BILL NUMBER: AB 1118 CHAPTERED 07/06/99 CHAPTER 72 FILED WITH SECRETARY OF STATE JULY 6, 1999 APPROVED BY GOVERNOR JULY 6, 1999 PASSED THE ASSEMBLY JUNE 16, 1999 PASSED THE SENATE JUNE 15, 1999 AMENDED IN SENATE JUNE 15, 1999 INTRODUCED BY Assembly Members Reyes, Ducheny, Machado, Jackson, Correa, Florez, Havice, Zettel, and Rod Pacheco and Senators Brulte, McPherson, Rainey, Schiff, Baca, Haynes, Johannessen, Johnson, Kelley, Knight, Leslie, Lewis, Monteith, Morrow, Mountjoy, Ortiz, and Poochigian FEBRUARY 25, 1999 An act to amend Sections 66025, 69615.6, 69618.1, 69618.2, 69618.3, and 76300 of the Education Code, relating to postsecondary education, and declaring the urgency thereof, to take effect immediately. LEGISLATIVE COUNSEL'S DIGEST AB 1118, Reyes. Postsecondary education: systemwide fees: Graduate Assumption Program of Loans for Education. (1) Existing law provides for a public postsecondary educational system in this state, which consists of the University of California, the California State University, and the California Community Colleges. Existing law requires systemwide fees charged to resident undergraduate students at the University of California and the California State University to be reduced for the 1998-99 fiscal year by 5% below the level charged during the 1997-98 fiscal year, and, for the 1999-2000 fiscal year, to be at the same level as for the 1998-99 fiscal year. This bill would require systemwide education and registration fees charged to resident undergraduate students at the University of California and the California State University for the 1999-2000 fiscal year to be reduced by 5% below the level charged for those resident students for the 1998-99 fiscal year. (2) Existing law establishes the Assumption Program of Loans for Education, under which an applicant enrolled in a participating institution of postsecondary education, or who agrees to participate in a qualifying teacher training program, is eligible to receive a loan assumption warrant upon completing a specified period of teaching in a public elementary or secondary school. Existing law provides that, for the 1998-99 school year, and each school year thereafter, the Student Aid Commission is required to issue warrants for the assumption of up to 4,500 loans under this program. This bill would require the commission to issue warrants for the assumption of up to 5,500 loans each school year, commencing with the 1999-2000 school year. The bill would require, beginning with the 2000-01 school year, and each school year thereafter, the commission to issue up to 100 of those warrants for the assumption of student loans for applicants who agree to teach in school districts serving rural areas. (3) Existing law establishes the Graduate Assumption Program of Loans for Education, under which an applicant enrolled in a participating institution of postsecondary education, and who agrees, upon graduation, to teach full-time at a California college or university, is eligible to receive a conditional warrant for loan assumption, to be redeemed pursuant to a prescribed procedure upon becoming employed as a full-time teacher at a California college or university. The bill would make persons who render the equivalent of full-time service by teaching part-time at more than one California college or university eligible to participate in the program. (4) Existing law establishes the fee charged per unit per semester charged to resident undergraduate students at the California Community Colleges at $13, except that for the 1998-99 and 1999-2000 academic years the fee per unit per semester is $12. This bill would reduce this fee to $11 per unit per semester, effective with the fall term of the 1999-2000 academic year. (5) The bill would declare that it is to take effect immediately as an urgency statute. THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS: SECTION 1. Section 66025 of the Education Code is amended to read: 66025. (a) Systemwide fees charged to resident undergraduate students at the University of California and the California State University shall be reduced for the 1998-99 fiscal year by 5 percent below the level charged during the 1997-98 fiscal year, and the systemwide fees charged to those students for the 1999-2000 fiscal year shall be reduced by 5 percent below the level charged during the 1998-99 fiscal year. Systemwide education and registration fees charged to resident graduate students at the University of California and the California State University for the 1999-2000 fiscal year shall be reduced by 5 percent below the level charged those resident students for the 1997-98 fiscal year. This subdivision does not apply to resident students pursuing a course of study leading to a professional degree who are subject to a supplemental fee pursuant to the policy of the University of California. (b) No provision of this section shall apply to the University of California except to the extent that the Regents of the University of California, by appropriate resolution, make that provision applicable. SEC. 2. Section 69615.6 of the Education Code is amended to read: 69615.6. (a) Beginning no later than the 1986-87 school year, and each school year thereafter up to and including the 1997-98 school year, the commission shall issue warrants for the assumption of up to 500 student loans for program participants eligible under this article. (b) For the 1998-99 school year, the commission shall issue warrants for the assumption of up to 4,500 