1, 2013.
(G) For purposes of the 2012-13 academic year, and every academic
year thereafter, an otherwise qualifying institution with a
graduation rate of 30 percent or less for students taking 150 percent
or less of the expected time to complete degree requirements, as
reported by the United States Department of Education and as
certified by the commission pursuant to subparagraph (A), shall be
ineligible for initial and renewal Cal Grant awards at the
institution, except as provided for in subparagraphs (F) and (I).
(H) Notwithstanding any other law, the requirements of this
paragraph shall not apply to institutions with 40 percent or less of
undergraduate students borrowing federal student loans, using
information reported to the United States Department of Education for
the academic year two years before the year in which the commission
is certifying the three-year cohort default rate or graduation rate
pursuant to subparagraph (A).
(I) Notwithstanding subparagraph (G), an otherwise qualifying
institution with a three-year cohort default rate that is less than
10 percent and a graduation rate above 20 percent for students taking
150 percent or less of the expected time to complete degree
requirements, as certified by the commission pursuant to subparagraph
(A), shall remain eligible for initial and renewal Cal Grant awards
at the institution through the 2016-17 academic year.
(J) The
commission shall do all of the following:
(i) Notify initial Cal Grant recipients seeking to attend, or
attending, an institution that is ineligible for initial and renewal
Cal Grant awards under subparagraph (C) or (G) that the institution
is ineligible for initial Cal Grant awards for the academic year for
which the student received an initial Cal Grant award.
(ii) Notify renewal Cal Grant recipients attending an institution
that is ineligible for initial and renewal Cal Grant awards at the
institution under subparagraph (C) or (G) that the student's Cal
Grant award will be reduced by 20 percent, or eliminated, as
appropriate, if the student attends the ineligible institution in an
academic year in which the institution is ineligible.
(iii) Provide initial and renewal Cal Grant recipients seeking to
attend, or attending, an institution that is ineligible for initial
and renewal Cal Grant awards at the institution under subparagraph
(C) or (G) with a complete list of all California postsecondary
educational institutions at which the student would be eligible to
receive an unreduced Cal Grant award.
(K) By January 1, 2013, the Legislative Analyst shall submit to
the Legislature a report on the implementation of this paragraph. The
report shall be prepared in consultation with the commission, and
shall include policy recommendations for appropriate measures of
default risk and other direct or indirect measures of quality or
effectiveness in educational institutions participating in the Cal
Grant Program, and appropriate scores for those measures. It is the
intent of the Legislature that appropriate policy and fiscal
committees review the requirements of this paragraph and consider
changes thereto.
(m) "Satisfactory academic progress" means those criteria required
by applicable federal standards published in Title 34 of the Code of
Federal Regulations. The commission may adopt regulations defining
"satisfactory academic progress" in a manner that is consistent with
those federal standards.