Arkansas Democrat Gazette
Gov. Mike Beebe announced Tuesday that more students will get lottery-funded scholarships than initially thought.
An additional $5.9 million in lottery proceeds will fund about 1,000 scholarships of $5,000 each at four-year institutions and 400 of $2,500 each at two-year institutions, Beebe’s office said.
The money will go to students in the “nontraditional” category, which generally includes students who have left school for a period of time and are returning for more studies, Beebe spokesman Matt DeCample said.
That will leave about 3,800 qualified students in the nontraditional category who will not get scholarships for the 2010-11 school year, he said.
All qualified “traditional” students (those beginning college for the first time right after high school) and qualified “current achiever” students (those already in college and aiming to continue) received scholarships, the state has said.
Beebe’s announcement that he had asked the state Department of Higher Education to release the extra $5.9 million came after an Arkansas Democrat-Gazette article Tuesday noted a discrepancy between two agencies in the amount available for scholarships from the first nine months of the lottery’s operation.
The department believed $76 million was available. But a Lottery Commission spokesman put the amount $6 million higher at $82 million. DeCample said the governor learned from the newspaper about the higher figure.
“As recently as last week, correspondence from the Lottery Commission to the Department of Higher Education was using the lower number,” DeCample said. “It was just not updated.”
But when asked whether the commission had advised the governor of the higher figure, lottery spokesman Julie Baldridge cited a July 14 letter and report to the governor and to the chairmen of the legislative Lottery Oversight Committee, Sen. David Johnson, D-Little Rock, and Rep. Barry Hyde, D-North Little Rock.
That material contained numbers on pages marked as “preliminary,” and on Page 9 it listed $82.8 million as the amount available from the lottery for scholarships. It was the ninth point of a 13-point report.
Higher Education Director Jim Purcell, who answers to Beebe, said his agency received an e-mail Friday from Timothy Parrish, lottery treasurer, placing the amount available for scholarships at $76.7 million.
Purcell said the lottery’s deposit into the scholarship fund reached $82.8 million as of July 14. He said he didn’t learn about that figure until Tuesday from the newspaper. He said the $76.7 million was the figure through June 30.
Parrish’s e-mail was in response to Harold Criswell, the Higher Education Department’s associate director, who had asked for the amount available for scholarships “as of June 30.”
Baldridge said Parrish “is a CPA and was answering the question literally and exactly on the amount in the fund as of June 30, I expect.”
DeCample acknowledged that the governor’s office received the July 14 report from the commission. He said he’s sure the governor’s office paid attention to it.
“It was just unintentional miscommunication,” DeCample said. “At the end of the day we got it straightened out, and we’re getting the money to the students.”
Sen. Shane Broadway, D-Bryant, who took a lead role in crafting the scholarships for nontraditional students, said officials working on the lottery legislation in 2009 and 2010never expected to cover all of the nontraditional students applying for scholarships.
“I think there was an expectation [among some in the public] based on the lottery campaign and the discussion surrounding it was that anybody that qualified would get a scholarship,” Broadway said.
He said legislators in 2009 set the maximum amount to be spent for nontraditional scholarships at $12 million. But when more money than expected came in from lottery ticket sales, that cap was removed earlier this year. Legislators also added the “current achiever” category.
Broadway said that’s more than a lot of states with new lotteries have done.
“Most states when they started out just covered freshmen,” he said. “We were one of the few that tried to expand it as far as we could.”
The number of nontraditional students who would apply for scholarships was the hardest thing to anticipate, he said.
“We were all surprised by the number of applications,” Broadway said.
Some students have complained about a ranking system used to decide which qualified nontraditional students get scholarships and which don’t.
That system factors in the student’s closeness to completing a degree, his grades,and the demand for the student’s field of study. Broadway said that system has been in place about 10 years, since before the lottery proceeds helped fund the Academic Challenge Scholarships. He said it was put in place in case there were revenue shortfalls for scholarship as happened in 2000.
About 25,853 lottery scholarships have been awarded. The additional $5.9 million will raise the total to about 27,230.
There were 54,533 applicants, meaning about 30,000 were rejected. Those included those who didn’t qualify academically or didn’t properly fill out their applications.
Lottery sales totaled $373 million in fiscal 2010. Prizes totaled $228 million.
In addition to the $82.8 million from the lottery, the Legislature provided $20 million in general revenue to the Academic Challenge Scholarships, according to the Bureau of Legislative Research.
Lt. Gov. Bill Halter, who led the campaign in 2008 to get voters to approve a constitutional amendment for a state lottery, said the process needs to be improved.
“Very clearly you would want the Department of Higher Ed to get the decisions on scholarships for the current achievers and nontraditional students much earlier,” Halter said.
Broadway said a fourth category of the lottery scholarships may have to be created, one that breaks out part-time students from the larger category of nontraditional students.