Amended in Assembly May 4, 2015

California Legislature—2015–16 Regular Session

Assembly BillNo. 573


Introduced by Assemblybegin delete Memberend deletebegin insert Membersend insert Medinabegin insert and McCartyend insert

begin insert

(Coauthors: Assembly Members Alejo, Atkins, Bonilla, Brown, Calderon, Chau, Chiu, Chu, Cooley, Dababneh, Eggman, Frazier, Gipson, O’Donnell, Olsen, Quirk, Ridley-Thomas, Rodriguez, Santiago, Thurmond)

end insert

February 24, 2015


An act to amendbegin delete Section 69432.7 ofend deletebegin insert Sections 69433.5, 76300, 94923, and 94925 of, and to add Sections 69433.61 and 94926.5 to,end insert the Education Code, relating to higher education.

LEGISLATIVE COUNSEL’S DIGEST

AB 573, as amended, Medina. begin deleteStudent financial aid: Cal Grant Program: Student Aid Commission. end deletebegin insertHigher education: campus closures: Corinthian Collegesend insertbegin insert.end insert

begin insert

(1) Existing law establishes the California Community Colleges under the administration of the Board of Governors of the California Community Colleges, and establishes community college districts throughout the state that operate community colleges and provide instruction to students. Existing law requires community college districts to charge each student a fee of $46 per unit per semester. Existing law requires the waiver of this fee for students meeting prescribed requirements.

end insert
begin insert

This bill would authorize the board of governors to waive the fee for students who were enrolled in a private postsecondary educational institution that provided educational services in California or online educational services to California students at the time the institution closed or otherwise ceased to operate an academic program in which they were enrolled, and for students who withdrew from the institution within 120 days, or any greater period determined by the bureau, of the closure or cessation.

end insert
begin insert

(2) The California Private Postsecondary Education Act of 2009, provides for the regulation of private postsecondary educational institutions by the Bureau for Private Postsecondary Education in the Department of Consumer Affairs. The act requires an institution subject to its provisions to follow certain requirements prior to closing.

end insert
begin insert

This bill would require the bureau to establish a task force to respond to the closure of an institution that does not comply with these requirements prior to closing. The bill would require 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.

end insert
begin insert

The act also 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. The act caps the amount that may be in the fund at any time at $25,000,000.

end insert
begin insert

This bill would deem 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 under specified circumstances. The bill would raise the cap for the fund to $50,000,000.

end insert
begin insert

(3) The Cal Grant Program prohibits an applicant from receiving Cal Grant awards totaling in excess of the amount equivalent to the award level for a total of four years of full-time attendance in an undergraduate program, except as provided.

end insert
begin insert

This bill would exempt 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.

end insert
begin delete

Existing law, the Ortiz-Pacheco-Poochigian-Vasconcellos Cal Grant Program (Cal Grant Program), establishes the Cal Grant A and B Entitlement Awards, the California Community College Transfer Cal Grant Entitlement Awards, the Competitive Cal Grant A and B Awards, the Cal Grant C Awards, and the Cal Grant T Awards under the administration of the Student Aid Commission, and establishes eligibility requirements for awards under these programs for participating students attending qualifying institutions. Existing law requires the Student Aid Commission to do certain things, including notifying all Cal Grant recipients seeking to attend, or attending, an institution that is ineligible for initial and renewal Cal Grant awards that the institution is ineligible for initial Cal Grant awards for the academic year for which the student received an initial Cal Grant award.

end delete
begin delete

This bill would require the commission to establish a complete listing of California postsecondary educational institutions and identify which institutions are eligible and ineligible for participation in the Cal Grant Program. The bill would require the commission to make this information readily available on its Internet Web site.

end delete

Vote: majority. Appropriation: no. Fiscal committee: yes. State-mandated local program: no.

The people of the State of California do enact as follows:

P3    1begin insert

begin insertSECTION 1.end insert  

end insert
begin insert

It is the intent of the Legislature that the
2California Community Colleges shall utilize available resources
3to provide matriculation services, including, but not limited to,
4assessments, counseling, and academic planning to a student who,
5as of April 26, 2015, was enrolled at a California campus of a
6Corinthian Colleges, Inc. institution, including Heald College, or
7was a California student enrolled in one or more online programs
8offered by an out-of-state campus of a Corinthian Colleges, Inc.
9institution.

end insert
10begin insert

begin insertSEC. 2.end insert  

end insert

begin insertIt is the intent of the Legislature that unencumbered
11funds awarded to the state from a lawsuit involving Corinthian
12Colleges, Inc. and its affiliate institutions, including Heald College,
13shall be used to fund this act.end insert

14begin insert

begin insertSEC. 3.end insert  

end insert

begin insertSection 69433.5 of the end insertbegin insertEducation Codeend insertbegin insert is amended to
15read:end insert

16

69433.5.  

