SB 33-POSTSECONDARY SCHOLARSHIPS  8:03:41 AM CHAIR ELTON announced consideration of SB 33. 8:04:08 AM SENATOR STEVENS moved to adopt Amendment 1. CHAIR ELTON explained that Amendment 1 inserts the words "or the United States Department of Education" on page 3, line 31; it has the effect of expanding eligibility to institutions that are not covered under the current language in the bill. 8:05:06 AM NICK MOE, aid to Senator Ellis, said they proposed this amendment because it was not their intent to leave out any vocational, postsecondary institutions in Alaska; by choosing only one accreditation they were leaving out the Career Academy and the Alaska Vocational/Technical Center in Seward. Senator Ellis feels strongly that vocational schools are a very important part of education in Alaska and should be included in this scholarship grant. SENATOR OLSON asked if private vocational/technical schools are included as well. MR. MOE responded that if the schools come under the accreditation of the United States Department of Education, they are included. SENATOR OLSON queried, "So you don't know if the private institutions are indeed covered at this time?" MR. MOE said the current list contains the names of all of the institutions legislative research provided to him as institutions included in the grant; he believes that no others are included at this time. SENATOR DAVIS asked if the Career Academy, which is on the list, is considered private. If so, she suggested they make a clarifying change in the language. 8:07:49 AM CHAIR ELTON asked Diane Barrans if she knows whether the list that was passed out to the committee is a list of additional schools that will qualify for the program [if this amendment is adopted] rather than a comprehensive list of the vocational/technical institutions that are eligible. DIANE BARRANS, Executive Director, Alaska Commission on Postsecondary Education, Juneau, AK, said the effect of the change is to include non-collegiate programs. The current language specifies an accreditor that doesn't recognize certain nationally accredited types of schools; so by referencing the U.S. Department of Education approval, the amendment has broadened the scope to include those one-year training programs regardless of whether they are public or private. CHAIR ELTON asked how many students they are adding by adopting this amendment. MS. BARRANS said she doesn't expect it to substantially increase the pool. About 90 percent of students in Alaska attend the University of Alaska and are already included; enrollments at Seward are rarely above 300 and the Career Academy probably has similar enrollment, so even if all of those students qualified it would not represent a substantial expansion. 8:10:03 AM SENATOR OLSON asked how that increase would affect the existing $25 million fiscal note. MR. MOE said they currently have no appropriations to this fund; the bill just creates the endowment. The fiscal note only gauges the resources that would be required to manage a fund of that size. 8:11:12 AM SENATOR HUGGINS joined the meeting. 8:11:17 AM CHAIR ELTON advised Senator Huggins of the motion to adopt Amendment 1 and directed him to the list of additional eligible institutions, which is included in his packet. 8:11:57 AM CHAIR ELTON asked if there were any objections to the amendment; there being none, Amendment 1 was adopted. CHAIR ELTON thanked Mr. Moe and Ms. Barrans for making themselves available today and said he would like to move to discussion of the full bill at this time. 8:12:47 AM SENATOR STEVENS opined that the state has not done a great job of helping those students with financial need; he asked Ms. Barrans to explain, in general terms, how this helps address that problem. MS. BARRANS said what she sees as most advantageous, should the endowment be funded, is the ability to communicate to students, especially at-risk students, early in their education that there is a source of funds available to them. One of the problems with the current needs-based program, which is very modestly funded, is that the funding source is not dependable; the year-to-year structure makes it difficult for them to use it as an incentive for junior high students. CHAIR ELTON said he assumes this program is an addition to the Alaska scholars program, for which the top ten percent of graduating students are eligible as they enter the University of Alaska. He asked if that is correct and if so, how that affects the determination of need. 8:15:42 AM MR. MOE answered that there is a UA scholars program, but there are students who achieve a high grade point average and still fall into the gap between getting into the UA scholars program and qualifying for financial aid such as the Pell Grant or other scholarships; this complements those programs. This bill not only requires students to show a certain level of achievement, but at least $4000 of unmet financial need. His statistics show that the average annual tuition in the University [of Alaska] system is around $12,000; so even if students save all of their [Permanent Fund] dividends, apply for all of the financial aid they can get and are doing very well in school, there is a large disparity. SENATOR STEVENS felt that students might be embarrassed by a public recognition of their financial need when presented with the scholarship and asked if the presentation could be made a little more palatable. MR. MOE appreciated his concern but said he doesn't think many college students are shy about receiving money for their unmet financial need. SENATOR STEVENS said he would still like to make that aspect of it less obvious. 