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Lowered grading standards mean a surge in scholarship winners — and state taxpayers will pay

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It's about to get easier to qualify for state-funded college scholarships in South Carolina.

Under a new high school grading scale that shifts letter grades from 7-point intervals to 10-point intervals, an estimated 25,500 more students will qualify for merit-based scholarships over the next four years, starting with an influx of 5,897 students this fall.

That change won't come cheaply.

The state will have to spend $88.3 million to cover the scholarships for all those newly qualified scholars, according to projections from a state agency overseeing the funds. That comes as revenues from the S.C. Education Lottery, which was created to pay for state scholarships, already has failed to keep up with rising costs.

The state Commission on Higher Education released a report June 28 saying the new grading scale, in which the minimum passing score for a class drops from 70 to 60, "essentially provides lower merit requirements for state scholarships."

The new scale took effect during the 2016-17 school year after state Education Superintendent Molly Spearman pushed for the change, saying it would bring South Carolina's grading scale in line with neighboring states and help students compete for athletic and academic scholarships.

State Sen. Larry Grooms, R-Charleston, who sits on the Senate Education and Finance committees, said he wasn't happy about the change when it happened. Like many critics of the grade scale shift, he felt it lowered the state's academic standards.

"We wanted to make sure we had the best athletes with minimally adequate scores," Grooms said. "We were doing so at a cost of tens of millions of dollars from lottery scholarship monies, and possibly even endangering the general fund, and we did so to help Division 1 athletics in South Carolina."

In-state student scholarships can range from $2,800 to $10,000 a year depending on academic achievement. While lawmakers might consider ratcheting up the qualifications for scholarships when they return to work in January, Grooms said current scholarship recipients will be grandfathered in.

"The state will definitely keep the promise to the students. That shouldn’t be a concern to anyone who has received a scholarship," Grooms said.

The new high school grading scale provides a grade point average boost to students, especially ones on the brink of failing. A student who scored a 60 in a college preparatory course would earn a 0.0 GPA under the old scale, but under the new scale he now receives a 1.0.

At the high end of the spectrum, a student in an Advanced Placement course can now earn a weighted course GPA as high as 6.0, the new grade ceiling.

Unlike other states that emphasize financial need when awarding college scholarships, South Carolina's scholarship system is mostly merit-based. High school grade point averages are one of three factors, along with class rank and scores on either the SAT or ACT college entrance exams the state uses to determine eligibility. The baseline GPA for earning the Palmetto Fellows scholarship is 3.5, and the baseline for the less lucrative LIFE and HOPE scholarships is 3.0.

One possible way to defray the expense of new scholarship awards is to raise the minimum requirements for the three scholarships. The June 28 presentation from Commission on Higher Education staff included three hypothetical scenarios that all involved raising the minimum GPA requirements to 3.9 and 3.5, respectively. Since the cutoffs are established in state law, the Legislature must approve the change.

By curtailing the coming wave of eligible students, staff figured the state could save anywhere from $20.3 million to $37.7 million when the first class of high school students graded entirely on the 10-point scale graduates in 2020. The presentation noted that the scenarios are "models to further the dialogue," not necessarily staff recommendations.

"Our point is to not wait until January for folks to think about this, because it is a big ticket item that the state's going to have to grapple with over the next year," said Jeff Schilz, interim executive director of the commission.

Even before the new grade scale took effect last school year, the state routinely dug into its general fund to pay for its scholarship commitments. The number of eligible students has been climbing steadily, partly because of more Honors and Advanced Placement courses that give a GPA boost on the state's scale.

The state's Education Lottery, created after a statewide referendum in 2000, was intended to fund state college scholarships, but it often falls short. To date, proceeds from the lottery have funded about $3.1 billion worth of scholarships and grants at in-state colleges and universities, but a 2016 Post and Courier analysis found that the Legislature had to scrape together $1 billion from other taxpayer sources to cover the costs of scholarships over the course of 14 years.

Reach Paul Bowers at 843-937-5546. Follow him on Twitter @paul_bowers.

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