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Committee A‑4 raises state grant investment and changes award parameters, including family responsibility and living allowance
Summary
The A‑4 amendment increases funding for Minnesota's state grant program and includes multiple statutory parameter changes in Article 2 intended to stabilize awards and allow OHE to reduce awards if appropriations fall short; staff described the planned changes at the hearing.
Nonpartisan staff and committee members discussed several proposed amendments to the Minnesota state grant program that appear in Article 2 of the A‑4 amendment to Senate File 2,483. Staff said the package combines a large one‑time and ongoing funding increase with changes to award formulas and administrative flexibility.
"The A 4 proposes a total general fund budget of $4,071,092,000 in the 20 six‑twenty 7 biennium," staff said, and they highlighted a $104,520,000 increase in the state grant program in 2026–27. Tom Watson and other staff briefed the committee on specific statutory changes in Article 2 that affect how awards are calculated and administered.
Key parameter changes described by staff
- Assigned family responsibility (AFR): The amendment raises the AFR for dependent students to 90% of the parental contribution (up from 79%). Article 2 also changes how negative parental and student contributions are handled, setting a floor of negative $1,500 for calculation purposes. Staff explained this is intended to prevent future large negative contributions from producing disproportionately large award calculations.
- Cost of attendance/living allowance: The package changes the living and miscellaneous expense allowance used in cost‑of‑attendance calculations, moving from 15% of federal poverty guidelines to 10%, per staff explanation.
- Award timing and deadlines: The bill moves the annual deadline for applying for state grant aid from June 30 to 30 days after the start of the term for which a student applies. Staff said this aligns awards more closely with enrollment periods and was part of the governor's proposal.
- Award reductions when funds are insufficient: Staff said Section 17 clarifies the statutory process for reducing awards if appropriations do not fully fund the program. The provision allows OHE to adjust the AFR and add a surcharge; staff and agency witnesses discussed the effect on different student categories (dependent, independent, students with dependents).
- Credit limit and lifetime limits: Section 19 reduces the lifetime credit limit a student may use state grant dollars for from 180 credits to 120 credits.
Why it matters: the committee's changes pair a large funding increase with policy changes intended to keep the program solvent and predictable over time. Commissioner Dennis Holston of the Office of Higher Education said the office "appreciate[s] the balanced approach" and the flexibility to adjust awards if shortfalls recur.
What was not decided: The committee did not vote; staff noted several items remain pending fiscal notes and technical drafting work.
Speakers cited in this article appear in the committee record and were restricted to the list of testifiers and staff present.
