Assembly Budget Subcommittee No. 3 on Education Finance

Good morning. Calling the meeting to order today. Thank you all for being here. This is the Assembly Budget Subcommitee No. 3 on Education Finance. I am Chair, Assemblymember David Alvarez, and we have Assemblymember Mike Fong with us. The agenda is laid out before you and like we attempted to do last week, and it seemed to work well. If anybody would like to make public comment ahead of the panels, we will give you that opportunity.

We ask you to limit your statements to be more concise than if you were to speak after the panels. And if you speak prior to the panels, if you speak during this period, we'd ask you to refrain from saying the same thing again at the end of the panel. So if anybody like to speak now, this is an opportunity. Give a shorter, 30 second maybe, testimony on items on today's agenda. Going once. Going twice. All right.

That means you all are excited to be here in three hours and then speak. We have one.

Hi. Mark MacDonald, MGI Advocacy on behalf of National University and Southwestern Community College District. Appreciate the hearing on the Cal Grant proposal. Encourage that moving forward. If it can't, we would like to encourage you to look at the expanded entitlement for independent colleges and universities and students transferring from community colleges to those. Thank you.

Thank you very much. All right. That's a great example of concise testimony when you're first up. So thank you very much. So then we will go on to our first panel. Our first issue is an update on FAFSA. We have, sorry, several panelists. I hope you know who you all are. Come on forward. California Student Aid Commission, the Legislative Analyst Office, Department of Finance, University of California Office of the President, CSU Chancellor's Office and California Community College Chancellor's office.

I'd asked the Student Aid Commission to be the first to speak, and then we will go down the order of the agenda. We will be discussing the current issues involving the FAFSA, the Free Application for Federal Student Aid, which is a primary form of applying for federal, state, and institutional financial aid. So kick it off to the Student Aid Commission.

Well, good morning, Chair Alvarez, Assemblymember, Fong. Thank you for the opportunity to present today. I'm Jake Brymner. I'm the Deputy Director for Policy and Public Affairs at the California Student Aid Commission. I appreciate your starting our hearing this morning with this critical issue to California students. I'm also grateful that we're joined by my esteemed colleagues on the panel who could talk about the implications for their systems as well.

Just as a brief bit of background, the FAFSA simplification process, as I think your agenda notes, was set into motion back in 2020 through federal action to both simplify the process through which students apply for financial aid and to make the underlying financial aid formula more generous. It's also a major technology effort at the federal level. It's resulted in a delay to the rollout of that application, as well as technical issues that our students are still experiencing.

So we appreciate the work to make this forum simpler. We know many students are benefiting from that already. However, I'm going to focus my comments here on the issues that we know still persist and are impeding many families from being able to fully apply for federal, state, and institutional aid. The primary issue, from our view at the California Student Aid Commission at this point are the complications for students from mixed status families.

These are students with at least one parent who does not have a Social Security number, and these students are U. S. Citizens. They're fully entitled for federal financial aid but have been unable to apply until very recently, and that still itself has come with significant complications. Based on 22-23 data, we identified as many as 108,000 students in California who had applied for financial aid and had at least one parental contributor without a Social Security number listed.

Pew research estimates suggest that 12% of our K through 12 students in California are from mixed status families. So this is a really large population in California. We've been working very closely with our segment partners, with the Administration and many others to look at the best path forward to serving these students. The Department of Education recently announced a fix for the FAFSA that would allow these students to be able to complete and submit their application, which until that point, they'd been unable to do so.

However, in announcing this fix for the FAFSA, they announced another technical issue that continues to impede the students' ability to add their parents to their application and to fully move forward and submit that FAFSA. So, in anticipation of complications to the fix, we at the Student Aid Commission have been preparing technical adjustments to the California Dream Act application so that these students could still submit their information to CSAC and their campus to learn about aid status before key upcoming deadlines.

Of course, when you only submit a state based aid application, you're not being considered for federal aid, which is really significant. We're talking about the Pell Grant, which can be more than $7,000 for our low income students, and federal student loans that help provide more affordable lending opportunities than what students will rely on if they don't have access to them. These students, if we were to break glass in case of emergency and utilize the California Dream Act application as a short term measure.

We would want to make sure that these students later are able to submit a FAFSA so that they can be considered for all the aid to which they are entitled. The other significant issue, and I suspect you'll hear more about this from our colleagues on the panel, is the delay in transmission of student records, what are referred to as ISIRs, and that is the Institutional Student Information Record.

These are the records that a FAFSA generates and allows for state aid agencies and campuses to understand a student and their family's financial situation and to be able to determine their financial aid eligibility. The delay in transmission of these records, of course, not only delays determination of their eligibility, but also providing to students information about their financial aid status through a financial aid offer letter. The Department has started to increase the volume of records that are flowing to state agencies and campuses.

However, we are really just still receiving a small fraction of applications that have been submitted thus far since December 31 until today, and this is already much delayed relative to the pace at which we would typically receive these records. Additionally, it's still unclear at what point we would receive records for students with parents without a Social Security number, those mixed status families, and on top of that, many students who had been unable to submit an online application had submitted a paper application.

These records, the Department has already conveyed to us, will be processed last after all other online records have been processed. So we don't have a sense of timing yet for when those paper applications will be transmitted through those records. So this also has an effect on our ability to understand our progress in helping students apply for financial aid.

We typically use these student records and match them with California Department of Education data to be able to estimate how many students at each school district or each high school have applied for financial aid. We're not able to do that right now.

It's unfortunate because last year we'd actually achieved a historic high for California due to our collective efforts around implementation of AB 469, legislation that was adopted back in 2021 to ensure that all high school seniors had the opportunity to submit a financial aid application or opt out. We saw huge gains in our first year of implementation for the 22-23 academic year. We led the nation in growth in our number of high school seniors that applied for financial aid.

More than 24,000 additional seniors had applied for aid relative to the prior year. That was about 74% of the entire graduating class, compared to 68% in the prior year. So we're very eager to maintain and build on that momentum. But in some ways, you could say we're flying blind because we have very limited data. The National College Attainment Network receives aggregate state level data that they use to depict high school senior completion rate based on age proxies.

So it's not quite the same process that we use at the Student Aid Commission to give you more targeted insight into student applications. But this is the best we have to go off of so far. So the numbers here as of March 8th, this is a lacking indicator, but the numbers as of March 8 from the National College Attainment Network indicated that just over 173,000 California high school seniors had completed a FAFSA. That represents about 31% of high school seniors in the state.

And unfortunately, that is nearly 43% lower than where we were in high school senior completion in the prior year at the same time. We know that the most significant volume of applications is received immediately prior to the state aid deadline. So we hope and expect to see those numbers continue to improve in the next coming weeks.

And we appreciate that the Assembly, the Senate, and the Administration are coming together to provide our students with more time to apply and that legislation is being considered in order to extend the financial aid deadline. We'd already extended it once from March 2 to April 2 last year. This legislation would extend that once again from April 2 to May 2, and we know that additional time will help us continue efforts to work with students and families to get those applications in.

We've already been working to disseminate information widely to our local partners so they understand the changes that have come to the financial aid application, and we're doing that through increased online presence and social media, dedicated web page with resources and regular updates to our local partners. In the limited time that we've had thus far, about three months less time than we would have in a normal cycle. We've already hosted 1000 Cash for College workshops across the state, and thank you, Chair Alvarez.

I know you helped host one of these and saw firsthand some of the challenges that our students are experiencing when they try to navigate this application. We have another 200 scheduled, and we're already looking at how we can use the month of April to provide more of this assistance across the state. We've already trained over or nearly 300 community partners through our train the trainer efforts so that we could help provide the field with resourcing to support students in this process.

I'll end on a little bit of good news because I know there's a lot happening with the FAFSA that's very concerning. We had over the prior year updated the California Dream Act application to align with new federal aid methodology as well as enhance the user experience. And for this, I also have to thank Assemblymember Fong for legislation that helped us also embed the AB 540 affidavit within the California Dream Act application.

This modified application with this new functionality to provide an AB 540 affidavit launched on December 31 and I'm very pleased to report that since then it has been used consistently by students without issues or glitches that have been reported to us and certainly not on the scale of the FAFSA. This new application, as we call it, the better CADA to go along with the better FAFSA. It utilizes a simplified parental consent process, streamlined language, and skip logic to provide a better user experience.

And as I mentioned, it also provides this AB 540 affidavit to our campus partners in a way that it could not previously. So we're pleased that that's been going smoothly, but we know we have a lot more to do to help all of our students apply, particularly those from our mixed status families, and to make sure they have the information they need to make informed decisions about their enrollment. So I'll end my comments there and of course, happy to assist with any questions.

Thank you very much. Does the LAO have any comments?

Sure. Good morning Chair Alvarez, Assemblymember Fong. Lisa King with Legislative Analyst Office. In light of the implementation challenges with the new FAFSA as described by the Commission, we think it's worth considering extending the state financial aid application deadline for 2024-25. Doing so would allow more time for the technical issues impacting the FAFSA this year to be resolved so that students who have thus far been unable to submit the form have the opportunity to do so.

As Mr. Brymner mentioned, the students that are most impacted by these changes, including those in mixed status families, are eligible for federal aid, and the FAFSA is the only form that allows them to apply for that aid. We would note that extending the state financial aid deadline does need to be coordinated with the segment's deadlines for students to make enrollment decisions.

If students are going to be applying for financial aid later than usual this spring, they will also receive their financial aid offer letters later than usual, and we'd likely want to ensure that they still have time to review those offers and take them into consideration before they need to commit to enrolling at any given campus. Thank you. Happy to take questions.

Thank you. Department of Finance.

Good morning, Chair Alvarez and Assemblymember Fong. I'm Amin Singh with the Department of Finance. The budget assumes total financial aid expenditures of $3.3 billion in the budget year, which is intended to reach nearly 700,000 students in higher education in the state. However, students must submit a FAFSA to gain access to this aid.

The Administration commits to working with CSAC policymakers and our education partners in navigating this challenge and to ensuring that qualified students receive the financial aid awards that they're entitled to. Insofar as a deadline extension is deemed the appropriate measure, the Administration would be supportive of that.

Thank you. We'll go with the UC Office of the President.

Chair Alvarez and Assemblymember Fong. Thank you for the opportunity to share perspectives from the University of California and what would best serve our students. I'm Shawn Brick, Associate Vice Provost for Student Financial Support at the University of California Office of the President, and I want to start by thanking the Assembly for the incredible support that you've shown for California students.

The last four years have been very challenging for our students in many ways, but the investments that the state has made in expanding Cal Grants through the Community College Entitlement program and the Middle Class Scholarship program and the many other new financial aid programs have been really, truly transformative for our students. So on behalf of President Drake and our students, I want to thank you. As you've already heard, the FAFSA delay is presenting enormous challenges.

And I have to say this has been the most disruptive event in my 25 year career in financial aid. So it's very significant. It desperately needed to be updated, but it's really slowed down our ability to serve students, and it's added a lot of stress and anxiety for our students. And especially, as you've heard already, to our mixed status families, which we think at UC, we have about 11,000. Fortunately, we do have a little bit of good news.

As you heard from Jake, the trickle of FAFSA data has expanded. The latest I've been hearing from our campuses, it's only about 5% of what they would normally receive, but the rate of increase has gone up significantly in the last few days. So some glimmer of hope there.

We also heard about the fix last week from the Department of Education for the mixed status students, which what we heard from the Department was that the process, the turnaround time for the validation for those families would be about a week. We'll have to see if that holds up. But that's what we were told last week from the Department. We are planning to issue financial aid offers as soon as we can, when we get the data.

So we're expecting probably mid April, we would release financial aid offers that's a month later than usual. But it should still give students time, about a month, to compare their financial aid offers before we're asking them to accept their offer of admission by May 15. If any of these timelines slip, we will revisit the May 15 deadline. For now, I think the two things that the Legislature can help us with is the shift in the Cal Grant and Middle Class Scholarship deadline. We're very supportive of the shift to the May 2 deadline and support any advocacy efforts we have in Washington, DC.

If the state moves the Cal Grant April 2 deadline to May 2, we would certainly follow suit with our own institutional aid deadlines. Despite the challenges, we do stand prepared to help our California students. Our campuses have been having workshops like the Commission, as well.

One other slice of good news is we have heard that the students who don't have complicated circumstances are completing the FAFSA faster than usual, about 10 minutes once they sit down and are able to complete it, not to minimize the challenges that our mixed status families are facing. So I'll stop there. Thank you.

Thank you. CSU Chancellor's Office.

Good morning, Chair Alvarez and Assemblymember Fong. Thank you for the opportunity to address you today and provide insights on this crucial matter of financial assistance for more than 450,000 CSU students. My name is April Grommo. I'm the Assistant Vice Chancellor for Strategic Enrollment Management at the CSU Chancellor's Office. This current year has presented many challenges for our students.

The delay in processing FAFSA applications continues to be of notable concern, particularly regarding the issue of financial aid offers for newly admitted and transfer students that will be significantly delayed. Additionally, we are remaining deeply attentive to the challenges faced by mixed status families who are really hindered in completing the FAFSA. We're hopeful that the recent updates and the continued fixes made by the Department of Education will allow students and families to finally submit their FAFSA.

The CSU is in complete support of extending the state financial aid deadline to May 2. We would also extend our institutional deadline to meet that date, as well as work with our campuses and colleagues to extend intent to enroll deadlines further if it is necessary. In closing, I just wish to affirm our steadfast commitment to supporting California students in navigating these challenging times.

Like the UC, our colleagues and financial aid at all 23 campuses have been out doing financial aid workshops supporting their local school districts to try and help students through this process. Thank you for your attention to these critical matters and your continued support for financial aid for California students, and I'm happy to answer any question.

Thank you very much. Community College Chancellor's office.

Good morning. My name is Gina Browne, Assistant Vice Chancellor for the California Community Colleges Chancellor's Office. I want to thank you all for giving me the opportunity to speak to you and share the behalf of the Community College Chancellor's Office and the 1.9 California community college students regarding financial aid. I think my colleagues have adequately explained to you what the challenges are with the FAFSA delays. Those challenges do impact community college students as well. We know that community college students also are reviewing their award letter offers.

They are also making decisions as to which college to attend based on financial aid. So in that regard, we do support extending the Cal Grant deadline to May 2 because although the vast majority of community college students have a Cal Grant deadline of September 2, any community college student transferring to a UC or CSU or even a private college, that deadline does remain the April 2 as it stands, as with the other segments, our colleges are prepared to continue assisting students with completing their FAFSA applications.

The community colleges host a significant number of Cash for College workshops. Community college financial aid offices are available to assist students. However, I have heard just yesterday that the fix for FAFSA is intermittent at best. Some students with mixed status families have been able to complete just this week, some have not. So again, that's just another double down on why it is so important to extend that Cal Grant deadline. Thank you.

Thank you very much. Thank you all for your presentations. Mr. Fong, do you have some questions for the panel?

Yes. Thank you so much, Mr. Chairman. And thank you so much to all our panelists. I really appreciate the updates and it's been a very challenging time. And similar to Chair Alvarez, I also was very honored to host a Cash for College workshop in my district. Did it at our KD High School and a number of parents there. And similar to Chair Alvarez's comments about the challenges, we were going through the process and a number of the parents and students were experiencing challenges.

So we've heard that US DOE is working on some of these fixes, but there's also intermittent challenges, we're getting data that says yes, it may be working better, yes, or maybe it's not working. Really, really want to get a sense, as I know some of the segments touch upon this as well. But I've also heard from advocates asking for an admission acceptance deadline extension. Is that something that would be feasible. And what would be the consequences if we were to extend the admissions deadline?

So both the UC and the CSU has extended the deadline from May 1 to May 15. Some of our campuses have already extended to June 1. So as we move towards financial aid deadlines, we will definitely shift if necessary.

Thank you.

And same thing in terms of being willing and able to shift if necessary. The downsides to shifting are that it creates a more compressed, stressful summer for students with orientation, with housing selection. So the reason that we're waiting to see if we need to is those sort of downstream impacts on students and parents.

Thank you. So the option beyond May 15 is June 1, is that what I heard from the CSU and UC?

Yes.

