BILL NUMBER: SB 440	AMENDED
	BILL TEXT

	AMENDED IN SENATE  APRIL 13, 2015

INTRODUCED BY   Committee on Education (Senators Liu (Chair), Block,
Hancock, Huff, Leyva, Mendoza, Pan, and Vidak)

                        FEBRUARY 25, 2015

   An act to amend Section  66010   70037 
of the Education Code, relating to postsecondary education.


	LEGISLATIVE COUNSEL'S DIGEST


   SB 440, as amended, Committee on Education. Postsecondary
education: institutions. 
   Existing law establishes the California DREAM Loan Program, which
provides a student attending a participating campus of the University
of California or California State University with a loan, referred
to as a DREAM loan, if the student satisfies specified requirements.
The program requires the trustees and requests the regents to adopt
regulations providing for the withholding of institutional services
from current and former students who have been notified in writing
that they are in default on DREAM loans. The program specifies that
registration privileges may not be withheld from students who are in
default on DREAM loans.  
   This bill would authorize the withholding of registration
privileges from these students.  
   Existing law, the Donahoe Higher Education Act, sets forth the
missions and functions of the segments of the public postsecondary
education system in the state, including the University of
California, administered by the Regents of the University of
California, the California State University, administered by the
Trustees of the California State University, and the California
Community Colleges, administered by the Board of Governors of the
California Community Colleges. The act specifies that it is not
intended to regulate, subsidize, or intrude upon private education.
 
   This bill would make nonsubstantive changes to this provision.

   Vote: majority. Appropriation: no. Fiscal committee: no.
State-mandated local program: no.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:

   SECTION 1.    Section 70037 of the  
Education Code   is amended to read: 
   70037.  (a) The Trustees of the California State University and
the Regents of the University of California shall adopt regulations
providing for the withholding of institutional services from students
or former students who have been notified in writing at the student'
s or former student's last known address that he or she is in default
on a loan or loans under the DREAM Program.
   (b)  (1)    The regulations
adopted pursuant to subdivision (a) shall provide that the services
withheld may be provided during a period when the facts are in
dispute or when the student or former student demonstrates to either
the Trustees of the California State University or the Regents of the
University of California, as applicable, that reasonable progress
has been made to repay the loan or that there exists a reasonable
justification for the delay as determined by the institution. The
regulations shall specify the services to be withheld from the
student, which may include, but are not limited to, the following:

   (A) 
    (1)  The provision of grades. 
   (B) 
    (2)  The provision of transcripts. 
   (C) 
    (3)  The provision of diplomas. 
   (2) The services withheld pursuant to paragraph (1) shall not
include the withholding of registration privileges. 
   (c) "Default," for purposes of this section, means the failure of
a borrower to make an installment payment when due, or to meet other
terms of the promissory note under circumstances where the
institution holding the loan finds it reasonable to conclude that the
borrower no longer intends to honor the obligation to repay,
provided that this failure persists for 180 days for a loan repayable
in monthly installments, or 240 days for a loan repayable in less
frequent installments.
   (d) This section shall not impose any requirement upon the
University of California unless the Regents of the University of
California, by resolution, makes this section applicable. 
  SECTION 1.    Section 66010 of the Education Code
is amended to read:
   66010.  (a) Public higher education consists of (1) the California
Community Colleges, (2) the California State University, and each
campus, branch, and function thereof, and (3) each campus, branch,
and function of the University of California.
   (b) As used in this part, "independent institutions of higher
education" are nonpublic higher education institutions that grant
undergraduate degrees, graduate degrees, or both, and that are formed
as nonprofit corporations in this state and are accredited by an
agency recognized by the United States Department of Education.
   (c) This part is not intended to regulate, subsidize, or intrude
upon private education, including, but not limited to, independent
educational institutions and religious schools, or to vary existing
state law or state constitutional provisions relating to private
education.