BILL ANALYSIS �
AB 138
Page 1
Date of Hearing: January 7, 2014
ASSEMBLY COMMITTEE ON HIGHER EDUCATION
Das Williams, Chair
AB 138 (Olsen) - As Amended: January 6, 2014
SUBJECT : Public postsecondary education: undergraduate tuition
and systemwide fees.
SUMMARY : Requires the Trustees of the California State
University (CSU) and the Regents of the University of California
(UC) to determine the amounts of undergraduate tuition and
mandatory systemwide fees for California residents in each
incoming first-year class and prohibits the tuition/fees for
that class from being increased, other than to make a
cost-of-living adjustment not to exceed 2 percent after each
academic year, until the class has completed at least four
academic years. Prohibits the Trustees and Regents from
increasing the amount of tuition/fees for California residents
charged to an incoming first-year class by more than 5 percent
over the amounts charged to the immediately preceding first-year
class.
EXISTING LAW : Provides that statutes related to UC are
applicable only to the extent that the Regents make such
provisions applicable. Confers upon the CSU Trustees the
powers, duties, and functions with respect to the management,
administration, and control of the CSU system.
FISCAL EFFECT : Unknown.
COMMENTS : Purpose of this bill : According to the author, since
2008, tuition has increased about 63% in the CSU system. The CSU
Trustees have the flexibility to increase tuition annually
according to the needs of the CSU. This fluctuation in cost of
higher education prohibits certain groups of students from
entering into the university system and removes students who
find that they can no longer afford college in the middle of
their college career. This lack of ability to financially plan
for higher education has put a great burden on students and
parents as they attempt to maneuver through higher education.
This legislation guarantees a stable tuition rate for in-state
freshman students at CSU campuses for a period of four years,
and will prevent large jumps in tuition from one year to
another.
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Background : Through 1996, fees at California public
postsecondary institutions were governed by the Maddy-Dills Act,
which was enacted by the Legislature in 1985 to provide for a
statewide fee policy. The Act required fees to be gradual,
moderate and predictable; increases to be limited to 10% a year;
and fixed at least ten months prior to the fall term in which
they were to become effective. The policy also required
sufficient financial aid to offset fee increases. Even with
this policy, when the state faced serious budgetary challenges
the provisions of the Act were set aside in order to provide the
institutions some flexibility in dealing with the lack of state
General Fund support. In 1996, the Act was allowed to sunset,
and since that time, the state has had no statutory long-term
policy governing fees.
UC and CSU fees are established each year through the Budget Act
negotiations, with complementary actions on the part of the UC
Regents and the CSU Trustees to adopt negotiated fee levels.
There is an implicit policy whereby students and the State are
expected to share educational costs, but the relative
proportions are dependent on the State's fiscal situation. As a
result, as shown in the tables below, fees have increased
steeply during difficult budget years and then gradually
declined when the state's fiscal situation improved and more
General Fund support could be provided to the public higher
education segments.
------------------------------ ------------------------------ ------------------------------
| CSU Mandatory Systemwide |
| Student Fees Resident |
| Undergraduate |
------------------------------
|-------+----------+------------|
| Year | Fee | Percent |
| | Amount | Change |
|-------+----------+------------|
|1996-97| $1,584 | N/A |
| | | |
|-------+----------+------------|
|1997-98| $1,584 | 0.0% |
| | | |
|-------+----------+------------|
|1998-99| $1,506 | -4.9% |
| | | |
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|-------+----------+------------|
|1999-00| $1,428 | -5.2% |
| | | |
|-------+----------+------------|
|2000-01| $1,428 | 0.0% |
| | | |
|-------+----------+------------|
|2001-02| $1,428 | 0.0% |
| | | |
|-------+----------+------------|
|2002-03| $1,500 | 5.0% |
| | | |
|-------+----------+------------|
|2003-04| $2,046 | 36.4% |
| | | |
|-------+----------+------------|
|2004-05| $2,334 | 14.1% |
| | | |
|-------+----------+------------|
|2005-06| $2,520 |8.0% |
| | | |
|-------+----------+------------|
|2006-07| $2,520 | 0.0% |
| | | |
|-------+----------+------------|
|2007-08| $2,772 | 10.0% |
| | | |
|-------+----------+------------|
|2008-09| $3,048 | 10.0% |
| | | |
|-------+----------+------------|
|2009-10| $4,026 | 32.1% |
| | | |
|-------+----------+------------|
|2010-11| $4,429 | 10.0% |
| | | |
|-------+----------+------------|
|2011-12| $5,472 | 23.5% |
| | | |
|-------+----------+------------|
|2012-13| $5,472 | 0.0% |
| | | |
|-------+----------+------------|
|2013-14| $5,472 |0.0% |
| | | |
AB 138
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Tuition and General Fund support. Tuition is a significant
revenue source for CSU and UC. If faced with reductions in
General Fund support and an inability to increase tuition, UC
and CSU might need to reduce enrollments and course offerings,
or make other service reductions that would limit access to, or
reduce the quality of, these institutions.
The Committee may wish to consider if it is appropriate to
mandate a tuition freeze in years where the state has not
provided adequate general fund support to the segments.
Four-year tuition freeze . Under the provisions of this bill,
the segments would be able to increase fees for students who are
enrolled after four years-a common occurrence at both
institutions: the time-to degree is approximately four years and
one quarter at UC and five to six years at CSU. There are many
reasons for this, both within and beyond the student's control:
timely access to classes, the need to work to support families
or reduce the need to borrow, part-time attendance, family
and/or economic hardship, and high-unit majors, such as
engineering.
The Committee may wish to consider if this bill unfairly targets
students who are unable to graduate in four-years.
Unclear impact on transfer students . This bill is silent on the
fee level that transfer students would be charged.
The Committee may wish to consider whether transfer students
should be entitled to the fee levels they would have paid had
they entered as freshmen.
UC Working Group on Tuition . UC President Napolitano has
convened a working group to review and recommend a long-term
tuition policy. According to UC, "the working group is tasked
with examining options for bringing clarity to, and reducing the
volatility in, the tuition setting process." UC has taken a
position of "concern" on this bill, noting that "the University
is in the best position to collaboratively come up with a new
tuition policy without the need for state legislation."
Previous legislation . In 2013, several Assembly bills were
introduced that would have limited tuition increases and
established long-term fee policies for UC and CSU. Ultimately,
AB 138
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the Committee and authors agreed to move forward a single fee
policy bill. AB 67 (Olsen, Chavez, Gorell) would have
prohibited CSU and UC from increasing undergraduate fees for
California residents, until January 1, 2017, so long as
specified funding is provided to the segments in the Budget Act.
AB 67 was approved by this Committee but subsequently held on
suspense in the Assembly Appropriations Committee.
REGISTERED SUPPORT / OPPOSITION :
Support
None on File
Opposition
None on File
Analysis Prepared by : Laura Metune / HIGHER ED. / (916)
319-3960