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California Association of Private Postsecondary Schools

California A.B. 2099 - State Financial Aid

08/06/2014

Sponsor: Assemblymember Jim Frazier (D)

Summary: Current version (7/2/2014): Deems a public or private postsecondary educational institution that is accredited by an accrediting agency recognized by the United States Department of Education eligible for initial and renewable Title 38 awards if the institution has a 3 year cohort default rate less than 15.5% and a graduation rate of greater than 30% for students taking 150% or less of the expected time to complete degree requirements, and satisfies the other criteria for qualification for Title 38 awards.

Deems a private postsecondary educational institution that does not meet the cohort default rate or graduation rate requirement, but that is accredited by an accrediting agency recognized by the United States Department of Education, eligible for initial and renewable Title 38 awards if the institution is issued an approval to operate from the Bureau for Private Postsecondary Education and satisfies the other criteria for qualification for Title 38 awards.

Requires the California State Approving Agency for Veterans Education to verify by November 1 of each year a public or private institution’s latest 3 year cohort default rate and graduation rate as most recently reported by the United States Department of Education, and a private postsecondary educational institution’s approval to operate issued by the Bureau for Private Postsecondary Education if that private postsecondary educational institution fails to satisfy the cohort default rate or graduation rate requirement. Requires the California State Approving Agency for Veterans Education to notify initial Title 38 recipients seeking to attend, or attending, an institution that is ineligible for initial and renewable Title 38 awards that the institution is ineligible for Title 38 awards for the academic year. Requires the California State Approving Agency for Veterans Education to provide initial and renewable Title 38 recipients at an ineligible institution with a complete list of all California postsecondary educational institutions at which the student would be eligible to receive a Title 38 award.

Current version (7/2/2014):  http://www.leginfo.ca.gov/pub/13-14/bill/asm/ab_2051-2100/ab_2099_bill_20140702_amended_sen_v94.pdf

Amendment #4 (5/23/2014): http://www.leginfo.ca.gov/pub/13-14/bill/asm/ab_2051-2100/ab_2099_bill_20140523_amended_asm_v95.pdf

Amendment #3 (5/7/2014): http://www.leginfo.ca.gov/pub/13-14/bill/asm/ab_2051-2100/ab_2099_bill_20140507_amended_asm_v96.pdf

Amendment #2 (4/24/2014): http://www.leginfo.ca.gov/pub/13-14/bill/asm/ab_2051-2100/ab_2099_bill_20140424_amended_asm_v97.pdf

Amendment #1 (4/10/2014): http://www.leginfo.ca.gov/pub/13-14/bill/asm/ab_2051-2100/ab_2099_bill_20140410_amended_asm_v98.pdf

Introduced version:  http://www.leginfo.ca.gov/pub/13-14/bill/asm/ab_2051-2100/ab_2099_bill_20140220_introduced.pdf

Status: Introduced 2/20/2014. Referred to Assembly Higher Education Committee 3/3/2014. Withdrawn, amended, re-referred to Assembly Higher Education Committee 4/10/2014. Hearing held, reported; re-referred to Assembly Committee on Appropriations 4/22/2014. Amended 4/24/2014. Hearing held 5/14/2014. Hearing held, amended, reported 5/23/2014. Passed Assembly, received in Senate 5/29/2014. Referred to Senate Committee on Education 6/11/2014. Hearing held, reported; re-referred to Committee on Appropriations 6/25/2014. Amended 7/2/2014. Hearing held 8/4/2014.

Outlook: This measure was determined to have a significant fiscal impact by the Committee on Appropriations and placed in its suspense file for further consideration at a later date. The suspense file is a function of the fiscal committee in both chambers. Per Joint Rule 61(b)(14), the committee has by August 15 to act on this measure.

After allowing for public testimony, the Senate Committee on Education recommended this measure for passage unanimously. The measure will next be referred to the Senate Committee on Appropriations for consideration. As this measure contains fiscal provisions it must be approved by the Appropriations Committee before it may be considered by the full chamber.

The Senate Rules Committee has referred this measure to the Senate Committee on Education, chaired by Carol Liu (D).

The Assembly adopted this measure by a 62-4 vote.

The sponsor is a member of the majority party but has not garnered the support of any cosponsors. The Democratic Party controls both legislative chambers as well as the Office of Governor.

In 2012, the United State Senate Health, Education, Labor and Pensions Committee released a report examining taxpayer investments of billions of dollars into companies that operate for-profit colleges. The report found that these institutions have failed to make the necessary investment in services to help students succeed in school, such as tutors, counselors, academic advisors and job placement staff. The report also revealed that for-profit colleges employed nearly three recruiters for each support service employee and in some cases spent less on instructional cost than they spent on marketing and recruiting or made in profit. California A.B. 2099 was introduced by Freshman Assembly Member Jim Frazier (D) to help ensure veteran students find success at for-profit colleges.

“Every year the GI Bill helps thousands of veterans subsidize their college education and has been credited with the transformation of the middle class after World War II,” Assembly Member Frazier has stated. “While for-profit colleges can be a good choice for many non-traditional students, a number of companies have capitalized on the financial assistance that veterans receive.”

In the Assembly Member’s press release upon the introduction of A.B. 2099, Assembly Member Frazier claimed that most for-profit colleges set tuition above available financial aid and generally cost significantly more than comparable community colleges and state universities causing nearly 96% of students starting at a for-profit college to take on student loans. From the companies examined in the 2012 United State Senate Health, Education, Labor and Pensions Committee report, 54% of students from 2008 to 2010 left the school, often times with high debt and without a certificate or a degree. “Many veteran students have left these colleges with outrageous debt and few marketable skills to obtain a job that pays a living wage. We have the opportunity to set reasonable standards that will produce a well-educated and well trained veteran workforce,” said Assembly Member Frazier upon introducing the measure. “Our veterans deserve to be treated with respect and provided a high quality education from the college they attend.” A.B. 2099 represents the first effort by the legislature to enact this type of measure.

Effective Date: Upon approval by the Governor 

*Information provided by www.stateside.com