California Ban on Scholarship Displacement Act of 2021.
The implementation of AB288 will change how public and private educational institutions manage financial aid packages for students who qualify for assistance under both the federal Pell Grant program and the California Dream Act. Starting from the 2023-24 academic year, institutions are prohibited from reducing the institutional gift aid based on the amount of private scholarship money awarded, except when such awards exceed the students' total cost of attendance. Additionally, they may not consider private scholarships when determining eligibility for awarding institutional gift aid.
Assembly Bill 288, known as the California Ban on Scholarship Displacement Act of 2021, is designed to address the issue of scholarship displacement affecting California students who receive private scholarships in addition to state-funded financial assistance. This bill seeks to ensure that institutions of higher education do not reduce their institutional gift aid offers when students are awarded private scholarships, thereby maximizing the financial aid available to eligible students. The bill is part of a broader effort to improve access to education and reduce financial barriers for students in need.
The sentiment around AB288 has generally been positive, emphasizing the critical need for financial support mechanisms that honor private scholarship awards and ensure they are supplementary rather than supplanting existing institutional support. Advocates argue that the bill is pivotal in promoting educational equity and supporting students' financial stability. However, there may be concerns regarding how effectively educational institutions can manage their budgets in light of these newly mandated regulations.
Notable points of contention include discussions on the practicality of enforcing the provisions of this bill. Some institutions may worry about their financial viability if they are required to maintain aid levels in the face of increased private scholarship awards. However, the bill’s supporters contend that enabling students to access the full range of financial aid available will ultimately lead to higher college enrollment and retention rates, benefiting the education system as a whole.