BILL ANALYSIS Ó
AB 2506
Page 1
ASSEMBLY THIRD READING
AB
2506 (Thurmond)
As Amended May 27, 2016
Majority vote
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|Committee |Votes|Ayes |Noes |
| | | | |
| | | | |
| | | | |
|----------------+-----+----------------------+--------------------|
|Higher |13-0 |Medina, Baker, Bloom, | |
|Education | |Chávez, Irwin, | |
| | |Jones-Sawyer, Levine, | |
| | |Linder, Low, Olsen, | |
| | |Santiago, Weber, | |
| | |Williams | |
| | | | |
|----------------+-----+----------------------+--------------------|
|Appropriations |20-0 |Gonzalez, Bigelow, | |
| | |Bloom, Bonilla, | |
| | |Bonta, Calderon, | |
| | |Chang, Daly, Eggman, | |
| | |Gallagher, Eduardo | |
| | |Garcia, Roger | |
| | |Hernández, Holden, | |
| | |Jones, Obernolte, | |
| | |Quirk, Santiago, | |
| | |Wagner, Weber, Wood | |
| | | | |
| | | | |
AB 2506
Page 2
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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)Establishes, to the extent permitted by federal law, standards
for postsecondary educational institutions to be classified as
Chafee qualifying institutions.
2)Requires 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.
3)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%, 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% or
greater for students taking 150% 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.
AB 2506
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d) Provides that the aforementioned requirements do not
apply to institutions where an eligible Chafee grant
recipient is attending an institution outside of
California.
4)Requires CSAC to notify Chafee grant recipients regarding
institutional ineligibility and to provide students with a
list of eligible institutions.
5)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:
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.
6)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: Establishes CSAC to administer California's
student financial aid programs. CSAC administers the Chafee
AB 2506
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program funded by federal and state monies provided through the
California Department of Social Services. 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: According to the Assembly Appropriations
Committee:
1)Estimated additional General Fund costs of $4 million in the
first year for entitlement program awards, based on 1,230
additional awards and an average award of $3,234. There were
1,115 eligible applicants that, under the current Chaffee
program, did not receive an award in 2014-15 due to
insufficient resources. In addition, CSAC indicates that
another 845 applicants were deemed ineligible from due to lack
of a single piece of required information. CSAC expects that
new administrative procedures soon to be implemented to assist
such applicants will increase eligibility, which would lead to
an entitlement award. Annual costs would increase to around
$11 million in the third year and thereafter.
2)CSAC administrative costs (General Fund) will be about $60,000
one-time and $270,000 ongoing for four positions to implement
the entitlement program. The commission indicates that the
Chafee program is relatively labor intensive due to the
population it serves and the need to coordinate among various
agencies.
COMMENTS: Background. The federal John H. Chafee Foster Care
Independence Program (CFCIP) was created in 1999 to offer
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
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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 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 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.
AB 2506
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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.
Analysis Prepared by:
Laura Metune / HIGHER ED. / (916) 319-3960 FN:
0003149