HB2165

SECTION 1. The legislature finds that an educated labor force and engaged citizenry are essential in today's global, knowledge-based economy. Across the nation, states have set ambitious goals to boost college completion rates. The University of Hawaii's graduation initiative is a systemwide strategic initiative endorsed by the University of Hawaii board of regents with a goal to increase the educational capital of the State by increasing participation in, and completion of, college by students, particularly native Hawaiians, low-income students, and those from underserved regions and populations, and preparing them for success in the workforce and their communities.

Furthermore, Hawaii's own 55 by '25 campaign goal focuses on increasing the percentage of working-age adults with two- or four-year degrees to fifty-five per cent by 2025. According to the most recent data available, forty-four per cent of Hawaii's working-age adults have a postsecondary degree. As the State's sole public higher education system, the University of Hawaii is committed to doing its part to close the State's projected educational attainment gap.

In April 2016, the Institute for Research on Higher Education at the University of Pennsylvania Graduate School of Education issued a study that analyzed college costs in relation to family income level. The study revealed how higher education has gone from expensive to unaffordable for most low- and middle-income families. According to this same study, Hawaii ranked third in the nation for overall college affordability and noted that the University of Hawaii community colleges are the most affordable public two-year institutions in the nation.

The report further acknowledged that despite Hawaii's overall high affordability ranking, attending college was a big expense for families earning less than $30,000 annually; that Hawaii's financial aid policies did little to alleviate costs for these families; and that the State provided minimal need-based aid to students attending public institutions.

Although the State does not budget for scholarships, University of Hawaii policy requires that a minimum percentage of tuition revenue be set aside for need-based scholarships, including 8.8 per cent at the community colleges. The University of Hawaii provided $46,700,000 in tuition-funded financial aid during 2014-2015, including $6,300,000 at the community colleges. Even though financial aid through Pell grants, University of Hawaii and private scholarships, the GI Bill for service members and veterans, and employers covers much of the cost for need-based students, cost is still a barrier for certain need-based students.

The purpose of this Act is to establish the Hawaii promise program to provide scholarships for the unmet direct cost needs of qualified students enrolled at any University of Hawaii campus, including community college campuses, and to appropriate funds to establish and implement the program.

SECTION 2. Chapter 304A, Hawaii Revised Statutes, is amended by adding a new section to part II, subpart B, to be appropriately designated and to read as follows:

"§304A-A Hawaii promise program; established. (a) Notwithstanding section 304A-502, there is established the Hawaii promise program to be administered by the board of regents. The program shall provide scholarships for the unmet direct cost needs of qualified students enrolled at any campus of the University of Hawaii.

(b) A student enrolled at a community college campus shall be eligible for scholarship consideration for a maximum of eight semesters if the student:

(1) Qualifies for Hawaii resident tuition;

(2) Completes and submits the Free Application for Federal Student Aid for each academic year and accepts all federal and state aid, grants, scholarships, and other funding sources that do not require repayment;

(3) Is enrolled in a classified degree or certificate program with six or more credits per semester;

(4) Maintains satisfactory academic progress, as defined by federal requirements established pursuant to Title IV of the Higher Education Act of 1965, as amended, and determined by the campus where the student is enrolled; and

(5) Has been determined by the campus to have unmet direct cost needs.

(c) A student enrolled at a University of Hawaii campus, other than a community college campus, shall be eligible for scholarship consideration for a maximum of eight semesters if the student:

(1) Qualifies for Hawaii resident tuition;

(3) Is enrolled in a classified degree or certificate program with fifteen or more credits per semester;

(5) Has been determined by the campus to have unmet direct cost needs.

(d) Scholarships shall be awarded to the extent possible based on available funds and on a first-come, first-served basis. An award granted to a student shall be equal to the student's unmet direct cost need, based on the Free Application for Federal Student Aid calculation of need, less the amounts available to the student from Pell grants and other scholarships.

(e) To maintain a scholarship under this section, a student shall:

(1) Maintain a grade point average of 2.5 or higher, on a scale of 4.0 or its equivalent;

(2) Earn a minimum of:

(A) Twelve credits in one academic year if the student is enrolled at a community college campus; or

(B) Thirty credits in one academic year if the student is enrolled at a University of Hawaii campus other than a community college campus; and

(3) Comply with any other conditions placed on the scholarship by the University of Hawaii.

(f) A student who fails to comply with the requirements of subsection (e) shall be placed on scholarship probation. Social, economic, and other factors, or other extenuating circumstances as determined by the University of Hawaii shall be considered in determining probation. If the student demonstrates during the probation period satisfactory progress toward meeting degree completion and satisfying the requirements of the scholarship, the student shall be returned to good standing. Failure to meet the probationary period requirements of this subsection shall result in revocation of the student's scholarship, and the student shall be responsible for reimbursing the University of Hawaii for up to two semesters of scholarship amounts received under the program. A student may be placed on scholarship probation only once during any eight-semester period at a University of Hawaii campus. If a student is returned to good standing after a period of probation, but subsequently fails to comply with the requirements of subsection (e) at any time within an eight-semester period, after the return to good standing, the student's scholarship shall be revoked.

(g) As used in this section, "direct cost" means any cost directly related to a student's education. "Direct costs" include tuition, educational fees, and the costs of books, supplies, and transportation between the student's dwelling and the student's campus."

SECTION 3. Chapter 304A, Hawaii Revised Statutes, is amended by adding a new section to part V, subpart C, to be appropriately designated and to read as follows:

"§304A-B Hawaii promise program special fund. (a) There is established the Hawaii promise program special fund to be administered by the University of Hawaii. The special fund shall be administered pursuant to the authority of the board of regents to grant, modify, or suspend the scholarship and assistance under section 304A-501. This fund shall be used to provide financial assistance to qualified students through Hawaii promise program scholarships under section 304A-A.

(b) The University of Hawaii shall submit a report to the legislature no later than twenty days prior to the convening of each regular session with information on the special fund. The report shall include but not be limited to:

(1) The number of scholarships provided under the Hawaii promise program in the preceding year; and

(2) Recommendations as appropriate to the legislature on all tuition waivers.

SECTION 4. There is appropriated out of the general revenues of the State of Hawaii the sum of $ or so much thereof as may be necessary for fiscal year 2018-2019 to be deposited into the Hawaii promise program special fund.

SECTION 5. There is appropriated out of the general revenues of the State of Hawaii the sum of $ or so much thereof as may be necessary for fiscal year 2018-2019 to establish and implement the Hawaii promise program, including the provision of the program's scholarships, at the University of Hawaii at Manoa, Hilo, and West Oahu campuses.

The sum appropriated shall be expended by the University of Hawaii for the purposes of this Act.

SECTION 6. There is appropriated out of the general revenues of the State of Hawaii the sum of $ or so much thereof as may be necessary for fiscal year 2018-2019 to establish and implement the Hawaii promise program, including the provision of the program's scholarships, at the community college campuses of the University of Hawaii.

The sum appropriated shall be expended by the University of Hawaii for the purposes of this Act.

SECTION 7. In codifying the new sections added by sections 2 and 3 of this Act, the revisor of statutes shall substitute appropriate section numbers for the letters used in designating the new sections in this Act.

SECTION 8. New statutory material is underscored.

SECTION 9. This Act shall take effect on July 1, 2018.

INTRODUCED BY:	_____________________________

HOUSE OF REPRESENTATIVES	H.B. NO.	2165
TWENTY-NINTH LEGISLATURE, 2018
STATE OF HAWAII