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Regents pursue more money for state-backed scholarships

PIERRE -- The state Board of Regents wants Gov. Dennis Daugaard to ask the Legislature for additional funding for scholarships to South Dakota college students.

The regents, who govern the state's public universities, decided last week that the Opportunity scholarship should be worth more.

The Legislature made the Opportunity scholarship part of state government's ongoing budget in 2004.

The scholarship was set at $5,000 with the money to be spread across four years: $1,000 annually for three years and $2,000 for the fourth year.

The regents now want the Legislature to raise the four-year value to $6,800.

When the scholarship began, students took 32 credits in the standard two-semester academic year and paid an average of $4,812.16 per year.

By comparison, students now take 30 credits in the standard two-semester year. They paid $8,038.50 for those 30 credits in 2013-2014.

The scholarship 10 years ago was worth 26 percent of a student's tuition and fees over the four years for a bachelor's degree. The scholarship is now worth 16 percent.

Some of the decline is due to additional charges levied against students. Some of the loss results from inflation.

Regents' analysts have calculated that the $5,000 scholarship lost $1,330 in value just to inflation during the past decade.

Increasing the scholarship by $1,800, as the regents propose, wouldn't return the scholarship to its full original value, however.

That would require a $3,360 increase.

The goal a decade ago was to double the number of Opportunity recipients by 2010, the last year of then-Gov. Mike Rounds' administration.

That hasn't been achieved.

The regents' proposal is a flat amount that would cost $1,272,530. Their plan doesn't call for an automatic inflation adjustment in the 2017 budget and thereafter.

The Opportunity program will cost an estimated $4,699,499 in the current 2015 budget year that began July 1.

The regents' plan requests a total increase of $1,663,151 for the program in the 2016 budget.

That amount includes covering a projected 16 percent growth in recipients of the scholarship for the next budget year.

Nearly all of that growth results from changes the Legislature made during the 2010 session that now take effect.

The broader eligibility affects two groups of students:

Those who pursued career and technical education courses rather than two years of world or foreign language. This is expected to add 120 students to the Opportunity program; and

Those who score 28 or higher on ACT exams, regardless of coursework. This is expected to add 51 students.

With those changes, along with 2 percent of general growth otherwise, an additional total of 194 students is forecast to participate in the Opportunity program in fall 2015.

The regents are planning for 3,997 students in the program for the 2015-2016 academic year.

They include 805 students in the fourth year receiving $2,000 apiece and 3,192 students receiving $1,000 each in years one through three.

The 2010 goal was to double the number of new Opportunity students from the 2006 level of 849.

In fall 2013, there were 1,224 new recipients and 2,553 continuing recipients in years two through four.

Accompanying the 2010 growth goal were two related goals:

• Doubling the funding level for the program so that students received amounts equivalent to what students get in other states; and

• Building in an index factor so the scholarship retained its value over time.

The regents also are asking for $400,000 in funding on a one-time basis to supplement funding for two narrowly crafted scholarship programs.

They help needy students and students who go into critical areas of teaching needs in South Dakota K-12 schools.