Indiana's popular 21st Century Scholars program that provides full college scholarships to needy students who stay out of trouble would have stiffer requirements under a proposal approved Thursday by a legislative committee.
The Senate Appropriations Committee voted 8-4 to endorse a bill making changes to that program and others in the state's college financial aid system.
The fast growth of the 21st Century scholarship in recent years forced the shifting of money from other programs in the state's $248 million financial aid budget last school year, said Claudia Braman, executive director of the State Student Assistance Commission.
Nearly 13,000 students received the 21st Century scholarships last year — up 44 percent from four years earlier. Braman said the commission had to transfer about $17 million from other funds to cover its $45 million cost.
A principal change to the program would increase the required high school grade-point average from 2.0 to 2.5 for a student to receive the scholarship.
Committee Chairman Luke Kenley, R-Noblesville, said money going toward the program will be better spent on college students who've met the tougher high school GPA standard.
"We know that will be a better predictor of performance," he said.
The 21st Century Scholars program was started in 1990 under then-Gov. Evan Bayh. Students in sixth through eighth grades who qualify for free and reduced-price lunches can enroll in the program by signing a pledge to stay out of criminal trouble and drug-free and meet the grade standard in exchange for four years of free tuition at an Indiana public college.
Sen. Lindel Hume, D-Princeton, questioned whether the higher GPA requirement would discourage some students from trying to continue their education after high school once they realize they won't qualify.
Braman said those students could still seek grants based on income if they enroll at Ivy Tech Community College or another school.
"We hope this will motive students to try harder," she said.
Under the proposal, the higher GPA standard would start for those youths joining the program after this school year. The nonpartisan Legislative Services Agency estimated that about 1,100 fewer students could qualify a year with the higher standard, cutting the program's cost by $2.8 million a year.
The assistance commission says researchers have found that about 20 percent of those who signed up for the program as middle school students no longer met the low-income requirement as high school seniors.
The administration of Gov. Mitch Daniels wants to change state law to allow a senior-year assessment of financial need — and senators said a bill introduced in the Indiana House would do that.
The bill, which now goes to the full Senate, would also limit state financial aid to only undergraduate students and transfer college financial aid duties involving prison inmates to the Department of Correction.
Officials said the changes were needed to maximize the reach of the state financial aid budget when demand is growing. State figures show nearly 459,000 people applied for state college grants for last school year — an increase of about 130,000 from two years earlier.
"Here in the economic recession, we're seeing how we're being squeezed between one program versus another program," Kenley said. "In the interest of trying to have a better program overall, both in times of recession and in good times, we're trying to smooth the fairness out."