BILL ANALYSIS Ó AB 200 Page 1 Date of Hearing: March 25, 2015 ASSEMBLY COMMITTEE ON APPROPRIATIONS Jimmy Gomez, Chair AB 200 (Alejo) - As Amended March 11, 2015 ----------------------------------------------------------------- |Policy |Higher Education |Vote:|12 - 0 | |Committee: | | | | | | | | | | | | | | |-------------+-------------------------------+-----+-------------| | | | | | | | | | | | | | | | |-------------+-------------------------------+-----+-------------| | | | | | | | | | | | | | | | ----------------------------------------------------------------- Urgency: No State Mandated Local Program: NoReimbursable: No SUMMARY: This bill increases the number of authorized new Competitive Cal Grant awards from 22,500 currently to 45,000 in 2016-17, 80,000 in 2017-18 and 100,000 in 2018-19 and annually thereafter. AB 200 Page 2 FISCAL EFFECT: Based on current average award amounts and the distribution of awards to students at each of the public postsecondary segments and students at non-public institutions, General Fund costs would be around $55 million in 2016-17, $190 million in 2017-18, $340 million in 2018-19, and over $550 million by 2021-22. COMMENTS: 1)Background. The majority of Cal Grant recipients in 2013-14 (211,300) received an award under the Cal Grant Entitlement Program, which guarantee awards to students who meet specified GPA and income-related criteria and apply within deadlines. The majority of Cal Grant applicants, however, do not qualify for an entitlement award because they are more than a year out of high school, decide to go to college after the entitlement application deadline, or do not meet age or other requirements when they transfer. Competitive Cal Grant A and B awards are available to middle and low income applicants who are not eligible for entitlement awards. The number of new competitive awards has been limited by statute to 22,500 since 2000, and the program is now extremely oversubscribed. In 2012-13, almost 300,000 eligible applicants were denied a competitive award. 2)Purpose. This bill proposes to increase the number of Competitive Program awards from 22,500 for the 2015-16 AB 200 Page 3 academic year, to 100,000 by the 2018-19 academic year. According to supporters, this increase will help California's neediest students take more classes, go to school full-time, and ultimately complete their college degree in a timely manner. According to The Institute for College Access and Success (TICAS), denied Competitive Program applicants have an average family income of less than $21,000, a family size of three, and GPA of 2.9. 3)Related legislation. SB 15 (Block), pending in the Senate Education Committee, in part increases the number of Competitive Cal Grant awards to 30,000. 4)Budget Issue. Since 2001, there have been several unsuccessful legislative attempts to increase the authorized number of Competitive Program awards, most of which have been held in the appropriations committees. Notwithstanding the great need to expand this program, it ultimately is a question of budget priorities. Analysis Prepared by:Chuck Nicol / APPR. / (916) 319-2081 AB 200 Page 4