A plan to help thousands of first-time students – regardless of income – attend college cost-free is in the proposed budget bill, but whether it happens depends on a complex funding scheme.
The proposal’s fate involves the legalization of online lottery games.
The bill calls on the governor to consult with the Connecticut Lottery Corporation and other state officials on the feasibility of letting the lottery offer its games online or through a mobile application.
The governor will then determine whether the on-line offering is doable, the bill says, and whether the revenue from it is enough to cover the cost of a debt-free community college plan.
If the deal is done right, said Rep. Gregory Haddad, D-Mansfield, co-chairman of the Higher Education and Employment Committee, it could expand community college enrollment by thousands of full-time students and help reverse a financially-troubling decline in enrollment.
He also points to evidence from free or debt-free community college programs in other states, such as neighboring Rhode Island, that the program can be a substantial revenue producer for the community college system if it attracts more students who qualify for major federal financial aid.
“I think it will prove to be a very popular program,” Haddad said. “In no state around the country where they’ve adopted a free community college program have they retreated from that expenditure.”
But during a news conference on the budget, Senate Minority Leader Sen. Len Fasano, R-Meriden, raised questions about the likelihood of the Democratic proposal for debt-free college actually materializing.
“Debt-free college is subject to if the lottery gets the internet and if that is something we should be doing,” Fasano said. “You know it’s fluff and frosting to go out there and say, hey we also did something on debt-free college. It pacifies their core when they really did nothing on debt-free college.”
Connecticut currently has almost 48,000 students in its community colleges – 32,414 part-timers and 15,498 full-time enrollees. About 60 percent of those full-time students already are effectively attending for free with their financial aid and other assistance covering all tuition and feels.
The Office of Fiscal Analysis anticipates that the expense of cost-free college for all first year, full time students would be up to $6.1 million in Fiscal Year 2021.
That’s where the lottery comes into play.
Lottery officials have told lawmakers on several occasions in recent years they could generate tens of millions of dollars in new revenue by selling tickets to draw games — like Powerball and Mega Millions — online.
“The Connecticut Lottery Corporation was established to generate revenue for the state’s General Fund,” Chelsea Turner, the lottery’s vice president, said Saturday. “Like any 21st century business, we should be able to modernize and that includes our distribution channels.”
According to lottery corporation projections, selling all draw games online would raise an additional $5.2 million in the first year and $8.1 million in the second. From there, the annual receipts would continue to steadily increase, approaching $20 million by the 10th year of operations.
But those numbers aren’t set in stone.
One of the games that would be sold online is Keno, and Connecticut has an arrangement to share a portion of its Keno proceeds with tribal casinos in southeastern Connecticut.
If the state is unable to provide sufficient funding through iLottery sales, then the state would have to deal with the shortfall. The bill says that if the governor finds the iLottery is not feasible, he is required to propose budget adjustments next year, including any revenue source or spending reduction needed to cover the costs of the program.
In that event, the burden of deciding how to cover the added cost could be assigned to the Board of Regents for Higher Education, which oversees the community colleges.
Haddad said he is confident that iLottery sales will be sufficient and, if not, funds will be found to cover the expense of the cost-free college program. He also doubts that the Board of Regents would be asked to pick up the cost for the program as it is aimed to help solve the the community college’s financial problems.
Haddad said he thinks there is “political momentum behind us that will carry us” through legislative approval and implementation.
“I think it gets difficult to reneg on a promise like this,” he said. “I won’t tell you that it’s completely impossible but as I read this language, I think it would take additional legislative action to sort of repeal the free college program. I don’t believe that will happen. I think there’s a lot of support of this in the legislature. I think the governor himself supports the idea and we are just working to make sure it’s sustainable because we don’t want to make a promise we can’t keep.”
If implemented, the program would be a “last dollar” offer by providing students with any additional money needed after they have exhausted government private grant programs.
The Office of Fiscal Analysis anticipates that the program would bring in $2.1 million to $7.7 million in federal aid and other financial assistance provided to students during Fiscal Year 2021, depending on how many additional students enroll.
OFA expects the increase in eligible students to range from 10 to 45 percent from the projected previous year after accounting for an annual full-time student enrollment decline of 3.3 percent. The office said it based these numbers on research showing enrollment increases in Rhode Island, Tennessee and Oregon when similar programs were implemented.
The increase in students is expected to range from 637 to 2,310 in Fiscal Year 2021 and from 1,012 to 3,674 in Fiscal year 2022.
It’s also expected that the state’s four regional universities will see a decline in revenue — as students choose to start their college careers at the colleges — of less than $2.7 million in Fiscal Year 2021.
Originally, the legislature’s education committee had considered a bill that set income limits on those eligible for cost-free college.
But Haddad said that after examining the experience in other states, they decided to open it up to any recent graduates of Connecticut high schools — regardless of income. When such programs are free to anyone, Haddad said, the message is more likely to be heard by everyone and more students apply.
“If we can guarantee everybody who goes that you’ll be able to go tuition and fee free — that’s a simple message. It’s easy for people to understand,” Haddad said. “To achieve that bump in enrollment, we really wanted to make it simple.”