Proposed changes in federal Pell Grant awards would not help students but instead would save money for the state, said government officials on Monday at the Capitol.
Lisa DeReinee, the state’s department of finance higher education analyst, told the higher education conference committee that President Bill Clinton’s balanced-budget plan unveiled on Friday in Washington will not help Minnesota students.
“That increase in federal Pell Grant awards will offset the state’s obligation,” DeReinee said.
State law combines state and federal grant awards in determining grants for Minnesota students. The proposed increase in federal Pell Grants from $2700 to a maximum $3000 will drop the share the state allocates for overall grants.
State grants are determined by a formula. The student is expected to pay for 50 percent of the cost of college. The other 50 percent is paid from a combination of parental support, state aid and federal aid. When one of those categories increases, the other two categories will presumably decrease.
If the president’s bill is passed this year, the state would save about $17.3 million in 1998, and about $30 million during the next two years under the state’s current grant award formula.
At an April conference held in Coffman Memorial Union, several college students from across the state urged Sen. Paul Wellstone to use his political influence to decouple the state grants.
Rep. Lyndon Carlson, DFL-Crystal, who is on the higher education conference committee, sponsored a bill this year that would decouple the Pell and state grants.
The committee will discuss whether to decouple the state and federal grants during the week.
One of the highlights of the conference committee’s second meeting was the House offering a compromise higher education funding bill.
Under the compromise bill, the University’s state allocation would be $164 million, a sum closer to the House bill that would give the University a $171 million increase.
The Senate higher education omnibus bill would give the University a $132 million increase.
Senate conference committee members rejected the compromise bill, saying it offers even less for student aid than the original House bill.
Sen. LeRoy Stumpf, DFL-Thief River Falls, said the House offer was a good start, but did not address Senate concerns. The House compromise bill provides no funding for reducing a student’s share of college costs and living expenses. The bill would also not allow students who take less than 13 credits to receive any grant. The Senate bill funds $41 million for those three items.
The overall funding target for the compromise higher education bill is $2.376 billion, a figure between the House and Senate bills.
The committee has yet to decide on any funding numbers. They will meet again today from 2-4:30 p.m. and will attempt to wrap the bill up with an all-day Wednesday discussion.