Okay. Thank you. And this is to the California Student Aid Commission, and thank you for bringing up the contingency plan to use the California Dream Act application form, possibly in lieu of the FAFSA. And I know you touched upon it, but are the segments prepared to carry that out?

We would be prepared to carry that out if that's what the state did. We do think it should be treated as a last resort, because what you would be doing is either asking these families to fill out two forms, a CADA now and a FAFSA later, or forego access to federal financial aid. And that has us very concerned. At UC alone, that would be about $60 million, and we won't have the resources to backfill for that.

So that would be a big burden on the students and the parents, in addition to any direct loans that they want access to. But if the state did open it up, we would be able to process.

Thank you.

I'll just add a couple of comments. The first thing is that once that happened, we would have to make technical adjustments to our systems to be able to accept that new information. So it wouldn't be an immediate thing that we would be able to take in.

And to the UC's comments, we estimate that if we did have students that forego federal aid, that would be approximately $150 million to the CSU, and we do not have funding to be able to backfill that federal aid that would be missing for those students.

Thank you. And my final comment, just really appreciate the work and efforts being done here. I know we heard stats about 31% of high school seniors have completed the FAFSA, and that's 43% lower than last year.

So I think anything we can do as a state, as a system, as higher education institutions and CSAC and everybody continue to push the word out to really make sure that our students and families are aware of the opportunities of FAFSA as they continue to make their decisions as to what higher education institution they want to go to.

I think this is a very critical time with yesterday's hearing, with today's hearing, and with the legislative proposals going forward on AB 1887, but just everything as a state that we can continue to amplify this and the urgency of this going forward. I know that you have a partner in the Legislature to get really an Assembly to really push hard on this issue. So thank you so much, Chair Alvarez.

Thank you. Thank you for those questions. I won't add much more. I think what concerns me the most is whatever happens and if the data demonstrates that we have less students who have a situation with a parent without a Social Security number that drops from-- what CSAC reports is there was 108,000 applicants last year in California. We also must remember, those who applied last year and who are still students have to apply again.

And so if this number drops in any significant way, I think we have to strongly consider taking more action. What that is remains to be seen, but I would be concerned that these applicants from these types of families would then not have the access to any of our segments of higher education. So I guess the question is mainly to CSAC. How are we going to track what happens post mortem after this school year?

Really appreciate the question, Chair Alvarez. We are eagerly awaiting catching up on the receipt of those ISIRs, the student records, so that we can do a more nuanced evaluation and analysis of where we've seen significant decreases in applications, not only for our high school seniors. But to your point, we know that renewing financial aid status and knowing what amount of support students have is really important, that they're making decisions about persisting and coming back in the following year.

Making those housing decisions is a major factor for our newly admitted students, but also for returning students. So we're eager to get that data so that we can run that analysis and look to see where we've seen decreases. Hopefully, we will rebound from where we are right now.

And in that same spirit of forward looking and particularly with attentiveness to this student population that we know has been most impacted by the rollout of this new application, I want to just take a moment to explain one other difference in the better FAFSA process relative to the prior years. It requires that those parents without a Social Security number provide much more information that's personally identifiable to a federal agency. These are documents like passports, driver's license, et cetera.

In years past, they've been able to provide their financial information and essentially list zeros for a Social Security number. As we look to next year's cycle, and as much as we're all really focused on trying to help students rebound from this year, we are starting to think about how we improve on this for next year.

We can imagine that there are potential changes in the national political environment that may create a situation where it's even more daunting and intimidating for these families to share personally identifiable information with a federal agency and with the credit bureau. So I just want to note that there's enough to grapple with here for this financial aid cycle. But October 1 and November will be here very quickly as we think to how we continue to provide access to these many families in California.

Outside of the financial aid resource fairs that I think everybody's participating in, have we established anything like a hotline number for Californians through CSAC? I know when we were doing our event, it was really challenging. You can't get through the federal number. The system seemed to freeze up on you, and so people were sitting and waiting for a long time.

Is there a way that we can try to facilitate more support through a California only line, either CSAC or at any of the segments to get people access? If you're a student who's looking to go to a UC, a community college or a CSU, particularly helping those students get through this process.

That's a really important point. We do have a call center that we operate for California financial aid programs and where we often are getting questions that are about the FAFSA as well. So that number is out there. Students can contact us during regular business hours with their questions. We, of course, provide these online workshops as well.

Part of the challenge and where I think there was such significant wait times at the Federal Student Aid Information center and their call center operation is that these students who were unable to get their contributors matched with IRS data were being required to call the federal student aid line to generate a case number so that they can turn in those identity documents to verify who the contributor was on their application. That's unfortunately not a function that we can provide at the Student Aid Commission.

We're limited in how much we could do to assist the student with their question about their FAFSA record, particularly when we're not even in receipt of any data about the FAFSA yet ourselves. So we're looking at how we can provide as many resources directly to students and families as we can, and there are some questions where we know the students will need to go to federal student aid to resolve them.

So we're trying to get out the resources that we can but are sometimes not able to help a student where we know they're reaching that barrier in the process.

My last question is on the trends, and you've talked about it already, but I also heard a mention of it's usually in the very last, I don't know, period, whatever that's defined as where you get a huge surge of applications. What is a typical surge in the last, either week or whatever you define it as collectively? There probably isn't a specific definition, but can you give us a sense of what that is?

So, Mr. Chair, what I can say is that in typical years, our deadline is March 2 and the two highest submission dates for students are March 1 and in a non leap year it'd be February 28. So I don't have the specific numbers on what percentage of applications we receive on those two dates. Those are the two most significant application dates.

We have seen pretty steady growth for California over the month of March as we've been receiving that weekly update from the National College Attainment Network. And candidly, I guess my hope is we may have two deadlines. We may be working right now with the assumption that we have an April 2 deadline and then we'll have a May 2 deadline.

Hopefully that means we will be able to continue the urgency and the momentum in helping students apply not only throughout the rest of this period, but or if we should get that month of April, to use that with a similar level of focus.

So when you say significant on March 1 and March 2 or the two days before March 2, is that like more than half of the applicants?

I wouldn't say it's more than half, but I can certainly follow up with you with a breakdown on percentage by month and by specific calendar date.

You've reported-- multiple folks reported, or maybe CSAC specifically, the National College Attainment Network numbers, which for March 8 are 40% lower. Are you tracking that as to T minus X number of days, or at which point are you comparing that to?

Yes. So we've looked in that way in terms of T minus X days until the deadline. What the National College Attainment Network shares is based on where we were in March at this same time last year. So it's a one for one with the date. Okay, which last year we had a March 2 deadline, so we would have already received that surge of applications.

So we do have the benefit of still a couple more weeks of data to come in that will help us get closer to where we were with that deadline, but we know we're still really looking to drive up that rate from where we are now.

Okay, thank you. I think we'll have to see what the data shows and what other actions we can take perhaps next year to support specifically these students. So thank you all for your presentations and for answering our questions. We will move on to issue number two, which is a Cal Grant update and Cal Grant reform discussion.

While we just received an overview of FAFSA, I wanted to remind everybody that the focus of the hearing is on issues impacting students, primarily as we remain student centered, as we did when we first started this Committee hearing with students and their testimony. So we'll walk through the issues that directly impact students on their campuses and that account for a significant amount of state funding. As an example, 3.4 billion in Student Aid Commission, which of that two and a half billion goes to Cal Grant?

The state is going to support about 2.2 billion in bond funds to build more student housing. And then we have the three segments with 116 million every year to support basic needs and rapid rehousing programs.

However, we all know the realities of this year with our budget, and there are many things we will talk about today, as we have before, and will continue to do so, that I think we all support and believe in, but will be much more challenging to accomplish this year due to our budget shortfall.

We will have to think creatively about how we support all these common goals during this period where money will not be as easy to come by as it has been in the last couple of years. The Cal Grant program is one of the best programs California offers, providing financial aid to more than 400,000 California students. But we know after years of review that the program is inequitable. It's too complicated. It shuts out too many deserving students due to out of date barriers that must be updated.

The Legislature addressed this with Cal Grant equity framework, or Cal Grant reform as it's known, back in 2002. But that agreement left the funding decision to this year 2024. So we must talk about that today. The Student Aid Commission is going to walk us through new estimates and changes to the new program, what the changes would mean.

Cal Grant reform will simplify the program into the two parts, Cal Grant 2 for community college and Cal Grant 4 for university students. And estimates have said about 137,000 new recipients will be able to participate and will end barriers for students in those circumstances. Cal Grant reform is in statute and we know will happen, but we are in a budget situation where we need to think about how that is going to happen, but I believe it must start this year.

In addition to Cal Grant, we will talk today about student housing, which we'll hear about next, an update on the student housing program, which is supporting 12,000 beds. We will also hear today about the Student Housing Revolving Loan Fund, the governor's proposal to eliminate funding for the program. Treasurer Fiona Ma will be joining us to discuss this fund, which is being run through her office.

Then finally, we will discuss student basic needs and hear a report from each segment on the support for student food and housing insecurity. We know it's a significant problem at each of the segments, and we hope to talk to the segments about their programs and the outcomes related to those programs. So with that, we will begin with the panel on the Cal Grant update and Cal Grant reform discussion by the Committee.

We have the same folks at the table, so we will start with the Department on Finance on this one. Then we'll go to the Legislative Analyst Office and then hear from the Student Aid Commission. Please proceed.

Hi, I'm Amin Singh with the Department of Finance. The 2022 Budget act adopted the Cal Grant reform package and subsequent trailer bill language included a provision that Cal Grant reform would be triggered beginning in the 25-26 fiscal year if the state identified had adequate funding in the spring of 2024 during the May Revise. Once these May revision conversations occur, which is just around the corner, a determination will be made as to whether Cal Grant reform will be implemented in the upcoming fiscal year.

We cannot provide any indication prior to those conversations occurring.

That concludes my brief remarks, so I'll be happy to take any questions at the appropriate time.

Thank you very much. We'll move on to the Legislative Analyst Office.

Lisa Qing with the LAO. We've been asked to briefly review the changes that the Cal Grant program would undergo if the state were to move forward with implementation of Cal Grant reform in 2024-25. If you turn to page eight of your agenda, there's a chart that summarizes some key components of the Cal Grant program under its current form in the left-hand column and under Cal Grant reform in the right-hand column.

As the chair mentioned in his opening comments, the current Cal Grant program includes many different award types, each with its own eligibility criteria and award amounts. Under Cal Grant reform, these would be consolidated into two award types, a Cal Grant two at the community colleges and a Cal Grant four at all other segments. There would also be several key eligibility changes. Historically, Cal Grant awards have been available as entitlements only to recent high school graduates, as well as transfer students under age 28.

A few years ago, the state removed these agent time out of high school requirements for community college students. Cal Grant reform would further remove the requirements for students at all other segments. In addition, Cal Grant reform would remove the GPA requirements that are currently in place across all segments specifically for community college students. Cal Grant reform would also make certain changes to the income ceilings. The current Cal Grant program has program-specific income and asset ceilings.

Cal Grant reform would align those with the income ceilings for the Federal Pell Grant program. Those ceilings are generally lower. It'll vary by family size and household structure, but, for example, a dependent student and family of four, two parents would see the income ceiling go down from about 131,000 under the current program to about 76,000 under Cal Grant reform. There are also some changes to award amounts under Cal Grant reform. Currently, there's a rule that prevents certain first-year students from receiving tuition coverage at universities.

Cal Grant reform would address that so that all recipients at the universities receive tuition coverage. Regarding non-tuition awards, many Cal Grant recipients currently receive access awards of about $1600 to help with food, housing, and other living costs. Under Cal Grant reform, that would continue to be the case for community college students, and those access awards would be pegged to inflation, so they would be adjusted annually. For university students under Cal Grant reform, these recipients would no longer receive access awards.

Instead, it would be the expectation that the segments provide non-tuition coverage through their institutional financial aid programs. The last two rows of this chart provide a summary of the estimates that the Student Aid Commission has recently updated for 2024-25. Based on these estimates, the number of recipients under Cal Grant reform in that first year would be about 80,000 students higher. Costs would also be higher under Cal Grant reform by about 245,000,000 in that first year. I understand the commission will be providing more detail on the Cal Grant reform framework, so I will conclude here, but happy to take questions at the appropriate time. Thank you.

Jake Bremner with the Student Aid Commission, and I'll begin my remarks by first thanking the governor and the administration for their continued support of the Cal Grant program and of the 400,000 students that are beneficiaries of that program this year. We also would like to thank the administration and the Legislature for that historic action taken back in 2022 to adopt the Cal Grant Reform Act provisions. And now we know we're looking at this revenue trigger piece in what is a challenging budgetary environment.

For many years, students, equity advocates, and our policymakers have envisioned financial aid that's simpler and transparent and that serves students in a way that the current Cal Grant does not. Gallup poll surveyed adults 18 to 49 last year and found that the number one reason that was cited for why they chose to not enroll in postsecondary education, or why they had needed to drop out was affordability and cost concern.

The second reason was that they needed to work a number of hours that was not conducive to their enrollment. That's another way of saying it's the cost. So we know that a simpler financial aid system that's easier to understand. I think the agenda and the chart from our colleagues at LAO does a great job of explaining the complexity of financial aid and specifically Cal Grant.

We have eight different flavors of the Cal Grant today that really complicates our effort to send a clear signal to students and families about what they can expect and to help address that cost concern at a time when we know we're already spending $2.4 billion in state financial aid through the Cal Grant program.

So this vision of a simpler program that better aligns with the students that we're serving in higher education today, we know is key to our efforts in California to rebuild enrollment and to provide access to higher education despite a challenging budgetary context. It's clear, of course, that, and as your agenda notes, that this may require several years to realize the full vision of the Cal Grant Reform Act provisions.

And we're, of course, happy to advise the Legislature, the administration and other stakeholders on options to pursue reform that will help us serve more students and continue on this path towards a simplified system. I'll speak for a moment about the updated cost estimates that are included in your agenda.

Implementing Cal Grant reform, no matter how you do it, will require some one-time implementation costs over the course of four years because we're grandfathering in students that currently are receiving a Cal Grant, and we're also considering students who may be in their second or third or fourth year in higher education. We're starting to consider those students for a new Cal Grant under the Reform Act provisions who have been left out of the current system.

And as you start to implement the program and all students are considered under the Cal Grant Reform Act provisions, you see those one-time costs drop off. So in those years, implementation of the new model ramps up. That's what drives the one-time costs before we plateau at an ongoing total cost of implementation of $195,000,000 annually, meaning that the one-time cost that you would expect for 24-25 would be around $51 million.

These numbers are lower than the last available numbers that we provided back in 2022 when the May revision was being considered and the Legislature and administration were looking at Cal Grant Reform Act provisions. And that's because our modeling is always based on the latest actual data and students applying for financial aid. And we've seen some drops in college enrollment and financial aid applications from specific student populations.

These estimates reflect a really robust process of developing them, and we want to thank our colleagues at LAO and Department of Finance for helping advise us on this process. These projections also include reasonable enrollment growth assumptions that we discussed with colleagues at LAO and Department of Finance. And they also, of course, reflect the tuition increases that have already been scheduled at our four-year institutions.

Should we fund this, what we would expect to see, as your agenda notes, is a really significant increase in eligibility for financial aid, more than 137,000 additional eligible students compared to today's program in the first year of applications. As a reminder, and as our colleague noted, these are students who have the financial need but have been left out due to these non-financial eligibility barriers that prevent students from accessing the current Cal Grant program.

Those are factors based on when a student graduated from high school, their age at the time that they transfer, or to which institution they're transferring, and grade point average transcript requirements for students going to our open access community colleges. You can imagine the kinds of students that are disadvantaged by those types of barriers. Think if you were to look at their profile, you would probably imagine that they're a financial aid recipient on average, they have incomes of less than $30,000 per year.

There disproportionately are student parents. More than 45,000 of the number that I cited are student parents who would qualify for additional support in the Cal Grant program. But if they can't receive any Cal Grant first because of these eligibility barriers, they don't qualify for that $6,000 in support that we're providing to student parents. And these are also students who are disproportionately Latino, Black, and other student populations that have been historically disadvantaged by our financial aid system. So those numbers are all listed in your agenda, and I'm, of course, happy to take any further questions about what some options could look like to still move forward in recognition of the budgetary constraints.

