CONCURRENCE IN SENATE AMENDMENTS

CSA1 Bill Id:AB 697

Author:(Ting and McCarty)

As Amended Ver:August 19, 2019

Majority vote

SUMMARY:

Requires, by June 30 of each year from 2021 to 2024, the California State University (CSU) Trustees, the University of California (UC) Regents, and the appropriate governing bodies of each independent institution of higher education that is a qualifying institution as defined under the Cal Grant Program that provides preferential treatment in admissions to applicants with a relationship to donors or alumni, to annually report information about those admissions to the Legislature.

The Senate Amendments:

Delete the Assembly version of this bill, and instead

1. Require the CSU Trustees, UC Regents, and the appropriate governing bodies of each independent institution of higher education, to report to the appropriate budget subcommittees and policy committees of the Legislature, whether their respective institutions provide any manner of preferential treatment in admission to applicants on the basis of their relationships to donors or alumni of the institution.
2. Specify the report, pursuant to 1), above, shall be submitted, as specified, on or before June 30, 2020, and on or before June 30 of each year from 2021 to 2024, inclusive.
3. Specify the report, pursuant to 1) and 2), above, shall include specific data points for the academic year commencing in the previous calendar year pertaining to the applicants who received preferential treatment.
4. State Legislative findings and declarations.

EXISTING LAW: Establishes the Cal Grant A and B Entitlement Programs, the California Community College Transfer Cal Grant Program, the Competitive Cal Grant A and B Programs, the Cal Grant C Program, and the Cal Grant T Program, each with specified eligibility requirements related to the applicant's age, academic achievement, family income, maximum award amount limits, length of award eligibility, and other factors (EC Section 69430, et seq.).

COMMENTS:

Background. Per existing law, the California Community Colleges adhere to open enrollment; this measure would not affect them. Additionally, the University of California and California State University system have no policy allowing or prohibiting preferential treatment to applicants with a relationship to donors or alumni. However, both indicate they do not use preferential treatment, so they likely would have no information to report. Some independent institutions of higher education, however, provide preferential admissions treatment and would have to implement this measure.

Independent Institutions. It is unknown to what extent, if any, the use of legacy admissions preferences at these institutions "crowds out" admissions slots for other students who meet the institutions admissions requirements.

Cal Grant participation among the state's independent institutions, and their students, is not insignificant. In 2017-18, 71 of 84 institutions within in Association of Independent California Colleges and Universities (AICCU) enrolled Cal Grant recipients. These schools had a combined undergraduate enrollment in that year of 182,000 students. Of this total, over 27,000 received a Cal Grant. (About one-half of these recipients attended just 10 of the AICCU schools.) While overall, 15% of the AICCU students were Cal Grant recipients, some schools had much higher percentages of their students participating in the program. Those with at least double the statewide average were: Mount Saint Mary's University (42%), Holy Names University (39%), Mills College (34%), University of the Pacific (33%), Whittier College (32%), and La Sierra University (30%).

According to the Author:

The author refers to the recent college admissions scandal – stemming from a federal criminal investigation known as "Operation Varsity Blues" – which has resulted in numerous bribery and fraud charges against wealthy parents seeking to get their children into elite universities. The author maintains that this scandal has also shed light on the many legal ways that wealth and social connections can skew the college admissions.

The author refers to the 2018 Survey of College and University Admissions Directors, where 53% of the private nonprofit baccalaureate-degree granting schools participating in the survey indicated that they use legacy status as a factor in admissions. Interestingly, only 34% of the admissions directors at the private nonprofit institutions agreed that the use of legacy status was appropriate.

The author also indicates that 65% of high school counselors believe that their students with legacy status appear to have much better chances of admission than others applying to competitive colleges. When legacy considerations are coupled with the use of achievement test preparation services, private tutoring, and college admissions consulting, the author believes that the many legal advantages wealthy families have in the college admission process can discouraged many other families "who already feel the odds are stacked against them."

Arguments in Support:

According to the Student Senate for California Community Colleges, "Students related to a college's alumnus or donor may further benefit in the admissions process. The 2018 Survey of College and University Admissions Directors found that 42% of admissions directors at private institutions say that legacy status is a factor in admissions at their institutions, with only 32% believing it is an appropriate consideration. AB 697 would tackle these inequities by prohibiting preferential admissions treatment for students related to a college's donors or alumni, if that institution participates in the state's Cal Grant program."

Arguments in Opposition:

No opposition has been received; however, the AICCU, submitted an "Oppose Unless Amended" position letter on April 17, 2019. According to AICCU, "We firmly believe that AB 697 risks undue harm to low-income students, without addressing the underlying causes of the scandal. We respectfully request the bill be amended to not threaten Cal Grant students in response to the illegal activities committed by individuals and remove the tie to the Cal Grant program." To note, it appears that the Senate amendments address the concerns expressed by AICCU.

FISCAL COMMENTS:

According to the Senate Appropriations Committee, pursuant to Senate Rule 28.8, negligible state costs.

