House bill requires students to repay grants for failure to graduate

As Alaska struggles to deal with a $3.6 billion budget deficit, state legislators look to new ways to save and make money.

The bill, entitled “an Act relating to repayment of Alaska performance scholarships and Alaska education grants,” was introduced at the beginning of the 29th Legislative session on Jan. 20. If passed, the house bill would require students who received funds from the Alaska Performance Scholarship [APS] or Alaska Education Grant to pay back the awarded amounts if they fail to complete a qualified postsecondary program within six years.

Bill author, representative Tammie Wilson, said the purpose of the bill is to save the state money, as well as ensure that Alaska gets out of students what it puts in.

“I think for the State of Alaska, [it] was if we put more money into it beyond over the $350 million of UGF [Unrestricted General Fund] we currently put in, is that they expect also that we would have a better trained workforce to be able to take over those jobs that most of us, especially as legislators, keep saying why are they going to people out of state?” said Wilson. “As money gets tighter, and not as much money might be able to be put into the higher education fund, this is a way to make sure that you’ve got a little skin in the game. If you complete it, everything goes exactly like it is.”

Megan Green, an economics and German double major and APS recipient, expressed concern over the proposal.

I hadn’t heard of this [House] bill, but it rather surprises me, since the APS only pays for eight semesters anyway,” Green said.

The Alaska Commission on Postsecondary Education [ACPE], who manages the distribution of the APS and Education Grant, has not released an official statement on the proposed legislation, but has concerns that the bill could undermine students.

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“Added complexity can add cost to administering a program, but just from the impact on the students perspective, I think there’s concerns around it having kind of an adverse impact on students, who might otherwise take up the scholarship or the grant, because of the potential for it to become debt,” Diane Barrans, Executive Director of ACPE and Executive Officer for the Student Loan Corporation, said. “Even those that had qualified for it might have reservations and certainly, with respect to the grant, which is a needs based program, and we already know from national research that low income and middle income students are most likely to be debt adverse. It could have the opposite effect than the sponsor intends.”

Barrans also attended the initial House Education hearing regarding HB 264 on Feb. 8, where she shared concerns that the bill also took away from the requirements that the APS and Alaska Education Grant already prioritize.

“The threat of repayment is not currently in the program. There are requirements and incentives in both the scholarship and grant program to expedite their time to degree. With the APS program, there’s a minimum number of credits, enrollment level and credit accumulation that the students must earn in order to continue to receive their award. If they fail to, their award status is suspended until they satisfy those criteria,” said Barrans.

Both the APS and Alaska Education Grant require students to meet satisfactory academic progress, regardless of full-time or half-time enrollment, as well as have an unmet need of $500 or more.

The APS, however, encourages students who had high achievement in high school to continue their achievements through a credit load of 24 credits and a 2.0 or higher GPA in a year for the first year, and 30 credits and 2.5 or higher GPA for the subsequent years.

The house bill in it’s current state could pose additional threats to students who have extenuating circumstances, even if students were to receive an allowable extension through the program, or take a year off.

“As far as I know, they make no exceptions. Maybe they just have to finish it on their own,” Wilson said.

According to the ACPE website, under the APS, students participating in military service or struggling with enrollment delays may be able to hold on to their APS funds beyond the four years of funds and six years of availability that the scholarship promises.

The current language of the bill does not have provisions for these exceptions.

“I think that bill is in need of a major overhaul, and it would be better if they didn’t pass it at all,” Alanna Willman, a pre-nursing major — currently on the waitlist for the program — and APS recipient, said.

Willman also expressed concerns that the bill punishes students for that which they cannot control.

“Frankly, I think it’s a horrible idea to make students pay it back if they can’t use it,” said Willman. “I don’t think that any bill or university can declare what it means to graduate ‘on time’ for any students because everyone’s situation is different and everyone learns at a different pace.”

HB 264 has only been to the House Education Subcommittee once, as of publication. With a moratorium on non-budget bills in place in the House, it is unlikely that another hearing will be scheduled until an operating budget has been passed in the House before the end of the session on April 27.

APS/AEG Infographic
Photo credit: Kathryn Dufresne