BILL ANALYSIS �
SENATE COMMITTEE ON EDUCATION
Carol Liu, Chair
2013-2014 Regular Session
BILL NO: SB 1028
AUTHOR: Jackson
AMENDED: March 25, 2014
FISCAL COMM: Yes HEARING DATE: April 2, 2014
URGENCY: No CONSULTANT:Kathleen Chavira
SUBJECT : Cal Grant C awards.
SUMMARY
This bill requires that a minimum of 2,500 Cal Grant C awards
be reserved for California's "long-term unemployed," increases
the annual award amount for all Cal Grant C recipients to
between $3,009-$5000 if sufficient funds are available,
authorizes the California Student Aid Commission (CSAC) to use
different criteria for awarding the reserved awards, authorizes
the use of Cal Grant C awards for living expenses, and
establishes new criteria and processes for identifying areas of
occupational and workforce training which qualify for Cal Grant
C awards.
BACKGROUND
Current law authorizes the Cal Grant Program, administered by
the CSAC, to provide grants to financially needy students to
attend college. 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, California residency,
and other eligibility criteria, as specified in Education Code
� 69433.9. (Education Code � 69430-69433.9)
Cal Grant C awards assist with tuition and training costs at
occupational or vocational programs and may be used for
institutional fees, charges, and other costs, including
tuition, plus training-related costs, such as special clothing,
local transportation, required tools, equipment, supplies, and
books. Current law establishes the total number of Cal Grant C
awards as the number awarded in the 2000-01 fiscal year (7,761)
with the maximum award amount and the total amount of funding
being determined in the annual Budget Act.
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Current law requires the CSAC to consult with appropriate state
and federal agencies to develop areas of occupational and
technical training for which students may utilize Cal Grant C
awards. The commission, if necessary, may also consult with
nongovernmental stakeholders that develop or provide workforce
training or employ graduates of occupational and technical
training programs for this purpose. These areas of
occupational and technical training are required to be
regularly reviewed and updated at least every five years,
beginning in 2012.
The CSAC is also required to undertake various activities to
support the granting of priority to certain Cal Grant C
applicants. Specifically, the CSAC is required to:
Give priority in granting Cal Grant C awards to students
pursuing occupational or technical training in areas that
meet at least two of the following criteria: high
employment need, high employment salary or wage
projections, and high employment growth. The CSAC is
required to determine areas of occupational or technical
training that meet these criteria in consultation with the
Employment Development Department using projections
available through the Labor Market Information Data
Library.
Publish, and retain, on its Internet Web site a current
list of the areas of occupational or technical training
that meet these criteria and to update this list as
necessary.
Examine the graduation rates and job placement data of
eligible programs, and commencing with the 2014-15 academic
year, to give priority to Cal Grant C applicants seeking to
enroll in programs that rate high in graduation rates and
job placement data.
Current law requires the Legislative Analyst's Office to submit
a report to the Legislature on the outcomes of the Cal Grant C
program on or before April 1, 2015, and on or before April 1 of
each odd-numbered year thereafter, as specified.
(EC � 69439)
ANALYSIS
This bill :
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1) Requires that a minimum of 2,500 Cal Grant C awards
annually be reserved for California's long term unemployed
and further:
a) Requires that if there are fewer than
2,500 long-term unemployed applicants, that the
balance of these awards be reserved for those who
dropped out of the labor force after being unemployed
for more than 26 weeks.
b) Requires that if fewer than 2,500
applicants meet the criteria in (a) that the balance
of the awards be available to those who generally
meet the eligibility criteria for a Cal Grant C
award.
2) Increases the annual award amount of a Cal Grant C to at
least $3,009 and no more than $5,000, if sufficient funds
are available.
3) Authorizes the CSAC to use different criteria for
selecting students to receive awards reserved for the
long-term unemployed than that which applies to general
eligibility applicants.
4) Authorizes the use of Cal Grant C awards for books and
living expenses and requires that the CSAC consider other
state and federal programs available to the applicant in
determining the individual award amount.
