Mo. scholarships cut below law's minimum amounts

JEFFERSON CITY, Mo. (AP) -- An influx of needy students and a decrease in state aid have combined to place Missouri in the awkward position of potentially violating its own law when distributing college scholarships during the upcoming school year.

The Missouri Department of Higher Education said Tuesday that it doesn't expect to have enough money to meet the minimum scholarship amounts set by a 2007 law that created the state's main financial needs-based scholarship program.

In a letter sent to college and university leaders, the state agency cited a twofold reason:

-- A cut of more than one-fourth of the money available for Access Missouri scholarships to a total of around $60 million, instead of the $83 million that lawmakers originally had budgeted for the 2010-2011 academic year.

-- A nearly 19 percent increase in students eligible for the scholarships to a total of 102,000, compared with 86,000 during the recently concluded academic year.

When funding falls short of the amount necessary to fully fund scholarships, state law requires that scholarships be reduced proportionately.

But the 2007 law that created the Access Missouri program never contemplated such a severe budget crunch.

The law established a scholarship range of $300 to $1,000 for students at community colleges, $1,000 to $2,150 for those at public universities, and $2,000 to $4,600 for students at private institutions.

The Department of Higher Education said the scholarship amounts are estimated to fall just short of those minimum thresholds. It said community college students are projected to receive $275, public university students $950 and private school students $1,900.

Missouri's law doesn't specify any consequences for failing to meet the minimum scholarship amounts.

Higher education officials had little choice but to go below the law's requirements, said Leroy Wade, the assistant higher education commissioner for financial aid.

"It kind of is what it is," Wade said. "Given the amount of students we're anticipating will receive awards and the available funds, this was the amount we felt confident we would be able to pay."

Wade said officials plan to re-examine the number of eligible students in August and again in December to see if any adjustments need to be made to the scholarship amounts.

The scholarship reduction could have been larger.

Gov. Jay Nixon last month cut about $50 million from Access Missouri scholarships, citing an expected shortfall in state revenues. But a portion of that cut was offset when the Missouri Higher Education Loan Authority decided to give $30 million to the state for Access Missouri scholarships.