BILL ANALYSIS Ó AB 1888 Page 1 Date of Hearing: May 11, 2016 ASSEMBLY COMMITTEE ON APPROPRIATIONS Lorena Gonzalez, Chair AB 1888 (Low) - As Amended May 2, 2016 ----------------------------------------------------------------- |Policy |Higher Education |Vote:|8 - 1 | |Committee: | | | | | | | | | | | | | | |-------------+-------------------------------+-----+-------------| | | | | | | | | | | | | | | | ----------------------------------------------------------------- Urgency: No State Mandated Local Program: NoReimbursable: No SUMMARY: This bill requires, as a condition of voluntary participation in the Cal Grant Program, each Cal Grant participating public and private higher education institution, commencing in 2017-18, to certify both of the following to the California Student Aid Commission (CSAC): AB 1888 Page 2 1)The institution does not subject an applicant, student or employee to discrimination on the basis of disability, gender, gender identity, gender expression, nationality, race or ethnicity, religion, sexual orientation, age, or disability or any characteristic contained in the state's prohibition of hate crimes, per Penal Code Section 422.6. 2)The institution shall not have, apply for, or receive a waiver from the United States Department of Education (USDE) from federal nondiscrimination requirements for the receipt of funds under Title IX of the Education Amendments of 1972. The bill also: 3)Provides that, notwithstanding (1): a) A religious educational institution may hire or employ, or admit or enroll, persons of a particular religion if that educational institution is controlled by a religious institution and the educational institution is directed toward the propagation of that particular religion. b) An institution that since its establishment has had a policy of admitting students of only one sex may continue to do so. 4)Stipulates that (2) does not apply to an institution that received a waiver, but provides evidence to CSAC prior to 2017-18 that it has relinquished the waiver. 5)Stipulates the Cal Grant recipients attending an institution prior to the academic year in which the institution is deemed ineligible for Cal Grant participation pursuant to this bill are eligible for renewal of their Cal Grant awards for as long as they remain continuously enrolled at that institution. AB 1888 Page 3 FISCAL EFFECT: 1)CSAC anticipates needing one new auditor position ($120,000 annually GF) to review institutional compliance and student/employee discrimination complaints. The commission indicates that this is similar to the workload demands of recently enacted legislation that also conditioned Cal Grant participation of specific institutional actions. 2)Given the consequences to the institutions that could be impacted by this bill and the legal issues raised by this bill (see Comment #4 below), the probability of litigation against the state appears fairly high. The state could therefore incur significant legal costs, at least in the hundreds of thousands of dollars. 3)Based on information from CSAC, seven institutions that participate in the Cal Grant Program have either received or requested a federal waiver: Biola University, Fresno Pacific University, Loma Linda University, Pacific Union College, The Master's College, Simpson University, and William Jessup University. (Pepperdine University requested withdrawal of its religious exemption in January 2016.) In 2014-15, about 3,200 students at these seven schools-representing 20% to 50% of their respective undergraduate enrollments-received $26.6 million in Cal Grants. The most recent amendments to this bill allow these students to remain that their institution and continue to receive their Cal Grant. These costs will decline over four years as these students complete their Cal Grant eligibility. If these schools do not relinquish their federal waivers, and to the extent new students eligible under the Cal Grant Entitlement Program would attend one of these schools, and thus forego their Cal Grant award, the state would realize unknown, but potentially significant Cal Grant savings. (The maximum Cal Grant award at such schools is currently about AB 1888 Page 4 $8,000.) Many such students likely would elect to attend another institution that participates in the Cal Grant program, however, thus the extent of any possible savings is unknown. To the extent some of the Cal Grant-eligible students described above would instead attend a California Community College or the California State University (CSU), the state would bear the costs of those students attendance. For every 100 additional CCC or CSU students, state costs would be $475,000 (GF-Prop 98) at the CCC or $750,000 (General Fund) at the CSU. These costs would be offset to some extent by savings from lower Cal Grant awards amounts at the CCC and CSU. COMMENTS: 1)Purpose. According to the author, AB 1888 upholds California's commitment to nondiscrimination by requiring all Cal Grant participating institutions to certify to CSAC that they shall not discriminate on the basis of a protected class, including, sex, sexual orientation, gender identity, or gender expression. The author argues that allowing religion to be used as an instrument for discrimination goes against California public policy and should not be supported with state funding. Equality California (EQCA), the bill's sponsor, argues that religious protection should not be used to justify discrimination. According to EQCA, overly broad religious exemptions leave room for individuals and institutions to discriminate depending on how they apply, or choose not to apply, their religious beliefs. 2)The Equity in Education Act prohibits, among other protections, a person from being subjected to discrimination on the basis of disability, gender, gender identity, gender AB 1888 Page 5 expression, nationality, race or ethnicity, religion, sexual orientation, or any other characteristic that is contained in the definition of hate crimes, in any program or activity conducted by an educational institution that receives, or benefits from, state financial assistance or enrolls pupils who receive state student financial aid. An exemption is provided for an educational institution that is controlled by a religious organization if the application would not be consistent with the religious tenets of that organization. 3)Federal Title IX of the Education Amendments of 1972 (Title IX) prohibits discrimination, on the basis of sex, in educational programs or activities receiving Federal financial assistance. Various exemptions are provided, including for fraternities and sororities, military institutions, traditional male or female institutions, and institutions controlled by religious organizations. An exemption is provided for religious colleges that fall within specified guidelines. Federal guidance issued in 2014 clarified that the Title IX discrimination prohibition "extends to claims of discrimination based on gender identity or failure to conform to stereotypical notions of masculinity or femininity." In response to the USDE guidance, a number of religious institutions have applied for exemption to Title IX. According to a report from the HRC, 56 schools nationwide have requested an exemption, 33 have received an exemption from the law as it pertains to protecting students on the basis of gender identity, and 23 have obtained an exemption based on laws pertaining to protecting students on the basis of sexual orientation. Schools most commonly requested exemptions from provisions of the law relating to housing, access to facilities, and athletics. 4)Opposition. The Association of Independent California Colleges and Universities (AICCU) argues, based on current enrollments, that AB 1888 could impact almost 9,000 who would otherwise attend one of the state's faith-based colleges. These low-income students would either have to forgo their Cal AB 1888 Page 6 Grants or attend a different institution that would still participate in the Cal Grant program. Several AICCU member schools expressed similar concerns. The National Center for Law and Policy argues that AB 1888 unnecessarily restricts educational choices and "serves as an existential threat to church autonomy, the self-governance of religious organizations, and religious liberty?" The Center alludes to lawsuits challenging the unconstitutionality of AB 1888, "which coerces a waiver of federal constitutional and statutory rights. Analysis Prepared by:Chuck Nicol / APPR. / (916) 319-2081