VOTES:

ASM RULES: 9-0-3

YES: Cooley, Flora, Grayson, Kamlager-Dove, Maienschein, Mathis, Ramos, Robert Rivas, Wicks

ABS, ABST OR NV: Cunningham, Carrillo, Quirk-Silva

ASM HIGHER EDUCATION: 10-0-2

YES: Medina, Choi, Quirk, Bloom, Gabriel, Irwin, Levine, Low, Santiago, Weber

ABS, ABST OR NV: Kiley, Patterson

ASM APPROPRIATIONS: 13-0-5

YES: Gonzalez, Bloom, Bonta, Calderon, Carrillo, Chau, Eggman, Gabriel, Eduardo Garcia, Maienschein, Petrie-Norris, Quirk, Robert Rivas

ABS, ABST OR NV: Bigelow, Brough, Diep, Fong, Obernolte

ASSEMBLY FLOOR: 57-0-23

YES: Aguiar-Curry, Bauer-Kahan, Berman, Bloom, Boerner Horvath, Bonta, Burke, Calderon, Cervantes, Chau, Chiu, Chu, Cooper, Cunningham, Eggman, Frazier, Friedman, Gabriel, Cristina Garcia, Gipson, Gloria, Gonzalez, Gray, Grayson, Holden, Irwin, Jones-Sawyer, Kalra, Levine, Limón, Low, Maienschein, McCarty, Medina, Mullin, Muratsuchi, Nazarian, O'Donnell, Petrie-Norris, Quirk, Quirk-Silva, Reyes, Luz Rivas, Robert Rivas, Rodriguez, Blanca Rubio, Salas, Santiago, Smith, Mark Stone, Ting, Voepel, Waldron, Weber, Wicks, Wood, Rendon

ABS, ABST OR NV: Arambula, Bigelow, Brough, Carrillo, Chen, Choi, Cooley, Dahle, Daly, Diep, Flora, Fong, Gallagher, Eduardo Garcia, Kamlager-Dove, Kiley, Lackey, Mathis, Mayes, Melendez, Obernolte, Patterson, Ramos

SENATE FLOOR: 28-5-7

YES: Allen, Archuleta, Atkins, Beall, Bradford, Chang, Dodd, Durazo, Galgiani, Glazer, Lena Gonzalez, Hertzberg, Hill, Hueso, Jackson, McGuire, Mitchell, Monning, Nielsen, Pan, Portantino, Roth, Rubio, Skinner, Stern, Umberg, Wieckowski, Wiener

NO: Grove, Jones, Morrell, Stone, Wilk

ABS, ABST OR NV: Bates, Borgeas, Caballero, Dahle, Hurtado, Leyva, Moorlach

UPDATED:

VERSION: August 19, 2019

CONSULTANT: Jeanice Warden / HIGHER ED. / (916) 319-3960 FN: 0001526

 THIRD READING  

Bill No: AB 697

Author: Ting (D) and McCarty (D), et al.

Amended: 8/19/19 in Senate

Vote: 21

SENATE EDUCATION COMMITTEE: 5-1, 7/3/19

AYES: Leyva, Chang, Durazo, McGuire, Pan

NOES: Wilk

NO VOTE RECORDED: Glazer

SENATE APPROPRIATIONS COMMITTEE: Senate Rule 28.8

ASSEMBLY FLOOR: 57-0, 5/20/19 - See last page for vote

SUBJECT: Student financial aid: Cal Grant Program: qualifying institutions

SOURCE: Author

DIGEST:

This bill requires, by June 30 of each year from 2021 to 2024, the trustees, the regents, and the appropriate governing bodies of each independent institution of higher education that is a qualifying institution as defined under the Cal Grant Program that provides preferential treatment in admissions to applicants with a relationship to donors or alumni, to annually report information about those admissions to the Legislature.

Senate Floor Amendments of 8/19/19 specify the month and years for which segments are required to disclose certain admission information and clarify that the report is annual through 2024.

ANALYSIS:

Existing law:

1. Authorizes the Cal Grant program, administered by the California Student Aid Commission, to provide grants to financially needy students to attend college. The Cal Grant programs include both the entitlement and the competitive Cal Grant awards. 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 (GPA), California residency, and other eligibility criteria, as specified in Education Code § 69433.9. (Education Code § 69430-69433.9)
2. Requires a “qualifying institution”, i.e. an institution able to enroll Cal Grant recipients, to:
   1. Meet federal financial aid standards.
   2. Maintain a student loan default rate below 15.5 percent and a graduation rate above 20 percent. (Institutions with 40 percent or less of undergraduates borrowing federal student loans are exempt from these requirements.)
   3. Report enrollment, persistence, and graduation data for all students and Cal Grant recipients as well as job placement and earnings data for occupational programs. (EC§ 69432.7)

This bill requires, by June 30 of each year from 2021 to 2024, the trustees, the regents, and the appropriate governing bodies of each independent institution of higher education that is a qualifying institution as defined under the Cal Grant Program that provides preferential treatment in admissions to applicants with a relationship to donors or alumni, to annually report information about those admissions to the appropriate budget and policy committees of the Legislature. Specifically, this bill:

1. Requires, for each institution that provides preferential treatment, that the report to the Legislature include all of the following for the academic year commencing in the previous calendar year pertaining to applicants:
   1. The number of applicants who did not meet the institution’s admission standards that apply to all applicants, but who were offered admission.
   2. The number of applicants reported in a) above who accepted admission to the institution.
   3. The number of applicants reported in b) above who enrolled at the institution.
   4. The number of applicants who met the institution’s admission standards that apply to all applicants and who were offered admission.
   5. The number of applicants reported in d) above who accepted admission to the institution.
   6. The number of applicants reported in e) above who enrolled at the institution.
2. Requires, for information reported by the California State University (CSU) and the University of California (UC), to be aggregated by each campus of these segments.

Comments

1. Need for the bill. According to the author, “The admissions scandal sheds light on the many legal ways that wealth and social connections skew the college admissions process. While legislation might not prevent the next scandal from happening, it can help end fundamental systemic inequities and help more students access higher education.