Thank you very much. Does the UC or CSU want to add anything to this item or the chancellor's officer at community college?

I was counting on going last this time. Gina Browne, California Community College chancellor's office. The community college system would like to thank the California State Legislature for passing several financial aid bills and budget appropriations that continue to support community college students to help them meet the total cost of attendance. Obviously, I'm referring specifically to the Cal Grant reform rack passed in 2022. The California Community College's chancellor's office remains in complete support of including the funded needing for Cal Grant reform in 24-25.

And I'd also like to mention this is often referred to as the Cal Grant equity framework. Today's California college student community college students transfer to four-year universities, earn baccalaureate degrees, they graduate, enter the workforce at livable wages. Now more than ever before, California community colleges have evolved significantly over the past at least 20 years and will continue to evolve to address equity gaps. Today's community college students should not also have to wait or continue to wait for Cal Grant to also evolve. Thank you very much.

Thank you. Either of the other two systems like to speak?

Shawn Brick from the University of California. According to the latest analysis from CSAC, UC students would not on the whole benefit from Cal Grant reform. And I think given that and the challenges that we're facing this year with FAFSA, we would prefer that Cal Grant reform be enacted for 25-26 and going forward, the confusion caused by the delay in the FAFSA would be compounded if we then had to switch who was a Cal Grant recipient or who we've estimated would receive a Cal Grant.

Thank you. Would you like to.

April Grommo, California State University chancellor's office. We are deeply committed and very supportive of a more equitable framework for Cal Grant and definitely simplification of the program. But we do have several concerns. First, to highlight what the Legislative Analyst Office talked about. One is that lowering of the income ceiling. So a family of four going from 120,000 to a $75,000 income ceiling is concerning for our student population.

In addition, the access awards that will be taken from our students in this framework is concerning for basic needs and for those student support. We also agree that the framework and this year has had a lot of challenges. So moving to 25-26 would allow both students and CSUs and our segment partners to put together an implementation plan instead of waiting until this late date. I'd also point out that Cal Grant reform was initially intended to match Pell Grant eligibility, but that's not the case. For every student, there will be a group of students that will be Pell Grant eligible that will not be Cal Grant eligible. So that is also concerning and may cause confusion. Thank you.

Thank you. All right, it's definitely probably going to be the meatiest of the items today in terms of questions from me. Anyway, maybe we can start with that last comment from CSU. I'd like to hear more about this because I have not heard about the less Pell-eligible students would be eligible under Cal Grant reform. Was a statement made? Can you further explain that?

Sure. So there's three calculations that the Department of Education will use to calculate Cal Grant eligibility. One of those is taking the student aid index and minusing it from the max Pell award. So, for example, if a student had 6000 SAI, but the Pell Grant was 7400, that student would be eligible for $1,400 in Pell Grant funding. That is not part of the framework for Cal Grant reform. So those students in that situation would be eligible for Pell Grant but not eligible for Cal Grant.

Can I get CSAC to give me some more context to that? And maybe some, if that is sure that's accurate, how the decision was made on these particular students, or what the makeup of this student would be under this scenario.

Yeah. Appreciate us getting into the details here about how the new Pell Grant is working and the student aid index. So as a refresher, and again, this is noted in your agenda back in 2022, the new income ceilings that were adopted for the Cal Grant four align cleanly with the minimum Pell Grant income ceilings. The minimum Pell Grant is itself a new concept.

It didn't exist before the FAFSA Simplification Act, and what it allows for is for us to use a table that provides various student-family situations and income ranges based on the federal poverty limit. And before even touching a FAFSA, the student is able to look at this table and to know that they will qualify for some level of Pell Grant support. So that is one way that a student is considered for Pell Grant. Our colleague from CSU is correct. There is also another process through which families who have already completed the FAFSA can be considered for a Pell Grant even if their incomes exceed those minimum income ceilings. What I would note here two things.

One, being able to still align those eligibility tables so that we could put one single set of income ceilings in front of a family and let them see that they would be eligible for both Pell Grant and Cal Grant, we believe could be really powerful in addressing this issue of clear messaging to students before they go through this daunting process of submitting a financial aid application.

Second, I would also note that there are many students today who fall into this same category of they're Pell eligible, but they're not Cal Grant eligible. And that's because of these non-financial eligibility devices. So in some ways, you could look at this question as being which of those students should the state be prioritizing for Cal Grant support? But this phenomenon of some students getting one but not the other is unfortunately not a new one.

So for eligibility determination, we are using the federal Pell Grant. The framework uses the federal Pell Grant limits, which I assume increase over time with some sort of factor, and so that will remain consistent. And that when the discussion I was not here a couple of years ago on the framework equity framework, was there consideration for students who were otherwise eligible for other Pell support? And the decision, I assume, was made not to include that, because what I'm understanding is it complicated of the process more.

So since 2022, the US Department of Education has published more information that explains these. You could think of them as three tests for how a student gets Pell Grant access. Think at the time in 2022, it wasn't entirely clear that if a student had a student aid index number generated that exceeded those income thresholds, whether they would still qualify. We have since gone back to look at what would the additional cost be to include those students. They're primarily students that are four-year institutions.

So the per-student Cal Grant award amount is quite large. I don't have the specific number at my fingertips, but I can confirm it's over $100 million more in Cal Grant funds. If you wanted to also provide a Cal Grant to those students who are eligible for Pell based on their student aid index number and not their family income based on that federal poverty limit threshold.

Okay. Let's talk more detail about the different segments within the equity framework of students who currently do not qualify. That would qualify. So we've got age as a factor, we've got GPA as a factor. We've got several other factors I haven't been able to identify, and maybe you haven't had a chance to look into this, and I think it's important for us to have the information of the other one that's listed.

I want to acknowledge is in the staff report, the Cal Grant reform that was included in 2022, which extended the program to community college students that transferred to UC CSU, but it did not do so for community college students who were transferring to private nonprofit institutions. And so I'm interested in knowing what each of those different portions of reform would mean in terms of implementation and cost. Can you walk me through that, or does that require more analysis or give me a sense of what that would look like?

I can definitely give you a sense for that, Mr. Chair. So the largest driver of cost and of newly eligible students is the removal of a grade point average requirement for our community college students that brings in many thousands of students at the community college, allows them to keep their Cal Grant when they transfer. It also brings in many thousands of student parents. As I spoke to in my earlier comments, over 45,000 of the 137,000 are student parents.

Those students qualify for $6,000 awards towards their non-tuition costs. That's a very significant driver of cost. If you were to try to look at options that would just remove some of these specific barriers within the current Cal Grant A and B program that would require ongoing funds on top of the existing Cal Grant appropriation. Part of how you could look at financing Cal Grant reform is that it restructures in some ways how we spend and deploy our state dollars right now.

So you're working within the current appropriation. There are these one-time costs, as I mentioned, where you have several years of student cohorts where they may be receiving either type of Cal Grant. But that's how, looking at Cal Grant reform as a restructuring opportunity, you could finance an initial step using one-time funds versus removing barriers within the current program, all requiring additive dollars on top of the baseline appropriation.

Okay. Is the Department of Finance. I know you mentioned that maybe in May we would hear a decision. Are you looking at implementing this and potentially implementing this or at least analyzing the potential to implement this in phases as opposed to full Cal Grant reform? Are you analyzing those different scenarios or are you just focused on one? We have someone, Chris, is coming up to provide some.

Yeah. Chris Ferguson with the Department of Finance. At this point, we wouldn't be able to comment on what we are or aren't looking at internally beyond. We have a May deadline in law in which we must provide a response.

So just quickly, just to you, will you have a response in the May revise one way or the other? Is that what we should expect, or would it come before or maybe after?

It's not clear to me if we would put it in the May revision or if it would be a one off letter, like a JLBC type letter.

Is there an actual date in what was approved?

Yeah, I believe the date in law is May 15.

Okay.

Which is one day after the release of the May revision.

Yeah. Okay. So we'll hear one way or the other, either May revision on May 14 or through a letter on May 15. Got it. Okay. So I think I want to continue to certainly try and get a better understanding from CSAC. You mentioned the 40-plus thousand parents which would be eligible. You mentioned the GPA. I didn't hear a figure assigned to that, but certainly there's some number assigned to that.

There is some number assigned to, in our staff report talks about 1200 students that would meet the eligibility under being able to transfer from community college into the nonprofit private institutions. So I think I'm interested certainly in all of those to help me make a better decision of how to move forward. So I might have some more questions, but I'm going to turn it over to Mr. Fong.

Thank you so much, Mr. Chair, and thank you, everyone for the comments about how we continue to look at Cal Grant reform and its implementation and just amplify the chair. I also very keenly focused on Cal Grant reform implementation. I know this year is a very challenging year. We just heard from finance that if we look to choose, is there a way to phase in Cal Grant reform? And you've kind of said we need to wait another couple of months, is that where we're at?

Yeah, I think from our perspective, it would be at least a couple of months before you would hear from the Administration in terms of the Cal Grant reform law as it reads right now. Certainly we would just note that the proposal from the beginning, when it was enacted a couple of years back, was a legislative proposal. So I don't know that we're looking at particular avenues at this point for what we would put forward. Rather, we're looking at what the law is directing us to do.

Thank you. And in terms of the segments to preparation to implement Cal Grant reform, can you give us more details as to how you would plan to implement Cal Grant reform if we're able to make it happen this year?

April Grommo for the CSU. So the CSU is preparing for both scenarios of current Cal Grant or Cal Grant reform. We are planning on awarding students that meet the State University Grant criteria, those awards. Once the determination is made as to which program is moving forward, then students would be awarded our State University Grant would have it replaced with Cal Grant. The students that are not eligible for a Cal Grant program would keep their State University Grant award, our institutional aid program.

In addition, we have looked at changes, and we're hoping also that MCS can help with the framework. And if those are students that have lost eligibility. But with the MCS looking like it's being cut this year, staying at the same level of funding, that would mean less funding for our students with MCS that are losing Cal Grant.

Thank you.

Gina Browne, California Community College's chancellor's office. Community colleges remain in full support of full implementation for the 2425 year. All 115 community college financial aid offices have been preparing since 22 to award and implement Cal Grant 2. However, they are still prepared to proceed with the legacy Cal Grant. So again, fully support full implementation.

Thank you.

And Shawn Brick, University of California we would be prepared to implement. I think it would be somewhat confusing for families if we estimate they're getting a Cal Grant, but they do not, and vice versa. But because of the way the university uses our own institutional financial aid, our own UC grant, like the CSU, we would be backfilling for a missing Cal Grant if somebody meets the same income thresholds.

So the bottom line for UC students as a whole is just whether or not there would be additional Cal Grant or less Cal Grant money. And under the most recent analysis, it does look like it would be fewer Cal Grants for UC students under reform, which causes us some concern.

Thank you so much and really appreciate all the comments here. And this is one of my top priorities, the implementation of Cal Grant reform. I think with equity framework, the work that it's going to do to uplift hundreds of thousands of students here in California, especially in our community colleges, is so critical.

We just heard the stat, about 45,000 student parents, these factors, and the transition to a four-year university, I think overall, the implementation of this, if we make it happen this year would be tremendous for California higher education segments and our students here in California for their families. So thank you so much, Mr. Chair

In order to give Ms. Muratuschi some time, maybe he comes up with a question. I would just remind us. Last week we had a conversation about student enrollment, and we did hear from the UC system. The number of students who are on the higher end of the economic income brackets is growing, and so I could see why Cal Grant reform might have an impact there.

I think the response would be is, let's identify more of our California students that are lower income to be able to attend our UC system. And therefore, I think Cal Grant can be a net benefit for the UC system. So I would encourage us to continue to be focused on that. Mr. Muratsuchi, give you a chance? No? Okay. Thank you very much. Then we will move on to item number three. This is the middle class scholarship program. We will discuss the governor's proposal to forego the increase in funding for the program for year 24-25. We have the same panel. Appreciate you all being here. And we'll start with the Department of Finance.

I'm Aman Singh with the Department of Finance. The governor's budget allocates $637,000,000 in one-time general fund to the middle-class scholarship program, which is expected to reach 332,000 students in the upcoming academic school year. As a budgetary solution, the budget foregoes a planned $289,000,000 one-time general fund investment in the middle-class scholarship. The scholarship will continue to be provided to students in the upcoming budget year, but the additional investment will not be occurring. The financial shortfall we're seeing offers limited flexibility in supporting new investments.

By design, the middle-class scholarship is a last dollar program that is subject to the fluctuations in the state budget. We'd like to underscore that this stands in contrast to the Cal Grant program, which is the state's largest financial aid program and that remains intact. The Cal Grant is an entitlement and will be provided to students who meet specific eligibility criteria no matter the state's budget situation. The administration remains attentive to the issue of college affordability and commits to working with partners to ensure that college remains accessible in the state.

Thank you.

Lisa Qing with the LAO. The middle-class scholarship program helps cover students' remaining cost of attendance after accounting for their available resources. As the Department of Finance has noted, the way the state budgets for this program is different from how it budgets from Cal Grants. Each year, the state determines at the outset how much funding to provide for middle-class scholarship, and then, in turn, the commission determines what percentage of each student's remaining costs it can cover within that budgeted level.

Essentially, the Commission is spreading the budgeted funds across all eligible students in proportion to their remaining costs. So in the current year 2023-24, the state has added some one-time funds on top of the ongoing funding level for this program in order to temporarily increase students' middle-class scholarship awards. Under last year's budget agreement, the state was planning to take a similar approach in 2024-25. But the governor's budget removes that planned one-time increase.

In light of the state's large budget deficit, we think the governor's proposed approach is reasonable. We would note, however, that it has a programmatic impact in your agenda. If you turn to page 16, there's a figure at the bottom of the page that summarizes program estimates under the governor's budget for middle-class scholarships. You'll see in the top part of this chart that the number of middle-class scholarship recipients is actually projected to increase in 2024-25.

That reflects enrollment growth at the segments as well as annual adjustments to the program income ceiling. But when we spread the lower proposed funding level across the higher projected number of recipients, the average award per recipient decreases. And so you'll see in the bottom section of this chart that we're projecting on average for CSU and UC students, their middle-class scholarship award would go down by roughly $800 in 2024-25. Thank you. Happy to take questions.

Thank you.

On behalf of the commission, I'd like to thank the administration for their continued support of the ongoing appropriation to the middle-class scholarship and the Legislature's work to also provide additional support for our students. In addition to that major investment that we all make through the Cal Grant program, I believe Lisa just very effectively explained what the implications are for students. Should that one-time appropriation be, you know, certainly recognize the challenging budgetary context in which you're making these decisions. Also happy to take any questions you may have about implementation of this program and the unique nature of a last dollar program and what that means for how we all deliver this for students. Thank you.

Segments. Anybody want to share anything, please go ahead. Sure.

Shawn Brick from the University of California. So, without continued expansion for the middle-class scholarship program, the progress towards achieving a debt-free education for all UC undergraduates, which is the goal under the compact and the goal of the middle-class scholarship program, will be slowed. Our progress towards that goal will be slowed. When you have a program like MCS that focuses on the total cost of attendance, which we do think is the right focus for this kind of program.

If you aren't expanding the program, you're falling behind because our students will face additional cost increases with inflation, and inflation has hit our students particularly hard this year, so the cost that they face will be higher than ever this fall. On the positive side, we also expect our students will qualify for more federal Pell Grant than ever before and UC has set aside more of our tuition revenue than ever before.

So the university will continue its own path to debt -ree program which is focused on the lowest-income students and provide them with the debt-free financial aid package. But our ability to achieve our debt-free goals overall will be slowed down. With so many factors unknown at this point, we'll have a better sense of where we are progressing towards that goal this fall.

Thank you very much.

So we were able to award middle-class scholarships earlier this year as the program has been significantly overhauled. That was an improvement. We were also very thankful and grateful for the treatment of basic needs and non-need scholarships as self helps would mean fewer MCS awards need to be recalculated. There are a couple of items that we would also encourage to be looked at.

One is that the Legislature could empower CSEC to provide the phase-in percentage and self-help amount in earlier points in time during the year. This would allow us to include MCS estimates in financial aid packages to our students in the earlier time frame. Also, we would like to see a higher threshold before recalculation on individual awards.