5) Specifies that the state entities with which the CSAC is
required to consult to identify areas of occupational and
technical training for which Cal Grant C may be utilized
include the Economic and Workforce Development Division of
the Office of the Chancellor of the California Community
Colleges and the California Workforce Investment Board
(WIB) and requires, to the extent feasible, that the CSAC
also consult with representatives of the state's leading
competitive and emerging industry clusters, workforce
professionals, and career technical educators to determine
which programs and industry cluster should be prioritized.
6) Requires that the CSAC update the priority areas of
occupational and technical training by January 1, 2016.
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7) Expands the criteria which must be met for an occupational
or technical training area to qualify a student for
priority in the granting of a Cal Grant C awards. More
specifically it requires that the occupational training
area meet all four of the following (rather than the two
of three which are required in current law):
a) High employer need or demand and
likelihood of the student being placed in a job for
which the student is being trained.
b) High employment salary or wage
projections for workers employed in the occupations
for which they are being trained.
c) The likelihood of job placement in a
position with a well-articulated career pathway to a
job providing economic security.
d) High employment growth in the
occupational field or industry cluster for which the
student is being trained.
8) Expands the entities with which the CSAC is required to
consult to identify areas of occupational and technical
training for which Cal Grant C may be prioritized to
additionally include the Department of Economic and
Workforce Development Division of the California Community
College Chancellor's office and the California WIB.
9) Authorizes the CSAC, in determining areas of occupational
or technical training, to supplement the analyses of the
Employment Development Department Labor Market Information
Data Library with the labor market analyses developed by
the Economic and Workforce Development Division of the
California Community College Chancellor's office and the
California WIB and the projections of occupational
shortages and skills gap developed by industry leaders.
10) Requires the CSAC to consult with the Employment
Development Department (EDD), the Chancellor's office of
the CCC, the CA WIB and local workforce investment board
to develop a plan to publicize the Cal Grant Program for
California's long term unemployed and to be used by those
agencies when they come into contact with people who are
potentially eligible.
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11) Requires the CSAC to consults with the Workforce Services
Branch of the EDD, the Chancellor of the CCC, the CA WIB
and the local workforce investment boards to develop a
plan to make students receiving awards aware of job search
and placement services available through the EDD and the
local WIB.
12) Deletes the requirement that the Legislative Analyst
Office report on the outcomes of the Cal Grant C program
and instead requires the CSAC to submit this report and to
include information on awards reserved for the long-term
unemployed separately.
13) Defines various terms for purposes of the bill, including
"long-term unemployed" to mean a person who has been
unemployed for more than 26 weeks at the time of
submission of the Cal Grant C application.
STAFF COMMENTS
1) Rationale for the bill . According to the author,
California has one of the highest long term unemployment
rates in the country. In February 2014, the author
reports that 39 percent of the 1.6 million unemployed had
been so for 6 months or longer. Time out of work results
in skills erosion making it harder for workers to go back
to work. In addition, this bill requires that the CSAC
utilize information already developed by other
governmental agencies to help determine priority sectors
and occupations based on growth trends and job quality.
2) Cal Grant C . Students meeting the general eligibility for
the Cal Grant award may be considered for the Cal Grant C.
There is no high school graduation requirement, minimum
grade point average or maximum age for recipients.
However, students must be California residents, have
United States or eligible noncitizen status, complete US
selective service requirements, enroll at least half-time
at an eligible California institution, maintain
satisfactory academic progress (defined by the
institution) once enrolled, meet family income and asset
ceilings, and not be in default on any student loan or owe
any federal or state grant refund.
Cal Grant C awards assist with tuition and training costs
for occupational, technical, and vocational programs. The
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award includes up to $547 for books, tools and equipment -
and up to $2,462 more for tuition and fees for attendance
at other than a California Community College. Funding is
available for up to two years, depending on the length of
the program. To qualify, a student must enroll in an
occupational, technical, or vocational program that is at
least four months long at a California Community College,
an independent college, or a vocational/career school.
In order to determine an applicant's eligibility for a Cal
Grant C, additional information must be provided on the
Cal Grant C Supplement form. Supplements are scored based
on the applicant's work experience, educational history,
vocational aptitude, and occupational goal. Students who
select a priority occupation receive additional points in
the scoring criteria.
