Funding changes proposed for opportunity grants

Members of the Education Committee heard testimony March 2 on two bills that would adjust the funding source of Nebraska Opportunity Grants.

Currently, 24.75 percent of net lottery receipts are dedicated to the Nebraska Opportunity Grant Fund. Beginning in fiscal year 2016-2017, that funding will be discontinued and redirected to the Nebraska Education Improvement Fund.

LB520, introduced by Cedar Rapids Sen. Kate Sullivan, would phase out the funding over three years as opposed to eliminating all funds in FY2016-17.

“We recognize the importance of these grants and the financial support they provide for need-based students,” Sullivan said. “This provides a mechanism for phasing out the use of lottery dollars and phasing in more general funds.”

The lottery dollars allotted for the opportunity grants would decrease by 6.5 percent in FY2016-17, FY2017-18 and FY2018-19.

The bill also includes intent language that would direct the Legislature to replace the lost revenue from the general fund.

Mary Sommers, director of student financial aid at the University of Nebraska at Kearney, opposed the bill. She said that LB520 would put her students’ academic success at risk.

“I really cannot overstate the importance of a stable funding mechanism for this program,” she said. “My students really cannot afford vulnerability. Moving [the funding source] to general fund dollars makes it much riskier.”

The committee also heard testimony on LB519, also introduced by Sullivan. The bill would provide funding to the state Department of Education and the Coordinating Commission for Postsecondary Education to establish competitive innovation grant programs.

Sullivan said the bill would provide a stable funding source for the programs.

“Lottery proceeds are unpredictable and are voluntarily generated from a limited sector of the population,” she said.

The department and commission would receive 40 percent of the money available in the Nebraska Education Improvement Fund and would award grants to school districts, educational service units or postsecondary institutions.

The bill also would establish a new best practices allowance in the state aid to schools formula.

Jon Habben, representing the Nebraska Rural Community Schools, supported the bill, saying that it would help to grow education statewide.

“Identifying best practices and, equally as important, spreading those best practices, are critical in the future of education in Nebraska,” he said.

The committee took no immediate action on either bill.