BILL ANALYSIS Ó
SENATE COMMITTEE ON EDUCATION
Senator Carol Liu, Chair
2015 - 2016 Regular
Bill No: AB 1307
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|Author: |McCarty |
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|Version: |July 7, 2015 Hearing |
| |Date: July 15, 2015 |
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|Urgency: |No |Fiscal: |Yes |
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|Consultant:|Olgalilia Ramirez |
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Subject: Working Families Student Fee Transparency and
Accountability Act
SUMMARY
This bill, requires, in lieu of encouraging, the University of
California (UC) and the California State University (CSU) to
follow specified notification and consultation timeframes for
approving and implementing student fee increases, and requires
rather than urges the segments to continue to set aside a
portion of fee increase revenues for institutional aid.
BACKGROUND
Existing law:
1)Further provides that statutes related to UC (and most other
aspects of the governance and operation of UC) are applicable
only to the extent that the Regents of UC make such provisions
applicable. (Education Code § 67400)
2)Confers upon the Trustees of the CSU the powers, duties, and
functions with respect to the management, administration, and
control of the CSU system.
(EC § 66066)
3)Under the Working Families Student Fee Transparency and
Accountability Act (Act), UC and CSU follow specific notice,
consultation, and timeframe requirements when approving
student fee increases. (EC § 66028 - 66028.6)
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ANALYSIS
This bill requires, in lieu of encouraging, the UC and the CSU
to follow specified notification and consultation timeframes for
approving and implementing student fee increases, and requires
rather than urges the segments to continue to set aside a
portion of fee increase revenues for institutional aid.
Specifically this bill:
1)Requires, instead of encourages, all of the following:
a) As changes in mandatory systemwide fees and
financial aid are being considered, the impact of these
changes to be explained to students.
b) Students be consulted via the appropriate
statewide student body associations before increases on
mandatory systemwide fees are proposed.
c) Adequate advance notice to be provided to
students regarding future mandatory systemwide fees.
d) All current and prospective students to be
provided timely information related to student financial
aid.
e) The state's public colleges and universities
ensure transparency in the uses of mandatory system wide
fee revenue and the rationale for implementing mandatory
systemwide fee increases.
2)Requires, rather than urges, California State University (CSU)
and University of California (UC) to maintain their commitment
to institutional financial aid programs by ensuring at least
33% of fee increase revenues charged to resident students are
set aside for institutional student aid.
3)Specifies that the institutional student aid described above
shall be used to assist "resident students," in lieu of
"students," thereby excluding non-resident students from
receiving those benefits.
STAFF COMMENTS
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1)Need for the bill. Under the Working Families Student Fee
Transparency and Accountability Act (Act), UC and CSU must
follow specific notice, consultation, and timeframe
requirements when approving student fee increases. According
to the author in November 2014, the UC Board of Regents passed
a 5% per year increase for a 5-year period beginning with the
2015-16 academic year. The author notes, with the passage of
this fee increase, the UC was non-compliant with several
statutory provisions regarding public notice and transparency
of proposed fee increases established by current law.
This bill seeks to ensure that the UC and CSU adhere to
notification and consultation timeframes for increase student
fees and attempts to codify existing CSU and UC policy which
allocates 33% of student fee revenue for institutional aid.
2)Related Legislative Analyst Office (LAO) Report. In March 2015
the LAO found UC to be non-complaint with several provisions
under the Act including: 1) most notification and consultation
procedures and; 2) developing a tuition and fee policy that
includes a list of factors taken into account when considering
an increase. UC did comply with the reporting provisions by
publishing expenditure information and submitting the required
institutional financial aid reports. According to the report,
UC believes it is not legally obligated to comply because of
its constitutional autonomy. To note, CSU had not increased
mandatory systemwide fees; therefore, was not required to
follow consultation or notification procedures. The report
found CSU also complied with all other provisions.
3)Fee History. The Maddy-Dills Act previously required fees to be:
(1) gradual; moderate and predictable; (2) limited fee
increases to not more than 10% a year, and (3) fixed at least
ten months prior to the fall term in which they were to become
effective. The policy also required sufficient financial aid
to offset fee increases. However, even with this policy, when
the state faced serious budgetary challenges the statute was
"in-lieued" in order to provide the institutions some
flexibility in dealing with the lack of state General Fund
support. The Maddy-Dills Act sunset in 1996 and since then,
the state has had no long-term policy regarding the way in
which mandatory student fees are determined.