MCS can be adjusted for many reasons since it's a last in program and the current threshold is $6 and any student that goes over that threshold requires a recalculation of their award, so raising that tolerance amount would help. We are deeply thankful for MCS, but we would point out that it is not an entitlement award. So as the state's budget changes and the amounts change that are provided to the program, this does deeply impact our students and the ability to meet their total cost of attendance.

Thank you.

Gina Browne, California Community College chancellor's office. I will keep my comments short in proportion to the number of students that receive an MCS at California community colleges. We are in support of MCS expansion. We are now six colleges, last time I checked, have awarded 27 MCS awards. Thank you.

Thank you very much. Let me ask a question regarding the UC and CSU concerns about changing the program. First, I think I want to start off by thanking UC officer, the president for the commitment for debt-free college. I know he's expressed that as a think, you know, there's a goal of a year understanding that impacts like this one sort of change, that calculation. I appreciate you letting us know that that's a reality that you now have to deal with if this happens.

But still, a commitment to debt-free college is very important. So I appreciate that. The question on changing the changes that are being requested when there's an overage of $6, as was mentioned, maybe. Can you give me a sense, both systems that deal with this in larger volume, how often that occurs, how challenging that is for you to implement?

Sure. And I'll preface this by saying that the numbers I'm about to share should go down as a result of the changes that the Legislature made around basic needs and non-need scholarships that April mentioned. But it was as high as 30% at all of our campuses where campuses were having to recalculate those awards. So that was very frustrating to students.

Okay, anything to add to that?

I would say that number, we don't have the exact numbers, but it was a very frequent thing that happens because any adjustments to financial aid means an adjustment to MCS. I think in one example, we had a student that was transmitted back and forth over 10 times.

Let me see if I also understand the other ramifications to the student, because students entered here. So the student receives an award, and then you have to make a change. Does that just lower the award, perhaps in the second semester? In the semester system or the second quarter? How does it impact the student? I know it impacts you having to go and fix it, but how does it impact a student?

So we've, over the decades, gotten very efficient at deploying money through financial aid. And so what has been happening is that, for example, a student might earn a scholarship from their academic department at the end of the Fall semester. They receive that scholarship, say it's $1,000s. That reduces their middle class scholarship eligibility by $1,000 times the phase in percentage. The problem is that we're so efficient that we pay that scholarship out to the student in some cases, so the student gets $1,000, but then in Spring, we have to send $260 back or whatever to the Student Aid Commission.

So the student might actually get a Bill in the Spring semester because we've had to recalculate the middle class scholarship award and send that money back. But it doesn't happen. It's such a manual process to do the recalculation. They already got their $1,000 scholarship, so it feels like a takeaway to the student, and it's very confusing and frustrating to them.

Even if we catch it ahead of time, the student doesn't feel good because they got told they were getting $1,000 scholarship, and we have to tell them, no, you're getting a check for $700, not $1,000. And that issue will ideally be fixed this coming year when the scholarship isn't affecting middle class scholarship for the most part.

But there are other examples like that if their federal aid eligibility changes. Financially, it is such a fluid thing throughout the academic year that there are, as April was saying, a number of different factors can mean a recalculation.

Yeah. And I guess I'm definitely more sympathetic to this scholarship that you received. Financial situations change, and that definitely requires recalibration there, but certainly, definitely don't want to be in a position of asking students to pay back or it feels like you're something that you've earned and that you've lost. So I was concerned about that, but I hear that that seems to be something that is being addressed.

Let me ask another question, and then maybe to the LAO, will that change the calculation on the dollar amount. If we're no longer collecting back, if you will, from anybody who's no longer eligible for some portion of - does that substantially - it sounds like it happened a lot. We don't really know the figures. Have you had a chance to analyze what that would mean for the actual cost of the program and therefore the award per student?

So for context, you'll recall that last year in the Trailer Bill, the state adopted a change that will take effect in 2024/25 so that the segments no longer have to do those recalculations when students receive additional merit based scholarships, as we've just discussed. We would expect that that will increase the total amount of remaining costs that the program has to cover on aggregate because the state decides at the outset how much funding it wishes to provide in any given year for middle class scholarship.

It doesn't directly translate to additional state costs, but you could think of it as additional cost pressures in the program. Another way to put it is when the aggregate amount of remaining costs goes up in middle class scholarship, the phase in percentage or the percentage of total costs that can be covered goes down at any given funding level.

Right.

Unfortunately, I don't have specific numbers for you at the time about the impact of this.

But your figure six that you referenced to on page 16 of the agenda is already reflective of your anticipated changes.

The figure six is based on estimates that were run by the Commission in October.

Let me ask the Commission then. It's their estimates. You understand my question and trying to understand where this is going.

Yes, I think I do, Mr. Chair. I think we will really need to look at this transmission of student information records that we have not yet received to be able to provide more insight into what 24/25 looks like. The estimate that we develop in anticipation of the Governor's Budget is based on all the most recent data that we've collected. We have not previously collected data about academic scholarships.

So that will be a new data point for us that we'll begin to collect over the Summer as we receive the enrollment files and amount of institutional or scholarship aid that students are receiving and where that's factored into the underlying calculation. So there are a few moving parts here. This was the best estimate that we could provide back in October, though, as you've heard in the first panel, a lot of changes in the months since then.

Okay, thank you. I'll turn it over to Mr. Fong, who has some questions.

Thank you so much, Mr. Chair. And following in a line of comments about the mid year adjustments, I know there's suggested tweaks to simplify the process. What are some of those suggested tweaks to simplify the process so that we're not changing the student awards mid year. I know the CSU, you mentioned that one person got changed 10 times in a year.

That's just a lot of, feels like a lot of yoyo back and forth here. How often do these mid year changes happen, and how can we simplify the process?

Well, I can answer by saying everything April said. This is Sean Drake from University of California. We're in alignment around a number of the things that the CSU outlined. For example, this is a very complicated program to administer. And so with all due respect to the California Student Aid Commission, which is trying to manage a very complicated program, knowing that phase in percentage in December, the year before school starts, is critical. If we want to provide estimated awards that are accurate to our newly admitted students, we need to know that well in advance so that we can start to build that into our system. And we want to do that.

We really want to be able to tell students the full range of financial aid that they're eligible for. So understanding what that phase percentage is early would really help with the newly admitted students. And then I think again, as April said, having a broader allowance that would not require a recalculation, I think would help.

We do have that in some ways at the federal level with the Pell Grant, where you can have, I think it's a $200 to $300 over award at the end of the year, and you don't have to recalculate. So either that or even sort of tiered awards would just round the awards to the nearest $100 would simplify things quite a bit.

And I'll just add, there are scenarios where students get, we've dispersed their Fall aid, we've dispersed their spring aid, and then late or middle to late Spring, they get an adjustment to financial aid, and that will require a recalculation of MCS and us to bill the student. And so when Spring awards happen, we have no other choice because aid is within that aid year to go to the student and ask them to return that funding. And that becomes a very delicate situation. In some cases, students have already spent that money, so we're asking them to take money out of their pocket to repay because of that MCS recalculation.

Thank you.

And if I may just add on here, first, I appreciate our segmental colleagues walking through the complexity of this program. It is a complex program for our Administration as well, and we would join in identifying several areas where statutory revision could help simplify this, not only for the administrators of the program, but most importantly for these students who are subject to that yo yo effect that you described.

Assemblymember Fong. What I'll just note in terms of the phase in percentage, this timing of how we determine the phase in percentage is really required by the way the statute is currently constructed, which means that we need to know, really, you could think of three key data points. All of the students who apply and are eligible for the middle class scholarship.

The appropriation amount, which we don't settle upon, finally until June, and then the amount of aid that each of those recipients is receiving, which we receive from our campuses in the July, August time frame. Which is when we then can definitively identify the amount per student. We provide currently an estimate of what the phase and percentage could look like in the Spring to help inform the financial aid offer letter process, but that's still conditional and an estimate based on those other three really key inputs.

You could envision a system, as I think Sean was describing, in which you would instead look at student profiles and identify an amount that you would provide to each of those students based on their segment and their income status. That'd be a pretty significant change to the structure of the program and might make it feel a little bit more like an entitlement which has a benefit to the student. But I imagine you look at differently in a budgetary context.

Thank you so much for those comments. And what is the percentage of students that are being affected by this mid year changes? Do you have a guesstimate?

Our latest for this last year was about 30%. 30% of students. I do think that number will go down with the change to the scholarship treatment.

Okay. CSU.

We don't currently have that information from our campuses, but it is a significant amount of students and the manual intervention to make that happen. And then that subsequent process of communicating with the student is highly burdensome on the financial aid offices and confusing to the students.

Sure. Thank you. Thank you so much, Mr. Chair. I appreciate all the comments here and how we can really make this process better. Thank you.

Thank you for your questions. We will move on to, well, sorry, we're going to hold that issue open just like the prior one. Certainly. We'll continue to discuss strategies for the previous one, how to fully or partially implement Cal Grant, and on this one we'll hold it open for further discussion. Thank you all for your comments and answering our questions.

We will move on to the next panel, which is on student housing Revolving Loan Fund. We will be discussing the Governor's Budget proposal to defund the student housing Revolving Loan Fund Program. In this year's budget, we have the Department of Finance, Legislative Analyst Office, the State Treasurer's Office is present, I believe. We have the California Education Facilities Authority from the State Treasurer's Office and the UC, the CSU, and the Community College. Leadership is also here. So why don't we start with the Department of Finance on discussing the proposal in the Governor's Budget?

Good morning, Chair and Members Alex Anaya Velazquez with the Department of Finance. For the California Student Housing Revolving Loan Fund program, the 2023 Budget act approved a multi year investment of 1.7 billion onetime General Fund over six years, which should comprise of 200 million onetime General Fund in 2023/24 and 300 million onetime General Fund each year from 2024/25 to 2028/29.

Given the budget and revenue outlook, the Governor's Budget proposed suspending funding for this program. This includes pulling back the planned 1.5 in General Fund investments from 2024/25 to 2028/29 and reverting 194 million of the 200 million onetime General Fund appropriate in the current year 2023/24. This concludes my remarks and I'm happy to take any questions at the appropriate time.

Thank you. We'll hear from the Legislative Analyst Office.

Jennifer Pacella, LAO. We recommend adopting this particular proposal. As finance described, it yields 1.7 billion in budget solution, so it's by far the largest higher ed budget solution before you. It achieves the solution without any direct negative impact on students, faculty or staff. To the extent you would desire a Revolving Loan Fund for housing and higher education, you could revisit it in future years when the budget conditions improved.

Thank you. Who's here representing the treasurer's office?

Yes. Hi. Good morning, Mr. Chair and Members of the Committee. Carolyn Aboubechara from the California Educational Facilities Authority here on behalf of California State Treasurer Fiona Ma. She is both the Chair of the California Educational Facilities Authority as well as the School Finance Authority, referred to as CFA or CSFA.

Both CFA and CSFA, as finance mentioned, were allocated 200 million as part of the 2023 Budget Act to co-administer the California Student Housing Revolving Loan Program, which I'll refer to as the CASH RLF Program. That was chaptered into law in 2022. 150,000,000 was designated for CFA to administer applications from qualifying applicants of the California State University and the University of California systems, and $50 million for CSFA to administer applications from California Community Colleges.

The CASH RLF Program was designed to provide zero interest loans to the three segments to provide affordable student, faculty and staff housing. On behalf of Treasurer Fiona Ma, I am here to emphasize the importance of this funding and what this program would accomplish, which is more affordable housing units for the vulnerable students of California. The need for affordable housing in California grows each day. California is experiencing increasing housing costs and lower declining vacancy rental rates with additional rent increases on the horizon.

The CASH RLF Program is a Revolving Loan Program, which means it leverages one time funding to reduce ongoing permanent financing tool that campuses can utilize over the future to build affordable housing. As soon as the program was funded, the CFA and CSFA teams hit the ground running. They worked expeditiously to draft regulations and an application which was shared with the key stakeholders, all the three segments and other associations. We received valuable feedback.

We were ready to incorporate the feedback from the segments and the advocacy groups and then the Governor's proposed budget proposed suspending the funding for the program, just halting it just yards from the finish line. The treasurer's office appreciates the initial funding the Legislature set forth for this shared priority and also now the difficult task that has to be done in order to work with the current budget. Housing has been and will continue to be a priority of the California State Treasurer.

And as you consider the adjustments to the state budget, the Treasurer's Office is ready to assist in providing housing options for the students and for the workforce of California. Just a few things to highlight on the program. Due to the limited amount of funding provided in the budget and in order to kind of potentially stretch the funds that were allocated in the budget, the program was proposing to do bridge financing or gap financing for student housing.

Bridge financing meaning funding early works of student housing projects, which is planning permits, preliminary design and site acquisition or preparation. And then later the University can fund it with other financing. Or gap financing where we would finance a portion of the student housing project not covered by either campus contributions, the grant funds or other financing vehicles. Since the funding is very limited, instead of funding the full project costs, which could vary from 25 million all the way up to 575 million per project.

In the past, we proposed these financing options. Also in order due to the limited amount of funding CFA and CSFA developed draft guidelines that included evaluation criteria to rate the applications and score them. Based on unmet demand for student housing, based on affordability, having a local match, which was very important because of the limited amount of funding, assessing project feasibility and how ready a project is, the project budget, projections, quality of credit and security structure, as well as the public benefit.

In the draft of the program, we were given priority to intersegmental projects, awarding projects to diverse geographic areas and projects with earlier start dates. Also, CFA and CSFA because we are housed within the State Treasurer's Office, we invested the $200 million in the pooled money investment account as of the end of October of 2023 and as part of the State Treasurer's Office role in being a fiscally responsible steward of monies.

CFA and CSFA's $200 million already raised $1.6 million in interest, and that interest could be used in the future if the funding were to come back to offset administrative costs or for future funding projects. So, CSFA and CFA, we were ready to proceed whatever decisions made to move forward with the regulations if the funding is restored, and that would be where we would finalize the regulations, incorporate the valuable feedback we received from the segments, and then go to Office of Administrative Law to finalize the regs and then approve or start accepting applications. So that's kind of where we're at and happy to answer any questions.

Thank you very much for being here. Would UC or CSU system like to.

Thank you, Chair Alvarez and Members of the Committee Seya Vertan for the University of California. The University of California has greatly expanded student housing over the last eight years. In 2016, we began the Student Housing Initiative, which was aimed to support current and future students in expanding our campus housing inventory, and this initiative identified land on which housing could be built and identified various funding sources that could be utilized to expand our housing inventory.

These efforts have resulted in the completion of over 28600 new student housing beds since 2016, and we were enthusiastic to continue to expand our student housing inventory, which is why the University was supportive of the California Student Housing Revolving Loan Fund Act. The availability to borrow funds with no interest would allow the University to build additional housing with modest savings that could be passed on to students, staff and faculty.

The University worked with the California Educational Facilities Authority to provide feedback on the Revolving Loan Fund Program criteria. On January 5 of 2024. The University submitted formal comments on the proposed Revolving Loan Fund regulations. While the application process for the loan program was never opened, we do know that at least two UC campuses were intending to submit applications for the loan program.

In addition, several UC campuses prepared applications for the higher Education Student housing grant program funds that were not selected for funding that could utilize the loan program as an available source of funding. Thank you for your time today. I'm available for questions.

Thank you, Community College System or CSU.

Good Morning, Chair Alvarez. My name is Paul Gannoe and I'm Assistant Vice Chancellor, Capital Planning Design and Construction with the California State University. Appreciate the opportunity to participate in the hearing. Since the inception of the Revolving Loan Fund, we have had interest among the campuses to participate in the program. The attractiveness of a 0% loan on a housing project is there, and those savings are passed along in lower rents to our students.

So we did have a bit of interest in that as well as for faculty and staff housing. We were just like everyone else, waiting to hear to see what the final application process would look like and eager to participate in it when it comes around, if it comes around, and I'll be glad to answer any questions. Thank you.

Good morning, Chair Alvarez and Subcommittee Members. I'm Wrenna Finche, Vice Chancellor of College Finance and Facilities for California Community Colleges. I really thank you for the opportunity to give an update on student housing this morning. I'd like to remind you that community college students face increasing housing insecurity and homelessness, which impacts their ability to meet their educational goals. In fact, according to a 2023 California Student Aid Commission Food and Housing survey, 53% of students reported experiencing housing security, which is a 20% increase since 2018.

