Gov. Matt Bevin got some applause Tuesday night when he proposed ending the legislative practice of diverting millions of dollars generated by the Kentucky Lottery from college scholarships to the General Fund.
But Bevin is not proposing to put that money back into the need-based financial aid programs for which it was designated. Instead, $27 million in 2017 and $32 million in 2018 would form a new scholarship program to help students attend special workforce programs, said Carl Rollins, executive director of the Kentucky Higher Education Assistance Authority, which would administer the fund.
Need-based aid funds would remain flat.
Bevin also is proposing to issue $100 million in bonds for workforce development construction projects, which he said would allow schools and private industries to partner and create innovative workforce training programs.
The new scholarship fund would “help students pay to attend new programs that would be created by the workforce development fund,” Rollins said.
Bevin’s budget proposal would fully fund the merit-based Kentucky Educational Excellence Scholarship program and adds money to a fund that helps National Guard members attend college.
Where lottery monies have been diverted in the past is from need-based aid that helps low-income Kentuckians afford college, and that’s where a huge need lies.
Jason Bailey, executive director of the Kentucky Center for Economic Policy
But the need-based College Assistance Program for public schools and the Kentucky Tuition Grant program for private colleges were basically flat-lined, Rollins said. Because so much money has been diverted from those program over the years, they are running out of money long before the need is met.
Last year, according to the Kentucky Center for Economic Policy, the Kentucky Lottery provided $221 million to state government. Under state law, 55 percent of that money is supposed to go to need-based college aid. Instead, lawmakers took $28 million and diverted it to the General Fund. That year, 62,000 eligible students were denied need-based scholarships because the funds ran dry, the center estimated.
“It’s good to see a proposal to put the lottery money back to its intended use — helping Kentuckians afford higher education,” said Jason Bailey, executive director of the economic policy center. “The big proposed increase in the governor’s budget is to a new workforce training program that we need to learn more about. Where lottery monies have been diverted in the past is from need-based aid that helps low-income Kentuckians afford college, and that’s where a huge need lies.”
Rollins said the governor believes that many of the students eligible for existing need-based scholarships could be served by the new workforce scholarship fund.
“I’m excited we have opportunities for new programs, and we’re not facing any additional cuts to the current programs,” Rollins said. “Student financial aid did not get cut, so that’s good.”
Robert King, president of the Council on Postsecondary Education, was equally upbeat.
“The fact they’re moving the lottery money back into higher education and are not spending it on sidewalk repairs is good,” he said. “We’re very pleased and will be anxious to see the details.”