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Historically, fees have fluctuated in response to the State's
fiscal condition and the stated needs of University of
California (UC) and California State University (CSU), as
negotiated in the budget deliberations. These conditions have
triggered mid-year fee increases for currently enrolled
students in the past.
4)Related Budget Activity. SB 97 (Committee on Budget and Fiscal
Review, Ch. 11, 2015) among other things, states legislative
findings relative to the UC Regents endorsing the framework
for long-term funding agreed to by the Governor and the UC
President. The agreement freezes tuition in the 2015-16 and
2016-17 academic years, and specifies that the UC will
implement reforms to reduce the cost structure and improve
access, quality, and outcomes. The reforms included in the
framework endorsed by the Regents are intended to create
capacity for all campuses of the university to serve more
resident students, including by using funds and existing
resources that can be redirected to higher priorities, such as
those currently being used to provide financial aid to
nonresident students are also available to enable more
residents students to enter the university at all campuses.
Consistent with these legislative findings, this bill
requires, rather than encourages, the 33% set-aside for
institutional student aid must be used to assist "resident
students," in lieu of "students," thereby excluding
non-resident students from receiving those benefits.
5)Return-to-aid. For many years, UC and CSU have generally
returned 33% of student fee increases to their institutional
aid programs. At CSU, the grant program is known as the State
University Grant (SUG). According to CSU, despite losing
one-third of state funding during the recent economic downturn
the system maintained its commitment to the SUG program and
has done so for more than two decades. This bill mandates 33%
of resident student fee revenues to be returned to aid.
Arguably, requiring these institutions to set aside a portion
of fee increases for student aid may limit their ability to
address quality and access issues that may arise in the
future. Nevertheless, given that the practice of setting aside
these dollars is a policy that has been adopted by CSU and UC
and given the historical commitment by the respective
governing bodies to the aid program, a mandate may be
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unnecessary. For this reason, staff recommends the bill be
amended to urge, rather than require, the institutions to
maintain their commitment to the 33% set aside.
6)Prior Legislation. SB 1461 (Negrete-Mcleod, 2012), as amended by
this Committee, limited the amount by which the CSU Board of
Trustees could increase the mandatory systemwide fees for
resident undergraduate students, in a given year, and
requested the Regents of the UC adhere to the same limit. SB
1461 passed out of this Committee by a vote of 8-0 in April
2012, but was subsequently held under submission in the Senate
Appropriations Committee.
SB 969 (Liu, 2010) placed an upper limit on mandatory
systemwide student fees, not to exceed a fixed percentage of
the cost of education as defined, and prohibited annual
mandatory systemwide fee increases from increasing by more
than the implicit price deflator for state and local
government for goods and services. This version of SB 969
combined elements of SB 969 (Florez) and SB 1199 (Liu). The
bill was passed by this committee by a vote of 8-0, but was
subsequently held on suspense in the Assembly Appropriations
Committee.
SB 969 (Florez, 2010) placed an upper limit on mandatory
systemwide student fees, not to exceed a fixed percentage of
the cost of education, as defined, prohibited student fees
from ever increasing beyond the amount a student paid at the
time of enrollment, and prohibited annual mandatory systemwide
fee increases for each new cohort of undergraduate students at
the UC, CSU, and California Community Colleges from exceeding
five percent of the preceding academic year.
SB 1199 (Liu, 2010) required the governing boards of the UC
and CSU to develop student fee increase methodologies
consistent with specified direction, and included many of the
same concepts found in SB 969. The bill's provisions were
combined with those of SB 969 and the hearing was canceled at
the request of the author.
SCA 26 (Denham, 2010) amended the State Constitution and
imposed upon the UC a waiting period of 180 days before
mandatory student fees could take effect and limited annual
fee increases to no more than a cumulative 10% over the
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preceding academic year. SCA 26 failed passage in this
Committee by a vote of 2-2.
SUPPORT
American Federation of State, County and Municipal Employees
(AFSCME)
California Faculty Association
OPPOSITION
California State University
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