Community college students and those who are low income, adult learners, student parents, female and black, or Latinx, continue to be more likely to experiencing housing insecurity. And at the same time, community colleges have the least amount of campuses with housing available for students. Because of these reasons, we were very interested in learning the details, seeing the final application for the Student Housing Loan Revolving Fund.

We would be very interested in participating in this fund in the future and would really encourage you to consider the ratio of funds that are provided for community colleges, giving our great need. In 23/24 only 25% of the funds were earmarked for community colleges, where we serve over 2 million students in California. So we'd like that to be considered in the future and very interested in seeing if we can continue this program when state revenue allows for it.

Thank you all. Appreciate your presentation. I'm not going to ask anything about the need. I think it's pretty evident, and you've all expressed it quite well. And there's some backup in our agenda, just the number of students that desperately could receive assistance with housing. So I'm going to just pass on that. What I'm interested in is learning more about how the Revolving Loan Fund, maybe the intent of a Revolving Loan Fund, is to make it essentially ongoing and sort of self sufficient, if you will.

And so I don't know if anybody's got any, the Treasurer's Office, maybe the LAO. Any thoughts on what the repayment plans would look like to replenish the funds and how long that would take and at what point this truly becomes revolving as opposed to in the beginning. Definitely. Likely it's going to feel more like one time in nature. At some point, the money comes back and we can reuse it for other purposes. But did you, maybe the Treasurer's Office or LAO have any projections on the intent from last year's budget and what that is going to lead us down to?

Yes. Thank you, Mr. Chair, for the question. So the way we had envisioned and developed the program was that the segment would apply for a term that they would like to repay the loan back up to 30 years. So technically, if a segment were to apply for 30 year loans, funds will cycle in on a monthly yearly basis until there's a good amount of money back in the fund. Then we can recycle it.

So it'd probably take at least five to 10 years to get a good enough amount of money to recycle it. However, it can be set up in any way possible where we could set shorter terms, obviously with a shorter due date to pay back a loan. It would be a higher payment for the systems, which might not help them cash wise, but it can be designed in any way possible where the funds can recycle at an earlier phase or they would recycle at a later phase, but the funds are there to be recycled.

Appreciate that response, maybe, and I'm not going to ask UC or CSU or Community Colleges to give me specifics, but clearly this loan program is much more attractive than the market. We know that those rates are usually higher than 6 or 7%, especially for these types of projects. They're probably higher, so there is some savings there.

I'm just curious, again, without any, certainly no commitment, a faster repayment, I assume in your assumptions for the programs that you were hoping or the projects you were hoping to apply for, you had a 30 year repayment assumption, I assume, maybe not. Just interested in hearing more about what you perhaps were going to be proposing and how maybe even a program that is perhaps not a 0%, if it wasn't 0%, would you then not pursue it at all?

Or does a 3% program offer a benefit that may be attractive to any of the segments? Again, knowing that you won't have specifics, but just curious as to if there's a different pathway forward here.

Thank you. Chair Alvarez. We did look, working with the Treasurer's Office, we looked at some possibility maybe borrowing for CAPI. So during construction, taking a loan to cover that. So we're not paying a high interest rate or our interest rate, about four and a half percent, 5% for CAPI. As mentioned, we also looked at loans for preliminary plans and working drawings, sort of just to get us through that period of time at the beginning of the program. And I think the 0% obviously is attractive. We would have to run the numbers as we get closer to what we're borrowing at to see if the program were valuable. But really the 0% would make a market impact on our rent rates.

Yeah, I'll let the others answer, and maybe you want to answer also this follow up that I have for you. It's interesting. You talked about getting the loan for the planning and all the pre work that happens, which is substantial quite often, and you just don't have the cash flow in your General Fund to do that. It sounds like that could be helpful.

Is that because then you might be able to go to the market and actually finance the construction using traditional market products? Or why would that be helpful? If you just got it for a certain period, like planning, preparation work, or maybe just the construction component of it.

We would be glad to get it for the entire project. So I wouldn't mean to say we were limited to that area of interest, but when we were first talking, maybe the loan amounts would be smaller, and that seemed like a good way, as you mentioned, gap financing, a good way to address maybe the smaller amounts that would be available. So getting that again, that CAPI covered with a 0% loan until we start getting revenue from the project.

Okay. Answering the variety of those questions.

Seya Vertan for the University of California. Receiving a lower interest rate than what we can get on the market would be beneficial. It would not allow us to pass as many savings back on to the students. Right. So whether or not we can then set those rates for the housing at affordable rates versus just having more available student housing stock, that would be the differential there.

Allowing us to borrow for those preliminary plans and working drawings costs might allow us to get started on a project faster, which could save us six to eight months on a project, allowing us to open it sooner for students to move in and thus alleviate some of the housing pressures on our students. So it is still preferable to have a loan program that would allow us to give us some gap financing or slightly lower interest rates, even if you can't bring it down to zero.

Okay, thank you. Any additional comments to that?

Yeah, I'll just remind you, Wrenna Finche from California Community Colleges, I'll remind you that for our system, the application process would have looked different. We have 73 local districts with authority over their own capital outlay planning, over their student housing planning. Our central office wouldn't be applying for a loan. It would be individual districts. So that's a lot of individual decisions to see how that financing could work. Clearly, it beats a lot of other financing out there, and I think there would have been good uptake.

There are certainly a lot of anecdotal interest in it, especially around, because it expanded into faculty and staff housing. So we appreciate the recognition that housing is not affordable for pretty much anybody in California right now, but it would have been 73 local decisions on how to move forward on that.

Thank you all for the feedback. As we try to be supportive of this issue, I think it's important to try to understand alternatives that we could perhaps still be successful in providing housing for students. And thank you for reminding us also faculty and staff. I'll turn it over now to Mr. Fong.

Thank you so much, Mr. Chair, and thank you to all the panelists here. Follow up question to our Community Colleges. I was looking at page 25. So there are currently 30 projects have been submitted by different districts, is that correct?

Yes. Well, this is for affordable student housing grant program, that former program. So it wouldn't have been necessarily related to the Revolving Loan Fund program, but it demonstrates our need. And so any of those projects that weren't funded through the potential statewide lease revenue bond, they could have sought financing through this methodology.

Okay. And in terms of the 25, I'm sorry, the 30 projects, how do you rank them, or how does the ranking process work?

So there's a scoring matrix that's based on the statutory language, primarily that was provided by the Legislature and a few administrative items in there. A couple of the big ones are the affordability, how many actual low income beds, what's the state's cost? Looking at the need in that region, there are quite a number of factors. I'd be glad to provide you the full matrix outside of this meeting.

Thank you. And thank you to the various segments for also talking about the various projects and planning, the UC system and CSU as well. Obviously, as the Chair's just trying to find, there's an urgent need out there for additional student housing. The students that stay on campus have much higher completion rates and success rates, and so it's a very challenging budget year. But anything that we can do to continue to amplify these efforts is critical going forward. So look forward to continuing the conversation on how we can support the Revolving Loan Fund and the housing here. Thank you, Mr. Chair.

Thank you, Mr. Fong. Again, we'll hold the item open and certainly ask that you think about some of the questions that we've posted about how potentially an alternative program might still lead to successful implementation of more housing.

You're all working hard on. So thank you. Appreciate your work. We will move on to issue number five, which is also housing, but this is the student housing grant program. We will discuss that program and its specifics. We have again the same panel. We'll start off with the Department of Finance.

Alex Anaya with the Department of Finance for theHigher Education Student Housing Grant Program. The Governor's Budget continues to support UC and CSU and community college projects that were approved in the 2022-23 budget acts specifically for the UC and CSU. The Governor's Budget continues to support the approach of providing debt service funding for approved UC and CSU projects that will be funded with UC and CSU issued revenue bonds, rather than providing General Fund grants for those projects

For the community college, the 2023 Budget Act also reverted prior and planned General Fund support for approved community college projects with the intent to develop a statewide lease revenue bond or other statewide financing approach by the 2024 Budget act. The administration remains committed to a statewide lease revenue bond approach for approved community college affordable student housing project at the Governor's Budget and is developing a trailer bell language proposal for consideration at the May revision that would establish a statewide lease revenue bond program.

This concludes my remarks, and I'm happy to take any questions at the appropriate time.

Thank you. The LAO.

Jennifer Pacella, LAO. So there's lots of student housing projects before you. At UC the state over the last three years or two years, approved eight student housing projects, including three intersegmental projects. Of the eight projects, two remain in early planning phases and no associated bonds have been sold. At CSU, the state approved 12 projects, including one intersegmental project. Of the 12 projects, eight remain in earlier planning phases or design phases.

Despite the CSU projects, those eight being in preconstruction phases CSU has sold University bonds for nine of the 12 housing projects. CSU sold some taxable bonds for some of those taxable bonds for some of those projects. As you know, taxable bonds come with higher interest rates than tax exempt bonds. One of the reasons that they were sold as taxable is because some of those projects were still in earlier planning phases so that they couldn't draw down the bond proceeds within the required time frame for tax exempt bonds.

So, given the state's projected budget deficits, we recommend pausing those five projects that either aren't in construction or for which University bonds have not yet been sold. Those five projects total 455,000,000 in state project costs, including, I'm sorry, with 34 million for associated debt service all of the projects have near term costs and that there's a cost to develop the facilities and longer term costs and that there would be new facilities that would require maintenance and renewal over time.

So the objective again, of pausing these projects would just be to help with the state budget situation. That projects could be revisited moving forward. The Legislature also could consider closer oversight of CSU projects. I'd note that one of those projects that could be paused is the San Jose Project, which has been converted from a new construction to a lease arrangement after the state approved the project. So that would be again more problematic.

On a related issue, for both UC and CSU capital projects, the state took a different approach last year where it provided the segments with funding for debt service before the actual debt service costs were incurred.

So because UC and CSU, it'll take them a few years to sell all of the bonds, and because the state might have just over budgeted for some of these debt service costs because it was having to make estimates a year ago, we think there's about tens of millions of dollars one time General Fund savings that the state could achieve over the next few years if it just aligns state funding with those actual debt service costs.

It's just a near term solution until both segments have fully sold bonds for those projects. Lastly, turning to the community college projects, under the Governor's Budget, there's 13 projects that would become part of a new state lease revenue bond program. The administration, as you heard, has said at May revised they'll present a proposal before you that will explain the design of that new program.

Designing a new program could be somewhat complicated, so we'd encourage the administration to give you the proposal as soon as possible and for you to allocate some time to actually study the proposal and figure out what kind of new program you want to provide. The last time the state provided a lease revenue bond for a community college program was in 2008.

So more than 15 years ago. The reason it stopped providing lease revenue bonds is because the process was rather administratively complex and at least one community college failed to meet a loan disclosure requirement. So the state's credit rating is based on upon its total collection portfolio of projects, including whatever community college projects are added. So the state was hesitant to keep issuing new bonds for community college projects.

So we would just encourage you, when you do get the proposal for designing a new state lease revenue bond program, that you take some time to try to avoid those potential pitfalls that the state experienced in the past. Thanks.

Thank you. The UC System.

Thank you, Chair Alvarez and Members of the Committee. Saya Vertenon for the University of California I want to thank the Legislature and the Governor for funding the Higher Education Student Housing Grant Program that has helped our students tremendously. With the help of the funding received, the University of California is currently building 3,592 new student housing beds. These projects are currently going well, and only the UC Berkeley People's Park project has an unknown timeline for opening for students.

In addition, the University is also partnering with three community colleges to build a total of 2,655 student beds in campus housing that will include both UC and community college students. These projects were also made possible by the Higher Education Student Housing Grant Program. The University is also using traditional lease revenue funding to build additional student housing, including the state grant fund projects.

The UC campuses are going to be opening 4,736 new student housing beds this coming fall, and we will complete another 11,000 by fall of 2028. The University of California is committed to the compact, which seeks to increase student access, success and affordability, and we see housing availability as an important part of the affordable education. A compact working group on housing has been meeting twice a quarter to discuss student needs.

The working group consists of both campus staff and student representatives, and the University continues to look for possible locations and financing for even more student housing projects. As our campuses grow, we want to increase the housing options for our students. Thank you. I'm available for questions.

Thank you. Community College.

Thank you, Chair Alvarez and Subcommitee Members. I'm Wrenna Finche, California Community Colleges Vice Chancellor of College Finance and Facilities. Thank you for the opportunity to provide an update on the affordable student housing program this morning. Again, we've talked about the need at California Community Colleges and how excited we were for this grant program. To date, through the first two rounds, we have 19 approved projects.

One is complete and occupied at this point, and 18 are in progress with estimated completion dates between as early as this summer through fall of 2028. Some of the challenges that our community colleges have faced is the transition and the uncertainty around shifting the funding to a statewide lease revenue bond.

And along with that, we've been very grateful to our partners at Department of Finance for providing a lot of early information and having an opportunity to meet with them and their bond council to work through some of the very weedy details in this complex program. So we're in the process of working with them on that. And another challenge that community colleges are facing is significant cost overruns.

Many of the district projects that have not broken ground yet have been taking kind of a wait and see approach to available funding through the statewide lease revenue bond, and at the same time, we're facing a lot of inflation. So those cost pressures are very real. But we really appreciate and thank the Legislature and the Administration for their continued commitment to providing affordable student housing for our students.

Thank you. Does the CSU System want to share testimony?

Thank you, Chair Alvarez and Members. I'm Paul Gannoe with the California State University Assistant Vice Chancellor, capital planning, design and construction. We currently have about 61,000 beds in our student housing portfolio, which provides beds for 14% of our student body. In our five year capital outlay plan, we have another just under 10,000 beds planned over that five year planning horizon.

In addition to those as part of the Higher Education Student Housing Grant Program, we have about 5,200 beds either in construction or in various states of planning, and 3,700 of those will be listed as affordable, and the remainder will be standard rate beds. We really appreciate the funding we've gotten through the grant program. It's going to have a lasting impact on our system and our students, and I'd be glad to answer any questions.

Thank you. That's everybody. Yes. Thank you very much, all of you. I was just sharing with our consultant that it technically, I guess, is a grant because the state is covering, but it's more of like a bond from the state's perspective, because it's ongoing expenses. Hopefully we don't confuse people, but let me try to again acknowledge the difficult challenge of our students and what this is trying to address and appreciate that, but trying to understand exactly where we're at-

So there are five UC projects that are utilizing this funding? 11 CSU projects, and they're all required to provide the affordable beds as defined. Five for UC? That's correct. And 11 for CSU is correct. And then there are three UC, in addition to the five UC, there are three UC community college joint projects. And then is there one CSU community.

One of our 11.

One of your 11. So while for UC it's in addition to the five, there's three. Yours is one of the 11 is a joint partnership. Okay. So in the report, we've got those projects listed, and these are 3,900 affordable beds in this UC system, UC and Community College joint partnerships. So those eight total projects at the CSU, it's 3,600 beds, again, to address specifically the numbers. And then we've got this other proposed.

Well, not a proposal yet, but we will be seeing a proposal for the Community College. And I guess what I'm trying to understand, and I could have asked this before, but I didn't get a chance-to Department of Finance, how large is the upcoming proposal for the community college? Revolving? No, not revolving Loan Fund, the grant Fund. This specific Fund for community colleges. What is the total amount?

Alex Anaya with the Department of Finance. Don't have the number with me right in front of me, but I believe it's roughly 800 million that would get shifted from General Fund support and would be turned into the statewide lease revenue bond program. But I can follow up with the correct number with your staff.

Appreciate that. And so the projects that we've got listed on page 24 to our Community College leadership here, those are projects that were already funded in previous years, or are these the ones that you look to fund in the upcoming year?

So I apologize. This is page 24, the approved projects.

Actually, you can let me know if this is helpful. So you see 16 Community College projects here. The state originally funded them. I'm remembering perhaps incorrectly, but about a billion in cash. That's why we called it a grant program, got converted into debt last year. Of these listed programs, three of them, the Napa, Santa Rosa and Imperial Valley, the Administration is proposing to fund them with the debt service funding that was in the 23-24 budget.

