BILL ANALYSIS �
Senate Appropriations Committee Fiscal Summary
Senator Kevin de Le�n, Chair
AB 1364 (Ting) - Cal Grant B Access Award
Amended: May 24, 2013 Policy Vote: Education 7-1
Urgency: No Mandate: No
Hearing Date: August 30, 2013
Consultant: Jacqueline Wong-Hernandez
SUSPENSE FILE.
Bill Summary: AB 1364 increases the maximum amount of the Cal
Grant B access award to $1,710, beginning in the 2014-15
academic year, and provides for its annual increase based upon
the California Consumer Price Index for All Urban Consumers
(CPI-U), as specified.
Fiscal Impact: The California Student Aid Commission (CSAC)
estimates that increasing Cal Grant B access awards, as required
by this bill, will result in additional costs of $40.1 million
(General Fund) in 2014-15, and $45.1 million (General Fund) in
2015-16. Increased Cal Grant costs would continue each year,
rising with the CPI-U.
Background: Existing law authorizes the Cal Grant Program,
administered by the CSAC, to provide grants to financially needy
students to attend college. The Cal Grant programs include both
the entitlement and the competitive Cal Grant awards. The
program consists of the Cal Grant A, Cal Grant B, and Cal Grant
C programs, and eligibility is based upon financial need, grade
point average (GPA), California residency, and other eligibility
criteria, as specified. (Education Code 69430-69433.9)
The Cal Grant B program provides funds to eligible low-income
high school graduates who have at least a 2.0 GPA on a
four-point scale and apply within one year of graduation. The
award provides up to $1,551 for books and living expenses for
the first year and each year following for up to four years (or
equivalent of four full-time years). After the first year, the
award also provides tuition fee funding at qualifying
postsecondary institutions. (Education Code � 69435.3)
Currently, the amount of the award for access costs cannot
AB 1364 (Ting)
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exceed $1,551, but this amount may be adjusted in the annual
Budget Act. "Access costs", for purposes of the Cal Grant
Program, are defined as living expenses and expenses for
transportation, supplies, and books. (EC � 69435 and 69432.7)
Proposed Law: Beginning with the 2014-15 academic year, AB 1364
would increase the maximum Cal Grant B Access award from $1,551
to $1,710, as specified, and:
1) Delete the specific authority to adjust the amount of the
access award in the annual Budget Act.
2) Require that the access award be adjusted annually to
reflect the percentage increase, if any, in the California
CPI-U, as specified.
3) Require the CSAC to calculate and certify the percentage
change using data from the two most recent indices reported
in June of each year, as specified.
Related Legislation: The 2011 and 2012 Budget Acts made
significant changes to the Cal Grant Program. Additionally,
several bills have been introduced in the current session that
would make changes to the Cal Grant program, including:
AB 1241 (Weber) extends the Cal Grant Entitlement program period
of eligibility by one year, allowing an applicant for Cal Grant
A and B Entitlement Awards to apply no later than two years
after high school graduation. That bill is also being heard in
this Committee on August 12, 2013.
AB 1287 (Quirk-Silva) alters a budget-related reduction that
requires renewing Cal Grant recipients to meet annual income and
asset criteria to maintain program eligibility, by allowing
certain disqualified students to re-enter the program if they
subsequently meet eligibility requirements. That bill is also
being heard in this Committee on August 12, 2013.
SB 285 (de Leon) provides for the use of funds from the College
Access Tax Credit Fund to increase the amount of the Cal Grant B
Access Award up to a maximum of $5,000 per award per academic
year. That bill is awaiting action in the Assembly
Appropriations Committee.
AB 1364 (Ting)
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Staff Comments: The CSAC estimates that increasing Cal Grant B
access awards, as required by this bill, will result in
additional costs of $40.1 million in 2014-15, based on an
increase to $1,710 plus a CPI-U adjustment of an additional
1.93%. The grant amount would be $1,743 in 2014-15.
The award amount in 2015-16 will depend upon the CPI-U rate. If
the CPI-U rate continues to be 1.93%, the total award amount
would increase to $1,776, and cost an additional $5 million
beyond the 2014-15 level. The total General Fund expense beyond
current funding levels would be $45.1 million in 2015-16. Cal
Grant costs would continue to rise each year, along with the
CPI-U.