California A.B. 573 – State Financial Aid 

Sponsor: Assemblymember Jose Medina (D)

Summary: Current version (5/11/2015): Requires the board of governors, until July 1, 2018, to waive the fee for students who were enrolled at a California campus of a Corinthian Colleges, Inc., institution, and were either unable to complete an educational program offered by the campus due to the campus’s closure on April 27, 2015, or withdrew from an educational program offered by a campus within 120 days, or a greater period determined by the Bureau for Private Postsecondary Education, of the campus’s closure on April 27, 2015.

Requires, upon the unlawful closure of an institution, the bureau to provide timely grant funds to local legal aid organizations to assist students of that institution with loan discharge requests and tuition recovery related claims.

Appropriate the sum of $1,300,000 from the Private Postsecondary Education Administration Fund to the Bureau of Private Postsecondary Education for the purposes of providing financial grants to legal aid organizations, as described above, for students affected by the closure of Corinthians Colleges, Inc.

Requires the Bureau for Private Postsecondary Education in the Department of Consumer Affairs to establish a task force to respond to the closure of an institution that does not comply with these requirements prior to closing. Requires the task force to assist the students who were enrolled at, or in an online program offered by, the institution in, among other things, obtaining refunds, loan discharges, and tuition recovery.
Establishes the Student Tuition Recovery Fund and requires the bureau to adopt regulations governing the administration and maintenance of the fund, including requirements relating to assessments on students and student claims against the fund, and establishes that the moneys in this fund are continuously appropriated to the bureau for specified purposes. Caps the amount that may be in the fund at any time at $25,000,000.

Deems a student who was enrolled at a California campus of a Corinthian Colleges, Inc. institution, or a California student who was enrolled in an online program offered by an out-of-state campus of a Corinthian Colleges, Inc., institution, to be eligible for recovery from the fund. Raises the cap for the fund to $50,000,000.

Exempts from this limitation on Cal Grant awards a student who was enrolled at a California campus of a Corinthian Colleges, Inc. institution, and who was unable to complete an educational program offered by the campus due to its closure.

Current version (5/11/2015):  http://www.leginfo.ca.gov/pub/15-16/bill/asm/ab_0551-0600/ab_573_bill_20150511_amended_asm_v96.pdf 

Previous version (5/7/2015):  http://www.leginfo.ca.gov/pub/15-16/bill/asm/ab_0551-0600/ab_573_bill_20150507_amended_asm_v97.pdf 

Previous version (5/4/2015):  http://www.leginfo.ca.gov/pub/15-16/bill/asm/ab_0551-0600/ab_573_bill_20150504_amended_asm_v98.pdf 

Introduced:  http://www.leginfo.ca.gov/pub/15-16/bill/asm/ab_0551-0600/ab_573_bill_20150224_introduced.pdf 

Status: Introduced 2/24/2015. Referred Assembly Committee on Higher Education 3/9/2015. Hearing held, reported; re-referred to Assembly Committee on Appropriations 4/28/2015. Amended 5/4/2015. Hearing held, reported 5/6/2015. Amended, re-referred to Assembly Committee on Higher Education 5/7/2015. Amended 5/11/2015. Hearing held, reported 5/12/2015. Passed Assembly; received in Senate, referred to Senate Committee on Rules 5/14/2015. Rereferred to Senate Committee on Business, Professions and Economic Development and Senate Committee on Education 5/28/2015.

Outlook: The Senate Committee on Business, Professions and Economic Development is chaired by Senate Jerry Hill (D). The sponsor is the Vice-Chairman of the committee of referral. Before this measure may be considered by the second committee of referral, it must first be reported out by this committee. Committees are not required to consider every measure referred to them. Per Joint Rule 61(a)(11), the committee has by July 17 to act on this measure.

The Assembly adopted this measure by a 74-0 vote.

The sponsor is a member of the majority party and has yet to garner the cosponsorship of any other member of the chamber. The Democratic Party controls both chambers of the Legislature as well as the Office of the Governor.

Effective Date: Upon approval by the Governor.

*Information provided by www.stateside.com