student loans for program participants eligible under this article. (c) For the 1999-2000 school year, and each school year thereafter, the commission shall issue warrants for the assumption of up to 5,500 student loans for program participants eligible under this article. (d) Commencing with the 2000-01 school year, and each school year thereafter, up to 100 of the 5,500 warrants issued pursuant to subdivision (c), shall be issued for the assumption of student loans for applicants who agree to teach in school districts serving rural areas. (e) The issuance of warrants shall be subject to funding to be provided in the Budget Act for each fiscal year. SEC. 3. Section 69618.1 of the Education Code is amended to read: 69618.1. (a) Program participants shall meet all of the following eligibility criteria prior to selection in the program and must continue to meet these criteria, as appropriate, during the payment periods: (1) The participant shall be a United States citizen or eligible noncitizen. (2) The participant shall be a California resident attending an eligible school or college in the state. (3) The participant shall be making satisfactory academic progress. (4) The participant shall have complied with United States Selective Service requirements. (5) The participant shall not owe a refund on any state or federal educational grant or have delinquent or defaulted student loans. (b) Any person enrolled in an institution of postsecondary education and participating in the loan assumption program set forth in this article may be eligible to receive a conditional warrant for loan assumption, to be redeemed pursuant to Section 69618.2 upon becoming employed as a full-time faculty member at a California college or university or the equivalent of full-time service as a faculty member employed part-time at two or more California colleges or universities. (c) (1) The commission shall award warrants to students with demonstrated academic ability and financial need, as determined by the commission pursuant to Article 1.5 (commencing with Section 69503). (2) The applicant shall have completed a baccalaureate degree program or be enrolled in an academic program leading to a graduate level degree. (3) The applicant shall be currently enrolled in or admitted to a program in which he or she will be enrolled in a full-time course of study each academic term as defined by an eligible institution. The applicant shall agree to maintain satisfactory academic progress. (4) The applicant shall have been judged by his or her postsecondary institution to have outstanding ability on the basis of criteria that may include, but need not be limited to, any of the following: (A) Grade point average. (B) Test scores. (C) Faculty evaluations. (D) Interviews. (E) Other recommendations. (5) In order to meet the costs of obtaining a graduate degree, the applicant shall have received, or be approved to receive, a loan under one or more of the following designated loan programs: (A) The Federal Family Education Loan Program (20 U.S.C. Sec. 1071 et seq.). (B) Any loan program approved by the commission. (6) The applicant shall have agreed to teach on a full-time basis at one or more accredited California colleges or universities for at least three consecutive years after obtaining a graduate degree. (d) A person participating in the program pursuant to this section shall not receive more than one warrant. SEC. 4. Section 69618.2 of the Education Code is amended to read: 69618.2. The commission shall redeem an applicant's warrant and commence loan assumption payments as specified in Section 69618.3 upon verification that the applicant has fulfilled all of the following: (a) The applicant has received a graduate degree from an accredited, participating California institution. (b) The applicant has provided the equivalent of full-time instruction at one or more regionally accredited California colleges or universities for one academic year or the equivalent. (c) The applicant has met the requirements of the warrant and all other conditions of this article. SEC. 5. Section 69618.3 of the Education Code is amended to read: 69618.3. The terms of the loan assumptions granted under this article shall be as follows, subject to the specific terms of each warrant: (a) After a program participant has completed one academic year, or the equivalent of teaching, at one or more regionally accredited, eligible California colleges or universities, the Student Aid Commission shall assume up to two thousand dollars ($2,000) of the participant's outstanding liability under one or more of the designated loan programs. The initial year of eligible teaching must begin within 10 years of receiving an initial conditional warrant from the commission. (b) After the program participant has completed two consecutive academic years, or the equivalent of teaching, at one or more regionally accredited California colleges or universities, the commission shall assume up to an additional two thousand dollars ($2,000) of the participant's outstanding liability under one or more of the designated loan programs, for a total loan assumption of up to four thousand dollars ($4,000). (c) After a program participant has completed three consecutive academic years, or the equivalent of teaching, at one or more regionally accredited California colleges or universities, the commission shall assume up to an additional two thousand dollars ($2,000) of the participant's outstanding liability under one or more of