BILL ANALYSIS Ó
SB 1466
Page 1
SENATE THIRD READING
SB 1466 (De León)
As Amended August 20, 2012
Majority vote
SENATE VOTE :32-6
HIGHER EDUCATION 8-1 APPROPRIATIONS 12-5
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|Ayes:|Block, Olsen, Achadjian, |Ayes:|Gatto, Blumenfield, |
| |Brownley, Fong, Galgiani, | |Bradford, Charles |
| |Lara, Portantino | |Calderon, Campos, Davis, |
| | | |Fuentes, Hall, Hill, |
| | | |Cedillo, Mitchell, |
| | | |Solorio |
| | | | |
|-----+--------------------------+-----+--------------------------|
|Nays:|Miller |Nays:|Harkey, Donnelly, |
| | | |Nielsen, Norby, Wagner |
| | | | |
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SUMMARY : Establishes priorities for allocation within the Cal
Grant program of funds derived from the Higher Education
Investment Tax Credit (HEITC) program. Specifically, this bill :
1)Requires the California Student Aid Commission (CSAC),
commencing with the 2014-15 academic year, to apply the
following three priorities when allocating funds from the
HEITC program:
a) First priority to students otherwise ineligible for an
Entitlement Cal Grant A or B award or a Cal Grant Transfer
Entitlement award but who meet eligibility requirements in
place for the 2011-12 academic year;
b) Second priority to students otherwise ineligible for a
Competitive Cal Grant A or B award but who meet eligibility
requirements in place for the 2011-12 academic year, up to
the maximum number of awards authorized for this program in
the annual budget act; and,
c) Third priority to all other students who meet
eligibility requirements in place for 2011-12 for a Cal
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Grant award, except that these students may have a
household income of an amount determined by CSAC, as
specified.
2)States intent that monies in the HEITC program are intended to
supplement other monies provided for the Cal Grant program and
are intended for students who would otherwise not be eligible
except for the expanded eligibility provided above.
3)Requires CSAC do the following:
a) Certify the HEITC funds available for distribution,
beginning April 1, 2014, and each April 1 thereafter, for
the following award year, and,
b) Determine the highest maximum household income level
that is capable of being supported by the fund (specified
not to exceed 80% of the fund balance) and requires CSAC to
thereafter adopt this amount as the maximum household
income level for the following award year, and,
c) Notify students that the award is for one academic year
only and is not an entitlement.
4)Specifies that awards are payable only to the extent that
funds are available for distribution from the HEITC special
fund and any remaining funds be available for allocation in
future years.
5)Sunsets all of the above on December 1, 2018, or until are
HEITC monies are expended, whichever comes last.
6)Makes all of the above operative upon verification by the
Franchise Tax Board to CSAC that legislation has been enacted
that provides for an investment tax credit for the purposes of
funding this act.
FISCAL EFFECT : According to the Assembly Appropriations
Committee, costs would only be incurred if future legislation
enacts a higher education investment tax credit.
1)With respect to the first priority, allocations from the HEITC
Fund would depend on the extent that students are ineligible
for Cal Grants in 2014-15 and thereafter, but would have been
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eligible under the criteria in place for 2011-12. This would
depend on future actions of the Legislature with respect to
Cal Grant eligibility. For 2013-14, there are no changes to
Cal Grant eligibility for students.
2)With respect to the second priority, the Competitive Cal Grant
program is currently over-subscribed by about 8:1, with tens
of thousands of currently eligible students not receiving
assistance, so it is highly unlikely that any additional
students would a receive assistance under the provisions of
this bill.
3)With respect to the third priority, the current income ceiling
for Cal Grant A eligibility (for a family of six or more) is
$92,600, with declining amounts for smaller family sizes. If
the income ceiling under the HEITC was set at $100,000, CSAC
estimates (based on current Cal Grant award amounts) that
allocations from the HEITC Fund would be about $200 million
from 2014-15 through 2017-18, with the last year assisting
about 9,200 students. An increase in the HEITC income ceiling
beyond $100,000 would allow for additional allocations to
qualifying students, assuming monies are remaining in the
HEITC Fund.
COMMENTS : The author believes that creative measures are
needed to assist students following years of budget cuts to
higher education. The state's contribution to higher education
has steadily declined, and the author's office calculates that
the share of expenditures borne by students, in the form of
tuition and fees, has tripled from 13% in 2000 to 40% in 2011.
Analysis Prepared by : Sandra Fried / HIGHER ED. / (916)
319-3960
FN: 0004995