Analysis of the 2007-08 Budget Bill: General Government

Military Department (8940)

The Military Department is responsible for the command and management of the California Army and Air National Guard. To support the operations for a force of more than 20,000 personnel, the department maintains a headquarters complex in Sacramento, 111 armories, 37 maintenance facilities, 2 training sites, and 11 aviation centers throughout the state. Additionally, four new armories are currently under construction.

The mission of the National Guard is to (1) provide mission-ready forces to the federal government, (2) protect the public safety of the citizens of California by providing military support to civil authorities during natural disasters and other emergencies, and (3) provide service and support to local communities in California.

The budget proposes expenditure of $131 million, an increase of nearly 3 percent. Nearly two-thirds ($86 million) of the overall funding for the department comes from federal funds and reimbursements, with the remaining one-third ($45 million) coming from the General Fund.

Tuition Assistance Program Duplicates Purpose of Existing Program

We recommend deleting a request for $1.7 million from the General Fund to establish a Tuition Assistance Program as an aid to recruitment efforts. This request duplicates a loan forgiveness program established in 2003. (Reduce Item 8940-001-0001 by $1,699,000.)

Tuition Assistance to Aid Recruiting. The department requests $1.7 million from the General Fund in the budget year to establish a Tuition Assistance Program (TAP) to aid in recruitment efforts. Program costs would grow to $3.3 million annually in subsequent years. The department request is based on the idea that a tuition program of some type is essential to the recruitment activities of the California National Guard and, without such a program, recruiting quotas will go unfilled. The department reports that it needs to recruit 489 members to attain 100 percent of the federally authorized troop strength. Of a total federally authorized troop strength level of 20,698 members, 489 represents a 2.4 percent shortfall.

Program Already Exists for the Same Purpose. This same rationale for improved recruitment led to the National Guard Assumption Program for Loans for Education (NG-APLE), created by Chapter 345, Statutes of 2003 (AB 547, Liu). The NG-APLE is administered by the California Student Aid Commission (CSAC), and pays off student loans for qualified students who fulfill specified terms of enlistment in the National Guard. The CSAC may only award the number of NG-APLE warrants authorized in the annual budget act. No warrants were authorized until the 2006-07 Budget Act, which authorized 100 grants. The program is due to sunset at the end of 2006-07.

NG-APLE Superior to TAP. There have been concerns about the NG-APLE. For instance, it has taken too long to get off the ground. The CSAC is only now in the process of promulgating regulations for NG-APLE, which are expected to be adopted in April 2007. In addition, there may be too few authorized grants to be of value in overall recruiting. Despite these issues, we believe NG-APLE is superior in design to TAP. First, NG-APLE is easier to administer. As a loan forgiveness program, it only pays benefits once the student has completed his or her military commitment. In contrast, TAP provides payment up front, and thus it would be necessary for the state to try to collect those funds from the student if he or she fails to complete the military commitment. Second, NG-APLE is structured similar to other programs already administered by CSAC. The TAP would create a new program to be administered by the Military Department, which has less experience in administering student financial aid programs. Finally, NG-APLE is established in statute, while TAP would give discretion to the Military Department regarding the allocation of awards.

No Need to Establish New Program. For these reasons, we recommend the Legislature reject the TAP proposal. If the Legislature wishes to continue to provide student financial aid as a way to help recruit and retain National Guard members, we would advise renewing the NG-APLE beyond its June 2007 sunset and authorize additional warrants in the budget year to aid in recruitment.

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