Retain Wyoming's Youth? Step One: Modify the Hathaway Scholarship Program

Disclaimer: The opinions in this article are my own. They in no way reflect the opinions of the Governor of Wyoming, or the State of Wyoming.

In 2005, the Wyoming legislature established a $400 million permanent endowment to provide scholarships to qualified Wyoming high school graduates to attend the University of Wyoming or any of the state's seven community colleges at a highly reduced rate. The legislature named the scholarship program after former Governor Stan Hathaway (Hathaway Scholarship). It was initially intended to increase opportunities for Wyoming youth to pursue post-secondary education, and in turn increase economic development and diversity in Wyoming though a highly educated work force.

The Hathaway Scholarship awards money on a tiered system, rewarding higher academic performance. The scholarship levels are:

• Honors: Requires a 3.5 GPA and 25 ACT score. Awards $1680/semester, and students must maintain a 2.5 GPA in college to keep the scholarship;
• Performance: Requires a 3.0 GPA and 21 ACT score. Awards $1260/semester, and must maintain a 2.5 in college to keep the scholarship;
• Opportunity: Requires a 2.5 GPA and 19 ACT score. Awards $840/semester, and must maintain a 2.25 in college to retain the scholarship; and
• Provisional: Requires a 2.5 GPA and 17 ACT score. The student must begin their education at a Community College, and receives $840/semester. The student must complete their associate degree with a minimum 2.25 GPA to retain their scholarship upon transfer to the University of Wyoming.

These dollar amounts are significant. For the 2017 spring semester, the cost of resident tuition is $1860, meaning the Hathaway Scholarship can significantly reduce a student's out-of-pocket expenses. In this way, the legislature was visionary--providing an opportunity for low-cost higher education to every Wyoming high school student that meets basic educational standards. Yet, whether the program provides measurable benefit to the State as originally contemplated is debatable. After more than ten years of implementation, our leaders need to determine if Hathaway Scholarship serves the State and its students in the most effective manner. I argue that it does not.

One criticism of the Hathaway Scholarship is that it has evolved into an entitlement, rather than a true scholarship rewarding hard work. Many students expect to receive the scholarship, yet are not college-ready. Then, after poor academic performance, they lose it. For example, in the 2015-2016 school year, nearly 26% (607 students) of all Hathaway Scholarship recipients lost their eligibility after the initial year. Even more telling, only 61% of those students receiving a scholarship as freshmen in 2014-2015, continued to receive the scholarship as sophomores in 2015-2016. These scholarship reductions are significant.

There are ripple effects from these failures. Most notably, the University of Wyoming and the seven community colleges must hire instructors to teach the scholarship recipients. When hundreds of students stop receiving the scholarship, and ultimately stop attending school, these instructors continue receiving salaries. It creates a juggling act for the various departments to ensure they are staffed at appropriate levels to provide the necessary course offerings, while being mindful of restricted budgets.

Additionally, the State receives little to no return on their investment from the hundreds of students that lose the scholarship each year. If law makers desire to produce a more highly educated workforce to help stimulate and diversify our economy, then investing millions of dollars on students who do not graduate falls short of that objective.

Finally, the scholarship program in its current form does nothing to incentivize the retention of those who graduate. Students still flock to other states for employment, and we are left hoping that they decide to return some day. Though nationally, there are benefits to a highly educated work force, spending millions of Wyoming dollars to educate the work force for other states is at odds with the original objectives of Hathaway Scholarship program.

The Hathaway Scholarship is noble and forward thinking, but it's time to do better. Economic times are dire. As a state we need to do more to maximize the return on our $400 million investment, while still doing all we can to provide post-secondary education opportunities to our citizens. We need incentivize youth retention and entrepreneurship to modernize and diversify Wyoming's economy. We can take a step in the right direction through modernization of the Hathaway Scholarship program.

Modernization entails continuing to provide money for college to as many high school students as possible, but in a way that removes the sense of entitlement. The Hathaway Scholarship program should hold the student accountable for failing to hold up their end of the educational bargain, and encourage students to either remain in Wyoming upon graduation, or return within a defined time period.

With this in mind, I propose one significant modification to the Hathaway Scholarship program. Instead of awarding scholarships, the program should award interest deferred loans to qualifying high school seniors based upon the same GPA and ACT criteria identified above. However, if requisite college and post-graduation criteria are met, then the State should forgive some, or all loans and interest, as described below.

Loan Terms for a Student who Fails to Graduate

• If a student accepts the scholarship, fails to maintain the necessary GPA to keep it, and fails to graduate, that student must repay the loan at an interest rate of 5-8%
• If a student accepts the scholarship, maintains the qualifying status, but fails to graduate, that student must repay the loan at an interest rate of 5-8%.

Loan Terms for a Student who Graduates

• If a student accepts the loan, fails to maintain the necessary GPA to keep it, but still graduates, that student must still repay the loan, but at a reduced interest rate of 2-4%.
• If a student accepts the loan, and maintains it though graduation, but accepts post-graduation work out of Wyoming, they must repay the loan, but at a reduced interest rate of 2-4%.

Loan Terms for Graduates who Remain in Wyoming

• If a student completes their degree, accepts employment in Wyoming, and works for three consecutive years, the state will forgive all principle and interest--effectively turning the loan into a scholarship.
• If a student completes their degree, and accepts employment in a different state, they will be subject to a reduced interest rate of 2-4%. However, if the student returns to Wyoming to work within ten years of graduating, and works for three consecutive years in Wyoming, the loan will be forgiven.

I know some will suggest this approach is too radical, and argue to support the status quo--citing to the provision in Wyoming's Constitution that requires that tuition at the University of Wyoming be as nearly free as possible. Others may have concerns about our young residents being saddled with debt at the hands of the State. While these concerns are certainly valid, I posit that the University of Wyoming remains on of the most affordable schools in the country, and that Wyoming uses similar programs to recruit and retain physicians and nurses with success.

I am also not suggesting that my proposal is the only, or even the best way to improve the Hathaway Scholarship program--it is merely meant to start a discussion. In the end, any number of possibilities may work. I simply argue that we must balance the desire to provide low-cost higher education for our young people with the need to retain an educated workforce that can help diversify our economy. Achieving this balance necessitates an evaluation of the Hathaway Scholarship program.

Will making these changes to the Hathaway Scholarship program solve our economic crisis? Of course not. However, expanding incentive based educational opportunities is a small piece of a much larger economic diversification puzzle. A puzzle that when completed will give Wyomingites more opportunities to get an education in Wyoming, work in Wyoming, and raise a family in Wyoming.

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