(a) Only a resident of California, as determined by
17the commission pursuant to Part 41 (commencing with Section
1868000), is eligible for an initial Cal Grant award. The recipient
19shall remain eligible for award renewal only if he or she is a
20California resident, in attendance, and making satisfactory
P4    1academic progress at a qualifying institution, as determined by the
2commission.

3(b) A part-time student shall not be discriminated against in the
4selection of Cal Grant Program award recipients, and an award to
5a part-time student shall be approximately proportional to the time
6the student spends in the instructional program, as determined by
7the commission. A first-time Cal Grant Program award recipient
8who is a part-time student shall be eligible for a full-time renewal
9award if he or she becomes a full-time student.

10(c) Cal Grant Program awards shall be awarded without regard
11to race, religion, creed, sex, sexual orientation, gender identity,
12gender expression, or age.

13(d) An applicant shall not receive more than one type of Cal
14Grant Program award concurrently. An applicant shall not:

15(1) Receive one or a combination of Cal Grant Program awards
16in excess of the amount equivalent to the award level for a total
17of four years of full-time attendance in an undergraduate program,
18except as provided inbegin delete Sectionend deletebegin insert Sectionsend insert 69433.6begin insert and 69433.61end insert.

19(2) Have obtained a baccalaureate degree before receiving a
20Cal Grant Program award.

21(e) A Cal Grant Program award, except as provided in Section
2269440, may only be used for educational expenses of a program
23of study leading directly to an undergraduate degree or certificate,
24or for expenses of undergraduate coursework in a program of study
25leading directly to a first professional degree, but for which no
26baccalaureate degree is awarded.

27(f) The commission shall, for students who accelerate college
28attendance, increase the amount of award proportional to the period
29of additional attendance resulting from attendance in classes that
30fulfill requirements or electives for graduation during summer
31terms, sessions, or quarters. In the aggregate, the total amount a
32student may receive in a four-year period may not be increased as
33a result of accelerating his or her progress to a degree by attending
34summer terms, sessions, or quarters.

35(g) The commission shall notify Cal Grant award recipients of
36the availability of funding for the summer term, session, or quarter
37through prominent notice in financial aid award letters, materials,
38guides, electronic information, and other means that may include,
39but not necessarily be limited to, surveys, newspaper articles, or
P5    1attachments to communications from the commission and any
2other published documents.

3(h) The commission may require, by the adoption of rules and
4regulations, the production of reports, accounting, documents, or
5other necessary statements from the award recipient and the college
6or university of attendance pertaining to the use or application of
7the award.

8(i) A Cal Grant Program award may be utilized only at a
9qualifying institution.

10(j) A recipient who initially qualified for both a Cal Grant A
11award and a Cal Grant B award, and received a Cal Grant B award,
12may be awarded a renewal Cal Grant A award if that recipient
13subsequently became ineligible for a renewal Cal Grant B award
14and meets the applicable Cal Grant A financial need and income
15and asset criteria.

16begin insert

begin insertSEC. 4.end insert  

end insert

begin insertSection 69433.61 is added to the end insertbegin insertEducation Codeend insertbegin insert, to
17read:end insert

begin insert
18

begin insert69433.61.end insert  

A student who was enrolled at a California campus
19of a Corinthian Colleges, Inc. institution, including Heald College,
20and was unable to complete an educational program offered by
21the campus due to the campus’s closure on April 27, 2015, shall
22be exempt from the limitation on Cal Grant Program awards in
23paragraph (1) of subdivision (d) of Section 69433.5.

end insert
24begin insert

begin insertSEC. 5.end insert  

end insert

begin insertSection 76300 of the end insertbegin insertEducation Codeend insertbegin insert is amended to
25read:end insert

26

76300.  

(a) The governing board of each community college
27district shall charge each student a fee pursuant to this section.

28(b) (1) The fee prescribed by this section shall be forty-six
29dollars ($46) per unit per semester, effective with the summer term
30of the 2012 calendar year.

31(2) The board of governors shall proportionately adjust the
32amount of the fee for term lengths based upon a quarter system,
33and also shall proportionately adjust the amount of the fee for
34summer sessions, intersessions, and other short-term courses. In
35making these adjustments, the board of governors may round the
36per unit fee and the per term or per session fee to the nearest dollar.

37(c) For the purposes of computing apportionments to community
38college districts pursuant to Section 84750.5, the board of
39governors shall subtract, from the total revenue owed to each
P6    1district, 98 percent of the revenues received by districts from
2charging a fee pursuant to this section.

3(d) The board of governors shall reduce apportionments by up
4to 10 percent to any district that does not collect the fees prescribed
5by this section.

6(e) The fee requirement does not apply to any of the following:

7(1) Students enrolled in the noncredit courses designated by
8Section 84757.

