Major expansion of Cal Grant financial aid proposed for state’s college students

Nearly 200,000 more California college students could receive state assistance for tuition and living expenses under one of the largest expansions of the Cal Grant financial aid program ever proposed, according to details released Tuesday.

The plan, unveiled by the California Student Aid Commission and two legislators, would eliminate some current requirements for the main Cal Grant award that favor younger students within a year out of high school who have a minimum GPA of 3.0. Instead, it would broaden access to older students and others not currently eligible.

It would also simplify the program and tie eligibility to the federal Pell Grant, which better accounts for a student’s total cost of attendance, which includes housing, transportation and other expenses. Although the Cal Grant focuses on tuition and fees, it is one of the nation’s most generous college financial aid programs, providing annual support to more than 500,000 California students.

The proposed expansion comes at a critical time for hundreds of thousands of California students struggling under soaring college costs, surging student loan debt and increased financial hardship triggered by the COVID-19 pandemic.

A study by the student aid commission last year found that 70% of 76,000 California college students surveyed had lost some or all of their income due to the pandemic, and that concern over tuition, housing and other expenses had skyrocketed. College enrollments of newly graduated high school students for fall 2020 declined across the nation, including at some California Community Colleges and California State University campuses.

The pandemic only exacerbated challenges documented in a 2019 commission survey that found that nearly two-thirds of California students at community colleges and four-year institutions cited financial reasons as the top obstacle to educational success.

“We really face a serious issue of losing an entire generation of students,” Marlene Garcia, executive director of the commission, said in an interview Monday. “It’s a milestone moment. If you’re in fact going to support the next-generation workforce with the kinds of talent and skills that we need to fuel the 21st century, mostly automated workplace, we’ve got to invest in students seeking some education beyond high school.”

College students themselves sounded the alarm about the increasingly unaffordable cost of higher education Monday, unveiling a national campaign to double the federal Pell Grant for low-income students over the next three years. Student leaders from the University of California, Cal State and California Community Colleges, as well as higher education systems in Oregon, Washington, New York, Minnesota and Georgia, noted that the current Pell Grant of about $6,500 covers only 28% of the total cost of college attendance today — compared with 75% in 1980.

Some students described how they would not have been able to finish college without the federal assistance — and even with a Pell Grant had to work multiple jobs and take out student loans to afford their education.

“It no longer meets students’ needs,” UC Student Assn. President Aidan Arasasingham said of the Pell Grant. “As a result of this decline in federal support, students have seen food insecurity, housing insecurity and debt grow year after year.”

California policymakers are aiming to change that. The proposed Cal Grant plan, laid out in new legislation by Assemblymen Jose Medina (D-Riverside) and Kevin McCarty (D-Sacramento), would significantly expand access to Cal Grants by eliminating key restrictions. Currently, applicants for the main Cal Grant must be low- or middle-income, eligible for in-state college tuition, apply by March 2 within a year of high school graduation and achieve a minimum high school GPA of 3.0.

Students who meet those requirements are guaranteed a Cal Grant. Eligible community college students, whose annual family incomes are generally below $11,000, receive fee waivers under existing state programs and may also receive an annual Cal Grant for living expenses of about $1,650.

Students heading to UC and Cal State campuses whose incomes generally fall below $59,000 are guaranteed grants to fully cover tuition and fees, while those at private nonprofit institutions receive awards of up to $9,084. Living expenses for four-year students are partly covered by a Pell Grant and other forms of aid, student contributions and loans.

Those who don’t meet the requirements — such as older students who decide to return well after high school graduation — are placed in a separate pool to compete for another kind of Cal Grant. But that program has limited funds, offering awards to only about 41,000 of 300,000 eligible students, Garcia said.

The new plan would guarantee grants to all eligible applicants without regard to age, proximity to high school graduation or, for community college students, GPA. For students at four-year colleges, the plan would drop the required high school GPA from 3.0 to 2.0.

Those changes are projected to boost the number of eligible community college students by 124%, from 124,260 to 279,264. The projected increase in Cal Grant award offers to students at four-year institutions is about 30%, from 132,626 to 172,889.

But the average award for community college students would drop by about $400 annually, because the Cal Grant program’s $2.5 billion in funding would be spread out over more recipients, unless Gov. Gavin Newsom and the Legislature increase it. For four-year colleges, the plan could free up more than $100 million in institutional aid currently used to help cover tuition and fees, according to Patrick C. Perry, director of policy, research and data at the student aid commission.

California Community Colleges Chancellor Eloy Ortiz Oakley hailed the plan as an “important first step” but said students need far more support than they are currently receiving.

An analysis by the Institute for College Access and Success found that the net cost of college was higher for California Community Colleges students in most regions of the state than for those at UC or Cal State, because the four-year systems offer more institutional financial aid. Overall, the total annual cost of attendance for community college students ranges from about $17,000 to $24,900 when taking into account living arrangements.

“This is a down payment,” Oakley said of the Cal Grant proposal. “We still have a long ways to go to adequately support California Community Colleges students.”