BILL ANALYSIS Ó
Senate Appropriations Committee Fiscal Summary
Senator Kevin de León, Chair
SB 384 (Gaines and DeSaulnier) - California Memorial Scholarship
Program
Amended: May 7, 2013 Policy Vote: Public Safety 7-0;
Ed. 9-0
Urgency: Yes Mandate: No
Hearing Date: August 30, 2013
Consultant: Jacqueline Wong-Hernandez
This bill meets the criteria for referral to the Suspense File.
Bill Summary: SB 384 extends the deadlines by which eligible
victims of 9/11 must be notified of their eligibility for, and
must inform and execute agreements to participate in the
California Memorial Scholarship Program administered by the
Scholarshare Investment Board (SIB). This bill is an urgency
measure.
Fiscal Impact:
Increased eligibility: Potentially significant costs, to
the extent that additional individuals who are eligible to
participate in the scholarship program are identified and
choose to participate (Anti-terrorism Fund).
Administration: Both the VCGCB and the SIB report that any
additional costs and workload would be minor and absorbable
within each agency's existing resources.
Background: Existing law establishes the California Memorial
Scholarship Program, administered by the SIB and funded by
Vehicle Code provisions, to provide scholarships for surviving
dependents of California residents killed as a result of the
September 11, 2001, terrorist attacks. (Education Code § 70010)
Existing law requires the California Victims Compensation and
Government Claims Board (VCGCB) to identify all persons who are
eligible for scholarships under the California Memorial
Scholarship Program by July 1, 2003. Existing law also requires
that eligible persons, or the parent or guardian of an eligible
person, inform the Scholarshare Investment Board of their
decision to participate in the program and execute agreements to
do so no later than July 1, 2005. (EC § 70010.5)
SB 384 (Gaines and DeSaulnier)
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Proposed Law: SB 384 is an urgency measure which extends the
deadlines for notification of eligibility and participation in
the California Memorial Scholarship Program. More specifically,
it:
1) Extends the deadline by which the VCGCB must identify
all persons who are eligible for scholarships from July 1,
2003 to July 1, 2014.
2) Extends the deadline by which eligible persons, or the
parent or guardian of an eligible person, must inform the
SIB whether they choose to participate in the program and
execute agreements to do so from July 1, 2005 to July 1,
2015.
Related Legislation: AB 1759 (Wesson) Ch. 38/2002 established
the California Memorial Scholarship Program, to provide
scholarships of up to $5,000 for dependents of California
victims who died during the terrorist attacks on September 11,
2001. The program is funded through the sale of memorial license
plates authorized by the California State Legislature.
Staff Comments: This bill functionally expands the California
Memorial Scholarship program, by extending two deadlines: the
deadline by which the VCGCB must identify and notify eligible
individuals, and the deadline by which those individuals (or
their parents/guardians) must elect to participate in the
program. The intent of this bill is increase participation among
eligible individuals who either did not know about the program
or did not execute agreements by the deadline. The cost of the
bill will depend on the level of increased participation. All
costs will be borne by the Anti-terrorism Fund.
Under the existing program, the dependents of California victims
who died during the terrorist attacks on September 11, 2001, or
the parents or guardians of minor dependents, were to be
notified of their eligibility for the California Memorial
Scholarship by the VCGCB by July 1, 2003. Eligible dependents
interested in receiving scholarship funds, in turn, must have
contacted the SIB and executed a participation agreement prior
to the June 30, 2005.
For those who participated, the SIB deposited scholarship funds
SB 384 (Gaines and DeSaulnier)
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on behalf of beneficiaries to accounts within the Golden State
ScholarShare College Savings Trust. The scholarships can be used
at eligible vocational, technical and trade schools, in addition
to four-year colleges, universities, and two-year colleges, to
pay for qualified higher education expenses (including graduate
school) until the beneficiary's 30th birthday or the year 2015,
whichever occurs later.
The scholarship and earnings are the property of the State of
California until requested by the beneficiary to pay for
qualified higher educational expenses. Any unused funds must be
returned to the State on the beneficiary's 30th birthday or year
2015, whichever occurs later. These funds are specifically
designated to revert to the Anti-terrorism Fund.
According to an April 2013 report on Special Interest License
Plate Funds by the Bureau of State Audits, the VCGCB did not
identify and notify all individuals eligible for the Memorial
Scholarship by July 1, 2003, as required under state law. Of the
43 individuals identified by the VCGCB to be eligible, only 13
ultimately participated. Additionally, 3 other individuals who
were not identified by the VCGCB for notification, but were
ultimately deemed eligible also participated. The VCGCB has
indicated that, to comply with this bill, it would re-notify the
eligible dependents it identified, and also advertise in the
media to try to reach people who were not identified but are
actually eligible.
If the 30 identified eligible dependents who did not participate
elect to do so under the extension, the cost would be $150,000
(Special Fund). Additionally, since 3 of the 16 current
participants were never identified by the VCGCB as being
eligible (nor notified directly about the program), it is likely
that there are additional eligible dependents (beyond the 30
already identified) who will elect to participate.