Analysis of Ohio Learn & Earn Amendment

This is a follow-up to my recent post on Ohio Learn & Earn.

For anyone who hasn't heard yet -- There is a petition drive afoot to put an Ohio Constitutional amendment to the voters that would allow casino slot machines at all existing race track facilities in Ohio, as well as at two locations in the City of Cleveland: one each on the East and West Banks of the Flats.

To "entice" voters to support this initiative, the proponents have put in this amendment that 30% of the "gross" revenue will be set aside for college scholarships for Ohio students.

For tonz of background and other commentary on this topic, I refer you to the following resources (in no particular order): Meet the Bloggers Discussion; Pho’s Akron Pages; Ohio Learn & Earn web-site; Google Search.

My commentary/analysis will be limited to attempting to reconcile what I have “heard and seen” about the Amendment and the proposed Amendment itself.

First, generally speaking, I feel constitutional provisions should be limited to broad concepts and legal precepts, not detailed scholarship programs.

Second, if you want to constitutionalize a detailed higher education scholarship program, you darn well better pay attention to the details. This proposed amendment utterly fails in that regard. Moreover, it is usually not good to have sections of state constitutions fraught with ambiguities and internal conflicts as the Learn and Earn amendment is.

Let's take it apart.

LARGE HOLE YOU CAN DRIVE TRUCKS THROUGH NO. 1. Internal Conflicts. Does the amendment set out the criteria for awarding the scholarships or does the Ohio Board of Regents get to do that? The amendment is unclear and contains the following conflicting language:

Eligibility criteria for such scholarships and grants, and the amounts, shall be established solely by the Ohio Board of Regents. Such scholarships and grants shall include only the following: [. . .] [various ambiguous restrictions follows (more on that next)].

So, does the Board of Regents get to establish the criteria, or is the criteria established by the amendment itself? Trust me, this language leaves a big enough hole for the Ohio Board of Regents to say: "we are solely responsible for the criteria and any restrictions in the amendment are so ambiguous that it must have been the intent that the Board of Regents gets to decide the criteria." This issue would then have to be litigated.

The "restrictions" put on the Ohio Board of Regents in establishing the criteria are disturbingly ambiguous. For example:

Individual learn and earn scholarship accounts for current and future students who, prior to enrolling in college, take core and advanced academic courses, participate in college readiness programs, assessment, and testing in any accredited public or non-pubic high school in this state, and contribute to public life through voluntary civic activity, and who attend any public or independent not-for-profit institution of higher education authorized by the Ohio Board of Regents and that has its principal office within this state.

LARGE HOLE YOU CAN DRIVE TRUCKS THROUGH NO. 2. Accounts. If you listen to the Meet the Bloggers pod-cast with representatives from Ohio Learn & Earn, you will hear that individual accounts will be set up for every Ohio student and as they Learn (meeting certain criteria) moneys (from slot gambling) will be deposited into the Students’ account (this is the “earn” part) toward college tuition.

However, as you can see from the above language, the amendment only makes a vague reference to accounts without any of the details (and benefits) claimed by the proponents.

LARGE HOLE YOU CAN DRIVE TRUCKS THROUGH NO. 3. Vague Requirements for “Earning”. . . . The proposed amendment restricts earning in these accounts to: students who, prior to enrolling in college, take core and advanced academic courses, participate in college readiness programs, assessment, and testing . . . and contribute to public life through voluntary civic activity.

The amendment leaves it up to the Ohio Board of Regents (a 9 member board, appointed by the Governor with minimal accountability to the voters) to define what constitutes “core and advanced academic courses”; to determine what is a “college readiness program;” to define what “assessment” and “testing” means; and to decide what “contribute to public life through voluntary civic activity” means.

For me, this raises at least two serious questions (which may have been asked in the Meet the Bloggers pod-cast.)

1. What if poorer urban and rural school districts don’t or can’t offer the core and advanced academic courses and/or college readiness, assessment and testing that the Ohio Board of Regents requires in order for a student to “earn” for his or her account?

2. If this is the case, won’t this proposal just re-enforce and aggravate the existing inequities in our statewide system of school funding and achievement?

LARGE HOLE YOU CAN DRIVE TRUCKS THROUGH NO. 4. 95% of Students won’t get college tuition until after the year 2020. The amendment states as follows:

The Ohio Board of Regents shall award [the scholarships and grants] commencing with the first high school class graduating two years following the approval of this amendment. [* * *] For the first twelve such high school graduating classes, uniform tuition grants, in an amount not to exceed the average undergraduate tuition by Ohio public universities, shall be awarded to the top five percent of students at each accredited public or non-public high school in this state . . .

Gloria Ferris told me that the proponents of this amendment are claiming that the money from the proceeds of slot gambling will be available immediately for students, implying that students will start to get money to use toward college right away. Hmm. I think they’re leaving a few details out.

First, be aware that NO students will receive any money from slot gambling until the first high school class graduates two years after the approval of the amendment. The language is confusing and misleading. It sounds like if the amendment were passed today, July 17, 2006, that the first eligible students would be in the class of 2008, two years from now. However, the amendment really states that two years have to go by after the approval of the amendment before the first graduating class can receive money. So, in reality, if the amendment were adopted today, July 17, 2006, two years from now would be July 17, 2008, but the 2008 graduating class will have already graduated, so the first eligible graduating class to get grants would be the class of 2009. (This is also the first year that kindergarten students can begin “earning” college tuition.)

