AB 1501 Summary

• Establishes the Middle Class Scholarship Program administered by the Student Aid Commission, providing scholarship grants to undergraduate students at UC and California State University with annual household income up to $150,000, commencing with the 2012-13 fiscal year.

• Scholarship grant award credits equal 60% of mandatory systemwide fees combined with other publicly funded financial aid (Pell Grants, Cal Grants, institutional need-based grants), with reduced awards for households earning $150,000-$160,000 and no awards above $160,000.

• Requires students to complete FAFSA, make timely applications for other financial aid, maintain 2.0 GPA, and meet Cal Grant Program eligibility requirements (with limited exceptions for nonresident tuition-exempt students).

• Appropriates $150 million annually from the General Fund to the Chancellor of the California Community Colleges for grants to reduce enrollment fees and cover textbooks and educational expenses, with distributions based on full-time equivalent credit and enrollment fee waiver participation.

• Establishes tax credit mechanism under Revenue and Taxation Code Section 17060 allowing scholarship amounts to be paid from the Tax Relief and Refund Account directly to UC and CSU to reduce student mandatory systemwide fees.