BILL ANALYSIS �
AB 1285
Page 1
ASSEMBLY THIRD READING
AB 1285 (Fong)
As Amended May 24, 2013
Majority vote
HIGHER EDUCATION 10-3 APPROPRIATIONS 12-0
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|Ayes:|Williams, Ch�vez, Bloom, |Ayes:|Gatto, Bocanegra, |
| |Fong, Fox, Jones-Sawyer, | |Bradford, |
| |Levine, Medina, | |Ian Calderon, Campos, |
| |Quirk-Silva, Weber | |Eggman, Gomez, Hall, |
| | | |Ammiano, Pan, Quirk, |
| | | |Weber |
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|Nays:|Waldron, Olsen, Wilk |
| | |
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SUMMARY : Phases in elimination of the restriction in the Cal
Grant B program that, in the first year of enrollment, denies
tuition benefits to 98% of Cal Grant B recipients.
Specifically, this bill :
1)Increases from 2% to 25% the number of first-year Cal-Grant B
recipients eligible for tuition and fee payments in the
2014-15 academic year.
2)Increases the above percentage to:
a) 50% in 2015-16;
b) 75% in 2016-17; and,
c) 100% in 2017-18.
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 : According to the Assembly Appropriations
Committee, based on the current number of Cal Grant B recipients
AB 1285
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and average award amounts at each segment of higher education,
General Fund costs are estimated at $27 million in 2014-15, $58
million in 2015-16, $88 million in 2016-17, and $117 million
upon full implementation in 2017-18. The annual cost could
increase considerably, however, as more freshman Cal Grant B
recipients choose a four-year college rather than community
college due to the availability of the tuition benefit in their
first year.
COMMENTS : 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
Board of Governors Fee Waiver.
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.
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
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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.
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 170,000 students and reduced the Cal Grant
program by almost $200 million. There are several measures that
would restore these cuts and/or increase access to the Cal Grant
program.
Analysis Prepared by : Jeanice Warden / HIGHER ED. / (916)
319-3960
FN: 0000932