Today's Law As Amended


PDF |Add To My Favorites | print page

AB-3086 California Ban on Scholarship Displacement Act of 2020.(2019-2020)



As Amends the Law Today


SECTION 1.

 Article 24 (commencing with Section 70045) is added to Chapter 2 of Part 42 of Division 5 of Title 3 of the Education Code, to read:

Article  24. California Ban on Scholarship Displacement Act of 2020
70045.
 This act shall be known, and may be cited, as the California Ban on Scholarship Displacement Act of 2020.
70046.
 The Legislature finds and declares both of the following:
(a) As of 2020, California students who have financial need and receive private scholarships are unable to make full use of the awards provided to them by private scholarship providers because institutions of higher education reduce their grants, scholarships, tuition waivers, and fellowship stipends which those students would otherwise be qualified to receive. The reduction of an institution’s financial aid due to private scholarships is referred to as “scholarship displacement.”
(b) This act is intended to ensure that private scholarships supplement, and do not supplant, grants, scholarships, tuition waivers, and fellowship stipends provided by institutions of higher education to California students who have financial need.
70047.
 As used in this article, the following definitions apply:
(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) “Institution of higher education” or “institution” means any public or private postsecondary educational institution that receives, or benefits from, state-funded financial assistance or enrolls students who receive state-funded student financial assistance.
(c) “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 student aid programs under Title IV of the federal Higher Education Act of 1965, as amended (20 U.S.C. Sec. 1070 et seq.).
(d) “Expected family contribution” means a student’s expected family contribution calculated according to the federal methodology pursuant to subdivision (a) of Section 69506 as established by Title IV of the federal Higher Education Act of 1965, as amended (20 U.S.C. Sec. 1070 et seq.).
(e) “Financial need” means the cost of attendance minus the expected family contribution.
(f) “Gift aid” means all financial aid designated for the student’s educational expenses, including a grant, scholarship, tuition waiver, fellowship stipend, or other third-party payment, that is not a loan or pursuant to a work-study program.
(g) “Institutional financial aid” means financial aid that is paid for by the institution of higher education from its funds and the recipient of the aid is selected by the institution.
(h) “Private scholarship” means gift aid funded or awarded by a private company, foundation, or non-profit organization, or a public charity or service group.
70048.
 (a) Commencing with the 2021–22 academic year, an institution of higher education shall not reduce a student’s institutional financial aid offer or award for an academic year as a result of private scholarship awards received by that student unless either the student’s expected family contribution is too high to qualify the student to receive a federal Pell Grant award or all of the following circumstances are satisfied:
(1) The student’s gift aid exceeds the student’s financial need.
(2) The institution reduces its institutional financial aid by no more than the amount of the student’s gift aid that is in excess of the student’s financial need.
(3) An institution of higher education shall not consider a student’s receipt or anticipated receipt of a private scholarship when considering a student’s qualification for institutional financial aid.
(b) This article shall not be interpreted or implemented in a manner inconsistent with federal law. The provisions of this article are severable. If any provision of this article or its application is held invalid due to a conflict with federal requirements, that invalidity shall not affect other provisions or applications that can be given effect without the invalid provision or application.