9(2) California State University or University of California
10students enrolled in remedial classes provided by a community
11 college district on a campus of the University of California or a
12campus of the California State University, for whom the district
13claims an attendance apportionment pursuant to an agreement
14between the district and the California State University or the
15University of California.

16(3) Students enrolled in credit contract education courses
17pursuant to Section 78021, if the entire cost of the course, including
18administrative costs, is paid by the public or private agency,
19corporation, or association with which the district is contracting
20and if these students are not included in the calculation of the
21full-time equivalent students (FTES) of that district.

22(f) The governing board of a community college district may
23exempt special part-time students admitted pursuant to Section
2476001 from the fee requirement.

25(g) (1) The fee requirements of this section shall be waived for
26any student who meets all of the following requirements:

27(A) Meets minimum academic and progress standards adopted
28by the board of governors, which fulfill the requirements outlined
29in this paragraph and paragraphs (2) to (5), inclusive. Any
30minimum academic and progress standards adopted pursuant to
31this section shall be uniform across all community college districts
32and campuses. These standards shall not include a maximum unit
33cap, and community college districts and colleges shall not impose
34requirements for fee waiver eligibility other than the minimum
35academic and progress standards adopted by the board of governors
36and the requirements of subparagraph (B).

37(B) Meetsbegin insert at leastend insert one of the following criteria:

38(i) At the time of enrollment, is a recipient of benefits under the
39Temporary Assistance for Needy Families program, the
P7    1Supplemental Security Income/State Supplementary Payment
2Program, or a general assistance program.

3(ii) Demonstrates eligibility according to income standards
4established by regulations of the board of governors.

5(iii) Demonstrates financial need in accordance with the
6methodology set forth in federal law or regulation for determining
7the expected family contribution of students seeking financial aid.

begin insert

8(iv) Was enrolled in a private postsecondary educational
9institution that provided educational services in California, or
10online educational services to a California student, at the time the
11institution closed or otherwise ceased to operate an academic
12program in which the student was enrolled.

end insert
begin insert

13(v) Withdrew from a private postsecondary educational
14institution that provided educational services in California, or
15online educational services to a California student, that closed or
16otherwise ceased to operate an academic program in which the
17student was enrolled, within 120 days of the closure or cessation,
18or any greater period determined by the bureau pursuant to Section
1994923.

end insert

20(2) (A) The board of governors, in consultation with students,
21faculty, and other key stakeholders, shall consider all of the
22following in the development and adoption of minimum academic
23and progress standards pursuant to subparagraph (A) of paragraph
24(1):

25(i) Minimum uniform academic and progress standards that do
26not unfairly disadvantage financially needy students in pursuing
27their education.

28(ii) Criteria for reviewing extenuating circumstances and
29granting appeals that, at a minimum, take into account and do not
30penalize a student for circumstances outside his or her control,
31such as reductions in student support services or changes to the
32economic situation of the student.

33(iii) A process for reestablishing fee waiver eligibility that
34provides a student with a reasonable opportunity to continue or
35resume his or her enrollment at a community college.

36(B) To ensure that students are not unfairly impacted by the
37requirements of subparagraph (A) of paragraph (1), the board of
38governors shall establish a reasonable implementation period that
39commences no sooner than one year from adoption of the minimum
40academic and progress standards, or any subsequent changes to
P8    1these standards, pursuant to subparagraph (A) of paragraph (1)
2and that is phased in to provide students adequate notification of
3this requirement and information about available support resources.

4(3) It is the intent of the Legislature that minimum academic
5and progress standards adopted pursuant to subparagraph (A) of
6paragraph (1) be implemented only as campuses develop and
7implement the student support services and interventions necessary
8to ensure no disproportionate impact to students based on ethnicity,
9gender, disability, or socioeconomic status. The board of governors
10shall consider the ability of community college districts to meet
11the requirements of this paragraph before adopting minimum
12academic and progress standards, or any subsequent changes to
13these standards, pursuant to subparagraph (A) of paragraph (1).

14(4) It is the intent of the Legislature to ensure that a student shall
15not lose fee waiver eligibility without a community college campus
16first demonstrating a reasonable effort to provide a student with
17adequate notification and assistance in maintaining his or her fee
18waiver eligibility. The board of governors shall adopt regulations
19to implement this paragraph that ensure all of the following:

20(A) Students are provided information about the available
21student support services to assist them in maintaining fee waiver
22eligibility.

23(B) Community college district policies and course catalogs
24reflect the minimum academic and progress standards adopted
25pursuant to subparagraph (A) of paragraph (1) and that appropriate
26notice is provided to students before the policies are put into effect.

27(C) A student does not lose fee waiver eligibility unless he or
28she has not met minimum academic and progress standards adopted
29pursuant to subparagraph (A) of paragraph (1) for a period of no
30less than two consecutive academic terms.

