BILL ANALYSIS Ó ----------------------------------------------------------------- |SENATE RULES COMMITTEE | AB 2506| |Office of Senate Floor Analyses | | |(916) 651-1520 Fax: (916) | | |327-4478 | | ----------------------------------------------------------------- THIRD READING Bill No: AB 2506 Author: Thurmond (D), et al. Amended: 8/19/16 in Senate Vote: 21 SENATE EDUCATION COMMITTEE: 9-0, 6/22/16 AYES: Liu, Block, Hancock, Huff, Leyva, Mendoza, Monning, Pan, Vidak SENATE APPROPRIATIONS COMMITTEE: 7-0, 8/11/16 AYES: Lara, Bates, Beall, Hill, McGuire, Mendoza, Nielsen ASSEMBLY FLOOR: 78-1, 6/1/16 - See last page for vote SUBJECT: Student financial aid: Chafee grant awards SOURCE: Author DIGEST: This bill requires postsecondary education institutions to meet eligibility requirements to receive Chafee funds, similar to existing provisions of the Cal Grant program. Senate Floor Amendments of 8/19/16 strike all existing provisions of the bill, and recast provisions that require Chafee grants to be awarded to a student only if the student attends a qualifying institution that is eligible for participation in the Cal Grant program or an institution that is located outside of California (thereby shifting the administrative details from this bill to the Memorandum of Understanding between the California Student Aid Commission and the Department of Social Services). AB 2506 Page 2 ANALYSIS: Existing law: 1)Establishes the California Student Aid Commission (CSAC) for the purpose of administering specified student financial programs. (Education Code § 69510, et seq.) 2)Establishes requirements for postsecondary education institutions to participate in the Cal Grant program, and requires, for the 2012-13 and subsequent academic years, an institution to maintain a graduation rate above 30% and a three-year cohort student loan default rate of less than 15.5%. (EC § 69432.7) 3)Establishes the federal John H. Chafee Foster Care Independence Program to provide, among other benefits, education and training vouchers to qualifying current and former foster youth. (United States Code, Title 42, § 677) 4)Provides that CSAC, through an interagency agreement with the Department of Social Services, operates a federally funded scholarship program that provides grant aid to provide access to California's current and former foster youth to postsecondary education. (EC § 69519) This bill requires the CSAC, beginning with the 2017-18 award year, to make a new Chafee grant award to a student only if the student attends either of the following: 1)A qualifying institution that is eligible for participation in the Cal Grant Program. 2)An institution that is not located in California that AB 2506 Page 3 satisfies the "qualifying institution" requirements of the Cal Grant Program. Comments Chafee eligibility requirements. To qualify for a Chafee Educational and Training Voucher (ETV), students must: 1)Be a current or former foster youth, with dependency established or continued by the court between ages 16-18. 2)Be under the age of 22 years as of July 1 of the award year. Students must fill out the Free Application for Federal Student Aid, or California Dream Act Application, and the California Chafee grant application. The Chafee ETV is not an entitlement, unlike the Cal Grant program. Qualifying institutions. The Chafee ETV may be used at any eligible California college as well as colleges in other states. In California, students may use the Chafee grant at career and technical schools, California Community Colleges, the California State University, the University of California, independent colleges, and private colleges. Existing law requires postsecondary education institutions to maintain, in order for students to use Cal Grants to attend those institutions, a graduation rate above 30% and a three-year cohort student loan default rate of less than 15.5%. This bill requires institutions to meet the standards established in statute for participation in the Cal Grant program. Funding. In California, the Chafee ETV provides up to $5,000 in grants to current and former foster youth. The budget for the program is approximately $11.5 million, which is evenly split between federal funds ($5.6 million) and the state General Fund. AB 2506 Page 4 State funding for the program is accounted for in the Department of Social Services budget. The 2016 Budget Act includes an additional $3 million for the Chafee ETV. The maximum Chafee grant is $5,000 per academic year; the average awarded grant in 2014-15 was $3,251. The program serves about 2,228 California students. FISCAL EFFECT: Appropriation: No Fiscal Com.:YesLocal: No According to the Senate Appropriations Committee, the CSAC indicates that verifying institutions' eligibility for the use of Chafee grant awards by its students would impose minor and absorbable costs to the CSAC. SUPPORT: (Verified8/19/16) None received OPPOSITION: (Verified8/19/16) None received ASSEMBLY FLOOR: 78-1, 6/1/16 AYES: Achadjian, Alejo, Travis Allen, Arambula, Atkins, Baker, Bigelow, Bloom, Bonilla, Bonta, Brough, Brown, Burke, Calderon, Campos, Chang, Chau, Chávez, Chiu, Chu, Cooley, Cooper, Dababneh, Dahle, Daly, Dodd, Eggman, Frazier, Gallagher, Cristina Garcia, Eduardo Garcia, Gatto, Gipson, Gomez, Gonzalez, Gordon, Gray, Grove, Hadley, Roger Hernández, Holden, Irwin, Jones, Jones-Sawyer, Kim, Lackey, Levine, AB 2506 Page 5 Linder, Lopez, Low, Maienschein, Mathis, Mayes, McCarty, Medina, Melendez, Mullin, Nazarian, Obernolte, O'Donnell, Olsen, Patterson, Quirk, Ridley-Thomas, Rodriguez, Salas, Santiago, Steinorth, Mark Stone, Thurmond, Ting, Wagner, Waldron, Weber, Wilk, Williams, Wood, Rendon NOES: Harper NO VOTE RECORDED: Beth Gaines Prepared by:Lynn Lorber / ED. / (916) 651-4105 8/22/16 23:05:44 **** END ****