The outlook for Gov. Michelle Lujan Grisham’s tuition-free college scholarship, one of her signature initiatives for the legislative session, had started to seem dubious.
A budget bill the House passed last week for fiscal year 2021 included $35 million for financial aid programs — but no funding for the New Mexico Opportunity Scholarship that Lujan Grisham had announced with fanfare in the fall. The effort would boost enrollment and graduation numbers at state colleges and universities, she said, and strengthen the state’s workforce.
But legislators had raised concerns that her proposal didn’t do enough to direct funding toward the lowest-income students.
The Governor’s Office and lawmakers collaborated on an overhaul to address those concerns, and the House Education Committee renewed hope Monday that her plan to ultimately provide free tuition could become a reality for some 55,000 eligible New Mexico students each year who attend in-state schools.
The committee voted 11-2 to support House Bill 14, sponsored by Rep. Tomás Salazar, D-Las Vegas.
A number of college presidents and educators at Monday’s hearing spoke in favor of the bill, saying it would relieve students of both overwhelming debt and the struggle to cover costs so they can stay in class.
“Finances loom as a very big reason for why students don’t come or end up dropping out,” said Garnett Stokes, president of the University of New Mexico.
The support from 10 Democrats and one Republican on the House Education Committee came after Salazar worked with other lawmakers to revamp the bill.
Under the substitute measure Salazar presented Monday, the scholarship program would provide funds to fill tuition and fee gaps for qualifying students after the state’s Legislative Lottery Scholarship and other state financial aid programs are applied — but before low-income students tap into federal programs, such as the Pell Grant.
Lujan Grisham initially had proposed awarding the Opportunity Scholarship after considering any federal funding a student would receive. The change means more federal financial aid will be freed up to cover other student needs, such as living expenses, health care and course materials.
Many members of the House Education Committee touted the new version of the bill for allowing students to use Pell Grants to pay for other costs of enrolling in higher education programs.
But the change comes with a price.
Rather than the $35 million the Legislature has so far budgeted for new financial aid initiatives — and the Governor’s Office had estimated it would cost to fund the Opportunity Scholarship — the revamped scholarship program eventually would cost the state $45 million annually.
The substitute bill calls for a two-year rollout, starting with a $26 million appropriation in fiscal year 2021 to fund scholarships for students enrolled in two-year community colleges.
The following year, the scholarship will become available to those seeking degrees at four-year institutions, adding a $19 million investment.
Kate O’Neill, Cabinet secretary of the state’s Higher Education Department, told the House Education Committee the bill would expand access to higher education for prospective students with financial barriers.
Rick Bailey, president of Northern New Mexico College in Española, said his college lost 800 students over the past five years — many of whom said in follow-up phone interviews that economic and social challenges forced them to leave the classroom.
“For a lot of our students, the Opportunity Scholarship will provide a level of support that will remove these existential barriers to higher education,” Bailey said.
HB 14 does not apply to tuition at private colleges because that would violate the state’s anti-donation laws, O’Neill said.
During a news conference after the hearing, Lujan Grisham said the committee’s vote of approval is “an indication that it has renewed support.”
“I’m not totally overconfident,” Lujan Grisham said, “but I’m feeling really good.”
The bill goes next to the House Appropriations and Finance Committee for consideration. An identical bill in the Senate introduced by Sen. Bill O’Neill, Senate Bill 323, is expected to be heard by the Senate Education Committee this week.