BILL ANALYSIS Ó Senate Appropriations Committee Fiscal Summary Senator Kevin de León, Chair AB 2160 (Ting) - Cal Grant Awards: GPA Verification Amended: June 18, 2014 Policy Vote: Education 6-0 Urgency: No Mandate: Yes Hearing Date: August 4, 2014 Consultant: Jacqueline Wong-Hernandez This bill meets the criteria for referral to the Suspense File. Bill Summary: AB 2160 requires the California Student Aid Commission (CSAC) to require electronic submission of the grade point average (GPA) of all 12th grade students at public schools and charter schools and, with specified exceptions, deems all 12th grade students in a California public school to be Cal Grant applicants for this purpose. This bill requires that parents be notified of such, and that they be provided an opportunity to opt out of such designation by a school district or charter school. Fiscal Impact: Mandate: Potentially significant reimbursable mandate on school districts to electronically submit the GPAs of every 12th grade student, with specified exceptions, and to administer an opt-out system for families. CSAC administration: Potentially significant workload to receive and process additional GPAs, and to provide technical assistance to schools and school districts. This workload would be off-set, to some degree, by a reduction in the number of hard copy GPAs that CSAC processes. Cal Grant awards: Potentially significant Cal Grant costs (General Fund), to the extent that this bill results in more Cal Grant awards. Background: Existing law requires GPAs for Cal Grant A and B applicants to be submitted to CSAC; requires GPAs to include a certification by a school official that the GPA is accurately reported; authorizes CSAC to establish grace periods for the receipt of GPAs and corrections; and, establishes Legislative intent that high schools and institutions of higher education certify GPAs of students in time to meet Cal Grant application deadlines. (Education Code § 69432) AB 2160 (Ting) Page 1 A school district is prohibited from permitting access to pupil records without written parental consent with some exceptions, as specified. School districts are authorized to release information from pupil records to agencies or organizations in connection with the application of a pupil for, or receipt of, financial aid. (EC § 49076) The federal Family Educational Rights and Privacy Act (FERPA) regulations authorize an educational agency or institution to disclose personally identifiable information from an education record of a student without consent if the disclosure meets one of several specified conditions. These include an instance in which the disclosure is in connection with financial aid for which the student has applied or which the student has received, if the information is necessary to: a) determine eligibility for the aid; b) determine the amount of the aid; c) determine the conditions for the aid; or, d) enforce the terms and conditions of the aid. (34 CFR 99.31(a)(4)) Proposed Law: This bill deems each student enrolled in 12th grade in a California public school to be a Cal Grant applicant, and requires every school district, or charter school, by October 15 annually, to: a) Notify the parent/guardian of each 12th grade student that the student will be deemed a Cal Grant applicant. b) Provide an opportunity for the student to opt out of being automatically deemed a Cal Grant applicant. This bill requires that the CSAC require all public high schools, including charter schools, to provide an electronic submission of a GPA for each 12th grade student, each academic year, with specified exceptions. Staff Comments: In order to apply for a Cal Grant award, a student must complete the Free Application for Federal Student Aid (FAFSA) or a Dream Act application, and the CSAC must receive the student's verified GPA. Currently, there is no standard practice for submitting GPA verification to the CSAC. Some schools submit hard copy verification forms, others submit GPAs electronically, and still others rely on their students to submit the verification forms themselves (once signed by a AB 2160 (Ting) Page 2 school official). This bill requires the CSAC to require public schools to submit the GPAs of all of their 12th grade students (with specified exceptions) to the CSAC each year. While schools currently verify student GPAs upon student request, and some have systems for communicating all GPAs to the CSAC, the only statutory "requirement" on schools is legislative intent language specifying that schools "certify the grade point averages of their students in time to meet the application deadlines" of the Cal Grant. This bill enacts a new universal requirement to electronically transfer every 12th grade student's GPA, which will likely constitute a significant reimbursable mandate on public schools. Transferring GPAs to the CSAC electronically could ultimately save staff time and school resources compared to a hard copy process that may exist at a school. However, whatever process the school currently uses is at local option and, thus, not reimbursable. This requirement will make the act of transferring GPAs a reimbursable mandate, even for schools that were already submitting GPAs to the CSAC electronically. In order to comply with FERPA protections, this bill deems each student enrolled in 12th grade in a California public school to be a Cal Grant applicant. Under FERPA, a school can transfer certain student information to other entities as part of an application for financial aid; since this bill would make every 12th grade student an applicant, GPAs could be transferred as a batch. Separate from FERPA compliance, this bill does require an opt-out process. This bill requires every school district, or charter school, by October 15 annually, to: a) notify the parent/guardian of each 12th grade student that the student will be deemed a Cal Grant applicant; and, b) provide an opportunity for the student to opt out of being automatically deemed a Cal Grant applicant. This bill's requirement for schools to administer an opt-out process for students will also likely be deemed by the Commission on State Mandates to be reimbursable. Staff notes that the opt-out provision may need clarification. The bill language specifies that parents and guardians receive notifications that "the pupil will be deemed a Cal Grant applicant unless the pupil opts out". Typically, a parent or guardian makes that decision when a pupil is under age 18; once AB 2160 (Ting) Page 3 a pupil is 18, he or she can make those decisions. This bill will impact students that are likely to be 17 and 18-year-olds, and who may be 17 when a parent receives the opt-out notification but turn 18 before the GPA would actually be sent to the CSAC. The author may wish to clarify intent regarding how schools should handle the required opt-out process. The most significant cost of this bill will likely be in increased Cal Grant application completions, and the resulting increase in Cal Grant awards. This bill is likely to increase application completion rates, but it is not known what that increase will yield in terms of actual awards. If, for example, the measure were to result in 4,000 more awards in the first year dispersed across UC and CSU so as to average to $7,000 each, the cost of the additional awards would be about $28 million in the first year, growing annually thereafter as additional cohorts were added.