the designated loan programs, for a total loan assumption of up to six thousand dollars ($6,000). SEC. 6. Section 76300 of the Education Code is amended to read: 76300. (a) The governing board of each community college district shall charge each student a fee pursuant to this section. (b) (1) The fee prescribed by this section shall be twelve dollars ($12) per unit per semester, effective with the fall term of the 1998-99 academic year, and eleven dollars ($11) per unit per semester effective with the fall term of the 1999-2000 academic year. (2) The chancellor shall proportionately adjust the amount of the fee for term lengths based upon a quarter system and also shall proportionately adjust the amount of the fee for summer sessions, intersessions, and other short-term courses. In making these adjustments, the chancellor may round the per unit fee and the per term or per session fee to the nearest dollar. (c) For the purposes of computing apportionments to community college districts pursuant to Section 84750, the chancellor shall subtract from the total revenue owed to each district, 98 percent of the revenues received by districts from charging a fee pursuant to this section. (d) The chancellor shall reduce apportionments by up to 10 percent to any district that does not collect the fees prescribed by this section. (e) The fee requirement does not apply to any of the following: (1) Students enrolled in the noncredit courses designated by Section 84757. (2) California State University or University of California students enrolled in remedial classes provided by a community college district on a campus of the University of California or a campus of the California State University, for whom the district claims an attendance apportionment pursuant to an agreement between the district and the California State University or the University of California. (3) Students enrolled in credit contract education courses pursuant to Section 78021, if the entire cost of the course, including administrative costs, is paid by the public or private agency, corporation, or association with which the district is contracting and if these students are not included in the calculation of the average daily attendance of that district. (f) The governing board of a community college district may exempt special part-time students admitted pursuant to Section 76001 from the fee requirement. (g) The fee requirements of this section shall be waived for any student who, at the time of enrollment, is a recipient of benefits under the Aid to Families with Dependent Children program, the Supplemental Security Income/State Supplementary Program, or a general assistance program or has demonstrated financial need in accordance with the methodology set forth in federal law or regulation for determining the expected family contribution of students seeking financial aid. The governing board of a community college district also shall waive the fee requirements of this section for any student who demonstrates eligibility according to income standards established by the board of governors and contained in Section 58620 of Title 5 of the California Code of Regulations. (h) The fee requirements of this section shall be waived for any student who, at the time of enrollment is a dependent, or surviving spouse who has not remarried, of any member of the California National Guard who, in the line of duty and while in the active service of the state, was killed, died of a disability resulting from an event that occurred while in the active service of the state, or is permanently disabled as a result of an event that occurred while in the active service of the state. "Active service of the state," for the purposes of this subdivision, refers to a member of the California National Guard activated pursuant to Section 146 of the Military and Veterans Code. (i) (1) It is the intent of the Legislature that sufficient funds be provided to support the provision of a fee waiver for every student who demonstrates eligibility pursuant to subdivisions (g) and (h). (2) From funds provided in the annual Budget Act, the board of governors shall allocate to community college districts, pursuant to this subdivision, an amount equal to 2 percent of the fees waived pursuant to subdivisions (g) and (h). From funds provided in the annual Budget Act, the board of governors shall allocate to community college districts, pursuant to this subdivision, an amount equal to 7 percent of the fee waivers provided pursuant to subdivisions (g) and (h) for determination of financial need and delivery of student financial aid services, on the basis of the number of students for whom fees are waived. Funds allocated to a community college district for determination of financial need and delivery of student financial aid services shall supplement, and shall not supplant, the level of funds allocated for the administration of student financial aid programs during the 1992-93 fiscal year. (j) The board of governors shall adopt regulations implementing this section. SEC. 7. This act is an urgency statute necessary for the immediate preservation of the public peace, health, or safety within the meaning of Article IV of the Constitution and shall go into immediate effect. The facts constituting the necessity are: In order to make the necessary statutory changes to implement the Budget Act of 1999 with respect to the funding of higher education as soon as possible, it is necessary that this act take effect immediately.