BILL ANALYSIS                                                                                                                                                                                                    Ó



                                                                       AB 200


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          ASSEMBLY THIRD READING


          AB  
          200 (Alejo and Jones-Sawyer)


          As Amended  May 28, 2015


          Majority vote


           ------------------------------------------------------------------ 
          |Committee       |Votes |Ayes                   |Noes              |
          |                |      |                       |                  |
          |                |      |                       |                  |
          |----------------+------+-----------------------+------------------|
          |Higher          |12-0  |Medina, Baker, Bloom,  |                  |
          |Education       |      |Chávez, Harper, Irwin, |                  |
          |                |      |Levine, Linder, Low,   |                  |
          |                |      |Santiago, Weber,       |                  |
          |                |      |Williams               |                  |
          |                |      |                       |                  |
          |----------------+------+-----------------------+------------------|
          |Appropriations  |17-0  |Gomez, Bigelow, Bonta, |                  |
          |                |      |Calderon, Chang, Daly, |                  |
          |                |      |Eggman, Gallagher,     |                  |
          |                |      |Eduardo Garcia,        |                  |
          |                |      |Gordon, Holden, Jones, |                  |
          |                |      |Quirk, Rendon, Wagner, |                  |
          |                |      |Weber, Wood            |                  |
          |                |      |                       |                  |
          |                |      |                       |                  |
           ------------------------------------------------------------------ 


          SUMMARY:  Establishes the number of Competitive Cal Grant A and B  
          awards to be 22,500 for the 2015-16 academic year, 50,000 for the  








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          2016-17 academic year, 60,000 for the 2017-18 academic year and  
          each year thereafter.  


          EXISTING LAW:  Establishes the Cal Grant program awards to provide  
          tuition and access cost assistance to eligible students attending  
          qualified institutions.  Students who are not eligible for  
          entitlement awards may compete for a Cal Grant A or B Competitive  
          award.  The award benefits and eligibility requirements are the  
          same as the entitlement program, but awards are not guaranteed.  
          Annually, 22,500 Cal Grant Competitive awards are available. Of  
          these, 50% are for students who do not qualify for a Cal Grant  
          Entitlement award, but who otherwise meet the Cal Grant  
          requirements.  The remaining awards are set aside for eligible  
          California Community College students.  Maximum award amounts for  
          California State University and University of California are  
          established in the annual Budget Act and have traditionally  
          covered all systemwide tuition and fees.  The maximum tuition  
          award for Cal Grant A and B for students attending private  
          for-profit colleges is $4,000 (commencing 2013-14), and for  
          students attending non-profit or Western Association of Schools  
          and Colleges-accredited for-profit institutions is $8,056  
          (commencing 2015-16). 


          FISCAL EFFECT:  According to the Assembly Appropriations  
          Committee, 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 $70 million in 2016-17, $150  
          million in 2017-18, $220 million in 2018-19, and $270 million in  
          2019-20 and thereafter.     


          COMMENTS:  A student's ability to pay for college is a major  
          factor in enrollment and completion of a degree program;  
          significant unmet need results in students being less likely to  
          enroll and, once enrolled, low-income students are also less  
          likely to complete their degree program.  Financial aid plays a  








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          vital role in increasing access, retention, and completion rates.   
          California has made a substantial commitment to affordability  
          through the Cal Grant Program; still, there is room for  
          improvement.  Higher education affordability experts have  
          consistently encouraged an increase in the number of awards  
          provided in the Competitive Cal Grant Program.  


          As previously noted, the Cal Grant Entitlement Programs guarantee  
          awards to students who meet specified grade point average (GPA)  
          and income-related criteria and apply within deadlines.  The  
          majority of Cal Grant recipients (211,300 in 2013-14) receive this  
          type of award.  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 did not receive an entitlement award.   
          Established in statute are minimum income/asset and academic  
          performance requirements; generally aligned with the Entitlement  
          requirements.  However, because over 300,000 applicants compete  
          for only 22,500 awards annually, Competitive Program award  
          recipients must significantly exceed minimum requirements.  


          In 2012-13, California Student Aid Commission reported that the  
          typical Competitive Program award recipient was 31 years old, with  
          a GPA of 3.41, a family size of 3.1, and a household income of  
          $14,262.  According to The Institute for College Access and  
          Success (TICAS), hundreds of thousands of Competitive Program  
          applicants meet eligibility requirements but are denied grants.   
          TICAS notes that denied Competitive Program applicants have an  
          average family income of less than $21,000, a family size of  
          three, and GPA of 2.9.  TICAS calculates that in 2001-02, at the  
          inception of the Competitive Program, eligible applicants had a  
          one in four chance of receiving a Competitive Program award.  By  








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          2014-15, the chances of a qualified applicant receiving a  
          Competitive Program award decreased to one in 17. 


          This bill proposes to increase the number of Competitive Program  
          awards from 22,500 for the 2015-16 academic year, to 60,000 by the  
          2017-18 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.  


          There is no opposition on file.




          Analysis Prepared by:                        Laura Metune / HIGHER  
                          ED. / (916) 319-3960                                
            FN: 0000688