Panel considered reducing scholarship amounts

LITTLE ROCK, Ark. — The legislative committee that oversees the state lottery yesterday considered, but ultimately tabled, a proposal to recommend reducing lottery scholarship amounts by 10 percent for the second class of lottery recipients.

Last year the Legislature set the amount for the first group of lottery recipients at $5,000 per year to attend a four-year school and $2,500 per year to attend a two-year school.

Rep. Barry Hyde, D-North Little Rock, co-chairman of the oversight committee, said Thursday that some number-crunching done Wednesday showed that if the second class of lottery recipients also receives scholarships at that level, "we will be out of money in the third year."

Hyde asked the committee to recommend to the Legislature that new lottery scholarships be lowered to $4,500 a year to attend a four-year school and $2,250 to attend a two-year school. The first class of lottery recipients would continue to receive $5,000 or $2,500 each year, he said.

Hyde had said as recently as last week he expected the Legislature to make no change to the scholarship amounts, but he said Thursday the numbers suggest that is not feasible. He said the number of scholarship recipients this year exceeded expectations, and the percentage of recipients choosing to attend a four-year school was 80 percent, exceeding the projected percentage of 65 percent.

Lottery scholarships were awarded in the fall to 30,575 students, and another 4,265 students have been awarded scholarships for the spring semester.

Several lawmakers said Thursday they wanted to wait until the session that starts Jan. 10 to make a recommendation.

"To avoid bad press and a whole lot of calls from constituents, it's better to wait to know exactly the amount that we're going to have and change it one time, and I think toward the end of the session is the best time for that," said Sen. Mary Anne Salmon, D-North Little Rock.

Some lawmakers said they wanted to gather public input.

"These major decisions, I think we need a lot more dialogue and input from those individuals who are affected every day, and even the people of this great state," said Sen. Tracy Steele, D-North Little Rock.

A motion by Salmon to delay making a recommendation until the session passed on a voice vote.

Hyde told reporters later he had pushed for a recommendation before the session because the oversight committee is charged with making a report to the Legislature before the end of the year. The makeup of the committee will be different in the coming session, he noted.

Hyde said he did not know whether he would be reappointed to co-chair the panel.

Matt DeCample, spokesman for Gov. Mike Beebe, said Thursday the governor supports setting the scholarship amounts responsibly so the state does not have to break commitments to students.

"The governor has said all along that it's important to ensure that whatever you promise students coming into the system that they're going to have, that you have a system and the revenue to ensure that they keep that," he said.

In a statement today, Jerry Cox, executive director of the Family Council, said it was "appalling" that lawmakers were considering reducing scholarships instead of cutting administrative or advertising costs first.

"If money is tight, why do scholarships have to be the first thing that gets cut?" Cox asked.
The conservative group has long opposed the lottery program.

Lottery officials say the lottery's administrative costs so far this fiscal year have amounted to 1.8 percent of total revenue, and advertising expenses have amounted to 0.8 percent.

Also today, the committee voted to recommend that college students who have completed more than 130 hours work at a four-year school or more than 66 hours at a two-year school be ineligible for a lottery scholarship.

State Higher Education Director Jim Purcell said the purpose of the scholarship is to help students obtain a degree, but some students "just like to take courses."

The committee also voted to recommend that a high school graduate who delays entering college for up to a year for certain reasons be considered a traditional student and therefore be guaranteed a scholarship if he or she qualifies. The reasons could include a medical condition of the student or an immediate family member, a personal or family emergency, military service or a humanitarian project.

The delay could be extended up to two years if a humanitarian project requires a two-year commitment.