Board Members Present: Mike Clumpner, Mary Beth Kornely, Gerard Randall, Mary Jo Green, Sandra Dercole for Paul Spraggins, Jeremy Shea, Julie Schaefer, Steve Van Ess, Marques Franklin, Bill Steiger.

HEAB Staff Present: Jane Hojan-Clark, Jim Buske, Mary Lou Kuzdas, Sandy Thomas, Nancy Wilkinson.

Others Present: Andy Nulis, UW System Administration; William Keeton, United Council; Kristen Hendrickson, UW System Administration; Rolf Wegenke, WAICU; Erin Fath, S.B.O. Department of Administration; Merry Larsen, Legislative Fiscal Bureau; Shelly Gardner, WTCS Board; Dan Goyette, Marquette University; David Dies, WAICU; Tess Arenes, AVP UW System Administration; Deborah Mahaffey, WTCS Board; Sharon Wilhelm, UW System Administration; Linda Cross.

The meeting was called to order at 9:10 a.m. by Chairman, Mike Clumpner. Chairman Clumpner also introduced Linda Cross who will be replacing him as the public representative on this Board starting August 1, 2000.

APPROVAL OF BOARD MINUTES

Motion was made by Gerard Randall to approve the minutes of April 28 Board meeting and seconded by Marques Franklin. Approved.

REPORT OF EXECUTIVE SECRETARY

Jane Hojan-Clark updated the Board on new activity. The New Teacher of the Visually Impaired Loan Program is in the process of getting set up. It will go into effect 2000-01.

There have been revisions to the WISSIS Survey Form for collection of data from each of the systems.

The Financial Aid Directors, through the Wisconsin Association of Student Financial Aid Administrators, are reviewing the policy and procedures manual for recommendations and changes. Feedback is due January 1.

The EdVest Program has expanded for 2000-01 to allow families to purchase future tuition at current rates. Funds can be spent on books, room and board as well as tuition. This will go into effect as of August 1. Funds in this program cannot be included in the calculation of state financial aid eligibility. This will require a system of monitoring that needs to be worked out.

BOARD REPORT #00-01 STATUS OF 1999-00 AND 2000-01 APPLICANTS AND PROGRAMS

WHEG - WTCS has made 876 more awards with 9.15% less committed than at this time last year. WHEG - UW has committed 753 more awards and .95% more committed than at this time last year. Jane indicated they would be watching the progress of both systems closely to determine if formula changes need to take place. Mary Jo Green cautioned that it may be premature to change the formula because the effect of the changes in the federal formula are still unknown as to how it will effect the WHEG population. It appears more students are eligible, but we know some students have also lost eligibility. HEAB staff will continue to watch the trends. Wisconsin Tuition Grant has committed 2,620 more awards and 12.26% more committed than at this time last year. The WTG figures already reflect the formula changes.

Total applicants appear to be increasing (1998-99 totaled 163,305; 1999-00 totaled 175,430 and the number through July 21, for 2000-01 is already 18,336).

Jane provided a run down of each program with estimated carry over from 2000-01. The Handicapped Student Grant Program had a substantial amount of carry over for the year. The Indian Student Assistance Grant had carry over because no special project money was spent this year due to timing of when the funds became available. Expectations are that the funds will be spent this year. Minority Retention Grant-Independent Colleges was expected to be spent with some unexpected refunds and will be fully spent by the end of this year. The Minority Retention Grant-WTCS was spent 100%. The Minority Teacher Loan had unexpected refunds, so there will also be some carry over in this program.

BOARD REPORT #01-2 2001 2003 BIENNIAL BUDGET ISSUES

Jane has visited Wisconsin colleges and universities to discuss individual needs at the campuses and the common thread that exists across the state for educational needs. The mission of the agency is to provide access to higher education for residents of Wisconsin. HEAB's policies are primarily based around need-based programs, merit-based programs or specific needs of the State. The budget instructions indicate a 0% increase the first year and a 1% increase for the next year. The instructions also indicate an expected 5 % decrease. The approach that the Staff has taken was the 0% and 1% increase but then have a list of priorities so that if money should be available, there was a plan in place.

The Executive Secretary's recommendation that the number one priority, based on the discussions she had with the schools, should be to meet the proportion of financial need today that was met by the programs ten years ago and to increase grants to their statutory maximum (TIP and WHEG to the maximum of 1800). Mary Jo Green made a motion, seconded by Jeremy Shea, to recommend increases in the WHEG, WTG and TIP grants to their statutory maximums and to meet the proportion of financial need today that was met by the programs 10 years ago, as the number one priority because of the increased number of applicants, more financial need and limited financial resources, and to support our commitment to provide access to Wisconsin residents before anything else.

A discussion on the motion followed. Steve Van Ess suggested another measure to add, which has also been looked at in the past, which is to keep pace with tuition increases. Bill Steiger asked what that would mean as a percentage increase and/ or dollar amount increases. Jane provided figures demonstrating the increase based on the current statutory maximum: WTCS WHEG - 112% increase; UW WHEG - 59% increase; TIP - 59% increase. To meet the same proportional financial need, the increase would have to be 12% for all programs. President Clumpner requested clarification from Steve Van Ess in regard to his comments on adding the pace of tuition increases. Steve Van Ess offered an amendment to the motion with the goal to achieve the statutory maximum of $1800 to meet the same proportional need today comparable to 10 years ago with at least each program being increased by the amount of tuition increases as funds are available. The motion read as amended: "The Board is in agreement to recommend funding increases in WHEG and TIP to bring the grant amounts up to the statutory maximum of $1,800; to meet the same proportional financial need for TIP, WHEG and WTG as was met 10 years ago; and, at a minimum, keep pace with tuition increases for all programs."

