BILL ANALYSIS                                                                                                                                                                                                    Ó



          SENATE COMMITTEE ON
          BUSINESS, PROFESSIONS AND ECONOMIC DEVELOPMENT
                              Senator Jerry Hill, Chair
                                2015 - 2016  Regular 

          Bill No:            AB 2609         Hearing Date:    June 13,  
          2016
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          |Author:   |Chau                                                  |
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          |Version:  |May 10, 2016                                          |
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          |Urgency:  |No                     |Fiscal:    |Yes              |
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          |Consultant|Bill Gage                                             |
          |:         |                                                      |
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                   Subject:  Advertising:  educational conferences


          SUMMARY:  Requires for-profit educational conference organizations, as  
          defined, that provide solicitation materials directly to a  
          school for purposes of distribution to a student, to include  
          specified disclosures in those materials and to provide the  
          materials in a sealed envelope addressed to the parent or  
          guardian of the student and to provide the disclosures on  
          separate documents addressed to the school and to any employee  
          thereof who is asked to distribute materials to a student.    

          Existing law:
          
          1)Pursuant to the federal Family Educational Rights and Privacy  
            Act (FERPA), protects the privacy of student education records  
            and specifies that it applies to all schools that receive  
            funds under an applicable program of the U.S. Department of  
            Education.  FERPA requires that schools, with certain  
            exceptions, obtain a parent or guardian's written consent  
            prior to the disclosure of personally identifiable information  
            from a child's education records.  (20 U.S.C. § 1232g; 34 CFR  
            Part 99) 


          2)Defines an "educational travel organization" (ETO) as a  
            person, partnership, corporation, or other entity who offers  
            educational travel programs for students residing, in the  
            State of California, and included an educational program as a  







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            component, and defines a "student traveler" as a person who is  
            enrolled in K-12 at a time an educational travel program is  
            arranged with an ETO.  (Business and Professions Code (BPC) §  
            17552)


           3) Establishes guidelines for an ETO and requires that a  
             written contract for educational travel include, among other  
             things, disclosure of the ETO's name, address, phone number  
             or other method of 24-hour telecommunications, statement on  
             whether or not the ETO maintains insurance that covers any  
             injury sustained by a student traveler, any additional costs  
             to students, staff qualifications required by the ETO for  
             staff who will accompany students, and specifies that it is a  
             violation to make misleading statements or substantial  
             representations in conducting an educational travel program.   
             (BPC § 17553 - 17556.5)


           4) Pursuant to the Student Online Personal Information  
             Protection Act (SOPIPA), prohibits an operator of a website,  
             online service, online application, or mobile application  
             from knowingly engaging in targeted advertising to students  
             or their parents or legal guardians, using covered  
             information to amass a profile about a 


           K-12 student, selling a student's information, or disclosing  
             covered information, unless otherwise specified.  (BPC §  
             22584(b)) 
          This bill:


          1)Defines an "educational conference" to mean a conference,  
            forum, camp, or other similar event, intended to develop the  
            leadership, career or college readiness of a student, or  
            provide some other form of educational benefit, when  
            participation in the event is represented as being limited to  
            students receiving an award, invitation or nomination to  
            participate in the event.



          2)Defines an "educational conference organization" (ECO) to mean  








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            a person, partnership, corporation, or other entity that  
            operates in a for-profit manner and that plans and advertises  
            educational conferences to students residing in California.



          3)Defines a "student" to mean a person who is enrolled in  
            elementary or secondary school, grade kindergarten through  
            grade 12, at the time an educational conference is arranged  
            with an ECO.



          4)Requires an ECO that provides materials related to an  
            educational conference directly to a school or employee for  
            purposes of distribution to a student to comply with all of  
            the following:



             a)   Provide materials in a sealed envelope or other  
               packaging addressed to the parent or legal guardian of the  
               student.



             b)   Include with the materials all of the following  
               disclosures, in clear and conspicuous language:



               i)     That the materials constitute a solicitation for the  
                 sale of a product.



            ii)    The legal form of the organization making the  
                 solicitation, including the for-profit status of the  
                 organization.



            iii)   The legal owner, if any, of the organization making the  
                 solicitation.