31(5) The board of governors shall provide notification of a
32proposed action to adopt regulations pursuant to this subdivision
33to the appropriate policy and fiscal committees of the Legislature
34in accordance with the requirements of paragraph (1) of subdivision
35(a) of Section 70901.5. This notification shall include, but not be
36limited to, all of the following:

37(A) The proposed minimum academic and progress standards
38and information detailing how the requirements of paragraphs (1)
39to (4), inclusive, have been or will be satisfied.

P9    1(B) How many students may lose fee waiver eligibility by
2ethnicity, gender, disability, and, to the extent relevant data is
3available, by socioeconomic status.

4(C) The criteria for reviewing extenuating circumstances,
5granting appeals, and reestablishing fee waiver eligibility pursuant
6to paragraph (2).

7(h) The fee requirements of this section shall be waived for any
8student who, at the time of enrollment, is a dependent or surviving
9spouse who has not remarried, of any member of the California
10National Guard who, in the line of duty and while in the active
11service of the state, was killed, died of a disability resulting from
12an event that occurred while in the active service of the state, or
13is permanently disabled as a result of an event that occurred while
14in the active service of the state. “Active service of the state,” for
15the purposes of this subdivision, refers to a member of the
16California National Guard activated pursuant to Section 146 of
17the Military and Veterans Code.

18(i) The fee requirements of this section shall be waived for any
19student who is the surviving spouse or the child, natural or adopted,
20of a deceased person who met all of the requirements of Section
2168120.

22(j) The fee requirements of this section shall be waived for any
23student in an undergraduate program, including a student who has
24previously graduated from another undergraduate or graduate
25program, who is the dependent of any individual killed in the
26September 11, 2001, terrorist attacks on the World Trade Center
27and the Pentagon or the crash of United Airlines Flight 93 in
28southwestern Pennsylvania, if that dependent meets the financial
29need requirements set forth in Section 69432.7 for the Cal Grant
30A Program and either of the following applies:

31(1) The dependent was a resident of California on September
3211, 2001.

33(2) The individual killed in the attacks was a resident of
34California on September 11, 2001.

35(k) A determination of whether a person is a resident of
36California on September 11, 2001, for purposes of subdivision (j)
37shall be based on the criteria set forth in Chapter 1 (commencing
38with Section 68000) of Part 41 of Division 5 for determining
39nonresident and resident tuition.

P10   1(l) (1) “Dependent,” for purposes of subdivision (j), is a person
2who, because of his or her relationship to an individual killed as
3a result of injuries sustained during the terrorist attacks of
4September 11, 2001, qualifies for compensation under the federal
5September 11th Victim Compensation Fund of 2001 (Title IV
6(commencing with Section 401) of Public Law 107-42).

7(2) A dependent who is the surviving spouse of an individual
8killed in the terrorist attacks of September 11, 2001, is entitled to
9the waivers provided in this section until January 1, 2013.

10(3) A dependent who is the surviving child, natural or adopted,
11of an individual killed in the terrorist attacks of September 11,
122001, is entitled to the waivers under subdivision (j) until that
13person attains 30 years of age.

14(4) A dependent of an individual killed in the terrorist attacks
15of September 11, 2001, who is determined to be eligible by the
16California Victim Compensation and Government Claims Board,
17is also entitled to the waivers provided in this section until January
181, 2013.

19(m) (1) It is the intent of the Legislature that sufficient funds
20be provided to support the provision of a fee waiver for every
21student who demonstrates eligibility pursuant to subdivisions (g)
22to (j), inclusive.

23(2) From funds provided in the annual Budget Act, the board
24of governors shall allocate to community college districts, pursuant
25to this subdivision, an amount equal to 2 percent of the fees waived
26pursuant to subdivisions (g) to (j), inclusive. From funds provided
27in the annual Budget Act, the board of governors shall allocate to
28community college districts, pursuant to this subdivision, an
29amount equal to ninety-one cents ($0.91) per credit unit waived
30pursuant to subdivisions (g) to (j), inclusive. It is the intent of the
31Legislature that funds provided pursuant to this subdivision be
32used to support the determination of financial need and delivery
33 of student financial aid services, on the basis of the number of
34students for whom fees are waived. It also is the intent of the
35Legislature that the funds provided pursuant to this subdivision
36directly offset mandated costs claimed by community college
37districts pursuant to Commission on State Mandates consolidated
38Test Claims 99-TC-13 (Enrollment Fee Collection) and 00-TC-15
39(Enrollment Fee Waivers). Funds allocated to a community college
40district for determination of financial need and delivery of student
P11   1financial aid services shall supplement, and shall not supplant, the
2level of funds allocated for the administration of student financial
3aid programs during the 1992-93 fiscal year.

4(n) The board of governors shall adopt regulations implementing
5this section.

