Guinn to recommend $100 million to boost Millennium Scholarships

Friday, Jan. 14, 2005 | 11:11 a.m.

CARSON CITY -- Gov. Kenny Guinn intends to propose selling a $100 million bond to rescue the financially ailing Millennium Scholarship that has provided money to more than 22,000 students at the universities and community colleges.

The governor said Thursday he would suggest some other changes in his "State of the State" message Jan. 24 to the Nevada Legislature to save the program that could be $16 million in the hole by 2006 and $73 million by 2010.

"This is the best problem the state can have -- too many kids going to college," the governor said.

It is important for this state, he said, to have these students trained in the new technology to be ready to enter a diversified work force in Nevada.

The proposed $100 million in bonds would be paid off over a 20-year period by excess revenues from the unclaimed property fund. "I have the money in my budget and I will be announcing exactly how it will be done in my State of the State," Guinn said.

Selling the bonds at the present interest rate would cost the state an estimated $146 million to redeem them over 20 years.

Guinn worked with state Treasurer Brian Krolicki, who administers the scholarship program. Krolicki has proposed a number of changes to tighten the system and these will be presented to the Legislature.

Guinn suggested the Millennium Scholarship program in 1999 using money from the national tobacco settlement that was estimated to bring Nevada more than $40 million a year.

The money has slowed down as people give up cigarettes and the number of students taking advantage of the scholarship is higher than expected, leading to the financial crunch.

"If it's in trouble, it's nice to say it is in trouble because it is so successful," he said.

Krolicki told the Legislative Interim Finance Committee Wednesday that the initial estimate that 40 percent of those who qualified for the scholarship would accept them. But he said 70 percent of the qualified students are now getting the scholarship.

There are going to be a myriad of recommendations on how to tighten the requirements.

Sen. Barbara Cegavske, R-Las Vegas, suggested that those students who get the scholarship and then drop out of the community college or university pay the money back.

Guinn is cool to the idea. "I don't know of any program where you have to pay them back," the governor said. "I don't know of one in the country."

The governor also doesn't support the proposal that the scholarship be means tested or given to the low-income student. This was set up to award the good students in high school. He said the means test has been looked at before.

"When they did the means testing last time, they took people working like teachers and their children would not be qualified," he said. Assemblywoman Chris Giunchigliani, D-Las Vegas, said that is one of the suggestions that should be examined.

The governor indicated he supports not awarding scholarship money for summer school. And there may be a move to raise the grade point average in high school required to be eligible.

The 2003 Legislature increased the requirement for grade points from 3.0 to 3.1 for students graduating in this year and next and to 3.25 in 2007 and after. There is a suggestion the student might have to have a 3.5 average to get the scholarship.

Scholarship payments range from $40 per credit for community college credit to $80 for a credit at UNLV or UNR. The maximum amount allowable is $10,000.