Even more surprising is the language restricting grants to the top 5% of high school graduates for the first twelve graduating classes, which means that, under my above example, even if the amendment became effective today, it won’t be until the year 2020 that ALL Ohio students receive college tuition – a fact that is conveniently absent from Ohio Learn & Earn’s campaign web-site and t.v. and radio commercials. Given the fact that my time example is based on the amendment being adopted today, 95% of Ohio students will not receive college tuition until sometime after the year 2020.

Beginning no sooner than 2009, the top 5% of students at each school will receive grants not to exceed the average college tuition for Ohio public higher ed. Institution. So, if one of these students wanted to go to a college that cost more than the average, they would have to somehow make up the difference in tuition – another fact conveniently absent from Ohio Learn & Earn’s campaign web-site and t.v. and radio commercials.

[If you’re concerned about “lottery” type loopholes in this proposal, pay attention to the next 2 Holes]

LARGE HOLE YOU CAN DRIVE TRUCKS THROUGH NO. 5. They get to keep their slots even if the tuition scholarship program isn’t put into effect. According to the amendment itself, the Ohio General Assembly has to pass laws to make this proposal operational and the Governor and other elected officials must appoint members to a Gaming Integrity Commission (established by the amendment). However, the amendment also provides that if the Ohio General Assembly fails to pass the necessary laws, or if the appointers fail to appoint the members to the Gaming Integrity Commission, the promoters of this amendment still get to run their slot machines.

Read the following language from the propose amendment:

The General Assembly shall pass laws within six months of the effective date of this amendment to facilitate the operation of this amendment. If the General Assembly fails to pass such laws within six months of the effective date of this amendment, or the members of the Gaming Integrity Commission have not been appointed as provided in this section, the games authorized in this section may be conducted on and after that date under the supervision of the Lottery Commission, which shall retain such supervisory authority until the General Assembly has passed laws to facilitate the operation of this amendment and the members of the Gaming Integrity Commission have been appointed as provided in this section.

Note that the language here does not require, in this event, that the slot proceeds are still subject to the provisions of the amendment. This can be read as a huge “out” for the slot owners. At the risk of sounding like a conspiracy theorist, this language actually sets up an incentive for the promoters of this Amendment to lobby against passage of the necessary laws and appointment of the necessary commission members in order for them to run their slots under supervision of the lottery commission and avoid paying anything for tuition scholarships. While that would certainly create a large enough outcry from the public to get the General Assembly to pass the laws, it could substantially delay the implementation of the tuition scholarships and accounts, allowing the slot owners to keep more of the profits.

LARGE HOLE YOU CAN DRIVE TRUCKS THROUGH NO. 6. The attempt to avoid the “lottery problem.”

The proponents of this amendment knew that its opponents and to some degree the voters in general would raise the “lottery problem” – how can we be sure that the money will really go to the schools and that the government won’t just use this additional money to replace other money and now we have slot machines with no net increase in school funding.

The proponents attempted to get around this problem by including the following language:

The amounts paid to the state pursuant to this section do not diminish the General Assembly’s constitutional obligations. The money’s expended hereunder on scholarships and grants shall supplement, not supplant, per-student state resources appropriated for post-secondary educational programs and purposes prior to or after the approval of this amendment.

I have some as yet unresolved questions regarding this language that I’ll try to track down for a follow-up post.

1. Does the General Assembly have any constitutional obligations with regard to funding post-secondary (college) education programs? I know there are constitutional obligations for secondary education (k-12), but I was not aware of any for post-secondary (college) education. If there are, in fact, no such constitutional obligations, then this provision becomes totally meaningless.

2. Does the General Assembly even provide funding for post-secondary education on a per-student basis? I don’t believe that Ohio’s public colleges are funded on a per-student basis, like k-12. If not, then, again, this attempt to avoid the “lottery problem” is totally meaningless and could be read by Ohio Courts has having no effect whatsoever.

LARGE HOLE YOU CAN DRIVE TRUCKS THROUGH NO. 7. Won’t cash-strapped colleges just increase their tuition and admission standards?

Economic theory would suggest that this program will increase the demand for higher education, thereby increasing its price. Have the proponents of this program factored this into their revenue and expense models? I don’t think so. What happens if the slot revenue projections are off, or fluctuates and doesn’t generate enough revenue to meet the programs obligations?

Moreover, what is the proponents’ purported dream was realized and every high school student qualified to go to college? There are only so many slots for college, and unless we’re going to build more colleges, many of these students will simply not be able to “get-in” because the admission standards will go higher and higher. This is not a bad thing in the abstract; however, what about the individual student who met all the requirements of the Learn & Earn program, has a decent sized account, but can’t get admitted anywhere in Ohio? What happens to the funds in his account? There is no provision for that likely scenario in this proposed amendment.

FINAL THOUGHT

In a previous post, I stated that “there are enough holes in the language of the proposed amendment to drive all of ODOTs snow removal trucks through – simultaneously.”

If you thought I was exaggerating or engaging in hyperbole, I think the foregoing analysis demonstrates that I did neither.