“A 2017 study published in the National Bureau of Economic Research found that children from the top one percent are 77 times more likely to attend an Ivy League college compared to children in the bottom 20 percent.

“High GPAs and SAT or ACT scores, along with a well-rounded resume of extracurricular activities, help a student’s college application stand out amongst his or her peers. While most students work exceptionally hard to bolster these credentials, some students benefit from extra support via expensive test preparation services, private tutoring, and college admissions consulting. SAT or ACT tutors can cost between $50 to a few hundred dollars an hour, and some students can afford to take the tests multiple times.

“According to the Independent Educational Consultants Association, most college consultants charge between $2,000 to $10,000 for a comprehensive package that can include guidance selecting prestigious middle and high schools, coursework and internships, and application essay topics. Some consultants charge over $75,000 for their services (more than four times the cost of one year’s tuition at the University of California system). With college admissions growing more competitive, market research firm IBISWorld estimates the number of independent education consultants has quadrupled between 2005 and 2018, booming into a $2 billion industry.

Students related to a college’s alumnus or donor may further benefit in the admissions process. The 2018 Survey of College and University Admissions Directors found that 42 percent of admissions directors at private institutions say that legacy status is a factor in admissions at their institutions, with only 32 percent believing it is an appropriate consideration. Furthermore, 65 percent of high school counselors say that their students with legacy status appear to have much better chances of admission than others applying to competitive colleges. Altogether, these considerations not only discourage families who already feel the odds are stacked against them, but also reveal the many legal advantages wealthy families have in the college admissions process.”

1. Gaming admissions. The Department of Justice charged several dozen individuals accused of cheating and accepting bribes to gain student’s unlawful admission to top universities throughout the country, including the UC. Athletic coaches from Yale, Stanford, University of Southern California, Wake Forest and Georgetown, among others, are implicated, as well as parents and exam administrators. This bill seeks to shed light on college admission practices in California. To note, it appears that neither the community college nor CSU system played a role in the mentioned admission incident.
2. Public institutions do not have policies that grant preferential treatment based on relationships. California community colleges are open access institutions and do not participate in selective admissions procedures. According to the CSU, there is no systemwide policy on legacy admissions. The UC discourages such action. As stated in the, UC Regents Policy Barring Development Considerations, “Admissions motivated by concern for financial, political or other such benefit to the University do not have place in the admission process.” It appears some independent non-profit colleges and universities may grant preferential treatment when considering admissions overall.
3. Cal Grant qualifying institution. Existing law establishes institutional eligibility criteria for participation in the Cal Grant program, including meeting federal financial aid requirements, maintaining a certain student loan default rate, and reporting enrollment, persistence, and graduation data for Cal Grant recipients. This bill requires, in addition to the public four-year institutions, an independent higher education intuition that is a qualifying institution as defined under the Cal Grant Program to comply with its provisions.

Related/Prior Legislation

AB 1383 (McCarty, 2019) prohibits a UC or CSU campus from admitting any student by admission by exception unless approved, prior to the student’s admission, by at least three campus administrators. The bill was approved by the Senate Education Committee on June 26 and was subsequently referred to the Senate Appropriations Committee.

ACR 64 (McCarty, 2019) requires that the CSU Trustees and the UC Regents conduct a study on the usefulness, effectiveness, and need for the SAT and ACT to determine student admissions. ACR 64 was approved by the Senate Education Committee on July 10 and subsequently referred to the Senate Appropriations Committee.

FISCAL EFFECT: Appropriation: No Fiscal Com.: Yes Local: No

SUPPORT: (Verified 8/12/19)

San Francisco Unified School District

OPPOSITION: (Verified 8/12/19)

None received

ASSEMBLY FLOOR: 57-0, 5/20/19

AYES: Aguiar-Curry, Bauer-Kahan, Berman, Bloom, Boerner Horvath, Bonta, Burke, Calderon, Cervantes, Chau, Chiu, Chu, Cooper, Cunningham, Eggman, Frazier, Friedman, Gabriel, Cristina Garcia, Gipson, Gloria, Gonzalez, Gray, Grayson, Holden, Irwin, Jones-Sawyer, Kalra, Levine, Limón, Low, Maienschein, McCarty, Medina, Mullin, Muratsuchi, Nazarian, O'Donnell, Petrie-Norris, Quirk, Quirk-Silva, Reyes, Luz Rivas, Robert Rivas, Rodriguez, Blanca Rubio, Salas, Santiago, Smith, Mark Stone, Ting, Voepel, Waldron, Weber, Wicks, Wood, Rendon

NO VOTE RECORDED: Arambula, Bigelow, Brough, Carrillo, Chen, Choi, Cooley, Dahle, Daly, Diep, Flora, Fong, Gallagher, Eduardo Garcia, Kamlager-Dove, Kiley, Lackey, Mathis, Mayes, Melendez, Obernolte, Patterson, Ramos

Prepared by: Olgalilia Ramirez / ED. /

8/21/19 10:12:10

**** END ****

 THIRD READING  

Bill No: AB 697

Author: Ting (D) and McCarty (D), et al.

Amended: 7/5/19 in Senate

Vote: 21

SENATE EDUCATION COMMITTEE: 5-1, 7/3/19

AYES: Leyva, Chang, Durazo, McGuire, Pan

NOES: Wilk

NO VOTE RECORDED: Glazer

SENATE APPROPRIATIONS COMMITTEE: Senate Rule 28.8

ASSEMBLY FLOOR: 57-0, 5/20/19 - See last page for vote

SUBJECT: Student financial aid: Cal Grant Program: qualifying institutions

SOURCE: Author

DIGEST:

This bill requires, for five academic years, beginning in the 2020-21 academic year, the trustees, the regents, and the appropriate governing bodies of each independent institution of higher education that is a qualifying institution as defined under the Cal Grant Program that provides preferential treatment in admissions to applicants with a relationship to donors or alumni, to report information about those admissions to the Legislature.

