What to do when TOPS is underfunded?

What to do when TOPS is underfunded?

The House version of next year’s budget funds the TOPS scholarship program at only 80 percent of current year funding.

Number of the Day

167 - Average annual percentage interest rate (APR) for a new predatory payday loan product that would be authorized by legislation passed by the Louisiana Senate on Tuesday evening. Current law caps interest rates at 36 percent APR. (Source: Center for Responsible Lending)

The House version of next year’s budget funds the TOPS scholarship program at only 80 percent of current year funding. Under current law, any cut would be applied across-the-board to all students’ scholarship awards. But a bill passed by the House Education committee on Tuesday would require the state to use new formula that prioritizes the highest achieving high school graduates and those with financial need. The Advocate’s Will Sentell reports:

House Speaker Pro Tem Walt Leger III, who handled the bill, said the plan would ensure that the highest-achieving students would be 100 percent funded even if state aid falls short. Students who gets TOPS Honors or TOPS Performance — nearly 25,000 students — would be protected on tuition but their annual stipends would be eliminated. The roughly 10,000 students who get TOPS Opportunity — the most popular category — and qualify for Pell grants also would be 100 percent funded under the legislation. The 14,000 students in line for major cuts would get $23.7 million of the $233 million in TOPS funds under Leger’s scenario. Leger said that, of that group, about 9,500 come from families with incomes of more than $100,000.


Payday lending expansion bill clears Senate

The harmful impact of predatory payday lending on low-income families is well-documented, which is why 15 states have effectively banned payday lenders. Unfortunately, a bill passed by the Senate on Tuesday evening would move Louisiana in the opposite direction. Senate Bill 365 allows predatory payday lenders to expand their operations in Louisiana by offering new longer-term and higher-dollar loans that come with triple-digit interest rates, just like traditional short-term payday loans. From LBP’s press release following the close Senate vote:

The bill is being pushed by national predatory loan corporations as a way to evade new federal consumer protection regulations. Similar bills have already been rejected in several other states (Florida being the lone exception). “We see too many people taken down the path of financial ruin by payday lenders in Louisiana already,” said Carmen Green, State Policy Fellow of the Louisiana Budget Project.”This bill should not even be on the table. We ask our lawmakers to stand with the hardworking people of our state and not the payday lending industry.” Fourteen groups signed an open letter to Louisiana legislators urging their opposition to the bill, including the Louisiana NAACP, faith groups, and advocates for low-income families.

University of Louisiana Professor Richard Fossey, writing in The Advocate, explains why predatory lending is an immoral exploitation of the poor:

Louisianans living in poverty are ripe for exploitation by predatory lenders. It is payday predators’ concerted targeting of the most vulnerable among us that led the CFPB to issue its “payday loan rule.” The rule would force payday lenders to assess the borrower’s ability to repay their loan, much like credit card companies must do. The Louisiana Budget Project reports that the annual percentage rate for a payday loan in our state can be as high as 780 percent, compared to an annual percentage rate of 24 percent for major credit cards. Thus, applying some of the same consumer protections as credit cards to payday loans makes sense.

To see how your senator voted on Senate Bill 365, click here.


Helping black students build wealth

In most cases a college degree is critical to economic success, but even with a degree many people of color struggle to accrue wealth in the same way that white college graduates do. While some may advocate that minority students skip college to start a business – à la Mark Zuckerburg and Bill Gates – Andre Perry with The Brookings Institution recommends that students of color do both. Perry suggests that historically black colleges and universities should continue to offer minority students the skills and knowledge of the traditional college curriculum while also helping to those students develop their entrepreneurial ambitions:

According to findings from the left-leaning public policy organization Demos, the median white adult who attended college has 7.2 times more wealth than the median black adult who attended college, and 3.9 times more wealth than the median Latino adult. …Colleges that enroll high concentrations of black students can help fix this. If the aim of higher educational institutions is to prepare their students for a successful life outside the classroom, they can focus on nurturing their students’ dreams of starting their own businesses, introducing them to investors who could provide the seed money to launch their ventures, and arming them with the skills and knowledge they’d need to grow them. And historically black colleges and universities can be a vanguard for change and wealth generation.


Perpetuating the gender pay gap

Several bills were filed by Louisiana lawmakers this session that would have prohibited employers from asking about and using an employee’s salary history at previous jobs as a basis for determining their salary upon being hired. While several states have successfully enacted such prohibitions, they failed to gain traction in Louisiana amid opposition from the powerful business lobby. But Claire Cane Miller with the New York Times’ Upshot Blog shares some advice for women who live in places that have yet to enact a salary history ban:

“Women are told they are not worth as much as men,” Judge Stephen Reinhardt wrote in the Ninth Circuit’s opinion, before he died last month.“Allowing prior salary to justify a wage differential perpetuates this message, entrenching in salary systems an obvious means of discrimination.” What if job applicants don’t live in one of the places where asking about salary history is banned? Some experts recommend that they find ways to politely deflect, although refusing to answer an interview question can be risky. Workshops by the American Association of University Women suggest some strategies.

Recent research shows that when salary history is not taken into consideration, employers are more likely to cast a wider net and consider a wider range of candidates:

Salary history bans can also have a less expected effect: When employers don’t rely on past pay as a proxy for how valuable someone is, they might consider a wider variety of candidates. A recent working paper was based on an experiment in an online job marketplace: Half of employers could see applicants’ past pay and half could not. The employers who could not see past pay viewed more applications, asked candidates more questions and invited more for interviews. The candidates they hired had, on average, lower past wages, and struck better deals when they negotiated.


Public health crisis preparedness

In several ways, Louisiana is more prone to public health crises than other states. The latest release of the National Health Security Preparedness Index shows that Louisiana may be ill-prepared to respond to those health emergencies. The index includes 140 indicators, ranging from vaccination rates to conditions of roads and bridges. Louisiana earned a composite score of 6.7 on the index, compared to the national average of 7.1. Kate Elizabeth Queram with Route Fifty:

But challenges remain, including inequities in health security. The highest-scoring state (Maryland) ranks 25 percent higher than the lowest states (Alaska and Nevada). Generally, states in the deep South and the Mountain West regions lag behind states in the Northeast and the Pacific Northwest, and many of the lower-scoring states–which face elevated risks of disasters—are home to disproportionate numbers of low-income residents.

Click here for more details on Louisiana’s public health preparedness score and ranking.


Number of the Day

167 – Average annual percentage interest rate (APR) for a new predatory payday loan product that would be authorized by legislation passed by the Louisiana Senate on Tuesday evening. Current law caps interest rates at 36 percent APR. (Source: Center for Responsible Lending)