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SB-354 California DREAM Loan Program: graduate degree programs.(2019-2020)

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Date Published: 10/07/2019 02:00 PM
SB354:v95#DOCUMENT

Senate Bill No. 354
CHAPTER 526

An act to amend Sections 70032, 70033, and 70034 of the Education Code, relating to postsecondary education.

[ Approved by Governor  October 04, 2019. Filed with Secretary of State  October 04, 2019. ]

LEGISLATIVE COUNSEL'S DIGEST


SB 354, Durazo. California DREAM Loan Program: graduate degree programs.
Existing law establishes the California DREAM Loan Program, which provides a student attending a participating campus of the University of California or California State University with a loan, referred to as a DREAM loan, if the student satisfies specified requirements, including a requirement that the student be exempt from paying nonresident tuition or meet equivalent requirements adopted by the regents, and that the student is enrolled in an “instructional program,” defined as a program of study that results in the award of a baccalaureate degree or undergraduate certificate, or undergraduate coursework in a program of study leading directly to a first professional degree for which no baccalaureate degree or undergraduate degree is awarded.
This bill would, commencing with the 2020–21 academic year, expand DREAM loan eligibility to a student who is enrolled in a program of study leading to a professional or graduate degree, including, but not limited to, a teaching credential, if the student meets the other applicable qualifications. This bill would require the participating institution to determine the proportion of program funding used for instructional programs and for graduate programs. The bill would require that priority under this program be given to loans for instructional programs.
Vote: MAJORITY   Appropriation: NO   Fiscal Committee: YES   Local Program: NO  

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


SECTION 1.

 Section 70032 of the Education Code is amended to read:

70032.
 As used in this article, the following terms have the following meanings:
(a) An “academic year” is July 1 to June 30, inclusive. The start date of a session shall determine the academic year in which it is included.
(b) “Award year” means one academic year, or the equivalent, of attendance at a qualifying institution.
(c) “Commission” means the Student Aid Commission.
(d) “Cost of attendance” means the student’s tuition and fees, books and supplies, living expenses, transportation expenses, and any other student expenses used to calculate a student’s financial need for purposes of federal Title IV student aid programs.
(e) “Enrollment status” means part-time status or full-time status of a student at a qualifying institution.
(f) “Expected family contribution” means a student’s expected family contribution calculated, pursuant to subdivision (a) of Section 69506, according to the federal methodology (as established by Title IV of the federal Higher Education Act of 1965, as amended (20 U.S.C. Sec. 1070 et seq.)).
(g) “Financial need” means a student’s financial need calculated pursuant to the federal financial need methodology (as established by Title IV of the federal Higher Education Act of 1965, as amended (20 U.S.C. Sec. 1070 et seq.)).
(h) “Graduate program” means a program of study leading to a graduate or professional degree, including, but not limited to, a teaching credential, the prerequisite for which is a baccalaureate degree or undergraduate degree.
(i) “Instructional program” means a program of study that results in the award of a baccalaureate degree or undergraduate certificate, or undergraduate coursework in a program of study leading directly to a first professional degree for which no baccalaureate degree or undergraduate degree is awarded.
(j) “Participating institution” means any campus of the California State University or the University of California that elects to participate in the DREAM Program pursuant to the requirements specified for a qualifying institution as set forth in this article.
(k) “Satisfactory academic progress” means those criteria required by applicable federal standards published in Title 34 of the Code of Federal Regulations. A participating institution may adopt regulations defining “satisfactory academic progress” in a manner that duplicates those federal standards.

SEC. 2.

 Section 70033 of the Education Code is amended to read:

70033.
 (a) Commencing with the 2015–16 academic year, a student attending a participating institution may receive a loan under the DREAM Program if the student satisfies all of the following requirements:
(1) The student is exempt from paying nonresident tuition under Section 68130.5, or meets equivalent requirements adopted by the Regents of the University of California.
(2) The student applies for financial aid using the application established by the commission pursuant to subdivision (b) of Section 69508.5, known as the Dream Act Application.
(3) The student is enrolled at least half time in good standing in one of the following programs at a participating institution:
(A) An instructional program.
(B) Commencing with the 2020–21 academic year, a graduate program.
(4) The student is determined by the participating institution to have financial need.
(5) The student maintains satisfactory academic progress at the participating institution.
(6) The student is not incarcerated.
(7) The student is not in default on any federal student loan, state student loan, or student loan issued by the California State University or the University of California.
(8) The student is enrolled in one of the following programs:
(A) A program eligible for participation in the Cal Grant Program.
(B) Commencing with the 2020–21 academic year, a state-supported graduate or professional degree program.
(b) (1) The commission or the participating institution shall require the student to affirm in writing that the student satisfies the requirements of paragraph (7) of subdivision (a).
(2) A student seeking an award shall authorize the commission to access any information pertinent to certify that the student meets the requirements of subdivision (a).
(c) The commission, in collaboration with the participating institution, shall certify that the student satisfies all of the requirements specified in subdivision (a) before the participating institution may issue an award to the student pursuant to this article.
(d) The Legislature finds and declares that this article is a state law within the meaning of Section 1621(d) of Title 8 of the United States Code.

SEC. 3.

 Section 70034 of the Education Code is amended to read:

70034.
 (a) The amount of a DREAM loan offered to an individual student by a participating institution shall be determined by the institution, subject to the following provisions:
(1) The loan may not exceed the financial need of the student.
(2) No student may borrow more than four thousand dollars ($4,000) under this program within a single academic year.
(3) No student may borrow more than twenty thousand dollars ($20,000) in the aggregate under the program from any one participating institution.
(4) The proportion of program funding used for instructional programs and for graduate programs shall be determined at the discretion of the participating institution. Priority shall be given to loans for instructional programs.
(b) The interest rate for loans issued under the program shall be the same as the then-current interest rate for undergraduate loans under the William D. Ford Federal Direct Loan Program (20 U.S.C. Sec. 1087a et seq.).
(c) Except as provided in subdivision (d), the standard repayment term for a DREAM loan shall be 10 years. Repayment shall commence following a six-month grace period that begins when a student graduates or ceases to maintain at least half-time enrollment in a degree or certificate program.
(d) On or before January 1, 2020, a participating institution shall adopt procedures allowing a borrower to select an income-based repayment plan for the repayment of a DREAM loan, in accordance with the standards set forth in the William D. Ford Federal Direct Loan Program for income-based repayment plans.
(e) Interest shall not accrue on a DREAM loan during periods of at least half-time enrollment in a degree or certificate program or during the six-month grace period specified in subdivision (c).
(f) Eligibility for deferment or forbearance of a DREAM loan shall be determined by the participating institution in accordance with the standards set forth in the William D. Ford Federal Direct Loan Program.
(g) Participating institutions shall use a common promissory note, approved by the Treasurer, to issue DREAM loans.