Higher Education

Higher Education Omnibus Budget Bill

The pandemic has hit post-secondary institutions, students and families hard, forcing most schools into online learning, which caused revenue loss for both the University of Minnesota and the Minnesota State system.

Fortunately, the special session agreement provides $100 million in additional funding (FY 22-23) and $100 million in FY 24-25. This is a 50% increase from the Senate Republican target that passed in May. Republican’s $45 million budget investment was $60.6 million short of what is needed to cover higher education inflationary costs for the coming two-year period. The increased investments for MinnState and the U of M were welcome news for the systems that are trying to recover from the enrollment declines of COVID-19.

The governor proposed a $170.3 million increase for FY 22-23, $77 million for MinnState and $46.5 for the U of M. Other increases included a $6.3 million increase in the state grant program, $35 million in Workforce Stabilization Grants and $1 million for the Direct Admissions Minnesota process for high school seniors. Other items funded include the Summer Academic Enrichment Program at $1 million, Intervention for College Attendance Program at $1.30 million and Teachers of Color Grants at $5.4 million. (HF 7)

Notable items in HF 7 include:


MinnState will receive $56.4 million in FY 22-23 and $54.1 million in FY 24-25for operations and maintenance and other programs including:

  • Supplemental aid to non-metro colleges: $5.4 million each biennia FY 22-23/FY 24-25.
  • Workforce Development Scholarships: $1 million each biennium, FY 22-23/FY 24-25, with student transfer scholarship eligibility reduced from 12 to 9 semesters requirement.
  • Mental Health Awareness: $1.5 million (FY 22): requires the MinnState board to implement a mental health awareness program at each community and technical college by fall of 2022.

The MinnState Board of Trustees is also required to request guidance from the U.S. Department of Education on whether federal COVID-19 relief funds may be used to refund or credit students for online courses in the 2020-2021 school year that were not online in the previous year. The letter to the federal government was sent at the end of June for guidance instructions.

MinnState agrees to tuition caps

MinnState tuition rates for undergraduate students at colleges and universities must not increase by more than 3.5% during the 2021- 2022 and 2022-2023 academic years. A university may change base tuition to adjust for the reduction of online differential charges provided the change is revenue neutral.

University of Minnesota investments increase

The University of Minnesota will receive $38 million in FY2 2-23 and FY 24-25 for operations and maintenance assistance. The Natural Resources Research Institute in Hermantown will receive a $500,000 increase (FY 22-23) to continue its natural resources economic development initiative. The Mayo Foundation will receive $2.7 million each biennia FY 22-23/FY 24-25).

State grant funding increases and changes included

The state grant program that provides tuition aid to students will increase by $5.2 million in FY 22-23 and FY 24-25. Provisions agreed to would also lower the percentage amount students are required to contribute to their college costs. Living and Miscellaneous Expenses percentage change increases from 106% of poverty to 109%. Assigned family responsibility (AFR) means the​ amount of a family’s contribution to a student’s cost of attendance, as determined by a federal​ need analysis to determine state grants amounts. All three areas decreased by three percentage points.

  • Percentage changes in the higher education bill:
    • Dependent students, the assigned family responsibility is 79%​ of the parental contribution.
    • Independent students with dependents other than a spouse, the AFR is 71% of the student contribution.
    • Independent students without dependents other than a spouse, the AFR is 35% of the student contribution.
    • These changes will have the following impact: 2,782 new student grant recipients.
      • Average grant increase: $87
      • 46% of new students will be from families with incomes below $40,000
      • Average grant for these students: $67

The State grant and childcare grant program eligibility extension entitles students who provide care to a spouse, child or parent with a serious health condition that limits the student to complete the term to an additional semester of eligibility for grant awards.

Report required on expense patterns of public higher education institutions

Requires the MinnState Board of Trustees and requests the U of M Board of Regents to provide a report on the expense patterns of public higher education institutions based on the data provided by to the National Center for Education Statistics (NCES).

Students are guaranteed transcript access

A school may not refuse to issue a transcript to a student if the student owes a debt/fee lower than $250, is from a prospective employer; if the student has entered into and is in compliance with a payment plan with the school or the school has sent it to debt collection. The provision will be uncodified and will expire on June 30, 2024, and a report to the Legislature is required. This provision was added on the floor to the Senate bill.

Teachers of Color Act provisions included in agreement

The higher education provisions of the Teachers of Color Indigenous Act (TOCAI) have bipartisan support and would provide an additional $5.5 million for three main areas:  Aspiring MN Teachers of Color Scholarship Program ($3 million-FY 22-23); grants to underrepresented teachers ($2 million-FY 22-23; $1.125 million-FY 24-25) and grants to student teachers in shortage areas ($500,000/year, ongoing). This appropriation would couple with the E-12 provisions to help Minnesota enhance teacher workforce diversity. Currently Minnesota’s teacher workforce is over 90% white, but students of color makeup 38% of the student population.

