Amended in Assembly January 23, 2014

Amended in Assembly January 9, 2014

California Legislature—2013–14 Regular Session

Assembly Bill No. 330

Introduced by Assembly Member Chau

February 13, 2013

An act to amend Sections 69433.2, 94910, and 94929.5 of the Education Code, relating to student financial aid.

LEGISLATIVE COUNSEL’S DIGEST

AB 330, as amended, Chau. Student financial aid: disclosures.

(1) Existing law establishes the Cal Grant Program under the administration of the Student Aid Commission, and establishes eligibility requirements for awards under the program for participating students attending qualifying institutions. As a condition for participation in the program, existing law requires each Cal Grant participating institution to annually report specified information to the commission, which the commission is required to provide on its Internet Web site in a searchable database.

This bill would include license examination passage rates, the institution’s latest 3-year cohort default rate, the institution’s percentage of undergraduate student borrowers, and certain other student loan debt information concerning begin delete graduates end delete begin insert full-time, first-time degree- or certificate-seeking undergraduate students end insert of the institution in the information that a participating institution is required to report and the commission is required to provide on its Internet Web site.

(2) Existing law, the California Private Postsecondary Education Act of 2009, which is repealed pursuant to its own provisions on January 1, 2015, provides, among other things, for student protections and regulatory oversight of private postsecondary schools in the state. The act is enforced by the Bureau for Private Postsecondary Education within the Department of Consumer Affairs. The act exempts specified institutions from all, or a portion of, its provisions. The act requires an institution to provide a prospective student prior to enrollment with a School Performance Fact Sheet, which is required to contain specified information relating to the educational program.

This bill would require the School Performance Fact Sheet to also include certain student loan debt information concerning begin delete graduates end delete begin insert full-time, first-time degree- or certificate-seeking undergraduate students end insert of the institution who have entered into student loans, as specified, while attending the institution.

These provisions concerning the School Performance Fact Sheet would become operative only if an act that becomes operative on or before January 1, 2015, delays or eliminates the January 1, 2015, repeal date of the California Private Postsecondary Education Act of 2009.

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

The people of the State of California do enact as follows:

SECTION 1.  

Section 69433.2 of the Education Code is
amended to read:

69433.2.  

(a) As a condition for its voluntary participation in
the Cal Grant Program, each Cal Grant participating institution
shall annually report to the commission, and as further specified
in the institutional participation agreement, all of the following
for its undergraduate programs:

(1) Enrollment, persistence, and graduation data for all students,
including aggregate information on Cal Grant recipients.

(2) The job placement rate and salary and wage information for
each program that is either designed or advertised to lead to a
particular type of job or advertised or promoted with a claim
regarding job placement.

(3) License examination passage rates, as begin delete required end delete begin insert reported to
the commission end insert pursuant to subparagraph (A) of paragraph (2) of
subdivision (l) of Section 69432.7.

(4) The institution’s latest three-year cohort default rate, as
begin delete required end delete begin insert certified by the commission end insert pursuant to subparagraph (A)
of paragraph (3) of subdivision (l) of Section 69432.7.

(5) The institution’s percentage of undergraduate student
borrowers as reported pursuant to subparagraph (H) of paragraph
(3) of subdivision (l) of Section 69432.7.

(6) (A) Student loan debt information concerning begin delete graduates end delete
begin insert full-time, first-time degree- or certificate-seeking undergraduate
students end insert of the institution, as calculated pursuant to subdivision
(c).

(B) The University of California and the California State
University may comply with this paragraph by including student
loan debt information, as calculated pursuant to subdivision (c),
in their respective begin insert final end insert annual financial aid reports, as completed
pursuant to Section 66021.1, and providing a copy of the report
to the commission.

begin insert

(C) Campuses of the California Community Colleges are exempt
from complying with this paragraph.

end insert

(b) Commencing the year after the commission begins to receive
reports pursuant to subdivision (a), the commission shall provide
both of the following on its Internet Web site:

(1) The information submitted by a Cal Grant participating
institution pursuant to subdivision (a), which shall be made
available in a searchable database.

(2) Other information and links that are useful to students and
parents who are in the process of selecting a college or university.
This information may include, but not be limited to, local
occupational profiles available through the Employment
Development Department’s Labor Market Information Data
Library.