ANALYSIS:

Existing law:

1. 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. 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 (GPA), California residency, and other eligibility criteria, as specified in Education Code § 69433.9. (Education Code § 69430-69433.9)
2. Requires a “qualifying institution”, i.e. an institution able to enroll Cal Grant recipients, to:
   1. Meet federal financial aid standards.
   2. Maintain a student loan default rate below 15.5 percent and a graduation rate above 20 percent. (Institutions with 40 percent or less of undergraduates borrowing federal student loans are exempt from these requirements.)
   3. Report enrollment, persistence, and graduation data for all students and Cal Grant recipients as well as job placement and earnings data for occupational programs. (EC§ 69432.7)

This bill requires, for five academic years, beginning in the 2020-21 academic year, the trustees, the regents, and the appropriate governing bodies of each independent institution of higher education that is a qualifying institution as defined under the Cal Grant Program that provides preferential treatment in admissions to applicants with a relationship to donors or alumni, to report information about those admissions to the appropriate budget and policy committees of the Legislature. Specifically it:

1. Requires, each institution that provides preferential treatment to include in its report to the Legislature all of the following for the previous academic year pertaining to applicants:
   1. The number of applicants who did not meet the institution’s admission standards that apply to all applicants, but who were offered admission.
   2. The number of applicants reported in a) above who accepted admission to the institution.
   3. The number of applicants reported in b) above who enrolled at the institution.
   4. The number of applicants who met the institution’s admission standards that apply to all applicants and who were offered admission.
   5. The number of applicants reported in d) above who accepted admission to the institution.
   6. The number of applicants reported in e) above who enrolled at the institution.
2. Requires, for information reported by the California State University (CSU) and the University of California (UC), to be aggregated by each campus of these segments.

Comments

1. Need for the bill. According to the author, “The admissions scandal sheds light on the many legal ways that wealth and social connections skew the college admissions process. While legislation might not prevent the next scandal from happening, it can help end fundamental systemic inequities and help more students access higher education.

A 2017 study published in the National Bureau of Economic Research found that children from the top one percent are 77 times more likely to attend an Ivy League college compared to children in the bottom 20 percent.

High GPAs and SAT or ACT scores, along with a well-rounded resume of extracurricular activities, help a student’s college application stand out amongst his or her peers. While most students work exceptionally hard to bolster these credentials, some students benefit from extra support via expensive test preparation services, private tutoring, and college admissions consulting. SAT or ACT tutors can cost between $50 to a few hundred dollars an hour, and some students can afford to take the tests multiple times.

According to the Independent Educational Consultants Association, most college consultants charge between $2,000 to $10,000 for a comprehensive package that can include guidance selecting prestigious middle and high schools, coursework and internships, and application essay topics. Some consultants charge over $75,000 for their services (more than four times the cost of one year’s tuition at the University of California system). With college admissions growing more competitive, market research firm IBISWorld estimates the number of independent education consultants has quadrupled between 2005 and 2018, booming into a $2 billion industry.

Students related to a college’s alumnus or donor may further benefit in the admissions process. The 2018 Survey of College and University Admissions Directors found that 42 percent of admissions directors at private institutions say that legacy status is a factor in admissions at their institutions, with only 32 percent believing it is an appropriate consideration. Furthermore, 65 percent of high school counselors say that their students with legacy status appear to have much better chances of admission than others applying to competitive colleges. Altogether, these considerations not only discourage families who already feel the odds are stacked against them, but also reveal the many legal advantages wealthy families have in the college admissions process.”

1. Gaming admissions. The Department of Justice charged several dozen individuals accused of cheating and accepting bribes to gain student’s unlawful admission to top universities throughout the country, including the UC. Athletic coaches from Yale, Stanford, University of Southern California, Wake Forest and Georgetown, among others, are implicated, as well as parents and exam administrators. This bill seeks to shed light on college admission practices in California. To note, it appears that neither the community college nor CSU system played a role in the mentioned admission incident.
2. Public institutions do not have policies that grant preferential treatment based on relationships. California community colleges are open access institutions and do not participate in selective admissions procedures. According to the CSU, there is no systemwide policy on legacy admissions. The UC discourages such action. As stated in the, UC Regents Policy Barring Development Considerations, “Admissions motivated by concern for financial, political or other such benefit to the University do not have place in the admission process.” It appears some independent non-profit colleges and universities may grant preferential treatment when considering admissions overall.
3. Cal Grant qualifying institution. Existing law establishes institutional eligibility criteria for participation in the Cal Grant program, including meeting federal financial aid requirements, maintaining a certain student loan default rate, and reporting enrollment, persistence, and graduation data for Cal Grant recipients. This bill requires, in addition to the public four-year institutions, an independent higher education intuition that is a qualifying institution as defined under the Cal Grant Program to comply with its provisions.

Related/Prior Legislation

AB 1383 (McCarty, 2019) prohibits a UC or CSU campus from admitting any student by admission by exception unless approved, prior to the student’s admission, by at least three campus administrators. The bill was approved by the Senate Education Committee on June 26 and was subsequently referred to the Senate Appropriations Committee.

