As lawmakers hear proposal to redesign financial aid, education policy experts say it’s a ‘bad idea’

by Molly Minta, Mississippi Today
January 24, 2023

A proposal that would substantially overhaul how the state doles out money to help Mississippians pay for college was presented to a joint hearing of lawmakers on Tuesday.

Jennifer Rogers, the director of the Office of Student Financial Aid, told lawmakers that she does not believe a “perfect plan” exists, but she can’t think of a proposal that has consensus and “would advance the state more than this one does.”

She credited this support to the closed-door task force that created the proposal. Last year, the Woodward Hines Education Foundation, a nonprofit, invited public officials from higher education and workforce development to participate with the goal of redesigning state financial aid. Student recipients of state financial aid were not invited to attend.

If the wide-ranging proposal becomes law, it would be the first time that lawmakers have updated Mississippi’s undergraduate grant aid programs since they were created in the late 1990s. The committees plan to consider two identical bills based on this proposal later this week.

Rep. Donnie Scoggin, R-Ellisville, the vice-chairman of the House Colleges and Universities Committee, said the goal of the bill is “simply to try to get more people into the workforce.”

He speculated Tuesday’s meeting was the first time the House and Senate committees ever held a joint meeting, signaling broad legislative support for this year’s proposal after prior efforts to redesign state financial aid have failed to get off the ground.

The Mississippi Eminent Scholars Grant (MESG), the state’s only merit-based program with the primary purpose of rewarding academic achievement — and the most racially inequitable program — is the only state aid program that would remain untouched. The task force didn’t propose changes to MESG, Rogers told the committee, recognizing it has “broad political support.”

The bill seeks to reduce the amount of money that Mississippi spends on its only grant aimed at helping low-income students afford college — the Higher Education Legislative Plan for Needy Students, or HELP grant — while expanding the Mississippi Resident Assistance Tuition Grant (MTAG).

It proposes kicking an additional $18 million in state funds to MTAG but lowering spending on the HELP grant by $7 million.

As written, the bills would reduce awards made under the HELP grant, which currently pays for all four years of college, no matter the institution a recipient chooses to attend. Officials are continuing to target spending on the HELP grant even though the cost, which had been increasing over the last decade, appears to be reaching a cliff, according to OSFA’s annual report this year.

HELP recipients, by and large, choose to spend the generous grant at four-year universities, not community colleges. The growing cost of tuition at the universities is one reason why the state spends the most money on this grant each year. But the bills’ changes aim to push more recipients toward community college by turning the HELP grant into what’s commonly called a “2+2 program.”

Awards for freshmen and sophomores would be lowered to the average cost of tuition at the community colleges, even if recipients decide to attend a four-year university. Juniors and seniors would receive the average cost of university tuition, an attempt to encourage them to transfer.

This way, the HELP grant would have reduced buying power at the universities, increasing the likelihood that low-income students would initially choose community colleges as the more affordable option.

While this move would save the state of Mississippi money, education policy experts told Mississippi Today that it also likely means the rate at which low-income recipients graduate from public universities would plummet.

Nationally, just 1 in 6 community college students successfully transfer to universities.

“Cutting HELP in a way that directs talented low-income students to community colleges is definitely problematic,” said Sandy Baum, a fellow at the Urban Institute who has studied Mississippi’s state financial aid policies.

Scoggin acknowledged that with the changes, HELP recipients “may very well just stay at the community college and not transfer” to university but he speculated that would depend on a student’s degree field.

Philip Bonfanti, the executive vice president of Mississippi Gulf Coast Community College and a member of the task force, said that he believes Mississippians transfer out of community college at a higher rate than the national average.

According to federal data, MGCCC’s transfer-out rate is 11% — less than the national average.

Bonfanti emphasized the changes to HELP are fiscally responsible. HELP students who wanted to go directly to university could supplement the new, lowered award amount with the Pell Grant or institutional or private scholarships.

“No student loses access to higher education because of this proposed change,” he said, “but it almost cuts the HELP program in half.”

Rep. Lataisha Jackson, D-Como, asked if the task force considered lowering the ACT requirement to the state average of 17 so more students could qualify. Right now, HELP recipients have to get at least a 20.

“I don’t think there was any objection to it,” Bonfanti replied. “I think it was a monetary decision.”

Lawmakers also discussed the proposed changes to MTAG.

The number of students served by MTAG would increase from 17,000 to 34,000, according to HCM Strategists, a consulting firm hired by Woodward Hines to assist the task force.

Under the bills, eligibility for MTAG would broaden so that Pell Grant recipients would no longer be excluded by statute, part-time students could qualify, and the requirement of a 15 or higher on the ACT would be dropped.

Award amounts would increase to $1,000 for community college students and $2,000 for university students.

Sen. John Polk, R-Hattiesburg, asked if it was fair to MESG recipients for MTAG awards to increase.

“So if you’re an Eminent Scholar, you only get $500 more than a student that breathes air,” he said, referring to the accessible requirements for MTAG. “We’re trying to keep Eminent Scholars in Mississippi.”

“I think it looks a little awkward,” he added.

MTAG would also be retooled in an effort to incentivize students to pick degrees that serve the state’s workforce needs as identified by Accelerate MS. Students who choose “high value pathways” would receive a $500 bonus.

Toren Ballard, K-12 policy director for Mississippi First, said the bills would result in a “huge shift” in resources away from lower-income students.

Ballard added that MTAG is not an efficient use of state resources, citing one study requested by the Office of Student Financial Aid that showed the grant does not have a statistically significant impact on if students obtain a college degree.

“At the end of the day, HELP is need-based, MESG is merit-based,” he said. “We can argue about which one of those should take precedence. But MTAG is nothing-based. It’s a hand out. That’s all it is.”

An extra $500 is likely not enough money to change students’ behavior, said Baum, the Urban Institute fellow.

“The idea that students will change their degree programs for $500 is questionable to begin with — and probably a bad idea,” she said.

Baum added that the state’s priorities of increasing educational attainment to 55% by 2030 are undercut by the lack of changes to MESG.

“In order to be more effective in increasing educational attainment, the system would have to stop showing so much favor to high-achieving students,” she said. “But I guess that is unlikely to happen any time soon.”

Editor’s note: The Woodward Hines Education Foundation is a Mississippi Today donor.

This article first appeared on Mississippi Today and is republished here under a Creative Commons license.

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