Bill Text: CA AB1927 | 2013-2014 | Regular Session | Amended

NOTE: There are more recent revisions of this legislation. Read Latest Draft

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Bill Title: Student financial aid: debit cards.

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Vetoed) 2014-09-29 - Vetoed by Governor. [AB1927 Detail]

Download: California-2013-AB1927-Amended.html

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BILL NUMBER: AB 1927	AMENDED
	BILL TEXT

	AMENDED IN ASSEMBLY  MAY 5, 2014
	AMENDED IN ASSEMBLY  APRIL 10, 2014

INTRODUCED BY   Assembly Member Frazier

                        FEBRUARY 19, 2014

   An act to add Section 69505.7 to the Education Code, relating to
student financial aid.


	LEGISLATIVE COUNSEL'S DIGEST


   AB 1927, as amended, Frazier. Student financial aid: debit cards.
   Existing law provides for the missions and functions of the
private and public segments of postsecondary education in the state.
Existing law establishes various student financial aid programs for
students attending all segments of postsecondary education.
   This bill would require the Board of Governors of the California
Community Colleges and the Trustees of the California State
University, and request the Regents of the University of California
and the governing bodies of accredited private nonprofit and
for-profit postsecondary educational institutions, to adopt policies
to be used for negotiating contracts between their postsecondary
educational institutions and banks and other financial institutions
to disburse a student's financial aid award and other refunds onto a
debit card, prepaid card, or preloaded card that best serves the
needs of the students. The bill would require the policies to ensure
that contracts between postsecondary educational institutions and
banks or other financial institutions to disburse a student's
financial aid award do certain things, including, among other things,
prohibit the sale  of private information   or
sharing of personal information, as defined,  that the student
or the postsecondary educational institution provides the bank or
other financial  institution,   institution;
 prohibit the bank or other financial institution from imposing
a  point-of-sale   transaction  fee on a student
for the use of the debit card, prepaid card, or preloaded 
card, and require any fees imposed by the bank or other financial
institution to be paid by the postsecondary educational institution;
prohibit the card from being cobranded;   card; provide
a clear and conspicuous disclosure to students of all fees associated
with the debit card, prepaid card, or preloaded card;  ensure
that a student does not incur any cost in opening the account or
initially receiving the card;  and  not market or
portray the account or card as a credit card or credit instrument, or
subsequently convert the card to a credit card or credit 
instrument.   instrument; and require the postsecondary
educational institution to disclose to students the benefits and
student responsibilities for all financial aid disbursement options
offered by the postsecondary educational   institution.

   Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: no.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:

  SECTION 1.  Section 69505.7 is added to the Education Code, to
read:
   69505.7.  (a) The Board of Governors of the California Community
Colleges and the Trustees of the California State University shall,
and the Regents of the University of California and the governing
bodies of accredited private nonprofit and for-profit postsecondary
educational institutions are requested to, adopt policies to be used
for negotiating contracts between their postsecondary educational
institutions and banks and other financial institutions to disburse a
student's financial aid award and other refunds onto a debit card,
prepaid card, or preloaded card that best serves the needs of the
students.
   (b) The policies adopted pursuant to subdivision (a) shall,
consistent with federal law,  including Section 668.164 of Title
34 of the Code of Federal Regulations,  ensure that contracts
between postsecondary educational institutions and banks or other
financial institutions to disburse a student's financial aid award
and other refunds onto a debit card, prepaid card, or preloaded card
do at least all of the following:
   (1) Prohibit revenue sharing between a postsecondary educational
institution and banks or other financial institutions.
   (2) Prohibit the sale  of private information 
 or sharing of personal information, as defined in paragraph (1)
of subdivision (d) of Section 1798.81.5 of the Civil Code,  that
the student or the postsecondary educational institution provides
the bank or other financial institution.
   (3) Prohibit the bank or other financial institution from imposing
 fees   a point-of-sale transaction fee 
on a student for the use of the debit card, prepaid card, or
preloaded card.  Any fees imposed by the bank or other
financial institution shall be paid by the postsecondary educational
institution.  
   (4) Prohibit the debit card, prepaid card, or preloaded card from
being cobranded, which means including the logo of the postsecondary
educational institution.  
   (4) Provide a clear and conspicuous disclosure to students of all
fees associated with the debit card, prepaid card, or preloaded card.
 
   (5) If the debit card, prepaid card, or preloaded card is
cobranded, provide a clear and conspicuous disclosure to students
that the card is not endorsed by the postsecondary educational
institution.  
   (5) 
    (6)  Ensure that the student does not incur any cost in
opening the account or initially receiving the debit card, prepaid
card, or preloaded card. 
   (6) 
    (7)  (A) Ensure that the student has convenient access
to a branch office of the bank or an automated teller machine of the
bank in which the account was opened or of another bank, so that the
student does not incur any cost in making withdrawals from that
office or those automated teller machines.
   (B) The branch office or automated teller machines must be located
on the postsecondary educational institution's campus, in an
institutionally owned or operated facility, or immediately adjacent
to and accessible from the campus. 
   (7) 
    (8)  Ensure that the debit card, prepaid card, or
preloaded card can be widely used. 
   (8) 
    (9)  Not market or portray the account or debit card,
prepaid card, or preloaded card as a credit card or credit
instrument, or subsequently convert the account or debit card,
prepaid card, or preloaded card to a credit card or credit
instrument. 
   (10) Require the postsecondary educational institution to disclose
to students the benefits and student responsibilities for all
financial aid disbursement options offered by the postsecondary
educational institution.