ACR 64 (McCarty, 2019), requires that the CSU Trustees and the UC Regents conduct a study on the usefulness, effectiveness, and need for the SAT and ACT to determine student admissions. ACR 64 was approved by the Senate Education Committee on July 10 and subsequently referred to the Senate Appropriations Committee.

FISCAL EFFECT: Appropriation: No Fiscal Com.: Yes Local: No

SUPPORT: (Verified 8/12/19)

San Francisco Unified School District

OPPOSITION: (Verified 8/12/19)

None received

ASSEMBLY FLOOR: 57-0, 5/20/19

AYES: Aguiar-Curry, Bauer-Kahan, Berman, Bloom, Boerner Horvath, Bonta, Burke, Calderon, Cervantes, Chau, Chiu, Chu, Cooper, Cunningham, Eggman, Frazier, Friedman, Gabriel, Cristina Garcia, Gipson, Gloria, Gonzalez, Gray, Grayson, Holden, Irwin, Jones-Sawyer, Kalra, Levine, Limón, Low, Maienschein, McCarty, Medina, Mullin, Muratsuchi, Nazarian, O'Donnell, Petrie-Norris, Quirk, Quirk-Silva, Reyes, Luz Rivas, Robert Rivas, Rodriguez, Blanca Rubio, Salas, Santiago, Smith, Mark Stone, Ting, Voepel, Waldron, Weber, Wicks, Wood, Rendon

NO VOTE RECORDED: Arambula, Bigelow, Brough, Carrillo, Chen, Choi, Cooley, Dahle, Daly, Diep, Flora, Fong, Gallagher, Eduardo Garcia, Kamlager-Dove, Kiley, Lackey, Mathis, Mayes, Melendez, Obernolte, Patterson, Ramos

Prepared by: Olgalilia Ramirez / ED. /

8/14/19 17:11:10

**** END ****

SENATE COMMITTEE ON EDUCATION

Senator Connie Leyva, Chair

2019 - 2020 Regular

Bill No: Hearing Date: July 3, 2019

Subject: .

SUMMARY

This bill requires, for five academic years, beginning in the 2020-21 academic year, any college or university that provides preferential treatment in admissions to applicants with a relationship to donors or alumni to report information about those admissions to the California Student Aid Commission (CSAC) annually, as a condition of its students receiving Cal Grant student aid.

BACKGROUND

Existing law:

1. 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. 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 (GPA), California residency, and other eligibility criteria, as specified in Education Code § 69433.9. (Education Code § 69430-69433.9)
2. Requires a “qualifying institution”, i.e. an institution able to enroll Cal Grant recipients, to:
3. Meet federal financial aid standards.
4. Maintain a student loan default rate below 15.5 percent and a graduation rate above 20 percent. (Institutions with 40 percent or less of undergraduates borrowing federal student loans are exempt from these requirements.)
5. Report enrollment, persistence, and graduation data for all students and Cal Grant recipients as well as job placement and earnings data for occupational programs. (EC§ 69432.7.)

ANALYSIS

This bill expands requirements to be a qualifying Cal Grant institution by, in addition to meeting the conditions in current law, requires, for five academic years, beginning in the 2020-21 academic year, any college or university that provides preferential treatment in admissions to applicants with a relationship to donors or alumni to report information about those admissions to the CSAC annually. Specifically it:

1. Requires, for the five academic years commencing with the 2020-21 academic year, the institution, if it provides any manner of preferential treatment in admission to applicants with a relationship to donors or alumni of the institution, to disclose all of the following to the commission for the previous academic year regarding these applicants:
   1. The number of applicants who did not meet the institution’s admission

standards that apply to all applicants, but who were offered admission.

• 1. The number of applicants reported in a) above who accepted admission to

the institution.

• 1. The number of applicants reported in b) above who enrolled at the

institution.

• 1. The number of applicants who met the institution’s admission standards

that apply to all applicants and who were offered admission.

• 1. The number of applicants reported in d) above who accepted admission to

the institution.

• 1. The number of applicants reported in e) above who enrolled at the

institution.

STAFF COMMENTS

1. Need for the bill. According to the author, “The admissions scandal sheds light on the many legal ways that wealth and social connections skew the college admissions process. While legislation might not prevent the next scandal from happening, it can help end fundamental systemic inequities and help more students access higher education.

A 2017 study published in the National Bureau of Economic Research found that children from the top one percent are 77 times more likely to attend an Ivy League college compared to children in the bottom 20 percent.

High GPAs and SAT or ACT scores, along with a well-rounded resume of extracurricular activities, help a student’s college application stand out amongst his or her peers. While most students work exceptionally hard to bolster these credentials, some students benefit from extra support via expensive test preparation services, private tutoring, and college admissions consulting. SAT or ACT tutors can cost between $50 to a few hundred dollars an hour, and some students can afford to take the tests multiple times.

According to the Independent Educational Consultants Association, most college consultants charge between $2,000 to $10,000 for a comprehensive package that can include guidance selecting prestigious middle and high schools, coursework and internships, and application essay topics. Some consultants charge over $75,000 for their services (more than four times the cost of one year’s tuition at the University of California system). With college admissions growing more competitive, market research firm IBISWorld estimates the number of independent education consultants has quadrupled between 2005 and 2018, booming into a $2 billion industry.

Students related to a college’s alumnus or donor may further benefit in the admissions process. The 2018 Survey of College and University Admissions Directors found that 42 percent of admissions directors at private institutions say that legacy status is a factor in admissions at their institutions, with only 32 percent believing it is an appropriate consideration. Furthermore, 65 percent of high school counselors say that their students with legacy status appear to have much better chances of admission than others applying to competitive colleges. Altogether, these considerations not only discourage families who already feel the odds are stacked against them, but also reveal the many legal advantages wealthy families have in the college admissions process.”

