January 21, 2020

New Mexico finance panel skeptical of tuition-free college plan


Statue of a Lobo on the University of New Mexico campus. Flickr cc

Members of the Legislative Finance Committee from both sides of the aisle cited concerns Monday about the governor’s $35 million plan for a scholarship program that aims to make tuition free for many in-state students attending New Mexico’s public colleges and universities.

Gov. Michelle Lujan Grisham has said the New Mexico Opportunity Scholarship, one of her key initiatives for the 2020 legislative session, would make higher education accessible to a larger number of high school graduates, lower the burden of student loans and help reverse a trend of declining enrollment at colleges.

But lawmakers’ comments during a hearing on the proposal Monday, a day before the session’s start, raised questions about whether it will gain enough support to pass the Legislature.

“I see a whole lot of problems,” Sen. George Muñoz, D-Gallup, a member of the Legislative Finance Committee, told Higher Education Secretary Kate O’Neill. 

Among the problems Muñoz cited: The scholarship could create an  incentive for eligible students to choose a four-year university over a two-year community college, leaving smaller schools with stagnant or declining enrollment. Muñoz said he’d like to see the tuition aid apply to community colleges first to increase student numbers at those institutions.

Sen. John Arthur Smith, a Deming Democrat who chairs the committee, had the same concern.

“We are going to encourage additional growth at the most expensive schools in the state, at the expense of the comprehensive schools and two-year schools,” Smith said.

Rep. Jason Harper, R-Rio Rancho, said he fears the governor’s plan would dissuade students from seeking other grants or scholarships. He noted a committee report on the scholarship proposal that said New Mexico students who fail to apply for federal student aid leads to a loss of about $15 million in potential aid annually.

“This takes away the motivation to look for other sources,” Harper said.

Mark Valenzuela, an analyst with the Legislative Finance Committee, also told lawmakers the governor’s $35 million estimated cost for the program might be low. It could cost up to $49 million to enact the plan, he said.

Nora Meyers Sackett, a spokeswoman for Lujan Grisham, said she did not see the committee’s concerns as an obstacle for the Opportunity Scholarship.

“Students want this, parents want this, educators want this,” Sackett said. “They want access to higher education opportunities, and that’s what we are trying to do.”

According to the Higher Education Department, enrollment at the state’s public colleges and universities has declined by more than 14 percent over the past five years.

Under the governor’s plan, the $35 million would cover tuition and fees remaining after the state’s Legislative Lottery Scholarship and federal Pell grants are applied for some 55,000 students who meet the qualifying criteria and maintain a grade point average of at least 2.5 — or 2.0 for adults over 24 who are enrolled at two-year schools.

The Legislative Finance Committee proposed an alternate higher education aid plan, which also was projected to cost $35 million. Among other measures, the lawmakers’ proposal would increase funding for the Legislative Lottery Scholarship by $9.7 million.

The lottery scholarship program, funded by lottery ticket sales, once covered 100 percent of college tuition costs for eligible students. But as ticket sales declined, so did scholarship revenues, which eventually prompted lawmakers to decrease the rate of coverage for each student.

The scholarship now covers about 60 percent of tuition costs. The additional $9.7 million would boost that to about 82 percent. 

The committee also proposed using $10 million to provide grants of $1,000 each to 10,000 low-income students. 

Despite the differences in the two higher education aid plans, Smith said he didn’t think legislators were at odds with the governor.

“We have a common goal: more college graduates for the state of New Mexico,” he said.

But lawmakers and the governor might disagree over how to “achieve that goal and keep it within the affordability of the taxpayers of New Mexico,” he said.

“I’m sure we’re gonna have this whole thing fixed in the next 30 days,” Smith said at the end of the hearing, a remark that drew laughter.