BILL ANALYSIS
AB 1320
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Date of Hearing: May 9, 2009
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Kevin De Leon, Chair
AB 1320 (Fong) - As Introduced: February 27, 2009
Policy Committee: Labor and
Employment Vote: 6-1
Urgency: No State Mandated Local Program:
No Reimbursable:
SUMMARY
This bill establishes the Lifelong Learning Accounts Pilot
Program for the purpose of providing grants to employees for
savings related to educational and training needs.
Specifically, this bill:
1)Establishes lifelong savings accounts under the program and
specifies that employees contributing to these accounts are
eligible for a match of up to 50% of both the employer and
employee contribution, up to $500.
2)Makes the California Workforce Investment Board responsible
for administering the grant program to make the matching
contributions. States that the board may contract with an
individual, nonprofit organization or other business to
administer and implement the grant program.
3)Establishes within the State Treasury, a Lifelong Learning
Program Fund to receive contributions from individuals,
foundations, nonprofits, businesses and the federal government
to be used for the program.
4)Requires the board to prepare and submit a report to specified
legislative committees at least 20 days prior to the date the
Legislature reconvenes in 2012.
5)States that the program shall become operative January 1,
2012, but only if the Director of Finance determines that
state funds are available to implement the program.
FISCAL EFFECT
AB 1320
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Unknown, potentially major state costs to establish and operate
a pilot grant program. As an example, a pilot program involving
10,000 employees could result in up to $5 million in matching
grants.
COMMENTS
1)Background . In recent years, several bills have been proposed
- but not passed - by Congress that would create Lifelong
Learning Accounts. As envisioned in federal legislation, the
lifelong learning accounts are intended to be tax-preferred,
employer-matched educational savings accounts, much like
401(k) plans, which can be used to finance workers' education
and training. Numerous pilot projects involving
matching-grants for lifelong learning accounts have been
adopted across the nation, but generally for a limited numbers
of workers and/or industries.
2)Rationale . The purpose of the bill is to create a California
grant program to encourage employee savings for lifelong
education. The sponsor (Council for Adult and Experiential
Learning) states that these worker-owned, employer-matched
accounts put learning opportunities with reach of adults who
have entered the workforce but may not have the skill to
compete in the changing economy.
Analysis Prepared by : Brad Williams / APPR. / (916) 319-2081