Fiscal Note - SB 0341 - Provides Educational Assistance To Certain Members of the National Guard, the Armed Forces & Their Spouses & Chil
L.R. NO. 1007-01
BILL NO. SB 341
SUBJECT: Education, Higher: Military
TYPE: Original
DATE: February 25, 1997
FISCAL SUMMARY
ESTIMATED NET EFFECT ON STATE FUNDS
FUND AFFECTED FY 1998 FY 1999 FY 2000
General Revenue ($20,403,329) ($20,403,329) ($20,403,329)
Total Estimated
Net Effect on All
State Funds ($20,403,329) ($20,403,329) ($20,403,329)
ESTIMATED NET EFFECT ON FEDERAL FUNDS
FUND AFFECTED FY 1998 FY 1999 FY 2000
None $0 $0 $0
Total Estimated
Net Effect on All
Federal Funds $0 $0 $0
ESTIMATED NET EFFECT ON LOCAL FUNDS
FUND AFFECTED FY 1998 FY 1999 FY 2000
Local Government $0 $0 $0
FISCAL ANALYSIS
ASSUMPTION
Officials from the Coordinating Board For Higher Education assume the
proposal would not have a fiscal impact on them, since it appears that the
responsibility for administering and financing the scholarship program would
rest with the public colleges and universities themselves. However, the
proposal would have a substantial but unknown fiscal impact on public
colleges and universities.
Officials from Missouri Western State College assume the fiscal impact would
depend on the number of eligible participants, which they could not determine
at this time.
Officials from Linn State Technical College state the average annual tuition
and fees for the college is $3,583. The college officials were unable to
forecast the number of students that would elect to attend the college.
Officials from Central Missouri State University assume the costs related to
the proposal are unknown.
Officials from Truman State University state they could not determine the
fiscal impact without data on the number of eligible individuals.
Officials from the University of Missouri state a recent study at the
university shows that the annual cost in FY 1996 for providing instruction to
undergraduates is $7,290 per student. Assuming an annual inflation rate of
3%, the estimated cost in FY 1998, the first implementation year of the
proposal, would be $7,725 per student. The cost per student would rise to
$8,441 in the final year of enrollment. University officials assumed a 3%
inflation rate over the period required to complete a baccalaureate degree.
The average cost during this four year period would be $8,079 per student.
University officials state that if 100 students would be eligible for the
assistance programs, the total cost for those students would be $807,900.
Lost fee revenue to cover a part of the cost would be estimated at $4,431 per
student, for a total of $443,100.
Officials from Jefferson College assume the proposal would result in major
budget impacts. They state current tuition and fees are $44 per credit hour.
They state currently there are 243 active National Guard members in Jefferson
County. They have no way to estimate former National Guard members in
Jefferson County. Their current experience indicates that 25% or more of
current members are attending college (25% x 243 = 60). Assuming thirty
credit hours taken annually by guard members at $44 per credit hour results
in $1,320 per guard member.
Sixty additional students times $1,320 equals $79,200 of foregone revenues.
They stated they have no easy way of identifying the number of veterans and
dependents; however, they assume the foregone revenues could easily exceed
$275,000 annually. Therefore, they estimate $350,000 in annual foregone
revenues. They assume they could potentially need up to .5 FTE clerical
position in the financial aid office to certify and process the required
documentation at $9,000 annually.
Officials from the National Guard Office of the Adjutant General assume that
the administration of the scholarship program would be done by the secondary
institutions. Commanders certificates of satisfactory participation could be
provided by the National Guard at no cost. They state the assigned strength
of the National Guard is approximately 9,029, as of October 1, 1996. If full
tuition benefits would be authorized, they project as many as 1,354 (15% of
the assigned National Guard members) would participate. The National Guard
assumes no direct fiscal impact to them from the proposal.
