Approve Cash for College Funds and Add Reporting Requirement
Given the anticipated increase in demand for Cash for College workshops, we recommend approving the Governor’s proposal to provide additional one?time funding for this program in 2022? 23-the first year of the financial aid application requirement. In the coming years, as more information becomes available on how districts are implementing this requirement, the Legislature likely will want to consider what ongoing funding level to provide for the Cash for College program. To inform future funding decisions, we recommend the Legislature add provisional language requiring CSAC to submit a report by ‘s activities in 2022?23. This report would include: (1) the areas of the state covered by the Cash for College program, (2) the number of workshops hosted, (3) the number of students participating in those workshops, and (4) the number of FAFSA or CADAA forms completed.
Dreamer Service Incentive Grants
Below, we provide background on the California Dreamer Service Incentive Grant (DSIG) and California Dream Loan programs, discuss the Governor’s trailer bill language proposals to increase DSIG award amounts and redirect any unexpended funds to the Dream Loan program, assess those proposals, and provide associated recommendations.
CSAC Recently Launched DSIG Program. The state created this program in the 2019?20 budget to provide additional nontuition aid to undocumented students receiving a Cal Grant B award who complete a community service requirement. After the onset of the pandemic, the state redirected program funding in 2019?20 and 2020?21 toward emergency grants for undocumented students. As a result, CSAC is implementing the program for the first time in 2021?22. The program provides awards of up to $1,500 per semester to eligible students who complete 150 hours of service (or up to $1,000 per quarter for completing 100 hours of service). The service requirement equates to about 10 hours per week. Part?time students receive prorated award amounts, although they are required to complete the same number of service hours as full?time students. Program participation for both full? and part?time students is limited to a total of eight semesters (or 12 quarters).
DSIG Participation Is Much Lower Than Anticipated. State law limits participation in the program to 2,500 students at any one time-the maximum number that could receive the full award amount without exceeding the ongoing funding level of $7.5 million. In fall 2021, only about 100 students participated in the program. Of these participants, about ten were part?time students. CSAC has identified several possible explanations for the low participation rate, including the availability of higher?paying work opportunities, the availability of emergency grants during the pandemic, and pandemic?related disruptions in service opportunities.
State Also Supports Dream Loan Program at UC and CSU. Chapter 754 of 2014 (S B 1210 , Lara) created the California Dream Loan program to provide loans to undocumented students with financial need. (Undocumented students are ineligible for federal student loans.) Under this program, UC and CSU campuses may award loans of up to $4,000 annually to eligible students. Each participating campus maintains a revolving fund for issuing loans and depositing repayments. At UC, the program is supported by a combination of General Fund (set aside from the university’s base support) and other institutional funds. At CSU, the program is pri?21, about 900 UC students received Dream Loan disbursements totaling $2.8 million, and about 460 CSU students received disbursements totaling $1.5 million. The segments indicate that participation is down from previous years, possibly due to decreased living costs for students who moved home during the pandemic, as well as the availability of emergency grants.
Proposals
Governor Proposes to Increase DSIG Award Amounts… The proposed trailer bill language would increase the maximum DSIG award amount from $1,500 to $2,250 per semester (or from $1,000 to $1,500 per quarter). Under this proposal, full?time students would in effect earn $15 per hour of service-equivalent to the state minimum wage for larger employers. Part?time students would continue to receive prorated awards. In addition, the proposed language would lower the limit on program participants from 2,500 students to 1,667 students at any one time to keep program costs within the current funding level.