BILL ANALYSIS Ó
AB 2546
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ASSEMBLY THIRD READING
AB
2546 (Calderon)
As Amended April 7, 2016
Majority vote
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|Committee |Votes|Ayes |Noes |
| | | | |
| | | | |
| | | | |
|----------------+-----+----------------------+--------------------|
|Education |6-0 |O'Donnell, Kim, | |
| | |McCarty, Santiago, | |
| | |Thurmond, Weber | |
| | | | |
|----------------+-----+----------------------+--------------------|
|Appropriations |17-3 |Gonzalez, Bloom, |Bigelow, Jones, |
| | |Bonilla, Bonta, |Wagner |
| | |Calderon, Chang, | |
| | |McCarty, Eggman, | |
| | |Gallagher, Eduardo | |
| | |Garcia, Chau, Holden, | |
| | |Obernolte, Quirk, | |
| | |Santiago, Weber, Wood | |
| | | | |
| | | | |
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SUMMARY: Requires that, when the history-social science
curriculum framework is revised after January 1, 2017, the
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Instructional Quality Commission (IQC) consider including
specified content on financial literacy. Specifically, this
bill:
1)Requires that, when the history-social science curriculum
framework is revised after January 1, 2017, the IQC consider
including content on financial literacy at least twice in
grade spans: kindergarten through grade five, grades six
through eight, and grades nine through 12.
2)Requires that the IQC consider including instruction on:
a) Fundamentals of banking for personal use, including, but
not limited to, savings and checking
b) Principles of budgeting and personal finance
c) Employment and understanding factors that affect net
income
d) Uses and costs of credit, including the relation of debt
and interest to credit
e) Uses and costs of loans, including student loans
f) Types and costs of insurance
g) Forms of governmental taxation
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h) Principles of investing and building wealth
i) Identity theft and security
j) Planning and paying for postsecondary education
aa) Charitable giving
FISCAL EFFECT: According to the Assembly Appropriations
Committee, no current fiscal effect to the California Department
of Education (CDE). As written, the bill would not require
additional consideration until the next framework, which is not
likely to occur until 2024. It is difficult to project costs
that may occur eight years from now.
COMMENTS:
Need for the bill. According to the author, "Financial
illiteracy negatively impacts young people entering the labor
market. Young adults aged 18 to 25 tend to have large amounts
of credit card and student loan debt upon entering the
workforce. Lacking a clear understanding of basic financial
concepts, 18-25 year-olds are more likely to rely on high-cost
methods of borrowing. Risky borrowing not only undermines future
homeownership but also the ability to control one's financial
future.
"Financial illiteracy also hinders adults and their hopes for
retirement. Without a base knowledge of financial tools, adults
are less likely to invest in retirement plans. According to the
Employment Benefit Research Institute, 46% of Americans have
less than $10,000 saved for retirement. Another survey found
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that 15% had not saved a single cent. Low saving and retirement
participation rates could lead to a dramatic increase in the
number of people on welfare and drive up costs nationally.
"Research has shown that early introduction to financial
concepts and repetition of those lessons yields a deeper
understanding. As a result, students who had financial
education courses early and more often had higher rates of
savings and were less likely to rely on high-cost methods of
borrowing."
Curriculum, standards, frameworks, and model curricula.
California's public school curriculum is based on content
standards in various subjects, including English-Language Arts,
Mathematics, Science, History-Social Science, Physical
Education, English Language Development, Career Technical
Education, Health Education, World Languages, and Visual and
Performing Arts. These standards are developed by the IQC
through a public process, and are adopted by the SBE.
These standards form the basis of California's curriculum
frameworks. These documents guide the implementation of these
standards, and are used to establish criteria for the evaluation
of instructional materials for state adoption for grades
kindergarten through grade eight. They also guide district
selection of instructional materials for grades nine through
twelve. In addition to developing standards in the above
subject areas, the Superintendent of Public Instruction is
sometimes directed by law to develop model curricula on
different topics, such as those on the life of Cesar Chavez, and
on human rights and genocide.
Draft History-Social Science Framework revision addresses
financial literacy. The CDE is in the process of revising the
state's curriculum framework in history-social science. The
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draft revision to the framework released in September, 2014
includes financial literacy content in at least the following
grades:
Grade 1: Students acquire a beginning understanding of
economics, including how people exchange money for goods and
services, and how people make choices about how to spend
money, including budgeting.
Grade 2: Students learn basic economic concepts of human
wants, scarcity, and choice, and the importance of
specialization in work today. Students also develop an
understanding of their roles as consumers in a complex
economy.
Economics course: Students learn about personal budgeting,
banking, debt, credit cards, interest, student loan debt,
mortgage debt, saving, and investing. This content is
presented in relation to larger economic issues and concepts.
Elective course outline: Students learn about credit cards
and other forms of consumer debt, savings and budgeting,
retirement planning, state and federal laws related to
personal finance (e.g., bankruptcy), financial credit scores,
credit card applications, bank account applications, simple
and compound interest calculations, retirement calculations,
and mortgage and interest rates. Students also learn about
the importance of managing credit and debt, and about identity
theft security.
History-social science framework adoption delayed. The
History-Social Science standards currently in use were adopted
in 1998, and the most recent framework was published in 2005.
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The Curriculum Development and Supplemental Materials Commission
(now the IQC) began revising the History-Social Science
Framework in January of 2008. A significant amount of the
process had been completed (focus groups, selection of
evaluation criteria committee members, five drafting meetings)
when in 2009 the state's fiscal emergency halted all work on
instructional materials adoptions and framework revisions until
the 2013-14 school year AB 2 X4 (Evans) Chapter 2, Statutes of
2009-10 Fourth Extraordinary Session. That suspension was later
extended until the 2015-16 school year by SB 70 (Budget and
Fiscal Review Committee), Chapter 7, Statutes of 2011.
The IQC began work again on the revision in July, 2014, and
released the draft History-Social Science framework for field
review in September, 2014. The draft generated extensive public
comment it generated (nearly 700 comments). The IQC also
determined that more subject matter expertise was needed certain
areas (including some mandated for inclusion by legislation),
and submitted a budget request for $124,000 to hire experts
through an interagency agreement. The IQC held a second field
review for this draft from November 2015 through February 2016.
These events have caused significant delays in the production of
the revised framework. Originally scheduled for adoption in May
2015, this framework is now set to be recommended to the SBE by
May 2016, with final publication in winter, 2016. Because this
framework is likely to be adopted in 2016, and curriculum
frameworks are revised every eight years, the requirements of
this bill would not go into effect until 2024.
Analysis Prepared by:
Tanya Lieberman / ED. / (916) 319-2087 FN:
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