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SECOND REGULAR SESSION
HOUSE COMMITTEE SUBSTITUTE FOR
HOUSE BILL NO. 2123
103RD GENERAL ASSEMBL Y
4305H.03C JOSEPH ENGLER, Chief Clerk
AN ACT
T o repeal section 173.250, RSMo, and to enact in lieu thereof two new sections relating to
higher education workforce policy prioritization.
Be it enacted by the General Assembly of the state of Missouri, as follows:
Section A. Section 173.250, RSMo, is repealed and two new sections enacted in lieu
2 thereof, to be known as sections 173.250 and 173.1541, to read as follows:
173.250. 1. There is hereby established a "Higher Education Academic Scholarship
2 Program" and any moneys appropriated by the general assembly for this program shall be
3 used to provide scholarships for Missouri citizens to attend a Missouri college or university of
4 their choice pursuant to the provisions of this section.
5 2. The definitions of terms set forth in section 173.1 102 shall be applicable to such
6 terms as used in this section. In addition, the following definitions shall apply:
7 (1) "Academic scholarship", an amount of money paid by the state of Missouri to a
8 student pursuant to the provisions of this section;
9 (2) "ACT", the American College T esting program examination;
10 (3) "Approved institution", an approved public or approved private institution as
11 defined in section 173.1 102;
12 (4) "Eligible student", an individual who meets the criteria set forth in section
13 173.1 104, excluding the requirements of financial need and under graduate status and, in
14 addition, meets the following requirements:
15 (a) Has achieved a qualifying score on the ACT or SA T ;
16 (b) Is a Missouri resident who has completed secondary coursework through
17 graduation from high school or the virtual public school established in section 161.670,
18 receipt of a general education development (GED) diploma, completion of a program of study
EXPLANA TION — Matter enclosed in bold-faced brackets [thus] in the above bill is not enacted and is
intended to be omitted from the law . Matter in bold-face type in the above bill is proposed language.
19 through homeschooling or any other program of academic instruction that satisfies the
20 compulsory attendance requirement under section 167.031; and
21 (c) Is enrolled full time or accepted for full-time enrollment as a postsecondary
22 student at an approved institution during the academic year immediately following the
23 completion of his or her secondary coursework;
24 (5) "Missouri test-takers", all Missouri high school seniors who take the ACT or the
25 SA T ;
26 (6) "Qualified higher education expenses", the qualified costs of tuition and fees
27 and other expenses for attendance at an eligible educational institution, as defined in
28 Section 529 of the Internal Revenue Code, as amended;
29 (7) "Qualifying score", a composite score on the ACT or the SA T achieved in an
30 eligible student's high school sophomore, junior , or senior year that is in the top five percent
31 of Missouri test-takers, as established at the beginning of an eligible student's final year of
32 secondary coursework;
33 [ (7) ] (8) "Recipient", an eligible or renewal student who receives an academic
34 scholarship pursuant to this section;
35 [ (8) ] (9) "Renewal student", an eligible student who remains in compliance with the
36 provisions of section 173.1 104, maintains continuous enrollment, and makes satisfactory
37 academic degree progress; and
38 [ (9) ] (10) "SA T", the Scholastic Aptitude T est.
39 3. The coordinating board for higher education shall be the administrative agency for
40 the implementation of the program established by this section, and shall:
41 (1) Promulgate reasonable rules and regulations for the exercise of its functions and
42 the ef fectuation of the purposes of this section, including regulations for granting scholarship
43 deferments;
44 (2) Prescribe the form and the time and method of awarding academic scholarships,
45 and shall supervise the processing thereof; and
46 (3) Select qualified recipients to receive academic scholarships, make such awards of
47 academic scholarships to qualified recipients and determine the manner and method of
48 payment to the recipient.
49 4. Befor e the 2027-28 academic year , eligible students shall be of fered academic
50 scholarships in the following amounts and in the following order of priority , within the limits
51 of the funds appropriated and made available:
52 (1) Each eligible student with a qualifying score in the top three percent of all
53 Missouri test-takers shall be of fered an academic scholarship of up to three thousand dollars
54 per year . All students in the top three percent shall receive awards of three thousand dollars
55 before any student in the top fourth and fifth percentiles receives any award;
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56 (2) Provided suf ficient funds are appropriated, each eligible student with a qualifying
57 score in the top fourth and fifth percentiles shall be of fered an academic scholarship of up to
58 one thousand dollars per year .