6(o) This section shall become operative on May 1, 2012, only
7if subdivision (b) of Section 3.94 of the Budget Act of 2011 is
8operative.

9begin insert

begin insertSEC. 6.end insert  

end insert

begin insertSection 94923 of the end insertbegin insertEducation Codeend insertbegin insert is amended to
10read:end insert

11

94923.  

(a) The Student Tuition Recovery Fund relieves or
12mitigates economic loss suffered by a student while enrolled in an
13educational program, as defined in Section 94837, at an institution
14not exempt from this article pursuant to Article 4 (commencing
15with Section 94874), who, at the time of his or her enrollment,
16was a California resident or was enrolled in a California residency
17program, prepaid tuition, and suffered economic loss.

18(b) The bureau shall adopt by regulation procedures governing
19the administration and maintenance of the Student Tuition
20Recovery Fund, including requirements relating to assessments
21on students and student claims against the Student Tuition
22Recovery Fund. The regulations shall provide for awards to
23students who suffer economic loss.

24The regulations shall ensure that the following students, and any
25other students deemed appropriate, are eligible for payment from
26the Student Tuition Recovery Fund:

27(1) Any student who was enrolled at an institution, at a location
28of the institution, or in an educational program offered by the
29institution, at the time that institution, location, or program was
30closed or discontinued, as applicable, who did not choose to
31participate in a teach-out plan approved by the bureau or did not
32complete a chosen teach-out plan approved by the bureau.

33(2) Any student who was enrolled at an institution or a location
34of the institution within the 120-day period before the closure of
35the institution or location of the institution, or who was enrolled
36in an educational program within the 120-day period before the
37program was discontinued, if the bureau determines there was a
38significant decline in the quality or value of that educational
39program during that time period.

P12   1(3) Any student who was enrolled at an institution or a location
2of the institution more than 120 days before the closure of the
3institution or location of the institution, in an educational program
4offered by the institution as to which the bureau determines there
5was a significant decline in the quality or value of the program
6more than 120 days before closure.

7(4) A student to whom an institution has been ordered to pay a
8refund by the bureau but has failed to do so.

9(5) A student to whom an institution has failed to pay or
10reimburse loan proceeds under a federal student loan program as
11required by law, or has failed to pay or reimburse proceeds received
12by the institution in excess of tuition and other costs.

13(6) A student who has been awarded restitution, a refund, or
14other monetary award by an arbitrator or court, based on a violation
15of this chapter by an institution or representative of an institution,
16but who has been unable to collect the award from the institution.
17The bureau shall review the award or judgment and shall ensure
18the amount to be paid from the fund does not exceed the student’s
19economic loss.

begin insert

20(7) Notwithstanding the requirements of subdivision (a) that
21the institution not be exempt from this article, a student who was
22enrolled at a California campus of a Corinthian Colleges, Inc.
23institution, including Heald College, or was a California student
24enrolled in an online program offered by an out-of-state campus
25of a Corinthian Colleges, Inc. institution, who also meets all of
26the other requirements in subdivision (a), if the student was
27enrolled as of April 26, 2015, or withdrew within 120 days of that
28date or any greater period determined by the bureau pursuant to
29this section.

end insert

30(c) Any student who is required to pay a Student Tuition
31Recovery Fund assessment who pays tuition equal to or greater
32than the required assessment shall be deemed to have paid the
33required assessment, whether or not his or her enrollment
34agreement specifies collection of the required assessment, and
35whether or not the institution identifies any money collected from
36the student as a Student Tuition Recovery Fund assessment.

37(d) The bureau shall establish regulations ensuring, as
38permissible under California law, that a student who suffers
39educational opportunity losses, whose charges are paid by a
40third-party payer, is eligible for educational credits under the fund.

P13   1(e) The bureau may seek repayment to the Student Tuition
2Recovery Fund from an institution found in violation of the law
3for which a student claim was paid. An institution shall not be
4eligible to renew its approval to operate with the bureau if the
5repayment is not made to the bureau as requested.

6(f) The bureau shall, by regulation, define “economic loss.” The
7regulation shall ensure that the definition of “economic loss”
8includes, but is not necessarily limited to, pecuniary loss, which
9is the sum of the student’s tuition, all other institutional charges
10as defined in Section 94844, the cost of equipment and materials
11required for the educational program as defined in Section 94837,
12interest on any student loan used to pay for such charges, collection
13costs, penalties, and any license or examination fees the student
14paid to the institution but is unable to recover. Economic loss shall
15also include the amount the institution collected and failed to pay
16to third parties on behalf of the student for license fees or any other
17purpose. Economic loss does not include Student Tuition Recovery
18Fund assessments, unless the student is entitled to a full refund
19under Section 94919 or 94920, room and board, supplies,
20transportation, application fees, or nonpecuniary damages such as
21inconvenience, aggravation, emotional distress, or punitive
22damages. Economic loss does not include legal fees, attorney fees,
23court costs, or arbitration fees. Nothing in this subdivision shall
24prevent the bureau from further defining economic loss to include
25loss of educational opportunity.