8:18:55 AM MS. BARRANS noted for the record that, under the proposed language, the commission does have the ability to promulgate regulations. It would be their intent that this grant will not displace other non-loan aid; so if students have sufficient scholarships to eliminate the gap between their non-loan aid and the cost of education without this program, they would not qualify. The University of Alaska student leadership feels it is important that students invest in their own education; so it was their suggestion that a student should have at least $4000 in unmet need. 8:20:11 AM SENATOR STEVENS asked how the scholarship appears to the student. MS. BARRANS said students receive notification from the institution through their financial letter of award of financial aid. She is not sure whether it will be called the Alaska ACES Award or Alaska Ice Award, but the award would appear in their financial aid letter. She added that it will be important to emphasize the academic achievement aspect of the award to students, because they will have to continue to meet the academic qualification each year. 8:21:31 AM CHAIR ELTON asked Ms. Barrans to explain what kind of performance standard students will have to demonstrate once they get into college. MR. MOE read on page 2, line 24 that a student must have "achieved a cumulative grade point average of 3.0 or higher on a scale of 4.0, or the equivalent at the school in which the applicant is currently enrolled;" so the student must demonstrate achievement of a B average or better while getting the scholarship and must graduate within five years. 8:23:11 AM CHAIR ELTON questioned the language "or the equivalent at the school where the applicant is currently enrolled." He asked if a student who is not making the required grade point average at one school could transfer to another school and re-qualify for the scholarship. MR. MOE said the student would probably have to demonstrate achievement of a 3.0 at the first school. He thinks the language was crafted in this way to accommodate those schools that do not have a traditional grading system. CHAIR ELTON questioned whether a student who wants to transition from a smaller school to UAF would be precluded from applying for the scholarship for the next year at the new school. MS. BARRANS clarified that the financial aid professionals have to be able to certify that students qualify with a 3.0 GPA; so they would have to attend for two terms and establish a two term GPA in order to be certified according to standard financial aid practices; a student can transfer credits, but not the grade point that accompanied them. CHAIR ELTON asked if striking the words "at the school in which the applicant is currently enrolled" on page 2, line 26, would solve the problem. 8:26:25 AM MS. BARRANS asked if the presumption is that the student had an eligible GPA at the prior school. CHAIR ELTON said he was confused; he thought she just said that the credits would transfer but not the GPA. MS. BARRANS agreed, but said if they strike that language, the new school could "reference" the qualifying GPA at the previous school so there would not be a break in the student's eligibility. CHAIR ELTON asked whether the institution or the commission certifies the previous GPA. MS. BARRANS explained that efficiencies in financial aid administration are created by a partnership between the commission and the institutions. The commission does not collect or review transcripts; they rely on an agreement with the financial aid office at the institution to certify all of that electronically. 8:28:16 AM SENATOR STEVENS thought part of the problem might be the use of the term "enrolled," which means the student has filled out the paperwork and been accepted, but may not be taking classes yet. CHAIR ELTON asked if the definition of "qualifying postsecondary institution" on page 3, line 29 would preclude an Alaska student who wants to participate in the WWAMI program from getting a scholarship. MS. BARRANS said she believes this program is only for undergraduate study, but she does not see that limitation in the language; so Alaska WWAMI would be covered even if the institution the student is attending is outside the state. 8:29:55 AM MR. MOE disagreed. He said he does not believe WWAMI qualifies because this program is only for postsecondary institutions within the state of Alaska. SENATOR OLSON said that under the WWAMI program, students do complete some of their work in Alaska and as expensive as it is to attend medical school, it would be a help if this could apply to those students. 8:30:44 AM MR. MOE said those students will qualify for their undergraduate work in Alaska, but not when they transfer to a school outside. SENATOR OLSON asked for verification of whether this is only an undergraduate program. MR. MOE said he can't answer the senator's question at this time, but will get back to him with that information. SENATOR DAVIS was concerned about the 3.0 qualifying GPA and said she would like to see it changed to 2.5 (C+), especially if students have to wait two semesters before they qualify. There isn't enough funding out there, she said, and if the committee wants to encourage more kids to go to school, they should consider lowering that. CHAIR ELTON said he was going to close discussion on the bill for this time and suggested that members be prepared to discuss the GPA and undergraduate issues when he brings it back. He also directed Ms. Barrans to page 2, line 22 and said it would be helpful to know what the parameters are for the Free Application for Federal Student Aid and about the reference on page 4, line 3 to 20 U.S.C. 1070c-2. 8:34:17 AM Chair Elton set SB 33 aside.