Roll call vote. 9-1 passed.

WI Tuition Grant - The recommendation was made to eliminate the maximum of $2300 as defined in the statute to allow the HEAB Board more flexibility in setting the maximums to meet current needs. There was concern that the $2300 award was not meeting the goals it was designed to meet. HEAB Staff recommended this also be a number one priority. Sr. Mary Beth Kornely supported the need for flexibility because of the changes in the industry, the increased need of students and lack of resources.

Gerard Randall expressed concern about how to measure what level of support each of these items should have on the "wish list". He agreed that more students are needy now and students are forced to take more loans but he was not sure of how we communicate that so if funds do become available, the legislature has a sense of where our preferences are.

Jane made the clarification that in this recommendation, the Board is not asking for additional dollars but to eliminate the statutory language creating the $2300 maximum.

A motion was made by Steve Van Ess and seconded by Gerard Randall that the Board recommends the elimination of the language of the $2300 statutory maximum for the WI Tuition Grant.

Roll call vote: 10-0 passed.

WI Indian Grant - The Staff recommendation is to double the appropriation and to double the award to restore the Indian Assistance Grant Program back to the level it was in 1995-96. A motion by Steve Van Ess and seconded by Gerard Randall recommended the increase of the WI Indian Grant fund maximum to $2200 in the statutes and requested additional dollars to accommodate that change. A change in statutory language is necessary in order to award a maximum of $2200.

Roll call vote: 10-0 passed.

Minority Undergraduate Grant for WI Technical College Students and Independent College or University Students - Staff recommends the expansion of the Minority Grant program to make it available to first-year students as well as to continuing students for recruitment as well as retention purposes. There is concern in the state regarding the need to provide minorities access to higher education.

Marques Franklin made a motion and seconded by Steve Van Ess to expand the Minority Undergraduate Grant Program to first-year students; pursue an increase in funding to facilitate the expansion in order to meet the existing need as identified.

A discussion of the motion followed. Jeremy Shea asked the Chairman for the history of the program and why it was set up as is. Mike indicated that he recalled the key word was retention and Jane concurred. Gerard Randall spoke in support of the Minority Grant as a retention tool rather than a recruitment tool. He has seen where students may get the outside help from scholarships, churches, etc. to start school but have difficulty finishing. If the Board had to make a choice, he would support it as a retention tool first. Sandy Dercole indicated that WEOP concentrates their efforts on minority students in the first year and try to focus their TIP Grant funds in their second year for retention. Sr. Mary Beth indicated her experiences have been completely opposite - even though the student has a lot of need, she can't offer the minority grant that first year. Students may get very discouraged and leave that first year. She suggested expanding the program to the first year to provide the support a student may need for retention. Steve Van Ess pointed out two distinct groups of students: some with family support and community resources and then those who have very little support and, actually for them, that first year is a very high-risk year. Student loan default statistics support this concept. It has been shown that if students drop out in the first year with loan debt, the chances of default are higher. Sandy Dercole made the point that a lot of these programs have been diluted over the years and may not be meeting the real needs. Mary Jo Green has seen in her system a lack of resources for minority students at recruitment and at retention, even with the Minority Grant, because it is so limited in funding. She commented that she could only fund 3 students in their second year at $100 each, which looses effectiveness at any level.

Roll call vote: 9-1 passed.

Minority Teacher Loan Program - This program has a purpose not only to provide minority students access, but also to provide teachers in minority areas that have a shortage. The staff recommends expanding the minority teacher loan program to allow graduate students as well as undergraduates and to increase funding to allow the expansion and to meet the financial need and to bring the maximum grant to $4000 from $2500. Steve Van Ess requested clarification of the expansion to graduates and their requirement to teach in a minority setting. If this change was included, it would change the whole program emphasis. Gerard Randall also had some concerns in changing the program emphasis. A motion was made by Gerard Randall and seconded by Bill Steiger that the maximum be eliminated to allow the annual maximum of $4000 from $2500 and to increase the appropriation to cover the increase.

Roll call vote: 10-0 passed.

Dental Capitalization Program - This program was essentially started to increase the number of Wisconsin dentists. There may be a shortage of dentists in the near future. The majority of the students funded by this program do stay in Wisconsin; therefore, meeting the intent of this program. The average dental student graduate has an average loan debt of $82,000. The rural areas and the medicaid recipients have a shortage of dentists. This may be due to income levels and the dentist's ability to pay back such high loan amounts.

The recommendations are:

1. To expand the dental capitalization program to increase the number of participants to allow 15 more students per year (total of 60) for a four-year program;
2. To increase appropriation funding to allow that expansion; and
3. To increase appropriation to allow for 50% of the cost of tuition ($15000 per student maximum). The current appropriation allows for 33% of cost.

A motion was made by Mary Jo Green and seconded by Marques Franklin to adjourn the meeting. The meeting was adjourned at 1:08 p.m.