TOPS, Louisiana’s popular college scholarship program, is expected to cost about $19 million more this year than the state Legislature dedicated to spending on it.
Leaders say they are working to resolve the issue — they promise students won’t be shortchanged on their individual awards — but the difference likely will translate into fewer dollars flowing to campuses this year.
“TOPS has to be fully funded,” state Higher Education Commissioner Joe Rallo said. “It’s got to be made up.”
The Louisiana Legislature wrapped up a session June 11 that was dominated by efforts to address a $1.6 billion budget gap. That gap had higher education leaders scrambling to figure out what a “doomsday scenario” would mean for colleges and universities across the state.
In the end, higher education was thought to be largely spared. State legislators instead worked to roll back some of the state’s tax credit offerings, increased the cigarette tax, and created a new fee and credit mechanism to funnel more money to colleges.
But less than a month into the budget year that started July 1, Rallo said leaders already were faced with a budget cut. Now, the additional $19 million to make TOPS whole likely will come from money earmarked for colleges and universities, too, he said.
“I’d say any amount is very important to us,” Rallo said.
Lawmakers dedicated about $265 million to the Taylor Opportunity Program for Students this year. But the real cost likely will be closer to $284 million, said Sujuan Boutte, executive director of the Louisiana Office of Student Financial Aid, which oversees the program.
“That promise is to be fulfilled to the students,” she said, noting that LOSFA has been in constant contact with the Division of Administration and state higher education leaders since it noticed the difference.
Boutte said legislators didn’t account for the tuition hikes colleges are allowed to implement through the GRAD Act.
In practice, she said, the discrepancy would affect students only in rare cases, if at all.
“We’re going to stay on top of it and work with the Division of Administration and Board of Regents,” she said.
Division spokesman Greg Dupuis said in a statement that the Jindal administration supports TOPS and will ensure it is fully funded.
Rallo said he thinks the adjustment shows why changes should be made to the scholarship program. “This has to be addressed,” he said.
Gov. Bobby Jindal, a Republican now running for president, vetoed a bill this year that sought to rein in the cost of TOPS by eliminating the automatic increases in amounts students receive when tuition goes up. In effect, it would have meant the scholarships might not cover all of tuition for future TOPS recipients, unless the Legislature voted to increase awards.
The bill had the backing of TOPS advocates, including Jindal ally Phyllis Taylor, and passed the Legislature.
“I think the Legislature understood what the problems were,” said Senate Finance Chairman Jack Donahue, a Mandeville Republican who sponsored the bill.
But Jindal’s administration argued that it would, in effect, cap the program and break a promise made to students.
As he has campaigned for president in Iowa and faced questions about college affordability, Jindal repeatedly has sung the praises of TOPS and cited the program as a way states can address affordability and student debt.
“Now, I’m not saying the federal government needs to get in that business,” he cautioned during a town hall in Marshalltown, Iowa, this week.
Thousands of Louisiana college students have benefited from the program, which is funded through a combination of state general fund dollars and tobacco lawsuit settlement money, in the nearly two decades since its creation.
During that time, the price tag for running TOPS has swelled drastically. In 2001, TOPS cost the state about $104 million. It’s on track to exceed $300 million by 2020.
Meanwhile, state funding for higher education has fallen drastically. The Legislature, through the GRAD Act, gave colleges the ability to increase tuition to try to offset some of the cuts, but that only created a cycle: Increases in tuition drive TOPS costs higher because of the direct link between the two.
And the number of students who receive TOPS each year is showing no signs of slowing.
At this point last fall, LOSFA counted 22,175 new students eligible for TOPS. That figure today is about 22,746.
Not all of those “newly eligible” students will translate to actual TOPS recipients, because they could decide to go out of state or not attend college this semester, Boutte noted.
Last year, the total number of TOPS recipients was 48,113.
The state Board of Regents has hired an outside consultant to help it draft a plan to submit to the next governor. The group had its first meeting with representatives from Deloitte Consulting earlier this week.
Louisiana voters will elect a new governor this fall. Jindal cannot seek re-election because of a term limit.