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            iv)    The specific eligibility criteria required for  
                 participation in the solicited educational conference or  
                 conferences, if any.



            v)     An itemized list of the costs to participate in the  
                 educational conference and the total price of  
                 participating in the educational conference, including  
                 estimated expenses not included in the price of the  
                 educational conference.



            vi)    That attendance at an educational conference may not  
                 affect a student's chances of being admitted to college,  
                 and that a parent or guardian should contact the  
                 student's school counselor for more information.



            vii)   Whether or not a nomination from a teacher or school  
                 administrator is required to participate in the  
                 educational conference, or if an individual may be  
                 self-nominated or nominated by a parent or guardian.



            viii)  The total amount, if any, of funding or other support,  
                 including employment or grants for school supplies, the  
                 organization has provided to the student's school or the  
                 school's employees during the last three years before the  
                 date of the solicitation.



            ix)    A phone number, email address, or website that a parent  
                 or guardian may use to contact a relevant government  
                 agency for purposes of filing a complaint related to the  
                 solicitation or the educational conference itself.









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          1)Requires the ECO to provide the disclosures described above on  
            separate documents addressed to the school and to any employee  
            thereof who is asked to distribute materials to a student.



          2)Makes legislative findings and declarations pertaining to the  
            importance of protecting students from false or misleading  
            advertising, promoting high-quality educational conference  
            experiences, and encouraging public confidence in youth  
            leadership conferences by establishing appropriate marketing  
            restrictions and disclosure requirements on for-profit  
            educational conference solicitations. 



          FISCAL  
          EFFECT:  According to the Assembly Committee on Appropriations  
          analysis dated May 18, 2016, this bill will result in minor,  
          non-reimbursable local costs due to the creation of a  
          misdemeanor, offset to some extent by potential fine revenue.
          
          COMMENTS:
          
          1. Purpose.  This measure is sponsored by the Author.  According  
             to the Author, this bill is intended to better protect  
             students from questionable marketing practices for  
             educational conferences by prohibiting for-profit ECOs from  
             distributing solicitation materials for educational  
             conferences directly to students at school, and by requiring  
             certain disclosures to be included with the solicitation, and  
             for those materials to be provided to the parent or legal  
             guardian of the student and to the school and to any employee  
             who is asked to distribute materials to a student. 



          Currently, as indicated by Author, some for-profit event  
             planning companies are using schools and teachers to deliver  
             marketing materials for expensive conferences directly to  
             K-12 students, often without their parents' knowledge or  
             consent. 








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          As stated by the Author, "By their own description, these  
             solicitations may appear to be an exclusive 'nomination' to  
             attend a prestigious youth leadership conference, when in  
             fact they are simply a sales pitch for a conference that  
             anyone could attend and can costs hundreds or even thousands  
             of dollars.  These solicitations are addressed directly to  
             the student rather than to the parent, and are delivered by a  
             trusted source; the student's teacher.   

          "These for-profit companies identify potential leads by asking  
             teachers to "nominate" students, although the criteria can be  
             vague, subjective or nonexistent.  Once delivered,  
             potentially with some public fanfare at school, "nominated"  
             students may mistakenly believe that they have won an award  
             or other competitive honor. 

          "However, according to a 2009 New York Times article about the  
             practice, there are no hard and fast criteria for nominators,  
             and teachers simply use their own discretion when identifying  
             potential applicants.  In some cases, these teachers are also  
             eligible to request 'grants' to pay for classroom supplies  
             from the same companies seeking student nominees - although  
             the teachers themselves may not be aware that the nomination  
             process is simply a means to generate a sale."

