BILL ANALYSIS Ó
AB 2506
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Date of Hearing: April 12, 2016
ASSEMBLY COMMITTEE ON HIGHER EDUCATION
Jose Medina, Chair
AB 2506
(Thurmond) - As Amended March 30, 2016
SUBJECT: Student financial aid: Chafee grant awards
SUMMARY: Requires the California Student Aid Commission (CSAC)
to provide a Chafee Educational and Training Voucher (Chafee) to
qualified students attending qualifying institutions.
Specifically, this bill:
1)Makes a number of findings and declarations, including:
a) Current and former foster youth who attend college
experience a low rate of persistence, transfer, and degree
completion.
b) Receipt of financial aid plays an important role in
persistence, transfer, and degree completion.
c) Access to the Chafee Educational and Training Voucher
(Chafee) is limited. One in four eligible applicants is not
awarded a grant due to limited funding.
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d) Low educational attainment is a factor in the poor adult
outcomes experienced by youth in foster care. Compared to
their same-age counterparts, former foster youth at 26
years of age are 400 percent more likely to have been
incarcerated and 300 percent more likely to be living below
the federal poverty level.
e) The Legislature recognizes its responsibility to provide
and adequately fund postsecondary programs and services for
students who are current and former foster youth attending
public postsecondary institutions.
f) The Legislature recognizes the importance of quality
education, and has taken action in the past to ensure
financial aid is directed to postsecondary institutions at
which the graduation rate and cohort default rate reflect a
reasonable likelihood of student graduation and success.
g) It is necessary and appropriate to take steps to
encourage the enrollment, retention, and transfer of
current and former foster youth in California's public
colleges and universities by ensuring that all foster youth
who meet the eligibility criteria for the Chafee receive a
grant.
2)Establishes, to the extent permitted by federal law, standards
for postsecondary educational institutions to be classified as
Chafee qualifying institutions.
3)Requires the California Student Aid Commission (CSAC) to
certify by October 1 of each year a postsecondary educational
institution's latest three-year cohort default rate and
graduation rate as most recently reported by the United States
Department of Education.
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4)Requires a federal Chafee participating institution to meet
the following, consistent with Cal Grant institutional
participation requirements:
a) A three-year cohort default rate that is equal to or
less than 15.5 percent, as certified by the commission on
October 1, 2017, and on October 1 of any year thereafter.
b) For purposes of the 2017-18 academic year, and every
academic year thereafter, a graduation rate of 30 percent
or greater for students taking 150 percent or less of the
expected time to complete degree requirements.
c) Provides that the aforementioned requirements do not
apply to institutions with 40% or less of undergraduate
students borrowing federal student loans.
d) Provides that the aforementioned requirements do not
apply to institutions where an eligible Chafee grant
recipient is attending an institution outside of
California.
5)Requires CSAC to notify Chafee grant recipients regarding
institutional ineligibility and to provide students with a
list of eligible institutions.
6)Provides that, commencing with the 2017-18 academic year,
current and former foster youth are entitled to a Chafee grant
award, and that CSAC shall allocate that award to foster youth
that meet all of the following criteria:
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a) He or she meets the Chafee grant requirements as set
forth in the federal John H. Chafee Foster Care
Independence Program.
b) He or she submits a Free Application for Federal Student
Aid (FAFSA) and a Chafee grant application between January
1 and September 2 of each calendar year for the academic
year beginning in the fall of that calendar year.
7)Provides that the amount of any individual Chafee grant award
shall depend on the cost of attendance at the qualifying
institution at which the student is enrolled. For each
applicant, the award amount shall not exceed the amount of the
calculated financial need.
EXISTING LAW:
1)Establishes CSAC to administer California's student financial
aid programs. CSAC administers the Chafee program funded by
federal and state monies provided through the California
Department of Social Services.
2)Federal law establishes the John H. Chafee Foster Care
Independence Program to provide, among other benefits,
education and training vouchers to qualifying current and
former foster youth.