The 23-24 budget included about 61 million in General Fund ongoing for debt service. And the administration's proposal is that these are not very good candidates for a statewide lease revenue bond program. So the state would just fund them with cash in 23-24. In 24-25 this new state lease revenue program would be designed, but no projects, none of the remaining 13 projects would actually have gone all the way through that process and to market to incur any of the debt service.

So actually what the Administration is proposing is that that 61 million ongoing in your budget is actually just taken out for 24-25 because you won't need it and then they'll put it back in the budget as those 13 projects start incurring debt service. The additional confusion perhaps, is that that cash that the state put out into the field in 22-23 is not going to be rescinded until the state sells the bond, has the cash, and sort of replenishes its own coffer.

So those projects that did get money in 22-23 even though the accounting for it is different here at the state level, they can proceed with their projects locally. I'm hoping that helps. I'm sorry if it didn't.

I'll be really honest, I'm still a little-

I lost you somewhere through it. Okay, I'm sorry.

I'm confused? Not because of what you said. I just tried to follow. There were a lot of moving parts of what was and what it's become and the three taken out. And I guess maybe for our conversation of, on a going forward basis, we have a $61 million repayment, essentially, of these bonds for the three campuses that you mentioned.

So for 23-24 those three that just don't meet the criteria for a state program would get cashed and proceed with their projects. They're sort of unaffected by anything the state has done over the last few years now because the money is ongoing. It is like in the budget before you. So the Legislature needs to decide what to do moving forward. The Administration is proposing to take it out, but it is in your, I mean, you can choose what you want.

If you do create a state program, it is likely that these projects will not have time to go through that new program and actually go to market. So we agree with the Administration you're not likely to need any General Fund in 24-25.

Okay. So to our Community College System that is hoping to help support students with more housing, what was just stated, and I think it's the administration's position, is that those projects won't be able to come to fruition, at least not in the next year. What is your expectation?

Well, they could get started if they're able to locate interim financing or bridge financing between when the bonds get issued. And so that was one area where we were looking at the potential of the student housing revolving loan fund as being a potential option there. But that's going to be, again, a decision at each campus.

Each of their board of trustees is going to have to consider what their other available local funds are, whether there's an appetite for a local bond, as opposed to participating in this project, if they have other matching funds. So the round one projects that were awarded in 22-23 received funding, but none of the projects that were approved in 23-24 received any cash for this.

So they're the ones that have probably the biggest decision ahead of them on how they could possibly finance to get started while we wait for the lease revenue bond to get moving.

Please remind me, I could be incorrect about this, but I thought during last year's conversations in this Committee and just in the budget overall, and again, I could be incorrect about my recollection of this, that there was statements made that we would essentially find a way to make sure that these projects move forward. So we encouraged community colleges and certainly UCs and CSUs, everybody, all the segments, to continue to move that. Do you recall if that was your understanding?

That's definitely our understanding that the Legislature and the Administration made a commitment to make sure this would happen. And so those are the details that we're working through.

Okay. All right. I'm still not entirely clear on how that is actually going to occur, given the feedback that I've got. So I might be spending more time personally myself trying to understand it. I'll turn it over now to my colleagues. Mr. Fong.

Thank you, Mr. Chair. And this is a follow up to our Community Colleges. Thank you for mentioning the overview. And also in the report, it says $81 million available for community college projects. Is there a criteria that's being used to prioritize that funding?

So the ultimate decision on how to use that funding is up to the Legislature. We had the round three applications. Those are the 30 applications that you had mentioned earlier, totaling about 1.6 billion in need, and that would have offered well over 6,700 low income beds. So those are the applications we received for that 81.3 million. You can see that that amount wouldn't go too far. And ultimately, it's whether any of those projects are approved is.

We've offered you those that we felt scored the best according to the statutory guidelines that you gave us. And ultimately that decision is up to be decided throughout this budget season.

Thank you. So just for my clarification, again, so it's the 30 projects, over $1.6 billion in projects, and that was just from last year's funding cycle.

These are applications that are requesting funding in the 24-25 cycle. That was going to be our third and final round of the grant program as it was originally designed.

And when we have the rankings here. So it's Kern, Contra Costa, Victor Valley, a lot of districts here. And so is there like a scoring metric on this or is that a separate document?

It would be a separate document. And again, I'm glad to provide the scoring matrix. It's pretty long and thorough, and it considers things such as how many beds, what the actual cost of the bed was, how affordable it was, what the state cost, know regional need in that district, and many other factors.

Thank you. And this question is for the Department of Finance. We heard a conversation also on the statewide lease revenue bond for the community colleges. Is there any additional details that you can share at this time?

Alex Anaya with the Department of Finance, I'll just echo and restate that we haven't faced any difficulties so far at the Governor's Budget, we identified three out of the sixteen approved projects, and we thought they were more appropriate to be funded directly using the current year appropriation, which is the 61.5 million for the remaining 13.

We continue to work with our colleagues over at finance and the legal Department in capital LA, but any more details will be forthcoming about the statewide lease revenue bond program at the May revision.

Thank you. Appreciate that. Look forward to continuing the conversation there as well, and finally to our Community Colleges. Again, in terms of the projects that have been requested, are there any opportunities for housing for student parents? We just heard in our last panel 45,000 student parents could be potentially impacted by financial aid opportunities and Cal Grant reform. In terms of the housing projects that have been solicited, are there any projects dedicated towards student parents or otherwise non traditional students?

I've certainly heard anec.ally there's interest in that, but as far as if any of those particularly chosen or recent applications had student housing incorporated, I'll have to get back to you on that one.

Okay. Thank you so much, Mr. Chair.

Thank you, Mr. Fong. Thank you to the panel. Appreciate your work, all of your work on creating housing opportunities for our students. We will hold this issue open as well, and we'll move on to our final panel for today, which is student basic needs. We're going to discuss the basic needs funding and programs at the three segments and also get a report from the Department of Social Services for 2023 on improving college students access to the CalFresh Program.

So I want to thank again the three segments for being here and also the Department of Social Services for being here. I think, unless you feel strongly otherwise, maybe we should start with the Department of Social Services to get that report on last year and then ask the segments to provide additional input, if there is any. We'll kick it off with the Department of Social Services.

Great. Good morning, Mr. Chair and Members. Jennifer Troia, I'm the Chief Deputy Director of the California Department of Social Services. It's good to be here with you this morning. I appreciate your interest in these important issues. CalFresh is the largest food assistance program in the state. We have 5.4 million recipients of that program. You asked asked a question in the agenda about the number of students participating in CalFresh. Our data reflects 160,400 students participating in the CalFresh program.

We do also now publish that data online in a dashboard that's publicly available. In California, CalFresh is state supervised by our Department, CDSs, and administered locally by 58 county human services agencies. The eligibility standards and the benefits levels, however, are established by the Federal Government. Federal rules regarding student eligibility for the program are complex and the details are outlined in your agenda. But generally, students are ineligible to participate unless they meet the criteria for a specific exemption.

In recent years, CDSs and our partners have engaged in efforts to expand CalFresh access to students, including workgroup meetings to identify ways to remove program barriers for students, coordinated efforts with CSAC to directly inform students of potential CalFresh eligibility via letter notifications, creation of a student exemption checklist as a reference tool for potentially eligible students and a streamlined process to approve programs as those that increase employability and therefore qualify students for one of those exemptions.

Your agenda outlines the recommendations of a report that we were required by SB 641 in 2022 to issue. The recommendations include identification of best practices, creation of a decision tree tool, statewide training or partnerships between higher education institutions and counties additional Calfresh Administration funding and automation system improvements. CDSS and our partners, including the Legislature, have taken multiple steps already to implement these recommendations and to support greater collaboration and student access.

I'll summarize briefly a few of those we host a CalFresh student workgroup as a forum for counties, advocates and representatives of the higher education segments to collaborate. The workgroup meets quarterly and frequently discusses best practices. In 2022, we also hosted a higher education liaisons workgroup, which resulted in identification of best practices and recommendations that were shared with all counties, as well as a statewide webinar on best practices.

We're in the process of updating the CalFresh Student Eligibility Handbook, which is the single source of student eligibility policy for counties and partners. The target release date for that is May 2024, so coming soon, we will also host an all county webinar upon release of that revised handbook. The cost of processing college student applications was factored into a reassessment of CalFresh Administration rates for 23-24 which resulted in an additional $160,000,000 in funding for CalFresh Administration that we have this current year.

Efforts for improving automation functionality related to students is also ongoing. So in response to the question in your agenda, we are also open to identifying ways to facilitate more campus and county data sharing agreements. This might include further exploring whether there's a statewide agreement that we could execute, rather than relying on individual counties and campuses to do that. In conclusion, CDSS is committed along with your commitment to maximize access to CalFresh for students who are experiencing hunger and food insecurity.

We appreciate your partnership and support for continuing these efforts, and I am happy to answer any extra questions that you have at the appropriate time.

Thank you very much. Let's start with the community college.

Thank you. Good morning, Chair and Members. My name is David O'Brien. I serve as Vice Chancellor for Government Relations for the California Community Colleges, really want to thank you for convening today's hearing on this critical topic. Last September, under the leadership of our new chancellor, Dr. Sonya Christian, the California Community College's Board of Governors adopted Vision 2030, a bold framework for action for re envisioning the role that community colleges play in providing equitable access to California's economic opportunities.

And that was centered around three goals, providing equity in access, equity in support, and equity in success to all of our students.

And addressing the crisis of basic needs actually falls under all three. The research shows students who are struggling with food insecurity, housing insecurity, or any other basic needs challenges are less likely to enroll, less likely to persist from one term to the next, and less likely to succeed in reaching their ultimate educational goal, whether that's workforce certificate and a training program, transferring to a four year University, or earning that degree.

So I want to first start off by thanking the Legislature, under the leadership of Assemblymember Marc Berman and Members of this Subcommitee, for providing the first ever ongoing state funding to address basic needs on a systemic basis. And it is important to note that, as your agenda notes, until just a few years ago, there was no ongoing state support in the state budget for addressing basic needs issues in community colleges. Or, I believe, in our four year partners, which I'll let them speak to.

So it was standard practice until just around the onset of the COVID pandemic for things like food pantries, diaper banks for student parents, emergency rental assistance, et cetera. All of these practices were purely local decisions and funded entirely with local dollars. Campuses often have to rely on philanthropy and sources of that nature. So I can confidently report to you today that the basic needs funding provided in the state budget is making a difference.

We received an update from our team in advance of this hearing that in the spring 2023 term, based on data submitted by 80 of our 116 community colleges, just over 68,000 unduplicated students are served by campus basic need centers, which is a 31% increase over the Fall 2022 term. The number you have on your agenda is accurate, but that's for the annual year, so I'm comparing term to term here.

Preliminary research, of course, indicates, as noted, a greater likelihood of student success for students who are receiving basic needs support with regards to CalFresh. I want to just give an enthusiastic plus one to everything, my colleague from the CDSS said. The Legislature is understandably very interested in this issue, and our campuses are using those basic needs center dollars for things like Calfresh application support and assistance, engaging with CDSS and other partners on the work groups and forums that were mentioned.

But as we've discussed, and as your agenda notes, major structural barriers do persist, and I'll just highlight two of them, one of which has already brought up the data issue. So, as your agenda notes, only a handful of our colleges have been able to sign those data sharing agreements with their counties. I believe we have one college, Compton College, and then the Contra Costa Community College District in the Bay Area.

The Legislature did take a big step forward in this regard with the passage of legislation in 2022 is Assembly Bill 2627 by Assemblymember Bauer-Kahan. But that bill made the data sharing agreements optional, not mandatory.

And one option that, again, my colleague previewed there that we've been sort of floating internally and may want to take those discussions to the next level for considering is some sort of statewide MOU or agreement to sort of avoid the complications that come with 58 different counties and 116 different community colleges, as well as CSUs and UCs all having to ink their own separate agreements.

The last structural barrier to mention, and I know it's something that's sort of out of our hands as a state, but it is important to continue to mention and highlight, are the federal restrictions on snapped eligibility. So the restrictions around the number of hours a student has to work or the various sort of exemptions they get are collectively known by advocates as the student eligibility rule. And those do seriously limit the number of students who would otherwise be eligible for CalFresh, which is known as SNAP.

At the federal level, the California community colleges system, our faculty and our students all participated in a major advocacy trip to Washington, DC last year, met with both Biden Administration officials and Members of Congress to discuss this, and we are united in calling for these arbitrary and discriminatory restrictions to be repealed entirely.

And we support legislative efforts at the federal level, like the EATS Act by California's own Congressman Jimmy Gomez, or the BASIC Act by Congresswoman Norma Torres that would open up eligibility drastically for SNAP and CalFresh. Happy to take any questions and appreciate the support of the Legislature. Thank you.

Thank you. We'll move on.

Good morning Chair Alvarez and members. My name is Ray Murillo. I'm the interim assistant vice chancellor for student affairs, equity and belonging at the California State University Office of the Chancellor. In the 22-23 academic year, the impact across basic needs teams was seen in the expansion of initiatives to support thousands of students facing food insecurity, housing insecurity, and financial stability. In addition, it also improved their holistic wellness and progress towards their academic goals.

This has been seen in an increase in retention rates and qualitative evidence of improved health and wellness among students. The CSU basic needs teams expanded their food security resources like pantry items as well as the Calfresh application assistance and gave out thousands of emergency grants to students to stabilize their finances and help them stay enrolled.

Additionally, basic needs program supported students in receiving on and off campus emergency housing and long term housing assistance, leading to many homeless and housing insecure students in finding stable housing. In the same academic year, the following numbers of students were supported by basic needs initiatives. 67,594 students were reached into support reached and supported by their campus food pantry and or food distribution services. 22,827 students were assisted with Calfresh applications 1,190 students were reached and supported with on and off campus housing.

12,644 students received housing support through the additional $10 million increase to our basic needs funding. In the same year. 1,538 students were provided housing support through our rapid rehousing program. 198 students were placed in long term housing through the rapid rehousing program. In this year, 68 students who participated in rapid rehousing graduated during that year and then lastly, 7,602 students were supported by emergency funds.

In the fall of 22, the chancellor's office collected a snapshot of students, a cohort size of approximately 20,000 who utilized basic need services. While it was too early to make any definitive conclusions about the direct or corollary effects of these services and supports may have had on the students academic persistence and graduation rates, it was promising to see that the vast majority of students, 90% undergrads, 86% graduate students, stayed enrolled and persisted onto the following terms.

CSU has also seen an increase in GPAs for students who received basic need services, 3.3 GPA versus a 3.0 for the general student population. The chancellor's office is encouraged by the cohort size of 20,000 students and the economic, ethnic, and gender diversity of the cohort to continue the study. The impact the chances office collected another snapshot of students in fall 23 to perform the same analysis which is underway. The following few campus case studies further elaborate the impact on basic needs programs.

The overall semester to semester, that is, fall 22 to spring 23 retention rate for all students at Cal State Channel Islands who utilized basic needs services was 92.7% compared to 89% overall for students who did not utilize basic need services during the same academic year. First year full time students persistence rate, that is, fall 22 to fall 23, was 79.4% for those who utilize basic need services as compared to 73.4% for those students who did not.

And with new transfer students from fall 22 to fall 23, there was a 95.3% of those students who utilized basic need service persisted in that year compared to 84% of those who did not utilize basic need services. The institutional effectiveness and research at CSU East Bay reports that students who received emergency financial support were less likely to stop out after receiving funds across underrepresented student categories. Of latinx students who received funds, only 14% stopped out compared to 23% of latinx students overall.

Of black students who received funds, only 3% of students stopped out compared to 29% of black students overall, and with Asian students who received funds, only 6% stopped out compared to 20% Asian students overall. An annual evaluation survey was distributed to students who accessed basic needs services at Cal State Stanislaus in the academic year of 22-23 69% of the CSU Stanislaus students surveyed indicated that they strongly agree or agreed that accessing basic needs programs helped them stay enrolled.

The same percentage of students also agreed and strongly agreed that basic needs services helped them towards graduation. An 81% of the students surveyed indicated accessing campus basic needs programs improved their stress levels. Cal State Stanislaus also analyzed their retention rates and found that for the first year, first time students one year retention, there was an 83.7% retention rate for those who accessed basic need services versus a 76.9% retention rate for those who did not.