          The Author further notes that while these ECOs may provide a  
             worthwhile enrichment experience for some children who  
             participate, the misleading and manipulative nature of a  
             solicitation that appears to be an honor, and the fact that  
             the pitch is directly and publicly aimed at the student and  
             communicated through a teacher, raises serious questions of  
             student privacy and consumer protection.  "Young students are  
             particularly vulnerable to manipulative solicitations that  
             appear to be a competitive award or honor because of their  
             perceived value in applying for college, because a respected  
             teacher delivered the materials or perhaps because the  
             'nomination' was announced publicly before the student's  
             peers.

          As argued by the Author, current law is not adequate to protect  
             kids from directly receiving solicitations from for profit  
             event-planning organizations. California's Student Online  
             Personal Information Act (SOPIPA) only restricts targeted  








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             advertising by operators of websites designed and marketed  
             for K-12 purposes. Similarly, the Federal Educational Rights  
             and Privacy Act (FERPA) broadly protects the privacy of  
             student education records, but does not apply to "directory  
             information," which can include the student's name. 
          2.Background. 



          The Educational Conference Industry.  Educational conferences go  
             by a variety of different names: youth leadership camps,  
             experiential learning programs, and prestige conferences, but  
             what they all have in common is that they provide school-aged  
             children who are seeking extra-curricular activities for  
             personal enrichment, civic engagement or even an advantage  
             with future college admissions.  However, these programs vary  
             widely from one another in their marketing, admissions  
             criteria, selection processes, and costs to participate.

          Perhaps the most well-known example of an educational conference  
             provider is the American Legion's Boys and Girls State, which  
             was founded in 1935 to allow students to study the operation  
             of local, county and state government by participating in  
             activities such as legislative sessions or court proceedings  
             during their annual conferences.  Legion Posts select high  
             school juniors based on recommended guidelines that include  
             interviews to evaluate merit and ability in order to attend  
             their program.  In most cases, individual expenses are paid  
             by a sponsoring post, a local business or another  
             community-based organization.

          Rotary International also offers several programs for youth such  
             as the Rotary Youth Leadership Awards, which is a leadership  
             development program that hosts events that include  
             presentations, activities, and workshops that cover a variety  
             of topics.  Participants are nominated by their local Rotary  
             clubs, which often cover all expenses.  Both the American  
             Legion and Rotary programs are organized as non-profits. 

          There are also programs offered by for-profit companies, such as  
             the Junior National Young Leaders Conference, the National  
             Youth Leadership Forum, or the Global Young Leaders  
             Conference.  These programs solicit their participants  
             through a "nomination" process that relies on teachers to  








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             identify potential participants from among their own  
             students, and can cost hundreds or even thousands of dollars  
             to participate. 

          Consumer Protection Concerns about ECOs and their Nomination  
             Process.  According to a New York Times article in April of  
             2009, "Congratulations! You are Nominated. It's an Honor  
             (It's a Sales Pitch)", students are receiving conference  
             solicitations that "looked and sounded more like an Academy  
             Award than a sales pitch.  In fancy script, on weighty card  
             stock adorned by a giant gold seal . . .[it] promised a  
             'lifetime advantage' and 'valuable addition' to her resume.   
             It used words like 'elite,' distinguished,' 'select.'"

          Students who receive these offers may be led to believe that  
             attendance at these conferences is a highly selective honor  
             because of statements in the solicitation materials that call  
             nominees "the nation's most highly acclaimed students" and  
             "most promising young leaders of tomorrow."  However,  
             according to the article, "there are no hard and fast  
             criteria for nominators. . . .The nomination form asks for  
             nothing beyond the student's name, address, school year and  
             sex."

          The New York Times cites Jeff Sherrill, an associate director  
             with the National Association of Secondary School Principals,  
             who says that in his view, a leadership conference is no more  
             or less likely to enhance college applications than, say,  
             soccer camp.  "It doesn't fall into the same category as  
             being selected by your county where there was truly some type  
             of assessment and selection process.  Honors typically don't  
             come with a price tag," he says.

