BILL ANALYSIS Ó
AB 1892
Page 1
Date of Hearing: April 27, 2016
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Lorena Gonzalez, Chair
AB
1892 (Medina) - As Amended March 28, 2016
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Urgency: No State Mandated Local Program: NoReimbursable: No
SUMMARY:
This bill establishes, in lieu of the existing Cal Grant C
Program, establishes separate Cal Grant C Entitlement and
Competitive Award (C Entitlement / C Competitive) programs to
provide need-based financial aid to students enrolled in
occupational or technical training programs between four months
and two years in length. Specifically, this bill:
AB 1892
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1)Establishes the C Competitive program with the following
changes from the existing Cal Grant C program:
a) Reduces the qualifying income limits to align with the
Cal Grant B award program.
b) Establishes in statute the award amounts as follows for
non-California Community College (CCC) students, which
mirror amounts currently established in the Budget Act:
$2,462 for tuition and fees and $547 for access costs and
training-related costs, such as special clothing and
required tools and equipment.
c) Increases the current award of $547 for California
Community College (CCC) students by $2,462 to cover access
costs and training-related costs.
d) Requires the CCC Chancellor's Office, rather than the
California Student Aid Commission (CSAC), to identify and
provide the commission a regional inventory of high-demand
technical or certificated occupations for purposes of
prioritizing Competitive C applications.
e) Requires CSAC to develop an outreach plan about the
program, and requires the commission, rather than the
Legislative Analyst's Office to report on program outcomes.
2)Establishes a Cal Grant C Entitlement award for CCC students
taking high-demand/high earning occupational or technical
training programs identified by the commission that require
less than one academic year to complete.
AB 1892
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3)Requires those seeking a C Entitlement to apply within three
years after high school graduation and to meet the income
limits of the Cal Grant B program, and provides an award for
access costs of $3,000, which may be adjusted through the
annual Budget Act.
FISCAL EFFECT:
1)Annual net Cal Grant costs of around $21 million. [General
Fund]
a) Aligning with Cal Grant B Income Limits: CSAC estimates
that this would affect about 350 current recipients, and
result in General Fund savings of $200,000.
b) Increased Competitive Program Awards for CCC Students:
Estimated annual General Fund costs of $9.5 million for
increased awards to about 5,400 students.
c) Entitlement Program Awards: Estimated annual General
Fund costs of $12 million, based on average award amounts
and assuming 5,300 recipients.
2)Annual administrative costs for CSAC to modify the current
program and implement the entitlement program will be around
$300,000 for four positions. One-time contract costs for
information technology modifications and development will be
$500,000 to $1 million. [General Fund]
COMMENTS:
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1)Background. The existing Cal Grant C program provides
financial aid to support California students pursuing
occupational and technical training. Since 2000-01, the number
of new annual Cal Grant C awards is limited to 7,761. Awards
are worth up to $2,462 for tuition and a $547 stipend for
books and supplies, and may provide support for up to two
years. Students attending community college programs are only
eligible to receive the smaller stipend for books, not the
tuition grant, whereas students attending other schools
receive a combined grant.
According to CSAC, of the CCC students selected for an award,
only about half actually receive the award. In 2014-15,
13,715 CCC students were awarded a Cal Grant C, yet only 6,535
actually received an award. The take rate for private and
independent institutions is higher than that for CCC students.
It is not entirely clear why the take rate in CCC is so low;
some reasons provided include (1) the incentive created by the
higher tuition award amount provided to for-profit and
independent institutions, and (2) a lack of financial aid
staffing and outreach provided at CCCs.
2)Purpose. According to the author, California has prioritized
workforce development at CCCs; earlier this year, the CCC Task
Force on Workforce, Job Creation and a Strong Economy issued a
report that included 25 recommendations to strengthen
workforce education. Among its recommendations, the Task
Force highlighted the importance of strengthening the Cal
Grant C program and aligning the program with the CCC economic
development priorities.
The Cal Grant A and B Entitlement Awards guarantee an award
for recent California high-school graduates that meet specific
academic and income eligibility guidelines. However, students
who enroll in a program of less than one-year in length are
not eligible for an entitlement award. According to the
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Chancellor's Office, this includes programs in high-demand,
high-wage career fields such as business, IT, engineering
technology, health, public service and commercial services.
As many as 60,000 CCC students graduated from these
high-priority fields between 2010-11 and 2014-15.
Analysis Prepared by:Chuck Nicol / APPR. / (916)
319-2081