Office of Higher Education warns North Star Promise funding strained by state grant shortfalls

The Minnesota Office of Higher Education told the House Higher Education Finance and Policy Committee that the North Star Promise scholarship program spent tens of millions of dollars in its first term and faces a shortfall in coming fiscal years tied to projected deficits in the state grant program.

The agency’s commissioner, Dennis Olsen, and Carrie Schneider, research director for the Office of Higher Education, presented updated spending and projection figures and described how changes to state grant parameters and federal Pell outlooks affect North Star Promise resources.

The North Star Promise program was funded with an appropriation for fiscal 2025 of $117,000,000; $5,000,000 of those funds were transferred to cover costs for the Fostering Independence Higher Education Grant Program, leaving $112,000,000 in the program for fiscal 2025, Schneider said. The program has two components: a North Star Promise Base award that covers tuition and fees after other gift aid and a North Star Promise Plus award for students with greatest financial need that can cover additional costs such as books and supplies.

“Fall of 24 is the first term that…