          The article goes on to say that "[l]eadership companies  
             marketing to teenagers spend handsomely on mailing lists (the  
             College Board is one source), but the biggest pipeline to  
             customers is teachers and program alumni.  Mailings usually  
             name the person making the nomination and include a list of  
             past participants from the student's school."

          Eligibility criteria may also be vague, or even non-existent.   
             For example, the website of one ECO (Envision EMI) suggests  
             that educators nominate students who "show special academic  
             promise, aspirations, and leadership potential, can meet the  








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             challenges of the program's rigorous curriculum, and will be  
             mature and confident contributors to group and program  
             activities."  However, no quantifiable criteria, such as  
             grade point average, are provided, and the nomination process  
             (requiring the student's name and address) can be completed  
             online.  Furthermore, a nominator need not even be the  
             student's teacher: Envision EMI allows any "teacher, educator  
             or mentor who is interested in giving students an  
             experiential learning opportunity outside the classroom is  
             eligible to nominate."  Once a nomination is made, marketing  
             materials designed to look like award letters will be  
             delivered to the student's school, addressed directly to the  
             student, or to the address provided in the nomination.

          The cost of for-profit conferences is also raised as an issue.   
             The Times article describes one program (Envision EMI's  
             week-long Congressional Youth Leadership Council (CYLC)) that  
             can costs upwards of $2,200, with airfare and meals not  
             included, which students are encouraged to pay for through  
             community fundraising: "Needy students are typically sent a  
             brochure with fund-raising ideas and success stories of other  
             students who have tapped friends, family and community to  
             help pay their way...."  In 2006, 1.7% of the revenues for  
             Envision's CYLC program went to grants and scholarships.

          FERPA and Access to Directory Information.  Although there are  
             several federal and state laws in place designed to protect  
             student privacy, certain exceptions exist that allow a  
             student's information to be released to outside  
             organizations.  For instance, FERPA permits schools to  
             disclose "directory information," defined as information that  
             is generally not considered  harmful or an invasion of  
             privacy if released, without written consent to a third  
             party, which can include companies that manufacture class  
             rings or publish yearbooks.

          Because ECOs are only accessing directory information when  
             asking teachers to nominate students, a FERPA violation does  
             not arise.
          3. Arguments in Support.  The  California Teachers Association   
             (CTA) is in support of this measure and indicates that  
             currently, some for-profit event planning companies are  
             delivering their marketing materials for expensive  
             conferences directly through public schools.  By their own  








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             description, these solicitations may appear to be an  
             exclusive nomination to attend a prestigious youth leadership  
             conference, when in fact they are simply a sales pitch for a  
             conference that can cost thousands of dollars.  These  
             solicitations are delivered by a trusted source; the  
             student's teacher.
          The CTA argues that teachers must know if the packet they are  
             asked to pass out to their class constitutes an advertisement  
             or an award.  This measure will require   disclosure to the  
             school and to any employee thereof asked to distribute  
             materials to the student.  It will clear up any confusion for  
             the teacher about whether the student is receiving a  
             competitive honor or whether it is in fact a solicitation for  
             a commercial purpose.

          The  Common Sense Kids Action  (CSKA) is also in support of this  
             measure and believe that it will protect school-aged children  
             from directly receiving potentially misleading solicitations  
             from for-profit companies to attend so-called "prestige  
             conferences."  As argued by CSKA, these solicitations are  
             sometimes designed to appear to be an exclusive nomination to  
             attend a prestigious youth leadership conference when in fact  
             they are simply a sales pitch for a conference that can cost  
             hundreds or even thousands of dollars.  Some of these camps  
             or conferences may provide a worthwhile enrichment experience  
             for some children who participate, but regardless, the  
             misleading and manipulative nature of a solicitation that  
             makes it appear to be an honor raises serious questions about  
             student privacy and consumer protection.  

           
          NOTE  :  Double-referral to Senate Committee on Judiciary, second.

          SUPPORT AND OPPOSITION:
          
           Support:  

          California Teachers Association
          Common Sense Kids Action

           Opposition:  

          None on file as of June 7, 2016.









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