SHEFA ‘over-awarded’ $787,000 to scholars

Saipan Higher Education Financial Assistance administrator Henry Hofschneider disclosed yesterday that the program has awarded financial grants to students more than what the law appropriated.

Based on program records, the Legislature gave SHEFA a total of $17.4 million from fiscal years 2004 through 2010. However, awards disbursed to scholars in six years totaled about $18.2 million—a difference of over $780,000.

Hofschneider labeled the excess amount as “over-awards” to recipients.

“Based on the available records at SHEFA office, a total of $787,000 was over-awarded to scholars in six years. This only indicates that the program has provided awards more than the appropriation set [by the Legislature],” he said.

Saipan Tribune learned that in the first two years of SHEFA’s operation, it was only appropriated $1.2 million each fiscal year. The local law was amended in 2006, increasing its appropriation to $3 million each fiscal year. These monies were sourced from poker license fees and related government revenue.

Hofschneider, who took over as administrator last year, said there’s a need to reconcile SHEFA records with that of the Finance Department’s to have a better picture of how the program was implemented.

Because of declining poker revenues, he said there is a need to be strict with what is being appropriated for the program so it will be sustainable.

Last month, the SHEFA board approved—at Hofschneider’s recommendation—a ceiling of $1.5 million disbursement for each academic year to ensure that the $3 million appropriation is equally awarded and disbursed to eligible scholars.

This came about after SHEFA awarded its scholars $2.2 million in the fall 2010 semester alone—more than half of the $3 million appropriated for the program. This resulted in having only about $800,000 left for spring 2010 recipients.

The reconciliation of records, according to Hofschneider, will aid the board make sound decisions for the future of the program.

He will recommend that for each fiscal year, any “unused funds” be carried over to the next academic year in order to either maintain or increase the number of scholars it serves.

SHEFA is a scholarship program that provides students financial assistance from poker fees. Its mission is to provide supplementary financial assistance, upon the availability of funds, to qualified residents of Saipan and the Northern Islands who are pursuing college education on Saipan or abroad. Recipients are expected to return to the island to work in the government or private sectors.