Indiana students could get $20,000 in scholarships

INDIANAPOLIS -- Indiana wants its best students to stick around for college and afterward -- and Gov. Mitch Daniels proposes paying them to do so, with $20,000 scholarships over four years.\nBut there's a catch -- leave the state less than three years after graduation and be required to repay the money.\nAt least 17 states offer general merit-based scholarships, according to the Education Commission of the States. Many pair industry and higher education to create clusters of jobs in specific fields, said commission member Bruce Vandal.\nBut none of the scholarship plans have post-graduation strings attached as Indiana proposes.\nDaniels says the "Hoosier Hope Scholarships" would help move Indiana's job-strapped manufacturing economy to one strong in life sciences, staffed with homegrown talent.\n"Let's make the dreary term 'brain drain' a forgotten phrase," he urged lawmakers in his Jan. 16 State of the State speech.\nSkeptics of the plan say the state first should create jobs that are attractive to young people.\n"The real issue is providing opportunities that young people want," said retired IU economist Morton Marcus.\nOthers are leery of Daniels' plan to fund the program by outsourcing the state's lottery for 30 years, in exchange for an estimated up front payment of $1 billion and annual payments thereafter.\nUnder a bill filed by state Sen. James Merritt, R-Indianapolis, 60 percent of the upfront money would go into a fund for the scholarships and 40 percent would be used to attract top faculty to state universities and colleges.\nIndiana House Speaker Pat Bauer, D-South Bend, has called the lottery outsourcing proposal "fool's gold." No state outsources its lottery, although several, including Illinois and Michigan, are considering it.\n"I wouldn't place any bets on it getting through," Bauer said after Daniels announced the proposal.\nIndiana education leaders insist they have to do something about the problem of students leaving the state for college and jobs.\nMore than one in three Indiana natives who stay in state for school leave after graduation, according to a 1999 study by the Indiana Fiscal Policy Institute, a governmental research organization. And 90 percent of those who leave the state for college never return, said Stan Jones, Indiana's higher-education commissioner.\n"The brain drain is one of the top three or four issues facing the state," Jones said. "If we cannot have a talented pool of young people in the state, we're not going to be able to attract jobs."\nDetails of the scholarships -- including how the state would track down recipients who don't stay in Indiana afterward -- are still being worked out. But education officials say they could help keep about 1,700 students a year in state.\nIndiana already offers scholarship programs for nurses and minority teachers who agree to work in state, as do other states. Missouri, for example, offers forgivable loans for students who agree to work at in-state life science companies after graduation.\nElizabeth Urbanski, acting director of Maryland's Office of Student Financial Assistance, said the programs work.\nMaryland offered forgivable loans in several fields, including science and technology, but is phasing out the programs in favor of need-based aid.\n"We had a large number of students who went into science and technology fields and received jobs in state," Urbanski said.\nDaniels' plan would give bright Indiana students $5,000 each year for four years to attend private or public schools in state. That sounds good to James Totton, a junior at Purdue, where tuition, fees and room and board top $13,000 a year.\n"Being able to keep high-level talent, as opposed to people going to California or the East Coast, is incredibly important," said Totton, who eventually wants to teach in Indiana. "$20,000 is a lot of money to college students."\nJones hopes it's enough to make students think twice about leaving after graduation.\n"Obviously, somebody may still choose to leave and forgo the scholarships, but at least they will have gone through the process of thinking about staying and looking for jobs in Indiana," he said.\nStacey Otts, a chemical-engineering student at Rose-Hulman University in Terre Haute, said the scholarship probably wouldn't have swayed her.\nOtts had job offers in Indiana and out of state. She took a job in Houston, where she thinks she will enjoy a big-city atmosphere.\n"I can either live in Terre Haute, Indiana, or I can live in Houston," she said. "To me, that was not a hard decision."\nBut Ashley Harris, a biomedical-engineering major at Rose-Hulman, said $20,000 would be appealing even with strings attached.\n"When you're younger, three years -- it's not really that big of a deal to stay in-state"