26begin insert

begin insertSEC. 7.end insert  

end insert

begin insertSection 94925 of the end insertbegin insertEducation Codeend insertbegin insert is amended to
27read:end insert

28

94925.  

(a) The amount in the Student Tuition Recovery Fund
29shall not exceedbegin delete twenty-fiveend deletebegin insert fiftyend insert million dollarsbegin delete ($25,000,000)end delete
30begin insert ($50,000,000)end insert at any time.

31(b) If the bureau has temporarily stopped collecting the Student
32Tuition Recovery Fund assessments because the fund has
33approached thebegin delete twenty-fiveend deletebegin insert fiftyend insert million dollar limit in subdivision
34(a), the bureau shall resume collecting Student Tuition Recovery
35Fund assessments when the fund falls belowbegin delete twentyend deletebegin insert forty-fiveend insert
36 million dollarsbegin delete ($20,000,000).end deletebegin insert ($45,000,000).end insert

37(c) An otherwise eligible student who enrolled during a period
38when institutions were not required to collect Student Tuition
39Recovery Fund assessments is eligible for Student Tuition
P14   1Recovery Fund payments despite not having paid any Student
2Tuition Recovery Fund assessment.

begin insert

3(d) A student who is eligible for recovery from the Student
4Tuition Recovery Fund pursuant to paragraph (7) of subdivision
5(b) of Section 94923 shall be eligible for payments despite not
6having paid any Student Tuition Recovery Fund assessment.

end insert
7begin insert

begin insertSEC. 8.end insert  

end insert

begin insertSection 94926.5 is added to the end insertbegin insertEducation Codeend insertbegin insert, to
8read:end insert

begin insert
9

begin insert94926.5.end insert  

(a) (1) The bureau shall establish and coordinate a
10closed school task force to respond to the closure of an institution
11that does not comply with the requirements, as applicable, of this
12article. The task force shall ensure that students who were enrolled
13at, or in an online program offered by, the institution receive
14accurate and uniform information regarding the school closure
15process and the students’ rights and responsibilities. The task force
16shall assist these students in all of the following:

17(A) Obtaining refunds, loan discharges, and tuition recovery
18for which the student is eligible.

19(B) Obtaining information regarding the option to transfer
20 credits that the student earned while attending the institution,
21including information necessary to help the student make an
22informed decision about whether to seek a loan discharge or to
23transfer credits.

24(C) Providing other support deemed necessary by the task force
25in accordance with the bureau's consumer protection mission.

26(2) The members of the task force should include, but not
27necessarily be limited to, representatives on behalf of the Student
28Aid Commission, the Department of Justice, the Office of the
29Chancellor of the California Community Colleges, the Department
30of Veterans Affairs, and one or more legal aid organizations.

31(b) Upon the unlawful closure of an institution, the bureau shall
32establish a grant fund in order to provide financial grants, not to
33exceed one hundred dollars ($100) per student, to local legal aid
34organizations, which may include local legal aid organizations
35designed specifically to assist veteran students, to assist the
36students of that institution with completing loan discharge requests
37and tuition recovery claims.

end insert
begin delete
38

SECTION 1.  

Section 69432.7 of the Education Code is
39amended to read:

P15   1

69432.7.  

As used in this chapter, the following terms have the
2following meanings:

3(a) An “academic year” is July 1 to June 30, inclusive. The
4starting date of a session shall determine the academic year in
5which it is included.

6(b) “Access costs” means living expenses and expenses for
7transportation, supplies, and books.

8(c) “Award year” means one academic year, or the equivalent,
9of attendance at a qualifying institution.

10(d) “College grade point average” and “community college
11grade point average” mean a grade point average calculated on the
12basis of all college work completed, except for nontransferable
13units and courses not counted in the computation for admission to
14a California public institution of higher education that grants a
15baccalaureate degree.

16(e) “Commission” means the Student Aid Commission.

17(f) “Enrollment status” means part- or full-time status.

18(1) “Part time,” for purposes of Cal Grant eligibility, means 6
19to 11 semester units, inclusive, or the equivalent.

20(2) “Full time,” for purposes of Cal Grant eligibility, means 12
21or more semester units or the equivalent.

22(g) “Expected family contribution,” with respect to an applicant,
23shall be determined using the federal methodology pursuant to
24subdivision (a) of Section 69506 (as established by Title IV of the
25 federal Higher Education Act of 1965, as amended (20 U.S.C. Sec.
261070 et seq.)) and applicable rules and regulations adopted by the
27commission.