College Possible, a program to increase students of color admission to college and degree completion received an additional $100,000 (FY 22-23 and FY 24-25) to the base $1.1 million appropriation.

Hunger Free Campus grants will help students in need

Legislation to expand Hunger-Free Campus designations at Minnesota public colleges and universities would fund grants to help campus groups provide food options for students in need. The bill provides $307,000 (FY 22-23) to expand programs and $204,000 (FY 24-25). Minnesota State and University of Minnesota campuses could receive the designations and grants. The funding is needed because today’s college student population has changed over the past few decades. They are older—45% are over 21 and 30% are parents. Of that 30%, 55% reported having experienced food insecurity. The Hope Center for College Community and Justice surveyed almost 10,000 students from 25 two-year and three four-year colleges in Minnesota and found that 37% of students had been food insecure the prior 30 days, 48% had been housing insecure the previous year, and 18% reported being homeless the previous year. The grants would be used for food pantries and other food emergency programs.

Student basic needs resources and emergency assistance funded

$1 million is provided and requires MinnState to develop an online basic needs resource hub and a financial aid resource trigger at all the community and technical colleges. The resource hub is for students to access information about resources that can assist with meeting basic needs. A second provision sets up an emergency assistance grant program ($188,000 FY 22-23; $$288,000 (FY 24-25) for post-secondary institutions that have a demonstrable homeless student population. The grants require a funding match.

Direct admissions will boost student college access

The agreement directs Office of Higher Education, Minnesota Department of Education, MinnState and others to create a program to automatically admit high school seniors to college and to provide information on higher education options and available grants. Total funding: $1 million FY 22-23. $150,000 (FY 24-25)

Z-degree Program will expand

Four additional Minnesota State colleges would be required to offer z-degree programs on their campuses and provide free textbooks to the students under the program. In 2019, legislation passed to require three colleges to provide a Z-degree Program with $500,000 appropriated. This bill would include a $500,000 funding base and $100,000 in FY 24-25.

Foster kids to get help

The bill creates a grant and waiver program for public and non-profit private institutions to provide tuition/room and board assistance to children who meet the bills’ criteria for foster care. Total funding: $3.9 million (FY 22-23) and $7.522 million (FY 24-25)

National statistics about foster children report:

  • Just 10% enroll in a degree or vocational certificate program
    • Of those 10%, only 26% will graduate

Foster kids have terrible postsecondary outcomes with many lacking the kind of family support and institutional knowledge kids need to make it through college, especially if they age out (at 21) as wards of the state with no family.

Notable items in HF 7 that weren’t included:

MinnState tuition cuts requirements

A provision requiring MinnState to cut student tuition by 5% below the 20-21 rate for the coming two academic years was added to the Senate Higher Education bill although the issue never had a committee hearing. MinnState said the provision would cost the system $60 million. MinnState was encouraged to federal relief dollars to backfill. Officials are unsure if the federal money can be used for tuition cuts. It was not included in the special session agreement.

University of MN tuition cuts encouraged

Similarly, the U of M was “encouraged” to cut tuition by 3% from 20-21 rate for the coming two academic years. Again, the U encouraged to use federal funds to backfill.

COVID19 faculty stipends don’t make the cut

The Senate bill required MinnState and the U of M was encouraged to provide $500 COVID-19 stipends to faculty. Again, federal money was suggested to pay for the stipends.

Maintenance of Effort Waiver

OHE Commissioner was required to request a Maintenance of Effort waiver from the federal government for COVID-19 relief requirements.

Private school teacher loan forgiveness deleted

The Senate bill changed the “school district” definition to include a nonpublic school, so private school teachers would have been eligible for the loan forgiveness program.

Higher Education Facilities expansion nixed

A provision to expand the authority and scope of the Minnesota Higher Education Facilities Authority (MHEFA) by allowing the MHEFA to provide financing to health care organizations was not included in the Senate bill or in the final agreement. An attempt to amend the provision into the bill on the floor also failed.

The MHEFA is a small state agency that was established in 1971 to provide an alternative method for higher education institutions in the state to finance or refinance capital construction projects by issuing tax exempt revenue bonds.

Spinal cord/traumatic brain injury grant program transfer fails

A bill to transfer the spinal cord and traumatic brain injury grant program to HHS with appropriation to be deposited to the special revenue fund did not happen; the provision remains with OHE. The governor suggested this funding be transferred from higher education to a more suitable agency. The appropriation remains at $3 million per year.