BILL ANALYSIS �
AB 1318
Page 1
ASSEMBLY THIRD READING
AB 1318 (Bonilla)
As Amended May 24, 2013
Majority vote
HIGHER EDUCATION 13-0 APPROPRIATIONS 17-0
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|Ayes:|Williams, Ch�vez, Bloom, |Ayes:|Gatto, Harkey, Bigelow, |
| |Fong, Fox, Jones-Sawyer, | |Bocanegra, Bradford, Ian |
| |Levine, Waldron, Medina, | |Calderon, Campos, |
| |Olsen, Quirk-Silva, | |Donnelly, Eggman, Gomez, |
| |Weber, Wilk | |Hall, Ammiano, Linder, |
| | | |Pan, Quirk, Wagner, Weber |
| | | | |
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SUMMARY : Establishes a formula for determining the maximum Cal
Grant award for students attending nonpublic postsecondary
educational institutions that provide a threshold amount of
institutional financial aid. Specifically, this bill :
1)Establishes the maximum Cal Grant award amount for students
attending nonpublic institutions accredited by the Western
Association of Schools and Colleges (WASC) at the following
percentages of the base funding per Cal Grant student at the
University of California (UC) and the California State
University (CSU), i.e., the average state support per student
plus the average Cal Grant award for UC and CSU, weighted by
enrollment and Cal Grant award amounts:
a) 52% for 2014-15;
b) 60% for 2015-16;
c) 67% for 2016-17; and,
d) 75% for 2017-18.
2)Specifies that to be eligible for the higher award amounts
above, the total amount of "institutional aid," as defined,
provided to California resident students by an institution, in
any given year, must be no less than 50% of the total Cal
Grant awards received by its students, unless the institution
has fewer than 50 students receiving Cal Grants or charges an
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annual tuition that is no more than 50% of the average of the
annual tuition charged by all institutions to which this bill
applies.
FISCAL EFFECT : According to the Assembly Appropriations
Committee, estimated General Fund costs are $4 million in
2014-15 increasing to $66 million in 2017-18. Costs would
depend on the number of institutions meeting the eligibility
threshold and the number of Cal Grants awarded to eligible
students at those institutions. The California Student Aid
Commission indicates that students attending 68 non-profit
institutions would initially qualify under the parameters of
this bill.
COMMENTS : 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. These cuts, combined with
actions taken in the 2011-12 Budget Act, impacted more than
170,000 students and reduced the Cal Grant program by at least
$194.5 million.
Specifically, SB 1016 (Budget and Fiscal Review Committee),
Chapter 38, Statutes of 2012, the education trailer bill,
implemented the following reductions in maximum tuition award
levels beginning in 2013-14:
1)For new recipients attending independent non-profit
institutions and private for-profit, WASC-accredited
institutions as of July 1, 2012, maximum grant awards were
reduced by 6.5%, from $9,708 to $9,084, and in 2014-15, new
maximum tuition awards at non-profit institutions and
WASC-accredited for-profit institutions will be reduced by an
additional 10.5%, from $9,084 to $8,056.
2)For new recipients attending all other private for-profit
institutions, maximum grant awards were reduced by 59%, from
$9,708 to $4,000.
Prior to 2001-02, the state had a longstanding statutory policy
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that linked the maximum Cal Grant for financially needy students
attending private institutions to the average General Fund cost
of educating a financially needy student at UC and CSU. When
the Cal Grant Entitlement program was created in 2000, this
policy was replaced with a new provision linking the maximum
private-student Cal Grant award to whatever amount was specified
in the annual budget act. The Legislative Analyst's Office
(LAO) has long recommended re-establishing the private Cal Grant
formula to establish a rational policy basis for the award and
promote consistency among student groups.
Analysis Prepared by : Jeanice Warden / HIGHER ED. / (916)
319-3960
FN: 0000958