28(h) “High school grade point average” means a grade point
29average calculated on a 4.0 scale, using all academic coursework,
30for the sophomore year, the summer following the sophomore
31year, the junior year, and the summer following the junior year,
32excluding physical education, Reserve Officers’ Training Corps
33(ROTC), and remedial courses, and computed pursuant to
34regulations of the commission. However, for high school graduates
35who apply after their senior year, “high school grade point average”
36includes senior year coursework.

37(i) “Instructional program of not less than one academic year”
38means a program of study that results in the award of an associate
39or baccalaureate degree or certificate requiring at least 24 semester
P16   1units or the equivalent, or that results in eligibility for transfer from
2a community college to a baccalaureate degree program.

3(j) “Instructional program of not less than two academic years”
4means a program of study that results in the award of an associate
5or baccalaureate degree requiring at least 48 semester units or the
6equivalent, or that results in eligibility for transfer from a
7community college to a baccalaureate degree program.

8(k) (1) “Maximum household income and asset levels” means
9the applicable household income and household asset levels for
10participants, including new applicants and renewing recipients, in
11the Cal Grant Program, as defined and adopted in regulations by
12the commission for the 2001-02 academic year, which shall be
13set pursuant to the following income and asset ceiling amounts:


14
15

 

CAL GRANT PROGRAM INCOME CEILINGS

P16  1735P16  37P16   4

 

 

Cal Grant A,
C, and T

Cal Grant B

Dependent and Independent students with dependents*

Family Size

  Six or more

$74,100  

$40,700  

  Five

$68,700  

$37,700  

  Four

$64,100  

$33,700  

  Three

$59,000  

$30,300  

  Two

$57,600  

$26,900  


Independent


  Single, no dependents

$23,500  

$23,500  

  Married

$26,900  

$26,900  

35P16  37P16   4

 

32*Applies to independent students with dependents other than a
33spouse.
34

 

CAL GRANT PROGRAM ASSET CEILINGS

P16  37P16   4

 

 

Cal Grant A,
C, and T

Cal Grant B


Dependent**   


$49,600  


$49,600  

Independent   

$23,600  

$23,600  

 

5**Applies to independent students with dependents other than a
6spouse.
7

8(2) The commission shall annually adjust the maximum
9household income and asset levels based on the percentage change
10in the cost of living within the meaning of paragraph (1) of
11subdivision (e) of Section 8 of Article XIII B of the California
12Constitution. The maximum household income and asset levels
13applicable to a renewing recipient shall be the greater of the
14adjusted maximum household income and asset levels or the
15maximum household income and asset levels at the time of the
16renewing recipient’s initial Cal Grant award. For a recipient who
17was initially awarded a Cal Grant for an academic year before the
182011-12 academic year, the maximum household income and asset
19levels shall be the greater of the adjusted maximum household
20income and asset levels or the 2010-11 academic year maximum
21household income and asset levels. An applicant or renewal
22recipient who qualifies to be considered under the simplified needs
23test established by federal law for student assistance shall be
24presumed to meet the asset level test under this section. Before
25disbursing any Cal Grant funds, a qualifying institution shall be
26obligated, under the terms of its institutional participation
27agreement with the commission, to resolve any conflicts that may
28exist in the data the institution possesses relating to that individual.

29(l) (1) “Qualifying institution” means an institution that
30complies with paragraphs (2) and (3) and is any of the following:

31(A) A California private or independent postsecondary
32educational institution that participates in the Pell Grant Program
33and in at least two of the following federal student aid programs:

34(i) Federal Work-Study Program.

35(ii) Federal Stafford Loan Program.

36(iii) Federal Supplemental Educational Opportunity Grant
37Program.

38(B) A nonprofit institution headquartered and operating in
39California that certifies to the commission that 10 percent of the
P18   1institution’s operating budget, as demonstrated in an audited
2financial statement, is expended for purposes of institutionally
3funded student financial aid in the form of grants, that demonstrates
4to the commission that it has the administrative capacity to
5administer the funds, that is accredited by the Western Association
6of Schools and Colleges, and that meets any other state-required
7criteria adopted by regulation by the commission in consultation
8with the Department of Finance. A regionally accredited institution
9that was deemed qualified by the commission to participate in the
10Cal Grant Program for the 2000-01 academic year shall retain its
11eligibility as long as it maintains its existing accreditation status.

12(C) A California public postsecondary educational institution.

13(2) (A) The institution shall provide information on where to
14access California license examination passage rates for the most
15recent available year from graduates of its undergraduate programs
16leading to employment for which passage of a California licensing
17 examination is required, if that data is electronically available
18through the Internet Web site of a California licensing or regulatory
19agency. For purposes of this paragraph, “provide” may exclusively
20include placement of an Internet Web site address labeled as an
21access point for the data on the passage rates of recent program
22graduates on the Internet Web site where enrollment information
23is also located, on an Internet Web site that provides centralized
24admissions information for postsecondary educational systems
25with multiple campuses, or on applications for enrollment or other
26program information distributed to prospective students.

