Bill to Regulate Income-Share Agreements Moves Through the California Legislature, Again – Ed Surge
University students in California could soon be able to delay paying college tuition until after they graduate and land a job.
California’s Assembly Committee on Higher Education approved a bill on Tuesday to pilot income-share agreements at the California State University and University of California systems. The legislation passed with a 12-0 vote and now heads to the Assembly Appropriations Committee.
Proposed by Assemblyman Randy Voepel (R-Santee), the bill would provide funds to enable students and their universities to enter income-share agreements, which require students to pay back a portion of their salary after graduating instead of paying tuition up-front. The two-year pilot program would begin in the 2021-22 academic year, and the university systems would be required to report back about the pilot to the California Legislature in 2023 and 2026.
Advocates of the income-share model say it provides an alternative to traditional student loans and the sticker shock of college. The bill states that the “agreement is not a debt instrument and “the repayment obligation of the student under the agreement may not be dischargeable under bankruptcy law.”