FISCAL EFFECT: Unknown.
COMMENTS: Background. The federal John H. Chafee Foster Care
Independence Program (CFCIP) was created in 1999 to offer
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assistance to current and former foster care youths in achieving
self-sufficiency. Federal grants are offered to States who
submit a plan to assist youth in a wide variety of areas
designed to support a successful transition to adulthood. The
Educational and Training Vouchers Program (ETV) for Youths Aging
out of Foster Care was added to the CFCIP in 2002. ETV provides
resources specifically to meet the education and training needs
of youth aging out of foster care.
In California, the Chafee Grant for Foster Youth provides up to
$5,000 in grants to foster youth. The budget for the program is
about $11.5 million, which is evenly split between federal funds
($5.6 million) and the state General Fund. State funding for
the program is accounted for in the Department of Social
Services (DSS) budget, the funding is distributed to CSAC
through a Memorandum of Understanding (MOU) that outlines
program operations; CSAC then directs money to students pursuant
to the requirements of the MOU. Current or former foster youth
qualify for the Chafee if they are under age 22 and were in
foster care in out-of-home placement at any time between the
ages of 16 and 18. The maximum grant is $5,000 per academic
year; the average awarded grant in 2014-15 was $3,251. The
program serves about 2,228 students.
Purpose of this bill. According to the author, this bill seeks
to address the low rates of college persistence and completion
among foster youth in California. There are two deficiencies in
current law that AB 2506 seeks to remedy:
1)Insufficient funding. The funding available to the Chafee is
inadequate to meet the current demand, which has increased
considerably with the expansion of foster care in 2012. In the
2014-15 school year, 4,609 students applied for the Chafee ETV
and were determined to be eligible in 2014-15. However, due to
insufficient funds, 1,115 eligible applicants did not receive
a grant. Currently, there is no application deadline or
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guarantee of funds and applications are processed on a rolling
basis until all funds are expended. This often results in
students not learning whether they received a grant until well
into the school term.
This bill would entitle all eligible students who apply for a
Chafee by September 2nd to receive a grant. Committee staff
notes there is no funding source provided in this bill.
Additionally, issues such as maximum program awards are not
addressed in this bill. Committee staff understands that the
author's intent is for the requirements of this bill to
supplement the existing requirements of the MOU; moving
forward this intent should be clarified in the bill.
2)Poor-quality institutions. Current law does not require
Chafee grants to be used at postsecondary institutions that
meet baseline performance measures. The Cal Grant Program
requires participating institutions to meet minimum rates of
graduation and loan repayment. The author notes reports of
for-profit colleges marketing specifically to vulnerable
student populations, including veterans and foster youth, in
order to access financial aid.
This bill would prohibit Chafee grants from being used at
California institutions that fail to meet the graduation rate
and cohort default rate requirements of the Cal Grant program.
This change could affect existing grant recipients; moving
forward the author may wish to consider allowing existing
grant recipients to continue at their current institution.
Alternatively, the bill could reinstate any lost award years
to allow students to transfer to, and in some cases start over
at, higher-quality institutions.
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REGISTERED SUPPORT / OPPOSITION:
Support
Alliance for Children's Rights
American Federation of State, County and Municipal Employees
California Alliance of Children and Family Services
California State University, San Marcos
Cerritos College
Children's Law Center of California
Children Now
First Place for Youth
Foster Youth Success Initiative at Fullerton College
Frontier High School
Guardian Scholars Program, City College of San Francisco
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Junior Leagues of California
Mission College
National Association of Social Workers-California Chapter
New Alternatives, Inc.
Plumas Crisis Intervention and Resource Center
Shasta College
Skyline College
Smith Renaissance Society at the University of California, Santa
Cruz
University of Southern California
Voices Youth Centers of California
Woodland Community College
Opposition
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None on File
Analysis Prepared by:Laura Metune / HIGHER ED. / (916) 319-3960