27(B) The institution shall be responsible for certifying to the
28commission compliance with the requirements of subparagraph
29(A).

30(3) (A) The commission shall certify by November 1 of each
31year the institution’s latest official three-year cohort default rate
32and graduation rate as most recently reported by the United States
33Department of Education. For purposes of this section, the
34graduation rate is the percentage of full-time, first-time degree or
35certificate-seeking undergraduate students who graduate in 150
36percent or less of the expected time to complete degree
37requirements as most recently reported publicly in any format,
38including preliminary data records, by the United States
39Department of Education.

P19   1(B) For purposes of the 2011-12 academic year, an otherwise
2qualifying institution with a three-year cohort default rate reported
3by the United States Department of Education that is equal to or
4greater than 24.6 percent shall be ineligible for initial and renewal
5Cal Grant awards at the institution.

6(C) For purposes of the 2012-13 academic year, and every
7academic year thereafter, an otherwise qualifying institution with
8a three-year cohort default rate that is equal to or greater than 15.5
9percent, as certified by the commission on October 1, 2011, and
10every year thereafter, shall be ineligible for initial and renewal Cal
11Grant awards at the institution.

12(D) (i) An otherwise qualifying institution that becomes
13ineligible under this paragraph for initial and renewal Cal Grant
14awards shall regain its eligibility for the academic year for which
15it satisfies the requirements established in subparagraph (B), (C),
16or (F), as applicable.

17(ii) If the United States Department of Education corrects or
18revises an institution’s three-year cohort default rate or graduation
19rate that originally failed to satisfy the requirements established
20in subparagraph (B), (C), or (F), as applicable, and the correction
21or revision results in the institution’s three-year cohort default rate
22or graduation rate satisfying those requirements, that institution
23shall immediately regain its eligibility for the academic year to
24which the corrected or revised three-year cohort default rate or
25graduation rate would have been applied.

26(E) An otherwise qualifying institution for which no three-year
27cohort default rate or graduation rate has been reported by the
28United States Department of Education shall be provisionally
29eligible to participate in the Cal Grant Program until a three-year
30cohort default rate or graduation rate has been reported for the
31institution by the United States Department of Education.

32(F) For purposes of the 2012-13 academic year, and every
33academic year thereafter, an otherwise qualifying institution with
34a graduation rate of 30 percent or less, as certified by the
35commission pursuant to subparagraph (A), shall be ineligible for
36initial and renewal Cal Grant awards at the institution, except as
37provided for in subparagraph (H).

38(G) Notwithstanding any other law, the requirements of this
39paragraph shall not apply to institutions with 40 percent or less of
40undergraduate students borrowing federal student loans, using
P20   1information reported to the United States Department of Education
2for the academic year two years before the academic year in which
3the commission is certifying the three-year cohort default rate or
4graduation rate pursuant to subparagraph (A).

5(H) Notwithstanding subparagraph (F), an otherwise qualifying
6institution that maintains a three-year cohort default rate that is
7less than 15.5 percent and a graduation rate above 20 percent for
8students taking 150 percent or less of the expected time to complete
9degree requirements, as certified by the commission pursuant to
10subparagraph (A), shall be eligible for initial and renewal Cal Grant
11awards at the institution through the 2016-17 academic year.

12(I) The commission shall do all of the following:

13(i) Establish a complete listing of California postsecondary
14educational institutions and identify which institutions are eligible
15and ineligible for participation in the Cal Grant program. The
16commission shall make this information readily available on the
17commission’s Internet Web site.

18(ii) Notify initial Cal Grant recipients seeking to attend, or
19attending, an institution that is ineligible for initial and renewal
20Cal Grant awards under subparagraph (C) or (F) that the institution
21is ineligible for initial Cal Grant awards for the academic year for
22which the student received an initial Cal Grant award.

23(iii) Notify renewal Cal Grant recipients attending an institution
24that is ineligible for initial and renewal Cal Grant awards at the
25institution under subparagraph (C) or (F) that the student’s Cal
26Grant award will be reduced by 20 percent, or eliminated, as
27appropriate, if the student attends the ineligible institution in an
28academic year in which the institution is ineligible.

29(iv) Provide initial and renewal Cal Grant recipients seeking to
30attend, or attending, an institution that is ineligible for initial and
31renewal Cal Grant awards at the institution under subparagraph
32(C) or (F) with a complete list of all California postsecondary
33educational institutions at which the student would be eligible to
34receive an unreduced Cal Grant award.

35(m) “Satisfactory academic progress” means those criteria
36required by applicable federal standards published in Title 34 of
37the Code of Federal Regulations. The commission may adopt
P21   1regulations defining “satisfactory academic progress” in a manner
2that is consistent with those federal standards.

end delete


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