1. Gaming admissions. The Department of Justice charged several dozen individuals accused of cheating and accepting bribes to gain student’s unlawful admission to top universities throughout the country, including the UC. Athletic coaches from Yale, Stanford, University of Southern California, Wake Forest and Georgetown, among others, are implicated, as well as parents and exam administrators. This bill seeks to shed light on college admission practices in California. To note, it appears that neither the community college nor CSU system played a role in the mentioned admission incident.
2. Public institutions do not have policies that grant preferential treatment based on relationships. California community colleges are open access institutions and do not participate in selective admissions procedures. According to the CSU, there is no systemwide policy on legacy admissions. The UC discourages such action. As stated in the, UC Regents Policy Barring Development Considerations, “Admissions motivated by concern for financial, political or other such benefit to the University do not have place in the admission process.” It appears some independent non-profit colleges and universities may grant preferential treatment when considering admissions overall.
3. Cal Grant qualifying institution. Existing law establishes institutional eligibility criteria for participation in the Cal Grant program, including meeting federal financial aid requirements, maintaining a certain student loan default rate, and reporting enrollment, persistence, and graduation data for Cal Grant recipients. This bill adds to those criteria the requirement for colleges and universities to disclose the number of applicants who were admitted but did not meet admission standards. Failure to report this information could disqualify the institutions from the Cal Grant program and subsequently have an adverse impact a student’s ability to use their Cal Grant award and remain enrolled at that institution. For this reason the author wishes, committee staff agrees, that the bill be amended to recast its provisions so that disclosure of the specified information not be a condition for institutional participation in the Cal Grant program and require information be disclosed to the Legislature rather than to CSAC.
4. Related legislation.

AB 1383 (McCarty, 2019) prohibits a UC or CSU campus from admitting any student by admission by exception unless approved, prior to the student’s admission, by at least three campus administrators. This bill was approved by this committee on June 26^th and subsequently referred to the Senate Appropriations Committee.

ACR 64 (McCarty, 2019), requires that the CSU Trustees and the UC Regents conduct a study on the usefulness, effectiveness, and need for the SAT and ACT to determine student admissions. This is scheduled to be heard in this committee on July 10.

SUPPORT

San Francisco Unified School District

OPPOSITION

None received

-- END --

ASSEMBLY THIRD READING

ATR Bill Id:AB 697

Author:(Ting and McCarty)

As Amended Ver:May 9, 2019

Majority vote

SUMMARY:

Requires, for the five academic years commencing with the 2020-21 academic year, any college or university that provides preferential treatment in admissions to applicants with a relationship to donors or alumni to report information about those admissions to the California Student Aid Commission (CSAC) annually, as a condition of its students receiving Cal Grant student aid.

EXISTING LAW:

1. Establishes CSAC for the purpose of administering specified student financial aid programs (Education Code (EC) Section 69510, et seq.).
2. Establishes the Cal Grant A and B Entitlement Programs, the California Community College Transfer Cal Grant Program, the Competitive Cal Grant A and B Programs, the Cal Grant C Program, and the Cal Grant T Program, each with specified eligibility requirements related to the applicant's age, academic achievement, family income, maximum award amount limits, length of award eligibility, and other factors (EC Section 69430, et seq.).

Major Provisions

None.

COMMENTS:

Background. Per existing law, the California Community Colleges adhere to open enrollment; this measure would not affect them. Additionally, the University of California and California State University system have no policy allowing or prohibiting preferential treatment to applicants with a relationship to donors or alumni. However, both indicate they do not use preferential treatment, so they likely would have no information to report. Some independent institutions of higher education, however, provide preferential admissions treatment and would have to implement this measure.

Independent Institutions. It is unknown to what extent, if any, the use of legacy admissions preferences at these institutions "crowds out" admissions slots for other students who meet the institutions admissions requirements.

Cal Grant participation among the state's independent institutions, and their students, is not insignificant. In 2017-18, 71 of 84 institutions within in Association of Independent California Colleges and Universities (AICCU) enrolled Cal Grant recipients. These schools had a combined undergraduate enrollment in that year of 182,000 students. Of this total, over 27,000 received a Cal Grant. (About one-half of these recipients attended just 10 of the AICCU schools.) While overall, 15% of the AICCU students were Cal Grant recipients, some schools had much higher percentages of their students participating in the program. Those with at least double the statewide average were: Mount Saint Mary's University (42%), Holy Names University (39%), Mills College (34%), University of the Pacific (33%), Whittier College (32%), and La Sierra University (30%).

The maximum Cal Grant for a student attending an independent institution is currently $9,084. (In 2017-18, the average Cal Grant award for these students was about $8,500.) By allowing the use of Cal Grants at the non-public institutions, the state is providing Cal Grant recipients a greater diversity of schools from which to choose. The state also benefits, in that enrollment pressures at the public institutions are somewhat reduced and the Cal Grant award for these students is less than the average per-student state subsidy for a Cal Grant recipient attending a public college, i.e. when the Cal Grant award and the associated state General Fund cost for that student are combined.

According to the Author:

The author refers to the recent college admissions scandal – stemming from a federal criminal investigation known as "Operation Varsity Blues" – which has resulted in numerous bribery and fraud charges against wealthy parents seeking to get their children into elite universities. The author maintains that this scandal has also shed light on the many legal ways that wealth and social connections can skew the college admissions.

