North Star Promise is an assist for attending college, but navigate carefully

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Last year, Minnesota enacted legislation to help defray the costs of higher education, called the North Star Promise. The program is designed to create a tuition- and fee-free pathway to higher education for families with household incomes below $80,000. But many may not be aware of program implications for Minnesota’s highest-need students or that money intended to support the total cost of attending college may be displaced in the process.

In greater Minnesota, higher education is an essential ingredient in building community wealth, moving rural places forward and keeping talent close to home. Unfortunately, the total cost of attending and completing college is an enormous burden on households across the state. The most recent State of Higher Education report found “cost” to be the top reason people choose not to attend college, alongside dozens of barriers to college completion ranging from the need to work or support dependents while studying and making enough academic progress to satisfy aid requirements.

That’s why so many civic organizations and institutions like ours provide scholarships or grants to help local students surmount the barriers, complete their studies and land well-paying jobs. And it’s why some advocates for higher education accessibility are working to educate the public about the fine print of programs like North Star.

As anyone navigating the college application process can tell you, financial aid is complicated. Imagine a glass representing the total cost of college that needs to be filled. Scholarships can typically be used to fund anything in the glass, such as transportation, tuition, housing or food. Tuition accounts for 34% of the total cost of attending college in Minnesota, so let’s envision that the bottom one-third of the glass represents this.

Programs like North Star are used to fill only the tuition portion of the glass and aid starts only after tallying any Pell grants, state grants, institutional awards and scholarships. If those funds do not cover the bottom third, the state promises to cover the tuition balance. Programs like this are called “last-dollar” financial aid because they top off tuition after pouring in the other aid first.

Five states have taken steps to curtail aid displacement and others are working to address last-dollar program implications. The good news is studies show promotion of free tuition increases overall interest in pursuing college. This could help North Star Promise become an economic driver in filling critical workforce gaps — provided academic progress requirements can accommodate students who must progress through their courses at a slower pace due to their financial and family obligations.

Scholarship-awarding organizations like ours are educating students about North Star Promise based on our nonpartisan analysis and will monitor impact, particularly on rural students and institutions. Our colleagues at the Center for Rural Policy and Development (CRPD) are keeping their eye on whether rural areas with limited access to four-year institutions will be put at any disadvantage and have suggested tweaks that may improve competitiveness with surrounding states.

From our perspective, the North Star Promise is a step in the right direction for some students. We believe this program could be strengthened by not counting private scholarships against tuition support so more students can realize the intended benefit of that aid.

On the heels of historic levels of higher ed funding, Minnesota has an opportunity to maximize the impact of those dollars and to make progress on our common goals of education and a healthy workforce. As we aim to improve higher education access and affordability across the state, let’s work together to strengthen the promise of North Star.