BILL ANALYSIS �
AB 1285
Page 1
Date of Hearing: April 9, 2013
ASSEMBLY COMMITTEE ON HIGHER EDUCATION
Das Williams, Chair
AB 1285 (Fong) - As Amended: April 2, 2013
SUBJECT : Student financial aid: Cal Grant Program.
SUMMARY : Expands Cal Grant B funding by eliminating the 2% cap
on the number of Cal Grant B Entitlement and Competitive awards
that cover the first year of tuition and fees, never to exceed
the student's calculated financial need.
EXISTING LAW provides for Cal Grant assistance for needy
students to be administered by the California Student Aid
Commission and provides that 2% of first-time Cal Grant B
recipients are eligible for payments for tuition or student
fees.
FISCAL EFFECT : Unknown but CSAC estimates additional costs of
$117.4 million in 2014-15.
COMMENTS : Background . In both the entitlement and competitive
Cal Grant programs, a very low-income student qualifies for a
Cal Grant B, while middle-income students qualify for a Cal
Grant A. In recognition that Cal Grant B serves the lowest
income students, the annual award pays for tuition and fees and
a small stipend (currently $1,473) toward books, supplies, food
and rent. (Cal Grant A pays for tuition and fees only.) When
the Cal Grant B program was authorized (in the early 1960s as
the "College Opportunity Grant Program") it was assumed that the
lowest income students would not go to a four-year college or
university but rather would choose to go to a community college
first. Therefore, the program allowed for first-year tuition
and fee payments for only the top 2% of the Cal Grant B
recipients.
This assumption is no longer presumed to be valid, but the Cal
Grant B program still does not pay tuition and fees in the first
year for 98% of the recipients. Thus the majority of those Cal
Grant B students who initially enroll in a four-year institution
must take on additional debt to cover their first-year tuition
unless they receive other, offsetting financial aid, such as
from the institution itself. For example, Cal Grant B students
at the California Community Colleges (CCC) are eligible for the
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Board of Governors Fee Waiver.
Need for the bill . According to the author, this bill is
necessary to give Cal Grant B students financial assistance for
four years, thereby expanding access to higher education and
allowing low income students to attend the college of their
choice.
Inequity of current policy . Some lower income (Cal Grant B)
students receive a smaller lifetime award than higher income
(Cal Grant A) students. This is because the first-year tuition
benefit (currently a maximum of $12,192) is more than four years
of the access grant (currently $1,473) received under Cal Grant
B. In 2007-08, for the first time students attending the
University of California (UC) faced the same situation. As a
result, UC shifts its students from Cal Grant B to Cal Grant A
awards, when possible, to provide students with the highest
four-year award.
Implementation date . CSAC may not have the resources or time to
do the necessary programming and outreach to implement this bill
in 2014-15. The author may wish to consider delaying
implementation until 2015-16.
Recent budget actions . As a result of recent budget deficits
and growing costs to the program, several changes to the Cal
Grant program over recent years reduced eligibility and
benefits, including annual student needs assessments to maintain
eligibility, a reduction in the Cal Grant B stipend amount,
institutional graduation and student loan default rate
thresholds for program eligibility, and a reduction in the award
amount for students attending private institutions. Combined
with actions taken in the 2011-12 Budget Act, these cuts
impacted more than 170,00 students and reduced the Cal Grant
program by almost $200 million.
Other measures to expand Cal Grant eligibility . Other measures
before this Committee to increase Cal Grant eligibility or
benefits include:
1)AB 303 (Calderon) would extend eligibility to the Cal Grant
Entitlement program to California residents who are current or
former members of the United States Armed Forces.
2)AB 1085 (Gaines and Morrell) would increase the Cal Grant
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award for students attending private postsecondary educational
institutions to $9,708, restoring it to the level it was prior
to reductions implemented in the Budget Act of 2012.
3)AB 1241 (Weber) would extend the Cal Grant Entitlement program
period of eligibility from one to three years.
4)AB 1287 (Quirk-Silva) would remove statutory provisions
requiring renewing Cal Grant recipients to meet annual income
and asset criteria to maintain eligibility.
5)AB 1318 (Bonilla), would link the Cal Grant award amount for
students attending private nonprofit colleges and universities
to the average cost of educating students in the public
sector.
6)AB 1364 (Ting) would increase the Cal Grant B access award
amount to no less than $5,900 and annually adjust the minimum
award amount by the percentage increase in the Consumer Price
Index.
Previous legislation . AB 970 (Fong), Chapter 620, Statutes of
2012, as introduced would have phased out the two percent
restriction. AB 1761 (Fong, 2010), AB 2365 (De La Torre, 2008),
and AB 302 (De La Torre, 2007), which were held in the Assembly
Appropriations Committee, were identical or substantially
similar to this bill.
REGISTERED SUPPORT / OPPOSITION :
Support
American Association of University Women
California Community College Association of Student Trustees
California Competes
California Federation of Teachers
California State Conference of the National Association for the
Advancement of Colored People
California State Student Association
Community College League of California
NAACP Los Angeles
National Council of La Raza
Public Advocates Inc.
Southern California College Access Network
Student Senate for California Community Colleges
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The Education Trust-West
The Institute for College Access & Success
University of California Student Association
Young Invincibles
Opposition
None on file.
Analysis Prepared by : Sandra Fried / HIGHER ED. / (916)
319-3960