University of Iowa reinstates scholarships to undergraduates

The University of Iowa has decided to reinstate scholarships to undergraduates who were informed recently that they would lose promised funding. I enclose below an e-mail many students received this morning from President Bruce Harreld.

Two students had already filed class-action lawsuits over the university’s decision to terminate five scholarships in order to save some $4.3 million. A trial pitting the university against children of alumni would be a public relations nightmare. In addition, Harreld would have had to explain under oath why university officials wrongly claimed last week to have warned current scholarship holders that awards were contingent on state funding levels.

In today’s message to students, Harreld noted,

Over the past few days we heard from many families who were unaware this was a renewable scholarship reliant on state support. While this was not a need-based award, we also heard from families who budgeted for college based on the scholarships and feared financial hardship with the programs’ elimination.

The University of Iowa takes its relationship with students and alumni very seriously and, therefore, will honor the awards previously made to those currently receiving this scholarship. […]

Moving forward we must continue to place a priority on need-based and merit-based awards, which is why the Iowa Heritage Award will no longer be offered to new students who start at the university in 2018.

I also enclose below a statement released by the university.

UPDATE: Added comments from James Larew, the attorney representing plaintiff Jenna Pokorny.

E-mail students received on March 1:

Dear [student’s first name],

After careful consideration we have decided to reinstate your Iowa Heritage Award. You will continue receiving this scholarship as long as you maintain the original conditions of the scholarship.

Over the past few days we heard from many families who were unaware this was a renewable scholarship reliant on state support. While this was not a need-based award, we also heard from families who budgeted for college based on the scholarships and feared financial hardship with the programs’ elimination.

The University of Iowa takes its relationship with students and alumni very seriously and, therefore, will honor the awards previously made to those currently receiving this scholarship. Continuing this scholarship while absorbing the $9.2 million reduction in state funding will be difficult. If this reduction becomes permanent, it will return the UI to the level of state funding provided in fiscal year 2014.

Single-year solutions or short-term decreases in spending are not viable options. It is not possible to simply absorb the cut. Over the past few days I have had productive conversations with members of the Board of Regents, the Governor, and the Iowa General Assembly. I appreciate their willingness to establish predictable tuition revenue increases and the level of state support necessary for us to compete with our national peers.

Moving forward we must continue to place a priority on need-based and merit-based awards, which is why the Iowa Heritage Award will no longer be offered to new students who start at the university in 2018.

Our focus on academic excellence and our core mission of education, research and discovery is unwavering, and we apologize for the disruption this has caused you and your family.

Sincerely,

Bruce Harreld
President
The University of Iowa

March 1 statement released by the University of Iowa Office of Strategic Communication:

March 1, 2017

After careful consideration we have decided to reinstate, for current students and students enrolling in the fall of 2017, scholarships previously identified for elimination, including:

• Iowa Heritage Award
• Iowa Heritage Transfer Award
• President’s Heritage Award
• 2 Plus 2 Transfer Scholarship
• Iowa Community College Transfer Academic Scholarship
As is the current practice, students must maintain the original conditions of the scholarship. Moving forward, we must continue to place a priority on need-based and merit-based awards, which is why the scholarships listed above will still be discontinued for new students starting in 2018.

Over the past few days, we heard from many families who were unaware that these were renewable scholarships reliant on state support. Though these were never need based, we also heard from families who budgeted for college based on these scholarships and feared financial hardship with the programs’ elimination.

“I want to thank the students and parents who contacted me and shared their concerns. The University of Iowa takes its relationship with students and alumni very seriously and wants to honor the awards previously made to those currently receiving these awards,” says UI President Bruce Harreld.

Continuing these scholarships while absorbing the $9.2 million reduction in state funding will not be easy. If the state reduction becomes permanent, it will return the UI to the level of state funding provided in fiscal year 2014.

“Over the past few days I have had productive conversations with members of the Board of Regents, the governor, and the Iowa General Assembly. I appreciate their willingness to establish predictable tuition revenue increases and state support moving forward,” says Harreld. “We all realize that without new and stable resources, the university will not be able to execute its recently approved strategic plan and keep providing high-quality education to students in line with its national peers.”

UPDATE: Attorney James Larew commented on March 1,

This is the right decision.

If Iowans want to continue a long-standing tradition of providing world class educations for its citizens, the Iowa General Assembly needs to restore past practices of providing sufficient funding to allow that to occur.

At the same time, tough budget decisions cannot be made in such a way to cause those who are least able to carry the burden be forced to do so.

I am very proud of Jenna Pokorny.

She is brave. She is articulate. She is a leader. She was a perfect plaintiff in the lawsuit that she filed. And, I suspect, the University of Iowa recognized that reality when it made its decision to keep its promises to Jenna and others who are similarly situated.

SECOND UPDATE: Iowa Board of Regents President Bruce Rastetter released this statement on March 1:

I am pleased with the announcement from President Harreld today. The Board of Regents realizes continuing these scholarships while absorbing a $9.2 million cut in state funding places the University of Iowa in a very difficult financial situation. The Board looks forward to working with the UI to resolve this short-term issue.

We also realize that a longer-term funding solution is needed that allows the UI to reach the strategic plan we recently approved. Moving forward, if the state chooses not to adequately fund the UI’s five-year strategic plan, the Board is committed to work with the UI to bring its tuition in line with its national peer group.

Rastetter struck a far different tone when Governor Terry Branstad proposed big funding cuts for Iowa’s state universities earlier this year. Here’s that January 10 statement from Rastetter:

The Board of Regents appreciates Governor Branstad’s and Lieutenant Governor Reynolds’ continued support for higher education.

They have been very supportive of our two-year funding model that the Board passed in the fall. This new approach provides for more predictability, transparency and long-term planning for students and their families.

We understand the revenue constraints the state is facing for the current fiscal year. We will work with our institutions to make the required reductions in a way that has the least effect on students.

We will work with the Governor and General Assembly in the upcoming legislative session to ensure Iowa public universities receive the level of funding that is needed to provide the quality education that our students deserve.

Bringing the University of Iowa’s tuition “in line with its national peer group” would involve a 33 percent increase over the next five years. From Jeff Charis-Carlson’s story for the Iowa City Press-Citizen:

The Iowa Board of Regents, which oversees Iowa’s three public universities, issued a statement Wednesday supporting UI’s decision to reinstate the scholarships. None of the nine members of the board had any questions for Harreld during last week’s board meeting, in which he informed them of UI’s plans to cut $4.3 million worth of promised scholarships for the 2017-18 academic year. […]

Harreld told lawmakers last week that UI would be willing to commit every state dollar above the current appropriation level to be used to support resident students. That promise, he said, was conditional upon UI receiving permission to raise its tuition and fees over the next five years from nearly $9,000 to nearly $12,000.

The Board of Regents alone has the authority to set tuition levels at the public universities, but state lawmakers and the governor set and approve the state funding levels of each of the three institutions.

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