BILL ANALYSIS Ó
Senate Appropriations Committee Fiscal Summary
Senator Kevin de León, Chair
SB 285 (de León) - Cal Grant Program
Amended: April 24, 2013 Policy Vote: Education 9-0
Urgency: No Mandate: No
Hearing Date: May 13, 2013 Consultant: Jacqueline
Wong-Hernandez
This bill does not meet the criteria for referral to the
Suspense File.
Bill Summary: SB 285 provides for the use of funds from the
College Access Tax Credit Fund (CATC) to increase the amount of
the Cal Grant B Access Award up to a maximum of $5,000 per award
per academic year. This bill is contingent upon the enactment of
legislation creating the CATC.
Fiscal Impact:
Minor and absorbable workload increase to the California
Student Aid Commission (CSAC) to administer
increased/fluctuating Cal Grants amounts.
To the extent that expanded Cal Grant Access Awards provide
additional funding to students in California's public
postsecondary institutions, it may supplant some
institutional aid from the segments.
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, and
eligibility is based upon financial need, grade point average
(GPA), California residency, and other eligibility criteria, as
specified in Education Code § 69433.9. These programs currently
operate as follows:
Cal Grant A - High School Entitlement Program provides tuition
fee funding for the equivalent of four full-time years at
qualifying postsecondary institutions to eligible lower and
middle income high school graduates who have at least a 3.0
GPA, and apply within one year of graduation.
Cal Grant B - High School Entitlement Program provides funds
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to eligible low-income high school graduates who have at least
a 2.0 GPA, 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.
Cal Grant Community College Transfer Program provides a Cal
Grant A or B to eligible high school graduates who have a
community college GPA of at least 2.4, and transfer to a
qualifying baccalaureate degree granting college or
university.
Cal Grant Competitive Award Program provides 22,500 Cal Grant
A and B awards available to applicants who meet financial,
academic, and general program eligibility requirements. Half
of these awards are reserved for students enrolled at a
community college and who met the September 2 application
deadline.
Cal Grant C Program provides funding for financially eligible
lower income students preparing for occupational or technical
training. The authorized number of new awards is 7,761. For
new and renewal recipients, the current tuition and fee award
is up to $2,592 and the allowance for training-related costs
is $576.
Existing law requires that the maximum household income and
asset levels for the Cal Grant program be adopted and defined in
regulations by the CSAC, and that these eligibility ceilings be
annually adjusted based upon changes in the cost of living. Cal
Grant funding is annually appropriated in the Budget Act, and
reductions to the program translate to award reductions.
Proposed Law: SB 285 provides for the use of funds from the CATC
Fund for purposes of increasing the Cal Grant B Access Award.
Specifically it:
1) Declares the intent that CATC Funds supplement other funds
appropriated for the Cal Grant Program and, once the CATC
Fund is established, prohibits the adjustment of the Cal
Grant B Access Award below the level set in the Budget Act
of 2012 ($1,473).
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2) Requires the Treasurer to certify the amount of moneys
available for distribution from the CATC fund beginning
April 1, 2015, and annually thereafter by April 1.
3) Prohibits the amount available for distribution in any year
from exceeding 85% of the certified fund balance.
4) Requires the CSAC to thereafter determine the amount of the
supplemental awards to be granted, and requires CSAC to
include that amount in its budget change proposals
submitted to the Legislature.
5) Requires that any funds remaining after all supplemental
awards are made be retained in the CATC for allocation in
future fiscal years.
6) Requires that supplemental awards be made for "access
costs" as defined under the provisions of the Cal Grant
Program.
7) Caps the amount of the supplemental award, when combined
with the annual award amount established in the annual
Budget Act, at $5,000.
8) Provides that these awards are only payable to the extent
moneys are available from the CATC Fund.
9) Requires CSAC to inform award recipients that the award is
for one academic year only, is not an entitlement, and that
future supplemental awards are subject to the availability
of moneys in the CATC.
Related Legislation: The provisions of this bill are contingent
upon the enactment of SB 284 (de León) which establishes the
CATC Fund, and requires that all revenue in this fund be
allocated to the CSAC for purposes of increasing Cal Grants B
Access Awards pursuant to the provisions of this bill. SB 284
will also be heard in this Committee on May 13, 2013.
Staff Comments: The grant expansion created by this bill is
contingent upon the enactment of SB 284 (de León) which provides
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funding to increase specified Cal Grant awards. SB 294 specifies
that the funding in CATC can only be used for the purposes
outlined in this companion bill. This bill provides that revenue
generated pursuant to SB 284 (up to 85% of the balance of the
CATC Fund) will be allocated to CSAC to implement these
provisions.
The bill's language clearly states that these awards are only
payable to the extent moneys are available from the CATC Fund,
and even specifically requires CSAC to inform award recipients
that the award is for one academic year only, is not an
entitlement, and that future supplemental awards are subject to
the availability of moneys in the CATC.