(c)  begin delete Student end delete begin insert Undergraduate student end insert loan debt information
concerning begin delete graduates of end delete begin insert student borrowers who received a
certificate, associate’s degree, or bachelor’s degree from end insert a Cal
Grant participating institution shall be calculated and reported as
follows:

(1) The institution shall calculate the number of students who
started as begin insert full-time, end insert first-time begin delete postsecondary end delete begin insert degree or
certificate-seeking undergraduate end insert students at the institution, and
who received a certificate, associate’s degree, or bachelor’s degree
during that academic year.

(2) (A) The institution shall calculate the number and percentage
of the students identified pursuant to paragraph (1) who borrowed
at any time while enrolled at the institution through any student
loan program, including, but not necessarily limited to, institutional
loans, state loans, begin insert private loans that were certified by the
institution, end insert federal Perkins loans, federal Stafford subsidized and
unsubsidized loans, begin delete and private loans that were certified by the
institution, including both end delete federal direct student loans begin insert , end insert and federal
family education loans.

(B) The institution shall calculate the total principal borrowed
in those loans described in subparagraph (A).

(3) (A) The institution shall calculate the number and percentage
of the students identified pursuant to paragraph (1) who borrowed
at any time while enrolled at the institution through a federal
student loan program, including, but not necessarily limited to,
federal Perkins loans, federal Stafford subsidized and unsubsidized
loans, federal direct student loans, and federal family education
loans, but excluding institutional loans, state loans, begin delete and end delete private
loans begin insert , and parental loans end insert .

(B) The institution shall calculate the total principal borrowed
in those loans described in subparagraph (A).

(4) The institution shall report both of the following to the
commission:

(A) The percentages begin insert of student borrowers end insert calculated pursuant
to paragraphs (2) and (3).

(B) The average certificate- or degree-seeking student
cumulative principal borrowed by those students counted pursuant
to paragraphs (2) and (3), calculated by dividing the sum identified
in subparagraph (B) of each of those paragraphs by the number of
students receiving the loans described in the respective paragraphs.
The institution shall report average loan debt information for begin insert Cal
Grant participating end insert certificate, associate’s degree, and bachelor’s
degree programs separately.

(5) For purposes of this subdivision, “loans” shall include
cosigned loans that financed a student’s own enrollment or
attendance, but shall not include parental loans begin insert and loans where
a person other than the student is the principal borrower end insert .

SEC. 2.  

Section 94910 of the Education Code is amended to
read:

94910.  

Prior to enrollment, an institution shall provide a
prospective student with a School Performance Fact Sheet
containing, at a minimum, the following information as it relates
to the educational program:

(a) Completion rates, as calculated pursuant to Article 16
(commencing with Section 94928).

(b) Placement rates for each educational program, as calculated
pursuant to Article 16 (commencing with Section 94928), if the
educational program is designed to lead to, or the institution makes
any express or implied claim related to preparing students for, a
recognized career, occupation, vocation, job, or job title.

(c) License examination passage rates for programs leading to
employment for which passage of a state licensing examination is
required, as calculated pursuant to Article 16 (commencing with
Section 94928).

(d) Salary or wage information, as calculated pursuant to Article
16 (commencing with Section 94928).

(e) If a program is too new to provide data for any of the
categories listed in this subdivision, the institution shall state on
its fact sheet: “This program is new. Therefore, the number of
students who graduate, the number of students who are placed, or
the starting salary you can earn after finishing the educational
program are unknown at this time. Information regarding general
salary and placement statistics may be available from government
sources or from the institution, but is not equivalent to actual
performance data.”

(f) All of the following:

(1) A description of the manner in which the figures described
in subdivisions (a) to (d), inclusive, are calculated or a statement
informing the reader of where he or she may obtain a description
of the manner in which the figures described in subdivisions (a)
to (d), inclusive, are calculated.

(2) A statement informing the reader of where he or she may
obtain from the institution a list of the employment positions
determined to be within the field for which a student received
education and training for the calculation of job placement rates
as required by subdivision (b).

(3) A statement informing the reader of where he or she may
obtain from the institution a list of the objective sources of
information used to substantiate the salary disclosure as required
by subdivision (d).

(g) The following statements:

(1) “This fact sheet is filed with the Bureau for Private
Postsecondary Education. Regardless of any information you may
have relating to completion rates, placement rates, starting salaries,
or license exam passage rates, this fact sheet contains the
information as calculated pursuant to state law.”

(2) “Any questions a student may have regarding this fact sheet
that have not been satisfactorily answered by the institution may
be directed to the Bureau for Private Postsecondary Education at
(address), Sacramento, CA (ZIP Code), (Internet Web site address),
(telephone and fax numbers).”