3) Who currently receives the Cal Grant ? According to the
CSAC, approximately 50% of eligible applicants receive the
limited number of awards. According to the 2012-13 report
on Cal Grant recipients prepared by the CSAC almost 85
percent of Cal Grant C recipients are independent
students. About 64 percent earned less than $18,000
annually, and almost 84 percent earned less than $30,000
annually. Almost two-thirds of the recipients were
female, with 70 percent ages 25 and over. CSAC reports
that over 17,000 completed supplemental applications were
returned in 2011-12 and 2012-13, with 9,000 awards offered
in those same fiscal years.
4) Cal Grant C versus Cal Grant for the long-term unemployed .
The provisions of this bill relative to using the Cal
Grant C to prioritize the training needs of the long term
unemployed raise several concerns for the committee's
consideration:
a) This bill authorizes the CSAC to use different
criteria for eligibility for awards reserved for the
long-term unemployed than that which applies to
general eligibility applicants. Why would different
criteria for eligibility for awards be applied?
Would/should these students be exempt from the
broader Cal Grant program requirements?
b) With the implementation of the Local Control
Funding Formula and the elimination of nearly all
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categorical programs, funding for career technical
education in the K-12 system has been significantly
reduced. Should the needs of the unemployed be
prioritized over the potentially increased needs of
recent high school graduates seeking financial
assistance to access postsecondary occupational and
job training programs?
c) What administrative costs and challenges exist
to verifying eligibility for the Cal Grant funds set
aside for the unemployed?
d) CSAC operates as the principal state agency
responsible for administering financial aid programs
for students attending public and private
universities, colleges, and vocational schools in
California and provides financial aid policy
analysis. Should the CSAC's mission be expanded to
administer a program that provides a benefit
specifically to the unemployed?
A non-exhaustive review indicates that there are at least
three programs that provide training for individuals who
are unemployed. These include:
a) Workforce Investment Act (WIA) - Eligible
Training Providers List .
This program provides employment training for adults and
dislocated workers. Training providers are
identified as eligible to receive Individual Training
Accounts through WIA Title 1-B funds. Individuals are
able to search public and private providers eligible
to receive these training funds and search by
program, occupation, physical location, or
apprenticeship.
b) Trade Adjustment Assistance . This federal
program assists workers who lost their jobs as a
result of increased imports or a shift in production
to foreign countries. During periods of
unemployment, the program, if needed, provides
classroom and/or on the job training, job search, and
relocation allowances. During the benefit period a
worker may receive up to 26 weeks of regular
unemployment insurance benefits, 26 weeks of basic
Trade Readjustment Allowance (TRA) benefits and up to
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65 weeks of additional allowances while attending
training.
c) California Training Benefits Program . For
individuals approved by the Employment Development
Department to participate, this program assists the
individual in training or retraining, provides an
extension of unemployment benefits specifically for
training, and the training claim can provide up to an
additional 52 weeks of benefits.
Rather than place increased pressure on an existing,
already heavily subscribed Cal Grant program by
redirecting limited funds to create a "sub-program" to
address the training needs of the unemployed, would it
make more sense to examine and modify the programs that
already exist to meet those needs?
Staff recommends the bill be amended to delete the
provisions relative to the redesign of the Cal Grant C
program to serve the long-term unemployed.
1) Why additional consulting ? Current law requires the CSAC
to give "priority" in granting Cal Grant C awards to
students pursuing occupational or technical training in
areas that meet two of the following three criteria: high
employment need, high employment growth, and high wage.
According to the CSAC through extensive consultation with
the Employment Development Department (EDD) and its
subsidiary, the Labor Market Information Data Library
(LMID), the Director at the Center for Strategic Economic
Research, and the Dean of the Industry Partnership
Practices Unit at the Community College Chancellor's
Office, the commission has determined which occupations
met the requirements set forth in law.
