BILL ANALYSIS                                                                                                                                                                                                    Ó




                   Senate Appropriations Committee Fiscal Summary
                            Senator Kevin de León, Chair


          SB 1028 (Jackson) - Cal Grant C Awards
          
          Amended: May 6, 2014            Policy Vote: Education 8-1
          Urgency: No                     Mandate: Yes
          Hearing Date: May 23, 2014      Consultant: Jacqueline  
          Wong-Hernandez
          
          SUSPENSE FILE. AS AMENDED.
          
          
          Bill Summary: SB 1028 requires the California Student Aid  
          Commission (CSAC), in selecting students to receive a Cal Grant  
          C award, to give special consideration to students who meet  
          specified criteria, including the employment status of the  
          applicant, increases the annual award amount for all Cal Grant C  
          recipients to between $3,009-$5,000 if sufficient funds are  
          available, authorizes the use of the awards for living expenses,  
          and establishes new criteria and processes for identifying areas  
          of occupational and workforce training which qualify for the  
          awards.

          Fiscal Impact (as approved on May 23, 2014):
              Administration: Potentially significant costs to the CSAC  
              to coordinate with specified state, local, and private  
              entities to identify priority occupational areas, and to  
              make application scoring changes. The bulk of the costs  
              would be for an additional Associate Governmental Programs  
              Analyst, at a cost of approximately $80,000, to act as the  
              lead for implementing these provisions. 
              Program publicity: Potentially significant costs to develop  
              and implement a plan to publicize the Cal Grant Program to  
              California's long-term unemployed.

          Background: Existing law authorizes the Cal Grant Program,  
          administered by the CSAC, to provide grants to financially needy  
          students to attend college. The Cal Grant programs include both  
          the entitlement and the competitive Cal Grant awards. The  
          program consists of the Cal Grant A, Cal Grant B, and Cal Grant  
          C programs, and eligibility is based upon financial need, grade  
          point average (GPA), California residency, and other eligibility  
          criteria, as specified. (Education Code 69430-69433.9)









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          Cal Grant C awards assist with tuition and training costs at  
          occupational or vocational programs and may be used for  
          institutional fees, charges, and other costs, including tuition,  
          plus training-related costs, such as special clothing, local  
          transportation, required tools, equipment, supplies, and books.  
          Current law establishes the total number of Cal Grant C awards  
          as the number awarded in the 2000-01 fiscal year (7,761) with  
          the maximum award amount and the total amount of funding being  
          determined in the annual Budget Act. 

          Current law requires the CSAC to consult with appropriate state  
          and federal agencies to develop areas of occupational and  
          technical training for which students may utilize Cal Grant C  
          awards. The commission, if necessary, may also consult with  
          nongovernmental stakeholders that develop or provide workforce  
          training or employ graduates of occupational and technical  
          training programs for this purpose. These areas of occupational  
          and technical training are required to be regularly reviewed and  
          updated at least every five years, beginning in 2012.

          The CSAC is also required to undertake various activities to  
          support the granting of priority to certain Cal Grant C  
          applicants. Specifically, the CSAC is required 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: high employment  
              need, high employment salary or wage projections, and high  
              employment growth. The CSAC is required to determine areas  
              of occupational or technical training that meet these  
              criteria in consultation with the Employment Development  
              Department (EDD) using projections available through the  
              Labor Market Information Data Library. 

               Publish, and retain, on its Internet Web site a current  
              list of the areas of occupational or technical training that  
              meet these criteria and to update this list as necessary.  

               Examine the graduation rates and job placement data of  
              eligible programs, and commencing with the 2014-15 academic  
              year, to give priority to Cal Grant C applicants seeking to  
              enroll in programs that rate high in graduation rates and  
              job placement data.









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          The Legislative Analyst's Office (LAO) is required to submit a  
          report to 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, as specified. (EC § 69439)

          Proposed Law: This bill requires the CSAC, in selecting students  
          to receive a Cal Grant C award, to give special consideration to  
          the social and economic situation of applicants by giving  
          additional weight to disadvantaged applicants, applicants who  
          face economic hardship, and applicants who face particular  
          barriers to employment. This bill requires that the criteria to  
          be considered for purposes of determining social and economic  
          hardship include, but not be limited to, all of the following:  
          a) family income and household size; b) household status,  
          including whether the student is a single parent or the child of  
          a single parent; and, c) the employment status of the applicant,  
          and whether the applicant is unemployed, giving greater weight  
          to the "long-term unemployed."
               
          This bill increases the annual award amount of a Cal Grant C to  
          at least $3,009 and no more than $5,000, if sufficient funds are  
          available. It authorizes the use of Cal Grant C awards for books  
          and living expenses and requires that the CSAC consider, in  
          determining the individual award amount: a) the financial means  
          available to the student to fund the course of study; b) the  
          costs of attendance; and, c) other state and federal programs  
          available to the applicant.

          This bill specifies the state entities with which the CSAC is  
          required to consult, requires that the CSAC update the priority  
          areas of occupational and technical training by January 1, 2016,  
          and expands the criteria which must be met for an occupational  
          or technical training area to qualify a student for priority in  
          the granting of a Cal Grant C awards, as specified.

          This bill further requires the CSAC to consult with the EDD, the  
          Chancellor's Office of the California Community Colleges, the  
          California WIB and local WIBs to develop a plan to publicize the  
          Cal Grant Program to California's long-term unemployed and to be  
          used by those agencies when they come into contact with people  
          experiencing long-term unemployment, and a plan to make students  
          receiving awards aware of job search and placement services  
          available through the EDD and the local WIB.









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          Staff Comments: This bill requires that "if sufficient funds are  
          available" the annual Cal Grant C award amount be increased to  
          $3,009-$5,000. Sufficient funds exist in the General Fund, but  
          they would trade off with other General Fund expenditures. Such  
          an  increase would drive General Fund costs in the millions of  
          dollars annually. 
          
          This bill creates significant additional workload for the CSAC  
          to take on various required activities relative to its changes  
          to the Cal Grant C program. The CSAC has indicated it would  
          require an additional PY and OE&E totaling $90,000. 

          One of the tasks this bill requires of CSAC, is coordination the  
          California WIB and local WIBs to develop a plan to publicize the  
          Cal Grant Program to California's long-term unemployed and to be  
          used by those agencies when they come into contact with people  
          experiencing long-term unemployment, and a plan to make students  
          receiving awards aware of job search and placement services  
          available through the EDD and the local WIB. Implementing a  
          publicity plan to be used by CSAC, and the WIBs will likely  
          drive additional costs, the extent of which will be determined  
          by the plan.


          Committee amendments delete the Cal Grant C award increase, and  
          specify that local workforce investment boards are only   
          required to participate in coordination efforts with the CSAC to  
          the extent that they are required to complete those activities  
          pursuant to federal law.