Officials from the Veterans Commission estimate approximately 323,100
veterans were honorably discharged and served in wars (39,000 Persian Gulf;
182,600 Vietnam and 101,500 Korean). They estimate approximately 12,389
veterans died in World War II, Korea and Vietnam, but they did not have the
number of qualifying children. The commission officials also estimate there
are approximately 1,000 spouses and children of persons who were prisoners of
war or missing in action. Officials from the Veterans Commission did not
have information regarding the number of veterans who would not qualify due
to the Servicemen's Readjustment Act of 1944. The Oversight Division assumes
of the 12,389 veterans who died, their children would be too old to qualify
under section 3 of the proposal, which only applies to children ages 18-23.
The Oversight Division has calculated the loss in tuition revenues based on a
statewide average of $2,364 for tuition at public two year and four year
colleges and universities. Oversight has applied the 15% utilization rate
estimated by the National Guard to the count of guard members and United
States service persons. Oversight used 75% of the Persian Gulf veterans (75%
x 39,000 = 29,250), 10% of the Vietnam veterans (10% x 182,600 = 18,260) and
0% of the Korean war veterans as a base for veteran age groups who would
likely attend college. Oversight assumes the children of World War II, Korea
and Vietnam deceased veterans would be at an age where they would likely not
attend college. Oversight used the 1,000 spouses and children of prisoners
of war or persons missing in action in calculating the fiscal impact.
Therefore, Oversight estimates $ ((9,029 National Guard + 29,250 + 18,260 +
1,000 United States services) x 15% x $2,364 = $20,403,329). The Oversight
Division has shown the tuition loss in the state fiscal impact section, since
it is assumed any loss in tuition revenue at the local government level by
junior colleges would be reimbursed by the state under Article X, Section 21,
of the Missouri Constitution.
FISCAL IMPACT - State Government FY 1998 FY 1999 FY 2000
(10 Mo.)
GENERAL REVENUE FUND
Public Colleges and Universities
Loss in tuition revenues ($20,403,329) ($20,403,329) ($20,403,329)
FISCAL IMPACT - Local Government FY 1998 FY 1999 FY 2000
(10 Mo.)
0 0 0
FISCAL IMPACT - Small Business
No direct impact to small businesses would be expected as a result of this
proposal.
DESCRIPTION
The proposal would allow any member of the Missouri National Guard who has
for served for at least one year and possesses other qualifications to be
awarded a scholarship to an approved public institution, consisting of an
exemption from incidental fees or tuition for four years while a member of
the National Guard. The scholarship would terminate if the student ceased to
be a member of the National Guard while enrolled or within three years after
completion of the course of study, and the recipient would repay any amounts
credited toward tuition.
The proposal would allow all honorably discharged persons who served in the
United States forces in any of its wars to receive free incidental fees or
tuition in any of the state-supported colleges and universities, medical
schools of the state-supported colleges and universities and community junior
colleges. However, the provision would not be applicable to persons
qualifying under the provisions of the Servicemen's Readjustment Act of 1944.
The governing boards could waive charges for matriculation, incidental fees,
tuition and any other educational fees for the children, ages eighteen to
twenty-three, of members of the armed forces who served in World War II,
Korea or Vietnam and were killed. The governing boards could also waive the
charges for spouses and children of persons declared to be prisoners of war
or missing in action in connection with the conflict in Southeast Asia after
January 1, 1961.
This legislation is not federally mandated, would not duplicate any other
program and would not require additional capital improvements or rental
space.
SOURCES OF INFORMATION
Coordinating Board For Higher Education
Missouri National Guard
University of Missouri
Central Missouri State University
Truman State University
Missouri Western State College
Jefferson College
Linn State Technical College
Veterans Commission
NOT RESPONDING: Southwest Missouri State University, Northwest Missouri
State University, State Fair Community College, Missouri Southern State
College, Harris-Stowe State College, Southeast Missouri State University,
Lincoln University, North Central Missouri College, Crowder College, Moberly
Area Community College, East Central College, Metropolitan Community College,
Mineral Area College, St. Charles County Community College, St. Louis
Community College, Three Rivers Community College
This Fiscal Note is not an official copy and should not be quoted or cited.