According to the author the provisions requiring
consultation with specific community college and workforce
investment board entities are intended to encourage CSAC
to make use of labor market expertise and analyses already
being performed. In addition, these are intended to bring
like-programs under different state agencies into better
alignment, reduce duplication of effort, and ensure that
agencies performing similar tasks with similar goals are
moving in the same direction.
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2) Independent analysis necessary . Current law requires the
LAO to report on the outcomes of the Cal Grant C program
beginning in 2015. This bill replaces the LAO with the
CSAC and asks them to comply with the reporting
requirements. Generally the LAO is seen as an objective
"outside" evaluator, able to provide some analysis of the
implementation of the Legislature's intent. According to
the author's office, the current reporting requirements
amount to a simple transfer of data from the CSAC to the
LAO.
Rather than delete the LAO reporting requirements, staff
recommends the bill be amended to restore the LAO
responsibility for submitting the report, to require that
the CSAC provide the information to the LAO and that the
LAO provide an analysis and recommendations regarding any
changes necessary to the Cal Grant C program.
3) Premature changes ? The most recent changes to the Cal
Grant C program occurred in 2011. According to CSAC,
since the enactment of the new requirements established by
SB 451, only two years of awards have occurred (2012-13
and 2013-14). To assess the impact of those changes, the
LAO is required to report on the outcomes of the Cal Grant
C program beginning in 2015 and every other year
thereafter.
This bill establishes new criteria and sets a much higher
threshold for occupational and training programs to be
identified as "priority." The committee may wish to
consider the following:
a) Should the results of the LAO report be
evaluated prior to implementing any new changes to
the program?
b) Could requiring that training programs meet all
four of the new criteria (rather than the two of
three required under current law) disadvantage
applicants from regions of the state whose economies
cannot support the types of occupations that would
satisfy all these criteria?
c) Some of the new requirements ask the CSAC to
consider the "likelihood" of job placement and the
"likelihood" of placement in jobs that lead to
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specified outcomes. How would the CSAC quantify the
"likelihood" of something?
According to the author, the priority occupational and
training programs currently identified emphasize job
growth, but give insufficient weight to job quality,
career mobility, and whether or not training meets skills
gaps. The new criteria are intended to ensure that
employer needs are being met while also ensuring that
training for high quality jobs are being prioritized.
If it is the desire of the committee to strengthen the
criteria to be met for assigning "priority" based on
occupation and training programs, staff recommends the
bill be amended to require that occupational and training
programs meet two of the four new requirements and that
the requirements be modified as follows:
A) High employer need or demand and likelihood of
the student being placed in a job for which the student
is being trained for the specific skills offered in the
program .
B) High employment growth in the occupational field
or industry cluster for which the student is being
trained.
C) High employment salary or wage projections for
workers employed in the occupations for which they are
being trained.
D) The likelihood of job placement in a position
with The occupation or training program is part of a
well-articulated career pathway to a job providing
economic security.
1) Duplicate definitions . This bill currently defines a
variety of terms for purposes of the bill. Many of these
terms are already defined as the result of the enactment
of SB 1402 (Lieu, Chapter 361, Statutes of 2012) and
SB 118 (Lieu, 2013), bills which respectively address the
Economic and Workforce Development Program at the
California Community Colleges and education and workforce
issues in the Unemployment Insurance Code. Staff
recommends the bill be amended to cross reference existing
Education Code and Unemployment Insurance Code definitions
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for the terms identified in the bill, as appropriate.
2) Prior legislation . SB 451 (Price, Chapter 627, Statutes
of 2011) required the CSAC to prioritize Cal Grant C
awards to students pursuing study in areas of high
employment need, high salary or wage protection, or high
growth, and established related authority and requirements
for identifying these areas of employment. SB 451 also
required CSAC to examine graduation rates and job
placement data of eligible programs and, commencing in
2014-15, to give priority to Cal Grant C applicants
seeking enrollment in programs rating highly in these
factors. The bill also requires the Legislative Analyst's
Office report to the Legislature to contain specified
information.
SUPPORT
California Hospital Association
Chancellor's Office, California Community Colleges
Community College League of California
OPPOSITION
None received.