Gov’t may scrap some scholarship programs

With revenue collections continue to drop, the government is considering the elimination of several scholarship programs and instead put in place a financial aid scheme for CNMI students seeking college education.

Such plan, which will form part of a package of proposals the administration plans to submit to the Legislature for consideration in order to address funding problem in the scholarship programs while ensuring that students have access to financial assistance to pursue higher education.

“The current system is extremely inefficient and overly generous,” said Dan Nielsen, Gov. Pedro P. Tenorio’s special consultant on education, referring to the Commonwealth’s scholarship program. “Taxpayers are not getting the returns that they should get under the current system.”

Last year the government spent $4 million in financial aid to college students under various scholarship programs and some $2.5 million for this year alone. The amount represents over 1 percent of the total spending limit of the government or about 7 to 8 percent of the budget earmarked for the Public School System.

“That’s a lot of money. We don’t have that money at this time to be generous,” Nielsen said.

The proposal, if approved, would in effect scrap existing educational aid projects and only retain two scholarship programs mandated by law, such as the Paul Manglona Scholarship Program.

According to Nielsen, the educational loan concept is similar to assistance programs extended by various states in the US to college students.

Under the scheme, the government will act as a guarantor for educational loans that students will secure from banks. The only time the government will step in is when students default in their payments, Nielsen explained.

The “study-now-pay-later” concept, he added, will also free several government agencies from responsibilities of monitoring and ensuring compliance since the Department of Finance will be the lone overseer of the program once the Financial Aid Board is put in place.

The government’s scholarship programs have been drawn into controversy after students complained of delay in their tuition and fees due to funding problem.

Almost all college students in the Northern Marianas have access to scholarship funds regardless of their economic background or grades, a condition that has drained money appropriated for this purpose.

“We continue to review and improve the present system and hope to make the program more of a guaranteed bank loan program based on the financial needs of the students,” Nielsen said. “In that way we hope to even the playing field.”