Hathaway student scholarship program-award increase.

14LSO-0193.C1

FISCAL NOTE

	FY 2015	FY 2016	FY 2017
NON-ADMINISTRATIVE IMPACT
Anticipated Expenditure Increase:
HATHAWAY SCHOLAR. EXPEND.	1,860,024	1,907,805	1,924,407

Source of Expenditure Increase:

The increase in expenditures to the Hathaway Scholarship Expenditure Account would result from the 10 percent increase to the scholarship award amounts.  The estimated total expenditures out of the Hathaway Scholarship Expenditure Account would be $20,460,260 for FY15, $20,985,855 for FY16, and $21,168,476 for FY17.  Income from the Hathaway Scholarship Endowment Account flows into the Hathaway Scholarship Expenditure Account to pay for Hathaway Scholarships.

Historical total investment income from the Hathaway Scholarship Endowment Account has averaged around $23,500,000 since the Hathaway Scholarship Endowment Account was fully funded in FY08  This average does include capital gains. 

Income projections from the State Treasurer’s Office, as of October 2013, for the Hathaway Scholarship Endowment Account are $12,300,000 per year for FY15, FY16, and FY17.  These projections do not include capital gains.

Assumptions:

The increase shown above is based upon the Department of Education’s Hathaway Scholarship projections based upon historical K-12 enrollment numbers from December of 2013. It is assumed that all students currently and prospectively would receive the new scholarship level award amounts. 

This estimate does not include any potential changes in student behavior such as more students qualifying or accepting the Hathaway Scholarship, changes in the percentage of students receiving different level scholarships, or any changes in scholarship retention rates.  Any changes to these variables would affect the total number of students receiving Hathaway Scholarships and thus the total expenditures in the future.

Prepared by:   Matthew Sackett, LSO  Phone: 777-7881