Despite talk, college projects long way off

JEFFERSON CITY, Mo. -- In case you haven't heard, Gov. Matt Blunt wants to expand scholarships and pay for a college construction boom by taking away money from Missouri's student loan entity.

Some concerns have been raised. So Blunt has altered his plan somewhat. But he is confident. And he implores urgent action.

"This proposal eliminates all objections voiced toward our proposal, and I look forward to working with the General Assembly in the weeks ahead to provide this needed assistance to our college students, their universities and our state's economy."

So said Blunt on Jan. 31, 2006 -- five days after he first proposed selling the Missouri Higher Education Loan Authority to finance his higher education plan.

In the past 15 months, Blunt's high-priority proposal has changed more times than a preschooler playing dress-up. Each time, Blunt has praised the new look as progress. And yet for all his urgency, the plan remains just that -- a plan.

Now, as has been the case several times before, it appears Blunt's plan may be moving toward reality.

Senate Republicans used their majority power last week to shut off a Democratic filibuster and force a vote on the legislation. They're expected to send the bill to the House this week. Then, perhaps the following week, House Speaker Pro Tem Carl Bearden intends to try to pass it on to Blunt's desk -- with no more changes.

Let's assume the legislature actually passes Blunt's plan. And let's assume no one successfully sues to stop the student loan agency from financing buildings.

What could Missourians expect from this deal?

They're unlikely to see anything soon.

Although a bill appropriating money for several dozen college construction projects theoretically would take effect as soon as Blunt signs it, that money can't be spent until it is received from the college loan authority.

And a separate bill, which isn't likely to take effect until Aug. 28, doesn't require the first payment from MOHELA until Sept. 15. By the time colleges get the money, the 2007 construction season will be largely past.

"It's our hope and belief that they will start them this year," said Spence Jackson, a spokesman for the Department of Economic Development, which has touted the job-creation potential of the new buildings.

But Jackson acknowledges, "if you start something in the fall, and you have to wait until the following year to complete it, that's a costly delay by anyone's standards."

In September 2006, while trying to urge the immediate enactment of Blunt's plan without legislative approval, the Department of Economic Development claimed that every day of delay added $70,000 to the cost of the projects.

If colleges get their money in September 2007, the year's wait will have inflated the collective price of their buildings by about $25 million, according to the department's formula.

Costs also are rising for students. Tuition and required fees have shot up 82 percent since 1997 at the University of Missouri-Columbia. But the amount offered through state scholarships has not kept pace. The result is that many students have become increasingly dependent on loans, such as those held by the Missouri Higher Education Loan Authority.

Because of the legislation's Aug. 28 effective date, the fall 2007 semester already will have started by the time the new scholarship program becomes law. So students already will have been awarded their annual financial aid under Missouri's old programs.

Bearden, a backer of the new scholarships, acknowledges that most students probably won't be able to take advantage of them until the 2008-2009 school year.

"They are the ones who will be suffering," Bearden said.

The bill also authorizes about $15 million to help commercialize university research and entice technology companies to Missouri. Since Blunt first outlined his plan, two such companies looking to locate in Missouri instead went to Kansas and a third to Kentucky -- losing patience with the potential incentives, said Rob Monsees, executive director of the Missouri Technology Corp., which would distribute the money.

Monsees, who helped develop Blunt's plan while a member of his staff, is among those who believe it must be enacted as soon as possible.

There are others who don't think it should ever be implemented.

Although MOHELA officials assure the loan sales and state payments won't harm its ability to offer good deals to student borrowers, there are those who doubt such assertions. They think the deal will financially weaken the student loan authority, decreasing its future ability to offer competitive interest rates to students or to forgive as many loans as it might have otherwise.

"The victims of this legislation will be Missouri's college-bound," Sen. Maida Coleman, D-St. Louis, said in frustration after Republicans forced the bill to a first-round vote.

To Coleman and others concerned, the cost of Blunt's plan to future loan holders is uncertain. To them, a delay in enacting is not opportunity lost, but opportunity gained.