AB 640 Summary

• Requires the Student Aid Commission to establish an appeal process for institutions that fail to meet three-year cohort default rate (15.5% or greater) and graduation rate (30% or less) requirements for Cal Grant eligibility.

• Commission may consider cohort size and likelihood of regaining eligibility in the following academic year when assessing appeals, with intent for the commission to define what constitutes a small cohort.

• Institutions with 40% or fewer undergraduate students borrowing federal student loans are exempt from default rate and graduation rate requirements.

• Commission must certify institutions' default rates and graduation rates by October 1 each year based on data from the United States Department of Education.

• Institutions that become ineligible due to these requirements automatically regain eligibility once they satisfy the thresholds, or immediately if federal data corrections result in compliance.