The Higher Education Services Office – responsible for distributing all state financial aid to students – will become a Cabinet agency if a bill introduced in the House Higher Education Finance Committee becomes law.

The bill, introduced by the committee’s chairman, Doug Stang, R-Cold Spring, would have the governor appoint the HESO director and would also expand the current nine-member council to include 16 people, with at least four students.

“This is in line with the governor’s recommendations for the office of higher education,” Stang said.

The recommended changes stem from HESO’s failure to adequately predict demand for financial aid. After a projected $16 million shortfall this year, HESO canceled the state’s work-study program and reduced state child care grants to fund existing financial aid grants.

Stang and Susan Hegardt, a representative from Gov. Tim Pawlenty’s office, said allowing the governor to appoint the director is a natural step in improving accountability.

“This ends up being political anyway,” Hegardt said. She added that the change would streamline the process and improve communication between HESO and the governor.

HESO has taken no official position on the recommendation, but communications and legislative services member Phil Lewenstein said the changes could threaten HESO’s current role as a financial aid advocate.

“The current structure provides an independent voice from the governor,” Lewenstein said. “Now we advocate in particular for all students in financial aid Ö but you might get a governor down the road who doesn’t, and we would be bound by that belief.”

Committee member Lyndon Carlson, DFL-Robbinsdale, also said he was concerned politics would interfere with HESO operations.

Student leaders were less concerned with politics and more worried about the changes’ efficacy.

Minnesota State College Student Association Vice President Derek Hudyma reiterated his group’s February recommendation to eliminate HESO entirely.

“We support the intent of creating more accountability with financial aid Ö but we think the systems are better understanding of financial aid,” Hudyma said.

Lewenstein said this would be bad policy.

“I think it would be a serious mistake,” Lewenstein said. “There would be no statewide advocate for need-based financial aid.”

He also said there would be no uniform guidelines for aid distribution.

If the bill sees success in the House, it will be included in a higher education omnibus bill, which will pass out of committee early next week, Stang said.

The omnibus bill will also include budget cut recommendations for the University, HESO and Minnesota State Colleges and Universities, as well as other grant program changes, such as fifth-year eligibility and summer grants.

Libby George covers politics and welcomes comments at [email protected]