BILL ANALYSIS Ó
AB 1721
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Date of Hearing: April 27, 2016
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Lorena Gonzalez, Chair
AB
1721 (Medina) - As Introduced January 28, 2016
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Urgency: No State Mandated Local Program: NoReimbursable: No
SUMMARY:
This bill makes several expansions to the Cal Grant program,
including to provide additional financial aid opportunities to
California Community College (CCC) students. Specifically, this
bill:
1)Increases the Cal Grant B access award, which can be used by
students for tuition, student fees, and other costs, to
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$3,000. This amount would continue to be authorized to be
adjusted through the annual Budget Act, and is currently
established at $1,648.
2)Extends the qualifying age limit for a CCC Transfer
Entitlement Program award from 27 to 30.
3)Requires, in order to qualify for a CCC Transfer Entitlement,
that the awardee had attended the CCC within three years of
transfer rather than having attended the CCC within the
preceding academic year.
4)Increases the number of new Competitive Cal Grant awards from
25,750 to 30,000 annually.
FISCAL EFFECT:
1)Cal Gran Award Cost: When all the above changes are
fully-phased in, annual GF cost would be about $470 million
annually.
a) Increase Cal Grant B Access Award: Based on the current
number of Cal Grant B recipients, annual costs would be
about $275 million.
b) CCC Transfer Entitlement Expansion: Estimated GF costs
of $90 million in 2016-17, increasing to $155 million in
2019-20 and thereafter.
c) Increase Competitive Cal Grant Awards: Estimated GF
costs of $15 million in 2016-17, increasing to $40 million
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in 2019-20 and thereafter.
2)CSAC will incur ongoing administrative costs of $200,000 (GF)
for the equivalent of two positions associated with
implementing program expansions, responding to additional
inquiries from applicants and institutions, and information
technology modifications.
COMMENTS:
1)Purpose. According to the author, "?Overall, only 32% of
students at California colleges and universities complete
credentials on time, and low-income students are much less
likely than higher income students to enroll in or complete
college. A major factor in a student's enrollment and success
in college is his or her ability to pay for fees and tuition,
textbooks, transportation, housing, food, and other access
costs. California has made an important investment in
need-based financial aid through the Cal Grant Program and the
BOG Fee Waiver program, but despite this commitment, access
grants for qualifying students are insufficient to cover
non-tuition college costs, and many low-income students are
left out of the program entirely.
2)Cal Grant B Access Awards. The Cal Grant B program began as
the "College Opportunity Grant" (COG) in the late 1960s. At
that time, policymakers acknowledged that the lowest income
students needed assistance with other college costs, such as
living expenses, textbooks, and supplies. In 1969-70, the
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first stipend was set at $900. The stipend was approximately
20% of the indirect costs in 1989-90, as determined by CSAC.
Since that time it has declined in relative terms; the current
access award of $1,648 is only about one-quarter of what the
original award would be had it kept pace with inflation.
3)Transfer Entitlement Program. This program provides
financially needy CCC students whom did not receive a Cal
Grant A or B award after leaving high school with a "second
chance" to receive an award upon transfer to a baccalaureate
degree-granting institution. According to information provided
by CSAC, an estimated 60,000 to 75,000 CCC transfer students
could benefit from a Transfer Entitlement, yet only about
17,800 new and renewal award offers are made annually. CSAC
indicates that the remaining students may be disqualified for
a variety of reasons. This bill addresses two possible causes
of underutilization in the Transfer Entitlement:
a) Age limitation. Increasing the age limitation from 28 to
31, as is proposed in this bill, would increase the
eligibility pool by over 23,000 students.
b) Gap years. In 2012, the education budget trailer bill
added a requirement to the Transfer Entitlement that
students had to attend a CCC in the academic year
immediately preceding the award year. This bill would
provide for up to three "gap years" for Transfer
Entitlement students. According to CSAC, in 2013-14 a
one-year gap-year was authorized, resulting in an
additional 2,280 award offers.
4)Competitive Cal Grant Awards. The Cal Grant Entitlement
Programs guarantee awards to students who meet specified GPA
and income-related criteria and apply within deadlines. The
majority of Cal Grant recipients (211,300 in 2013-14) receive
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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. Over 300,000 applicants compete for only 25,750 awards
annually. This bill increases the number of competitive awards
to 30,000.
Analysis Prepared by:Chuck Nicol / APPR. / (916)
319-2081