The author refers to the 2018 Survey of College and University Admissions Directors, where 53% of the private nonprofit baccalaureate-degree granting schools participating in the survey indicated that they use legacy status as a factor in admissions. Interestingly, only 34% of the admissions directors at the private nonprofit institutions agreed that the use of legacy status was appropriate.

The author also indicates that 65% of high school counselors believe that their students with legacy status appear to have much better chances of admission than others applying to competitive colleges. When legacy considerations are coupled with the use of achievement test preparation services, private tutoring, and college admissions consulting, the author believes that the many legal advantages wealthy families have in the college admission process can discouraged many other families "who already feel the odds are stacked against them..."

Arguments in Support:

According to the Student Senate for California Community Colleges, "Students related to a college's alumnus or donor may further benefit in the admissions process. The 2018 Survey of College and University Admissions Directors found that 42% of admissions directors at private institutions say that legacy status is a factor in admissions at their institutions, with only 32% believing it is an appropriate consideration.

AB 697 would tackle these inequities by prohibiting preferential admissions treatment for students related to a college's donors or alumni, if that institution participates in the state's Cal Grant program".

Arguments in Opposition:

No opposition has been received; however, the AICCU, has taken an "Oppose Unless Amended" position. According to AICCU, "We firmly believe that AB 697 risks undue harm to low-income students, without addressing the underlying causes of the scandal. We respectfully request the bill be amended to not threaten Cal Grant students in response to the illegal activities committed by individuals and remove the tie to the Cal Grant program".

FISCAL COMMENTS:

According to the Assembly Appropriations Committee, minor and absorbable costs to CSAC to send out a notice to institutions about the new requirements receive the data.

VOTES:

ASM RULES: 9-0-3

YES: Cooley, Flora, Grayson, Kamlager-Dove, Maienschein, Mathis, Ramos, Robert Rivas, Wicks

ABS, ABST OR NV: Cunningham, Carrillo, Quirk-Silva

ASM HIGHER EDUCATION: 10-0-2

YES: Medina, Choi, Quirk, Bloom, Gabriel, Irwin, Levine, Low, Santiago, Weber

ABS, ABST OR NV: Kiley, Patterson

ASM APPROPRIATIONS: 13-0-5

YES: Gonzalez, Bloom, Bonta, Calderon, Carrillo, Chau, Eggman, Gabriel, Eduardo Garcia, Maienschein, Petrie-Norris, Quirk, Robert Rivas

ABS, ABST OR NV: Bigelow, Brough, Diep, Fong, Obernolte

UPDATED:

VERSION: May 9, 2019

CONSULTANT: Jeanice Warden / HIGHER ED. / (916) 319-3960 FN: 0000454

Date of Hearing: May 8, 2019

ASSEMBLY COMMITTEE ON APPROPRIATIONS

Lorena Gonzalez, Chair

ABPCA Bill Id:AB 697

Author:(Ting) – As Amended Ver:April 29, 2019

Urgency: No State Mandated Local Program: No Reimbursable: No

SUMMARY:

This bill requires, beginning in the 2020-21 academic year, any college or university that provides preferential treatment in admissions to applicants with a relationship to donors or alumni to report information about those admissions to the California Student Aid Commission (CSAC) annually, as a condition of its students receiving Cal Grant student aid.

FISCAL EFFECT:

Minor and absorbable costs to CSAC to send out a notice to institutions about the new requirements receive the data. 

COMMENTS:

1. Purpose. The author indicates:

The recent college admissions scandal highlights two different paths towards a college degree – one for well-connected families with the means to pay for expensive preparation services, and one for working families with fewer resources at their disposal. Current admissions practices that give preference to students related to donors and alumni only exacerbate this fundamental inequity. AB 697 seeks to shed light on this practice across California and bring more equity and fairness to college admissions.

1. Background and Comments. Under current law, the California Community Colleges are open enrollment, so this measure would not affect them. The University of California and California State University system have no policy allowing or prohibiting preferential treatment to applicants with a relationship to donors or alumni. However, both indicate they do not use preferential treatment, so they likely would have no information to report. Some private institutions of higher education, however, provide preferential admissions treatment and would have information to report to CSAC under this bill.

The author may wish to consider limiting the bill’s provisions to five years, consistent with suggestions made in the Assembly Committee on Higher Education. This would provide time for the CSAC to collect this information and for the Legislature to review this information and determine potential next steps.

Analysis Prepared by: Natasha Collins / APPR. / (916) 319-2081

Date of Hearing: April 23, 2019

ASSEMBLY COMMITTEE ON HIGHER EDUCATION

Jose Medina, Chair

ABPCA Bill Id:AB 697 (

Author:Ting) – As Amended Ver:March 28, 2019

SUBJECT: Student financial aid: Cal Grant Program: qualifying institutions

SUMMARY: Prohibits a postsecondary educational institution from participating in the Cal Grant program if the institution provides preferential treatment in admissions to an applicant with a relationship to a donor or alumni of the institution.

EXISTING LAW:

1. Establishes the California Student Aid Commission (CSAC) for the purpose of administering specified student financial aid programs. (Education Code (EC) Section 69510, et seq.)
2. Establishes the Cal Grant A and B Entitlement Programs, the California Community College Transfer Cal Grant Program, the Competitive Cal Grant A and B Programs, the Cal Grant C Program, and the Cal Grant T Program, each with specified eligibility requirements related to the applicant's age, academic achievement, family income, maximum award amount limits, length of award eligibility, and other factors. (EC Sect. 69430, et seq.)
3. Requires a “qualifying institution”, i.e. an institution able to enroll Cal Grant recipients, to:
   1. Meet federal financial aid standards
   2. Maintain a student loan default rate below 15.5 percent and a graduation rate above 20 percent. (Institutions with 40 percent or less of undergraduates borrowing federal student loans are exempt from these requirements.)
   3. Report enrollment, persistence, and graduation data for all students and Cal Grant recipients as well as job placement and earnings data for occupational programs. (EC Sect. 69432.7.)