(h) If the institution participates in federal financial aid
programs, the most recent three-year cohort default rate reported
by the United States Department of Education for the institution,
the percentage of enrolled students receiving federal student loans,
and the average student loan debt of graduates of the institution
calculated pursuant to Article 16 (commencing with Section
94928).

SEC. 3.  

Section 94929.5 of the Education Code is amended to
read:

94929.5.  

(a) An institution shall annually report to the bureau,
as part of the annual report, and shall publish in its School
Performance Fact Sheet, all of the following:

(1) The job placement rate, calculated by dividing the number
of graduates employed in the field by the number of graduates
available for employment for each program that is either begin delete (1) end delete begin insert (A) end insert
designed, or advertised, to lead to a particular career, or begin delete (2) end delete begin insert (B) end insert
advertised or promoted with any claim regarding job placement.

(2) The license examination passage rates for the immediately
preceding two years for programs leading to employment for which
passage of a state licensing examination is required, calculated by
dividing the number of graduates who pass the examination by the
number of graduates who take the licensing examination the first
time that the examination is available after completion of the
educational program. The institution shall use state agency
licensing data to calculate license examination passage rates. If
those data are unavailable, the institution shall calculate the license
examination passage rate in a manner consistent with regulations
adopted by the bureau.

(3) Salary and wage information, consisting of the total number
of graduates employed in the field and the annual wages or salaries
of those graduates stated in increments of five thousand dollars
($5,000).

(4) (A) If applicable, the most recent official three-year cohort
default rate reported by the United States Department of Education
for the institution, the percentage of enrolled students receiving
federal student loans, and the average student loan debt of graduates
of the institution.

(B) The student loan debt information concerning begin delete graduates end delete
begin insert full-time, first-time degree- or certificate-seeking undergraduate
students end insert of the institution shall be calculated and reported as
follows:

(i) The institution shall calculate the number of students
receiving student loans who started as begin insert full-time, end insert first-time
begin delete postsecondary end delete begin insert degree- or certificate-seeking undergraduate end insert
students at the institution, and who received a certificate,
associate’s degree, or bachelor’s degree during that academic year.

(ii) (I) The institution shall calculate the number and percentage
of the students identified pursuant to clause (i) who borrowed at
any time while enrolled at the institution through any student loan
program, including, but not necessarily limited to, institutional
loans, state loans, federal Perkins loans, federal Stafford subsidized
and unsubsidized loans, and private loans that were certified or
known by the institution, including both federal direct student
loans and federal family education loans.

(II) The institution shall calculate the total principal borrowed
in those loans described in subclause (I).

(iii) (I) The institution shall calculate the number and percentage
of the students identified pursuant to clause (i) who borrowed at
any time while enrolled at the institution through a federal student
loan program, including, but not necessarily limited to, federal
Perkins loans, federal Stafford subsidized and unsubsidized loans,
federal direct student loans, and federal family education loans,
but excluding institutional loans, state loans, and private loans.

(II) The institution shall calculate the total principal borrowed
in those loans described in subclause (I).

(iv) The institution shall report to the bureau and on the School
Performance Fact Sheet both of the following:

(I) The percentages calculated pursuant to clauses (ii) and (iii).

(II) The average per-undergraduate cumulative principal
borrowed by those students counted pursuant to clauses (ii) and
(iii), calculated by dividing the sum identified in subclause (II) of
each of those clauses by the number of students receiving the loans
described in the respective clause. The institution shall report
average loan debt information for certificate, associate degree, and
baccalaureate degree programs separately.

(v) For purposes of this paragraph, “loans” shall include
cosigned loans that financed the student’s own enrollment or
attendance, but shall not include parental loans begin insert and loans where
a person other than the student is the principal borrower end insert .

(b) Nothing in this section shall limit the bureau’s authority to
collect information from an institution to comply with this section
and ensure, by regulation and other lawful means, that the
information required by this section, and the manner in which it
is collected and reported, is all of the following:

(1) Useful to students.

(2) Useful to policymakers.

(3) Based upon the most credible and verifiable data available.

(4) Does not impose undue compliance burdens on an institution.

SEC. 4.  

Sections 2 and 3 of this act shall become operative
only if an act that becomes operative on or before January 1, 2015,
amends or repeals Section 94950 of the Education Code to delay
or eliminate the January 1, 2015, repeal date of the California
Private Postsecondary Education Act of 2009 (Chapter 8
(commencing with Section 94800) of Part 59 of Division 10 of
Title 3 of the Education Code).