And among the first time transfer students one year retention, there was a 90.8% retention rate for students who access basic needs versus the 85.8% for those who did not. Again, the CSU is encouraged by the positive impacts that the basic needs services are having on our students. This concludes my report and I'm happy to take any questions or provide feedback at the appropriate time.

Thank you very much. UC system.

Thank you Chair Alvarez and members of the committee. My name is Genie Kim and I serve as the systemwide director for student mental health and well being for the University of California. The work that we've been able to accomplish at the University of California for students basic needs is commendable. In just under 10 years, each of our UC campuses has established critical services and supports to meet students basic needs. In 2022-23 our campuses served 78,000 unique students.

It's important to note that according to research conducted by the California Policy Lab, 31% of UC undergraduate students, so roughly 68,000 students and 6% of UC graduate students, so roughly 3000 students were eligible for Calfresh benefits. To me, this number indicates that the students we're serving is right on target. The financial support that we have received from the state has been critical to the success, and I want to thank the legislature for your support.

Also, acknowledge, sharing and support that we receive with our colleagues from the CSU as well as the California community colleges has been integral to our success. I have worked in the field of student basic needs for over 10 years, and I've seen firsthand the tremendous work that each and every one of our campuses has put into establishing critical basic need services for our students.

Day in and day out, our campus leaders, practitioners, peer educators, and students are reducing the stigma and shame of seeking support and normalizing access to healthy, nutritious food and safe and secure housing. When a student enters one of our basic needs centers, they are met with kindness, compassion, and empathy. They are also met with a sense of belonging and dignity.

And I might be biased, but I have one of the best jobs because I get to know each and one of our campuses intimately and the incredible work they have done to support our students. Many of our campuses have developed creative local partnerships on and off campus to support a holistic basic needs strategy. In addition, we're beginning to see regional partnerships grow, which are the heart and soul of this work.

We just hosted the California Higher Education Basic Needs Alliance Summit along with our other public higher ed segments a few weeks ago, and it was re energizing to be amongst leaders and champions in the field who care so deeply about student basic needs. It was a tremendous opportunity to learn from each other and develop evidence based, community fine programs and practices that continues to inform this work.

For example, our campuses continue to innovate and develop creative solutions such as pay what you can mobile food trucks at UC Davis, which has reduced stigma and accessibility challenges and quite literally brings food to hungry students. However, one particular area of importance that has been our close relationships that we have built with local counties as Calfresh enrollment remains our number one strategy to ensure students have access to regular, nutritious food.

Campuses have partnered with the Center for Healthy Communities at CSU Chico to conduct regular Calfresh outreach efforts, coaching and counseling students through application processes and helping students navigate complex processes. I'm grateful to see that our California Department of Social Services Department is here with us today, because without county partners and county liaisons to support Calfresh enrollment, our students would not be able to focus on their studies, their work and persist to graduation. Each element of the food access supply chain is critical in meeting our students' needs.

Meeting students' basic needs is more than just addressing food insecurity on our campuses, and the UC has been working diligently to build an ecosystem of financial stability for our students. You heard testimony earlier from my colleague Sean Brick from student financial aid. The UC is committed to ensuring students not only have access to financial aid, but the UC continues to assess the cost of attendance and more importantly, producing debt free pathways. Basic needs and financial aid are intricately connected thank you for your time.

Thank you. And thank you all for the work that you do on supporting students at the three segments. Clearly you're passionate in your purpose and so really appreciate the work.

I think the question that stands out really is what was mentioned from the department and also from the community college perspective, which is this idea, which it sounds like maybe UC has figured it out a little bit better, or just trying to assess here data sharing to ensure that the counties are working collaboratively, and then the concept of a statewide MOU to facilitate this work even further and hopefully reduce some of the barriers that you have and certainly hopefully also some of the challenges which require your attention and focus on trying to figure out the system rather than serving students, which I know is what you want to do.

So I like to learn more about what conversations have happened in the past. Certainly heard the testimony about the bill which makes the collaboration optional. Doesn't sound like maybe too many folks have taken the option at this point a couple of years since the legislation. And from DSS perspective, what would a statewide MOU look like? What would that require?

So I know that's a lot of questions, but it's all around the issue of data sharing and making sure that you have access to information and can share information. So maybe I'll start with DSS and then if anybody like to chime in, I'd like to hear your perspective.

Sure. Happy to respond. I think I highlighted some of the areas where we have close collaborations, and I think we each did in terms of spaces that we've created for that collaboration, and we're very appreciative of those partnerships. The data sharing aspects in particular at this point have mostly been the individual counties and campuses who have been doing that.

To my knowledge, we have internally, and it sounds like perhaps we've been having parallel internal conversations, but not yet connected with each other, asked the question of, could there be a greater efficiency here? Sounds like you also came to the same question to ease this. And rather than everyone having to build those individual relationships and draft those individual MOUs, is there something that we could do at the statewide level?

Our initial process for that has been to reach out to our legal counsel internally in the department and identify whether there are any barriers to that or whether that is something that is indeed already authorized and allowable. So that's a process that we're engaging in right now as a sort of initial step.

And if that is answered in the affirmative, then I think we were planning to have that conversation and reach out to then have further conversation about what you're asking, which is okay, assuming that it's authorized, what would it take?

Okay. Anything else any of you would like to add on that? Yes.

Yeah. I didn't address it in my comments, but wholeheartedly agree with the barriers, the structural barriers of Calfresh. So Calfresh has really become this staple program for us to address the long term food insecurity strategy, and we do a lot of work on outreach in the Center for Healthy Communities at Chico State is our hub for the grant, the state grant.

In doing this, what we don't have is the information about the students ultimately being enrolled in the program. Some campuses have, in fact, negotiated data sharing with the counties, but it is a laborsome process to go county to county, and some of our campuses are multiple counties, given the population of the students, which adds to the complexities. So with that said, we certainly, at a minimum, would like to have.

And what we found also working with county to county, is that there's inconsistencies on what the county's understanding of what they can and should share with us. So our minimum ask would be that there would be guidance, given statewide guidance to the counties to help process that, but certainly would love a statewide agreement that would help facilitate this in one shot, and we'd certainly open to that discussion.

Okay, sounds like you're all open to that, and certainly again, with your mission of serving more students.

So we'd be interested in hearing follow up from the department once you get your legal counsel opinion back, and just to keep us apprised of what steps need to be taken so we can continue to be supportive of this work.

We'll be happy to follow up with you.

Thank you, Mr. Fong, do you have some questions?

Thank you so much, Mr. Chair. And thank you so much to all of you for your leadership and efforts around addressing basic needs, rapid rehousing, and really looking out for our students to UC system. I noticed that when I was reading the report on page 29, it says seven campuses currently offer EBT. Two additional campuses plan to soon offer EBT programs. What are those two campuses and when will they be online for EBT access?

I don't specifically know the two campuses, but I know some of the challenges and barriers for our campuses to offer EBT on their campus includes the application process to offer it. Individual folks are required to provide their personal Social Security number in order to, and these are, I would say, really old application efforts back in the day when different mom and pop shops were required to provide a lot of different background information in order to provide EBT.

And so when we think about a college campus providing EBT on a campus, it's still tied to that individual person to apply for EBT and provide their Social Security number in order to provide the EBT access. And so that has been one of the biggest barriers and we have some national advocates requesting changes in legislation related to that.

Thank you. If you can get us the two campuses it really cures to see what those two are really would encourage to see what we can do to get those campuses on board sooner than later. Secondly, on page 30, this is for UC system as well. On page 30 of the report on figure five, when we look at the emergency housing category, I noticed that UCLA is the only campus that does not offer emergency housing. Is that correct?

They offer options in terms of referrals to local community resources so they do not offer it on campus.

So there is an alternative pathway towards local community resources.

Correct.

In case any student needs emergency housing. Okay, thank you. This is for our community colleges. In a report, it noted that 77 community colleges offer basic need centers by 2022 and we anticipate all campuses having basic needs centers by 2023. Do we have an update of every community college has had a basic need center implemented by them?

So the most recent data I have is that I have percentages, not numbers of colleges. I apologize. But two thirds of colleges report having a fully operational and basic needs center. 29% report already having had one prior to the funding and using funds to expand or upgrade their current one. And then 4% have one and are investigating the option to expand their centers. So they all either have one or had one and are using basic youth center funding to expand it and offer more services.

Just over my clarification, every community college has a basic need center.

Yes, a minor wrinkle there is. They may not all use that terminology. Right. It's kind of different, especially for the ones that had them prior to the funding. So they may sort of centralize those operations within or adjacent to their food pantry or their student center, student union. They use different terms, but they're all using the funds to provide basic needs services through a single on campus center as required by the statute.

Okay. And with the community colleges, with the tremendous work that they're going to serve, basic needs of students there, it's really, really critical. And I've taken a tour of some of the basic needs centers at Rio Hondo and East La College and community colleges and Valley College as well in the Southern California area. Lastly, this is to all the segments and all the presenters here today. And this goes back to how we continue to ensure access to this program and folks knowing about the services.

So our materials included an orientation, campus emails. How are we doing our work to get the word out to all the folks that are eligible for these services?

Yeah, so the outreach is key to the basic needs services, Calfresh and so forth, especially since we have a whole large cohort of students entering every year that may or may not know that we have the services. So, to your point? Yes.

New student orientations, basic needs coordinators, directors, partner with programs like EOP, the Educational Opportunity Program, foster youth dream centers, project rebound. All of these support services we partner to help tap into and make sure that their respective students are aware of all these services. Also, many of the campuses also have faculty member put on their syllabi, information about basic needs, housing, emergency grants and so forth. So they get it in that regard as well.

But it's a constant flux of outreach, tabling at events and so forth.

Thank you.

Yeah, I'll just add, I think the outreach component is what has truly made these programs successful on our campuses. I will say our partnership with the financial aid office to get a standard letter out to our students who would qualify for Calfresh has also been critical to the work that we do. And so strategies like that have really been beneficial to reaching to our students.

Thank you.

I'm sorry, I was just going to add that in addition to our partnerships with the segments, we do conduct outreach that we fund through federal funding for Calfresh and through our contractors and subcontractors. One of the target populations for that outreach has also been students. So we have a contract with an agency called the Rescue Agency and we've conducted some really tailored campaigns.

We did focus groups to identify what are the current barriers to participation or stigmas that exist and what messaging works the best to address that. We had 80% of college students who viewed those campaigns actually click through to begin an application. So I think we've had quite a bit of success, and we continue to receive federal funding every year for that outreach. That is in addition to what happens from the segments.

Thank you.

I would just highlight that it is happening extensively through things like orientation, other things at community colleges, which obviously have a somewhat different character due to the nature of the student population at community colleges. So we've identified best practices for our colleges and we're working through an internal community of practice to kind of push those out to other colleges, those strategies that are working.

One that my CSU colleague highlighted is that faculty information on the syllabus, that is time and time again we find that faculty are so often seen as a trustworthy source for students, even when sometimes, to be frank, the campus administration may not be. So having that, there can be very helpful and effective.

A key catch is that, at least in our system, because it relates to curriculum, the syllabus is considered part of the curriculum that has to be negotiated through each district's collective bargaining agreement for that to be on the syllabus. So that's a process that may take some time at our system, but we've definitely identified as a very effective practice.

Thank you so much for sharing best practices and amongst systems and how we can continue to elevate and expand these opportunities for our students. Really appreciate the work and efforts. Thank you so much, Mr. Chair.

Thank you again. Thank you all for the work that you're doing. Looking forward to helping you be more successful. So with that, we will go to our public testimony. Please come forward. We will give you 1 minute.

I will also remind all of you that we now have public testimony available at the beginning of the meeting. If you want to provide your testimony on the front end, you're welcome to do that at this committee in the future. But with that, we will start with our public comments.

Good morning, chair and committee members. Mary Washington with the Cal State Student Association representing nearly half a million of CSU students. Our students have spent five years now advocating for Cal Grant reform, and while we understand the tough budget outlook, we want to ensure that there are meaningful steps taken toward full implementation this year. I appreciate the commitment made in the 2022 budget, and thank you, Chair Alvarez and Assemblymember Fong, for your commitment to this issue.

Additionally, affordable housing and basic needs also remain a priority for our students, and we look forward to continuing to work with you all to comprehensively address these issues. Thank you.

Thank you.

Hello. Good morning. My name is Trinicia Jones and I'm a former foster youth attending Sacramento State. The significant difference in my situation due to being in foster care with no support, the Cal Grant and Middle Class Scholarship have made it possible to help me in continuing hiring my education and keeping me housed with the basic necessities.

I urge the committee to take an important step towards the Cal grant reform this year so that other former foster youth and other college students have the opportunity to further their education with the support of Cal Grant. Thank you.

Thank you.

Good morning. Samantha Seng with NextGen California and a member of the Cal Grant Coalition, which advocates for our vulnerable low income students and families to have access to higher education. We thank the legislature and the governor for including Cal Grant Reform Act in the 2022 budget. And it's been noted today's discussion Cal Grant reform will have a transformative impact on low income students and students of color, making college a reality for them for the first time.

We also understand the constrained budget landscape this year, and so we respectfully urge the legislature to advance Cal Grant reform in this year's budget by making a meaningful first step towards full implementation. We look forward to sharing our thoughts and ideas with the committee on that soon, and definitely want to thank you, Chair Alvarez and Assemblymember Fong, for your efforts and support around this Cal Grant reform. And thank you.

Thank you.

Good morning, members of the committee. Alex Walker Griffin with Arnold & Porter on behalf of Generation Up in support of the student housing grant opportunity. To the members of the committee, thank you for what you do. As a former member of the California Community College's Board of Governors, we understand the importance of finding student housing, especially when we think about our friends in more rural areas.

And as a current city council member of the City of Hercules, one of the things that worries me is the housing opportunities for my constituents should they choose to continue their higher education journeys. So thank you for what you're doing, and we'd love to partner with you in the future. Thank you.

Good morning. Rebekah Kalleen, on behalf of the Community College Facility Coalition on the student housing item. We want to thank you for your leadership in this space. We know how important it is. We support the higher education student housing grant program. We are neutral on the revolving loan fund program. This is obviously very complex, as you discussed today, so we really want to make sure that those 19 community college projects get successfully across the finish line. The details really matter.

We need to keep the eye on the prize. We would really love to see the detail and the language on the program as it's being developed. We are happy to be a resource as we've been working in this space for a number of years now. The sooner the better. On this. You heard today that the costs of construction continue to rise. What that means for these projects is that the budget is blown right?

And so as costs continue to rise, we will have challenges in delivering the number of beds in successfully delivering these affordable projects. We know we can get across the finish line with your help. We appreciate your support. We thank the Department of Finance for working with us as well on this important project.

Thank you very much.

My name is Wednesday Pope and I'm a former foster youth and current Folsom Lake College student. I'm here to ask the committee to take a meaningful step towards implementing Cal grant reform. I enrolled in college at 17 after taking the CHSPE to exit high school, and I did not have a good high school GPA when entering college due to life and housing instability during my high school years.

Under the current Cal Grant eligibility requirements, I was not eligible to receive any Cal Grant support during my first year of college. The Cal Grant could have supported me in affording housing, food and transportation to and from my classes. During my first few years of college, I struggled with homelessness, food insecurity and didn't do well in school while experiencing these life challenges. I nearly gave up on my education because I didn't have the resources I needed to succeed personally, which hindered my success academically.

I do not want the future of academically inclined foster youth to face the same barriers to success that I did. I respectfully ask the committee to support our foster youth in accessing this financial resource when they need it most. Thank you.

Thank you.

Good morning. Cody Van Felden, representing John Burton Advocates for Youth. I am a former foster youth. I was eligible for the Cal Grant, but many of my peers are not. So I'm here to ask the committee to take a meaningful first step to increase access for all of my peers that are current and former fosters. Thank you.

Thank you.

Thank you. Good morning. My name is Jetaun Stevens. I'm a senior staff attorney with Public Advocates and we're also the convener of the California Affordable Student Housing Coalition. I would like to ask the committee today to protect the Higher Education Student Housing Grant Program and adopt the revenue lease bond proposed by the governor and to fund all the viable projects submitted for the third round of funding.