FISCAL EFFECT: Unknown

COMMENTS: Purpose. The author refers to the recent college admissions scandal – stemming from a federal criminal investigation known as “Operation Varsity Blues” – which has resulted in numerous bribery and fraud charges against wealthy parents seeking to get their children into elite universities. The author maintains that this scandal has also shed light on the many legal ways that wealth and social connections can skew the college admissions.

The author refers to the 2018 Survey of College and University Admissions Directors, where 53 percent of the private nonprofit baccalaureate-degree granting schools participating in the survey indicated that they use legacy status as a factor in admissions. Interestingly, only 34 percent of the admissions directors at the private nonprofit institutions agreed that the use of legacy status was appropriate.

The author also indicates that 65 percent of high school counselors believe that their students with legacy status appear to have much better chances of admission than others applying to competitive colleges. When legacy considerations are coupled with the use of achievement test preparation services, private tutoring, and college admissions consulting, the author believes that the many legal advantages wealthy families have in the college admission process can discouraged many other families “who already feel the odds are stacked against them...”

AB 697 would prohibit an institution, as a condition of participating in the Cal Grant program, from providing preferential admissions consideration to an applicant related to a donor or alumnus of that institution. The author believes that this will “make the college admissions process more equitable and fair for all hardworking students across California.”

No Issue for the Public Institutions. Of the state’s three public segments of higher education, the California Community Colleges operates by open enrollment rather than through any kind of selective admissions process. The California State University indicates that it has no systemwide policy either prohibiting or allowing legacy admissions.

With respect to the University of California, the Regents Policy Barring Development Considerations from Influencing Admissions Decisions (1998) states in part that, “Admissions motivated by concern for financial, political, or other such benefit to the University do not have a place in the admissions process.” UC indicates that it does not consider the legacy status of undergraduate applicants at any point during the admissions application and review processes. The undergraduate admissions application purposely does not contain any items that directly or indirectly refer to applicants’ ties to the University by way of relatives’ past or present UC matriculation and/or graduation. Also, campus supplementary application materials (e.g., questionnaires, recommendation forms) do not contain any items regarding applicants’ legacy status.

Independent Institutions. Time did not permit a determination for this analysis as to how many of the state’s private nonprofit institutions currently take an applicant’s family connection to the school into account when making admissions decisions, and more specifically, how many such institutions also participate in the Cal Grant program. It is also unknown to what extent, if any, the use of legacy admissions preferences at these institutions “crowds out” admissions slots for other students who meet the institutions admissions requirements. Based on the national survey mentioned above, there are probably many California independent institutions that at least take legacy into account as part of a holistic admissions-screening process. With enactment of this bill, these institutions would face a choice – either discontinue applying any legacy-type admission preferences or discontinue participation in the Cal Grant program.

Cal Grant participation among the state’s independent institutions, and their students, is not insignificant. In 2017-18, 71 of 84 institutions within in Association of Independent California Colleges and Universities (AICCU) enrolled Cal Grant recipients. These schools had a combined undergraduate enrollment in that year of 182,000 students. Of this total, over 27,000 received a Cal Grant. (About one-half of these recipients attended just 10 of the AICCU schools.) While overall, 15 percent of the AICCU students were Cal Grant recipients, some schools had much higher percentages of their students participating in the program. Those with at least double the statewide average were: Mount Saint Mary’s University (42%), Holy Names University (39%), Mills College (34%), University of the Pacific (33%), Whittier College (32%), and La Sierra University (30%).

The maximum Cal Grant for a student attending an independent institution is currently $9,084. (In 2017-18, the average Cal Grant award for these students was about $8,500.) By allowing the use of Cal Grants at the non-public institutions, the state is providing Cal Grant recipients a greater diversity of schools from which to choose. The state also benefits, in that enrollment pressures at the public institutions are somewhat reduced and the Cal Grant award for these students is less than the average per-student state subsidy for a Cal Grant recipient attending a public college, i.e. when the Cal Grant award and the associated state General Fund cost for that student are combined.

Opposition. The AICCU acknowledges that the recent federal investigation “revealed an elaborate scheme involving illegal activities…”, but goes on to note that the scandal “…did not, however, involve the admission of any applicant due to the improper use of legacy admissions policies or philanthropic gifts to the institutions, two issues AB 697 seeks to regulate.” AICCU believes that the bill “risks undue harm to low-income students without addressing the underlying causes of the scandal.” AICCU sees the bill as a threat to student access to the Cal Grant program, and opposes unless amended to remove any tie to the program.

Related Legislation.

AB 1383 (McCarty), also on today’s committee agenda, prohibits a UC or CSU campus from admitting any student by admission by exception unless approved, prior to the student’s admission, by at least three campus administrators

ACR 64 (McCarty), also on today’s committee agenda, requires that the CSU Trustees and the UC Regents conduct a study on the usefulness, effectiveness, and need for the SAT and ACT to determine student admissions.

REGISTERED SUPPORT / OPPOSITION:

Support

Student Senate for California Community Colleges

Opposition

None on file.

Analysis Prepared by: Chuck Nicol / HIGHER ED. / (916) 319-3960