BILL ANALYSIS                                                                                                                                                                                                    Ó

                                                                    AB 1721

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          1721 (Medina)

          As Amended  May 31, 2016

          Majority vote

          |Committee       |Votes|Ayes                  |Noes                |
          |                |     |                      |                    |
          |                |     |                      |                    |
          |                |     |                      |                    |
          |Higher          |12-1 |Medina, Baker, Bloom, |Olsen               |
          |Education       |     |Chávez, Irwin,        |                    |
          |                |     |Jones-Sawyer, Levine, |                    |
          |                |     |Linder, Low,          |                    |
          |                |     |Santiago, Weber,      |                    |
          |                |     |Williams              |                    |
          |                |     |                      |                    |
          |Appropriations  |15-1 |Gonzalez, Bloom,      |Bigelow             |
          |                |     |Bonilla, Bonta,       |                    |
          |                |     |Calderon, Daly,       |                    |
          |                |     |Eggman, Eduardo       |                    |
          |                |     |Garcia, Roger         |                    |
          |                |     |Hernández, Holden,    |                    |
          |                |     |Obernolte, Quirk,     |                    |
          |                |     |Santiago, Weber, Wood |                    |
          |                |     |                      |                    |
          |                |     |                      |                    |


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          SUMMARY:  Expands the number of Cal Grant awards with the intent  
          to provide additional financial aid resources to California  
          Community College (CCC) students.  Specifically, this bill:  

          1)Increases the number of Competitive Cal Grant awards from  
            25,750 to 34,000.

          2)Provides that 19,000 Competitive Cal Grant awards shall be  
            reserved for CCC students.

          3)Authorizes CCC students enrolled in occupational or career and  
            technical training (CTE) courses leading to industry valued  
            credentials of no less than four months in length at a CCC to  
            be eligible for Competitive Cal Grant B awards.   

          4)Provides that the number of Cal Grant C awards shall be the  
            same as the number that were paid in the 2015-16 fiscal year.

          EXISTING LAW:  

          1)Establishes the Cal Grant program, administered by the  
            California Student Aid Commission (CSAC), to provide tuition  
            and access cost assistance to eligible students attending  
            qualified institutions:
             a)   Cal Grant A Entitlement Awards.  Students that meet  
               income, asset and other eligibility requirements, have at  
               least a 3.0 grade point average (GPA), and apply either the  
               year they graduate from high school or the following year  
               are entitled to an award that provides coverage for tuition  
               and fees.      
             b)   Cal Grant B Entitlement Awards.  Students that meet  
               income and asset (lower thresholds than Cal Grant A) and  


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               other eligibility requirements, have at least a 2.0 GPA and  
               apply either the year they graduate from high school or the  
               following year are entitled to a living allowance and  
               tuition and fee assistance.  Awards for first-year students  
               are limited to an allowance for books and living expenses.   
               In the second and subsequent years, the award provides  
               tuition and fee support. 
             c)   CCC Transfer Entitlement Awards.  Cal Grant A and B  
               awards are guaranteed to every student who graduated from a  
               California high school after June 30, 2000, was a  
               California resident at the time of high school graduation,  
               transferred to a qualifying baccalaureate-degree granting  
               institution from a CCC during the award year, was under the  
               age of 28 at the time of the transfer, and had a minimum  
               CCC GPA of 2.4.

             d)   Competitive Cal Grant A and B Awards.  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, 25,750  
               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 CCC students.

             e)   Cal Grant C Awards.  Students attending qualifying  
               occupational, technical, and vocational programs are  
               eligible for up to $547 for books and equipment and $2,462  
               for tuition and fees.  

          2)Maximum award amounts for California State University (CSU)  
            and University of California (UC) are established in the  
            annual Budget Act and have traditionally covered all  
            systemwide tuition and fees.  The maximum tuition award for  


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            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 (WASC)-accredited for-profit institutions is $8,056  
            (commencing 2015-16).  CCC students do not receive a Cal Grant  
            tuition award as the Board of Governors (BOG) Fee Waiver  
            program fully covers enrollment fees (but not other costs of  
            attendance) for financially needy students.
          FISCAL EFFECT:  According to the Assembly Appropriations  
          Committee, estimated General Fund costs for increasing the Cal  
          Grant Competitive Awards are $14 million in 2016-17, increasing  
          to about $50 million in 2019-20 and thereafter.

          COMMENTS:  Purpose of this bill.  According to the author, "to  
          remain economically competitive, California will need to produce  
          2.4 million more degrees by 2025 than the state is currently on  
          track to produce.  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.  The  
          author notes that, after taking into account the total cost of  
          attendance and all available financial aid, on average it is  
          more expensive for a needy student to go to a CCC than to attend  
          the UC or CSU.  This bill aims to renew California's commitment  
          to CCC affordability by making important changes to the Cal  
          Grant program to better assist CCC students."   

          Increasing the number of Competitive Cal Grant Awards.  As  
          previously noted, the Cal Grant Entitlement Programs guarantee  


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          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 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; Competitive Program award  
          recipients must significantly exceed minimum requirements.   
          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.  This bill proposes to increase the number of  
          Competitive Cal Grants from 25,750 to 34,000.  According to  
          supporters, this increase will help California's neediest  
          students take more classes, go to school full-time, and complete  
          their college degree.

          Authorizing CCC CTE students to receive a Cal Grant B.  Under  
          existing law, CCC CTE students at a CCC enrolled in programs of  
          between 4 months and 1 year in length are eligible for a Cal  
          Grant C award.  The Cal Grant C award requires students to apply  
          by March 1, and provides CCC students only $547 to cover  
          non-tuition related costs.  Currently, the Cal Grant C program  
          is underutilized, it is estimated that 3,000 grants will go  
          unclaimed in 2016-17.  The Cal Grant B Access Award provides CCC  
          students enrolled in programs of more than one year in length an  
          access grant of $1,656; the Competitive award cycle for CCC  
          students provides students until September to file an  
          application.  By moving (currently unclaimed) Cal Grant C awards  
          from the C program, and making CCC CTE students eligible for the  
          Cal Grant B award, this bill will increase grant award amounts  
          available to CCC CTE students and provide them with additional  
          time to file financial aid applications.   


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