I also want to note that I really appreciate the conversation today about the best path forward for funding student housing. I think, like Chair Alvarez mentioned, the need is very clear, and I appreciate the ongoing commitment from the chair to solve this problem. Over the past six months, the coalition has spent time doing workshops with students to hear about their housing experience, and the message from them to us has been very clear that there's not enough affordable housing.

And I appreciated the conversation about the pros and cons of the two programs before the committee today. Like you, I'm concerned about the proposal to withdraw the $1.7 billion that was going to fund future student housing, especially given the increase in student housing and security.

Thank you for your testimony. One last comment. Yeah.

Okay. Yes, I would like for you to prioritize affordability for any sort of future housing funding program.

Thank you.

Good morning. Chair Alvarez and Members. Melissa Bardo, on behalf of Ed Trust West, also a member of the Cal Grant Reform Coalition, financial aid has not kept pace with the cost of attendance, and with inflation at sky high levels, the consequences once again continue to hit students living in poverty the worst. Cal Grant reform will make college more affordable and accessible for over 130,000 low income students, many of whom are student parents and students of color.

While we recognize the challenging budget landscape the state is facing this year, we respectfully ask the Legislature to prioritize Cal Grant reform and make a meaningful first step towards implementation. And thank you, chair, for being a champion of Cal Grant reform.

Thank you.

Hi, good morning. My name is Angela Estrada, and I'm with Public Advocates. As a student engagement associate, we believe that students' experiences, and their voice should be shaping the policy that most affects them. Over the past five months, Public Advocates and the California Affordable Student Housing Coalition have held workshops with students across all three segments. Housing is the most significant cost barrier in accessing higher education, and across the board, students have told us that they need more housing and it needs to be affordable.

We ask that the legislature protect and expand the Higher Education Student Housing Grant Program by adopting the state revenue lease bond proposed by the governor fund. All the viable projects that have been submitted in this third round of the program and to prioritize affordability and any future funding appropriated for student housing.

Thank you.

Thank you chair. AJ Johnson with California Competes Higher Education for a Strong Economy in support of three items from today's agenda. Thank you for your leadership on Cal Grant reform. We are in support of that because it would help today's learners, both current and prospective, who are student parents, who are adult learners, who have other responsibilities who might be coming back as they're older. So thank you for that and any meaningful step around housing.

We are in support of the governor's proposed bond solution, and I'll echo what was mentioned by Public Advocate, Jetaun Stevens. We also have submitted comments on the revolving loan fund to just make sure that through those two programs, we're supporting student parents who may not have been addressed in the original regulations and happy to share those. So in terms of basic needs, very much in support of streamlining access to Calfresh and EBT, especially with that state data sharing agreement that would unlock those partnerships. Thank you so much.

Thank you.

Hi, I'm Molly Maguire with the Campaign for College Opportunity. Thank you, chair Alvarez. I just wanted to note two things that we support from today's hearing. One is the changes made to the Cal Grant deadline. We appreciate how quickly the legislature moved on that. And second of all, just want to add our support to the chorus behind me that was advocating for a phased in approach to Cal Grant reform, starting with our most in need students. Thanks so much.

Good morning. Alex Grace, the Association of Independent California Colleges and Universities. On behalf of our 90 member institutions, we'd also like to express our support for Cal Grant reform and appreciate your leadership in advancing those discussions. Also want to thank you and your staff for continuing to highlight the structural barrier regarding the portability of the Cal Grant award for adult learners who are transferring from community college.

As your analysis notes, those students are not eligible to bring the remaining eligibility if they transfer to one of our institutions, and certainly appreciate attention to that as we think about how to continue to make meaningful progress. Thank you.

Chair Members, thank you so much for this great hearing. Tiffany mock with CFTA Union of Educators and Classified Professionals on the first issue. We want to thank you for the discussion of FAFSA and supporting our mixed status families. We support the Cal Grant extension. On the third item on Cal Grants, we wanted to also note that this is why we think General funding is so important and in particularly fully funding the UC compact.

Overall, I think this important hearing highlights why CFTA supports an increase in revenues overall from new sources, including a wealth tax, corporate tax alignment, and also a split role tax. Finally, as we discuss these important issues, wanted to note that we should maintain the supports we have for all our academic resources to ensure that this diverse population will succeed as previous generations have as well. Thank you.

Thank you.

Hello. My name is Joy and I'm current first year and student worker attending the University of California, Berkeley. First, I wanted to thank Assembly Member Alvarez for championing the Cal Equity grant framework. Today, I'm here to advocate for my fellow peers of color, Low income, female identifying students who rely on financial aid accessibility to have the opportunity to pursue our right to higher education.

I'm here to ask you to support the implementation of the Cal Grant equity reform, which provide vital aid expansion to nearly 130,000 low income students while also expanding grant eligibility for over 11,000 Black and 9000 Latinx students looking for access to higher education.

Cal Grant was last updated over six decades ago and with the affirmative action ban, tuition and cost of living increase at CSU's, UC's, and community college, it has become a necessity that the Cal Grant is accessible to all students as a basic human right, removing barriers to entry for students looking to gain access to financial aid is a direct investment in our state's futures.

We are the future of California and in order to continue our work, we need our state to invest and believe in us and our future. Please consider prioritizing the implementation of the Cal Grant reform. Thank you so much for your time.

Thank you.

Good afternoon. My name is Lindsay Duncan. I'm a UC Berkeley student and I'm here to ask that you support the implementation of Cal grant reform by funding the equity framework in the 20242025 state budget. As a Cal Grant recipient myself, I can attest to its importance and impact on the lives of students.

Cal Grant funding helps students shoulder the burden of tuition and the Cal Grant equity framework would ensure nearly 130,000 additional students are no longer forced to choose, for example, between buying books for school and paying for groceries, reducing eligibility barriers for the Cal Grant ensures that more students of color, low income students, undocumented students, and student parents are eligible for this life changing financial aid. The Cal Grant equity framework has already been passed by the legislature.

We're just asking you to follow through on your commitment and demonstrate your support for students by prioritizing funding for this budget item. Thank you, all of you, and especially chair Alvarez for your continued support. Thank you.

Thank you.

Good afternoon. My name is Heidi and I'm a first year at UC Berkeley and as a first generation, Low income Mexican American College student, I depend on the Cal grant to Fund my education at UC Berkeley and I'm so grateful to say that I will be graduating debt free because of the Cal grant. My parents were never able to finish high school in Mexico because of a lack of financial support the government offers there and the lack of investments in education that Mexico invests in.

So I'm really grateful that California invests in higher education, but I'm asking that you continue to prioritize and discuss the Cal Grant equity framework to expand access to higher education. I understand that the state is in a budget deficit, but I want to mention that for every dollar invested in higher education, the state yields $4.50 in return and college graduates contribute $273,000 more in state income taxes during their lifetime compared to a high school graduate.

And funding this framework truly is an investment with a high return on investment. Thank you.

Thank you.

Good afternoon. My name is Sanvi. I'm also a student at UC Berkeley and I want to thank you for your continued support for our basic needs efforts. We recently had the Chebna 2024 summit where all segments gathered in addition to State and Federal Government leaders, community based organizations, foundations and advocacy organizations. We couldn't have accomplished this without your support.

Moving forward, we'd greatly appreciate your support with establishing data sharing agreements between at the state level, across CDSs, CWDA, Calsaws, all three segments, and higher education community based organizations. This sharing agreement will help us track, report and improve the distribution of social services for all college students across California. I also want to echo broad student support for Cal Grant reform. Students continue to face worsening barriers and holistic support is necessary for them to continue to access education. Thank you.

Good morning. My name is Preep Kundu and I'm a third year student at UC Berkeley and I would first like to thank off by thanking you, Chair Alvarez, for really being a champion on this issue. Well, budget is really a vision. It acts as a statement of a vision for the State of California. And if the State of California is serious about creating being a future for all of the United States and having a place where students can go and get jobs pretty easily.

Thank you.

Cal Grant and equity is the way for us to do that. By supporting Cal Grant and equity, we could add 11,000 Black students, 95,000 Latino students and 3000 undocumented students into higher education institutions. With the college degree being a gatekeeper to entering the job market. By making it more equitable and accessible, we can help diversify our workplaces. So please support this and I thank you for your continued support. Thank you.

Hello. My name is Lillia Maturo and I am a first year student at the University of California, Berkeley and I'm speaking in support of funding and streamlining the Cal Grant system through the Cal Grant equity process. And as a student who entirely relies on financial aid to get a higher education, I can attest that clarity in the financial aid process is vital. Expanding and streamlining access to higher education is simply a good decision for everyone. Education is still a massive equalizer for people from disadvantaged backgrounds.

However, access is quickly disappearing and equitable calculate distribution is vital to combating this. Thank you for your time.

Thank you.

Hello. My name is Mia Verdin and I'm a first year student at the University of California, Berkeley and I'm here to ask you to support the implementation of the Cal Grant equity framework. Expanding the eligibility requirements ensures accessibility to a greater population of students. I literally would not be here standing here before you if it wasn't for the Cal Grant. Cost of attendance is both the largest barrier and biggest reason for students not enrolling in college or university.

Limiting that access is barring hundreds of thousands of students from accessing higher education. And with tuition rising exponentially, it doesn't make sense to continue with an outdated framework that doesn't adequately reflect its needs of its students. It also meets the diverse needs of various student groups, including student parents, low income students, students of color, and foster youth. The state has an obligation to its student and there must be an investment in our futures.

We need the expansion of aid in order for our basic needs to be met. We cannot thrive in our institutions if we are struggling to put food on the table. There's a significant correlation between financial instability and the strain of mental wellness on students. So that's why it's imperative that you guys support the implementation of the Cal Grant framework. Thank you for your continued support.

Thank you.

Good afternoon, chair Alvarez. My name is Abby Austin Wood and I am a third year student at UC Berkeley and I am going to agree with all my fellow everyone and say how much we would love to have your support on expanding the Cal Grant like equity framework. I know sadly I'm a transfer and I just got in and also just due to that and some other factors, I think they're just unforeseen circumstances.

I am unable to qualify for getting a Cal Grant and also because of that I've had to take out loans and my mom had to put her future on hold to pay for my education so that sometime down the line she can get her own.

And I feel like honestly, if I had access to the Cal Grant for me and my family, I wouldn't have to stress so much for focusing so hard on trying to understand life and just trying to find my way in this world. So please thank you for your support on this and please do whatever you can to help expand on this for all the future generations to come. Thank you.

Hi Aliyah Sky, professional staff for UC Student Association chair Alvarez. First, we just want to acknowledge you as a resolute champion for Cal Grant reform funding. Thank you for always keeping your questions so focused on students and their lived experiences rather than institutional needs and wants many comments related to everything today in regards to the basic needs piece, we're in support of developing a statewide data sharing agreement to better understand the needs of our students more fluidly.

Share data also want to note that the UC Essential needs consortium, also known as Saya Center for Economic justice and Action, has confirmed that the UC has 18 self operated EBT retail sites across our campuses and they have been working with the USDA EBT retail branch team in setting up a federal streamlined process for reauthorizing existing locations and onboarding new locations to further increase EBT access.

UCSA also supports state action to extend the FAFSA deadline to May 2 in order to ensure vulnerable students, such as those from mixed status families, are able to complete the FAFSA. This obviously provided that the UC moves its institutional deadlines back in line, including its sir housing and school insurance deadlines. And finally, we'd like to see protection for the student housing revolving loan program and obviously funding for Cal Grant reform. Thank you.

Hi, my name is Ximena Anleu Gil. I am a postdoc at UC Davis. I study mace... development as a postdoc and I've been a PhD student or I was a PhD student at UC Davis. So I've been in academic research for a long time.

I've also worked as a teaching assistant at UC Davis and so I feel like I come with multiple angles of experience to talk in support of the specific grants that you're talking about here, but in general in support for no cuts for anything involving UC, CSU sort of grants and investments. Rent burden is something that everyone I know experiences everyone, including from undergrads to UC workers to people like me with PhD's you know.

And it's super important that we are holding the University of California and CSU's accountable because while they're getting money to actually like more student housing, oftentimes those rates are market rates that we cannot afford, you know, when we are presenting solutions, I think also holding our universities accountable to what they promise is really important. So thank you.

Thank you very much.

Hi, good afternoon. Carol Gonzalez here on behalf of Long Beach City College and Hope Espanas organized for political equality, both Members of the Cal Grant Reform Coalition. We really urge the Legislature to prioritize implementation of the Cal Grant reform. We know you're a great leader and champion for that, so we thank you. Ideally, it'll transform higher education access to over 100,000 students, especially those who are low income, BIPOC and student parents. So we thank you for that.

And Long beach also supports greater access to student basic needs and the bond revenue for student housing. Thank you.

Thank you.

Good afternoon. My name is Marcos Montes. I'm here on behalf of the Southern California College attainment Network. First, I want to share about better FAFSA 58 organizations are calling for deadline extensions. We're calling for the April 2 deadline and the registration deadlines to be postponed by at least four weeks. California has the second worst decline in FAFSA submissions this year. We heard it's a 40% decline. It's actually the second worst in the country.

It is very likely the timeline would not uphold for mixed status families, so we need to buy all the time for students. Two additional weeks on the registration deadline is not enough. So we call on this Committee to join us in asking the systems to extend that registration deadline again.

We also call for this Committee advance Cal Grant reform and do everything possible to start implementation of this new framework that prioritizes equity in our financial aid systems and targets our limited funds to the students who need it the most. Thank you.

Thank you.

Good afternoon Mr. Chair Members. My name is Parshan with you aspire, but here also today with the College for All Coalition and a number of other coalitions, but would like to first of all start with thanking you for your leadership in really moving the needle on Cal Grant reform. And we know that it has to take phases and approaches and whatever we need to get done. Let's get it done. And we appreciate you for that here.

Also, to echo remarks from my colleague Marcos, who just spoke about the need to now we're almost there with pushing the financial aid deadline to May 2. So what we are also calling and joining SoCal CAN is calling on the universities to now further push back their sir deadlines because then with May 2 being the deadline, there's only a couple of weeks left.

So it would be awesome and really appreciate it if the legislature could join us in calling on the institutions and asking them to push the sir deadlines back as well. And lastly, I will echo our colleagues from the CASH coalition in supporting the revolving loan fund and especially making sure that those funds are used for housing for family friendly units. Thank you.

Thank you.

Good afternoon, chair Manny Rodriguez. On behalf of Tikis, I'll also note that our partners at the student Center for California Community College could not make it, and they asked to mention them that they align their comments on Cal grant reform and affordable housing with us. Thank you for this Committee hearing on critical topics on Cal grant student housing basic needs and for your supportive comments, Chair Alvarez and Assembly Member Fong, on how important Cal Grant is to our BIPOC low income students in California.

We will note that affordable student housing and financial aid are two essential facets of college affordability. Without adequate investments in both areas, students will continue to struggle with the overall increases of attending college. Therefore, we respectfully ask for a meaningful first step towards Cal Grant reform implementation this year. We align our comments on student housing with the cash coalition. Furthermore, thank you for moving the deadline on financial aid applications and the Legislature for doing that work.

We ask that that is paired with a delay on the SIR dates and that we consider looking at the California Dream act as a option for mixed status families. Thank you.

Thank you.

Hello. My name is Delina, and I'm a second year UC Berkeley student. I want to start off by saying I'm really appreciative that we're having these conversations in places like this. I work at one of the basic needs centers at UC Berkeley, and I see how excessive the need is. And honestly, it's difficult for me to see how much students are struggling and suffering just by just trying to be a student and try to focus on their education, but they can't because of their other needs.

And our center tries to assist our community as much as possible. But I keep on saying we can't do that without wider reforms. We can't support students without more funding for students. And it's just not possible to support them without institutional change. There's always the stereotype that students are just able to have fun and party and do all these things but that's not possible for so many students, especially for marginalized communities, students of color, student parents where it's just like they're struggling to just get by.

They can barely pay attention to their education because they don't have the resources that they need. And I know that the Cal Grant makes it possible for me to come to college. It's the reason why I'm not going into debt the way that I see so many students that I'm hoping with go into debt.

And I really feel like it's important that we continue to have these conversations and we continue to pass reforms that directly support our students to make sure that we can actually even on the community level we can adequately support them.

Thank you very much. Appreciate all of you for your testimony. What with that we are adjourned. Thank you.