59 5. Befor e the 2027-28 academic year , eligible students may renew academic
60 scholarships for their second, third, and fourth years of postsecondary education, or as long as
61 the recipient is in compliance with the criteria to be a renewal student.
62 6. If an eligible student is unable to enroll during the first academic year or a renewal
63 student ceases attendance at an approved institution for the purpose of providing service to a
64 nonprofit or ganization, a state or federal government agency , or any branch of the Armed
65 Forces of the United States, such student shall be of fered an academic scholarship upon
66 enrollment in any approved institution after the completion of their service, if the student
67 meets all other requirements for an initial or renewal award and if the following criteria are
68 met:
69 (1) For an eligible student who cannot attend an approved institution as a result of
70 service to a nonprofit org anization or the state or federal government, the student returns to
71 full-time status within twenty-seven months and provides verification to the coordinating
72 board for higher education that the service to the nonprofit org anization was satisfactorily
73 completed and was not compensated other than for expenses, or that the service to the state or
74 federal government was satisfactorily completed; or
75 (2) For an eligible student who cannot attend an approved institution as a result of
76 military service in the Armed Forces of the United States, the student returns to full-time
77 status within six months after the eligible student first ceases service to the Armed Forces and
78 provides verification to the coordinating board for higher education that the military service
79 was satisfactorily completed.
80 7. A recipient of an academic scholarship awarded under this section may transfer
81 from one approved institution to another without losing eligibility for the academic
82 scholarship.
83 8. If a recipient of an academic scholarship at any time withdraws from an approved
84 institution so that under the rules and regulations of that institution he or she is entitled to a
85 refund of any tuition, fees or other char ges, the institution shall pay the portion of the refund
86 attributable to the academic scholarship for that term to the coordinating board for higher
87 education.
88 9. Other provisions of this section to the contrary notwithstanding, if an eligible
89 student has been awarded an initial academic scholarship pursuant to the provisions of this
90 section but is unable to attend an approved institution during the first academic year because
91 of illness, disability , pregnancy or other medical need or if a renewal student ceases all
92 attendance at an approved institution because of illness, disability , pregnancy or other medical
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93 need, the recipient shall be eligible for an initial or renewal academic scholarship upon
94 enrollment in or return to any approved institution, provided the recipient:
95 (1) Enrolls in or returns to full-time status within twenty-seven months;
96 (2) Provides verification in compliance with coordinating board for higher education
97 rules of suf ficient medical evidence documenting an illness, disability , pregnancy or other
98 medical need of such person to require that that person will not be able to use the academic
99 scholarship during the time period for which it was originally of fered; and
100 (3) Meets all other requirements established for eligibility to receive an academic
101 scholarship.
102 10. (1) As used in this subsection, "eligible pro gram of study" has the same
103 meaning as in section 173.2553.
104 (2) For the 2027-28 academic year and all subsequent academic years, subject to
105 appr opriation:
106 (a) An eligible student shall be offer ed academic scholarships in an amount
107 specified in subdivision (3) of this subsection for the first four semesters the student is
108 enr olled at the appr oved institution;
109 (b) An eligible student who has completed the student's first two semesters and
110 r eceived an academic scholarship under subsections 1 to 9 of this section shall be
111 deemed an eligible student under paragraph (a) of this subdivision for the student's
112 third and fourth semesters; and
113 (c) A renewa l student who is enro lled in an eligible prog ram of study may ren ew
114 academic scholarships for up to six semesters in an amount specified in subdivision (3)
115 of this subsection as long as the reci pient is in compliance with the criteria to be a
116 r enewal student.
117 (3) The academic scholarship for each semester shall be in an amount equal to
118 the cost of tuition at the appr oved institution in which the eligible student is enr olled or
119 five thousand dollars, whichever is less, to be used for qualified higher education
120 expenses.
121 (4) An appr oved institution shall not use an eligible student's r eceipt of an
122 academic scholarship under this subsection to supplant any other existing financial aid
123 award that was offered by such institution in the 2025-26 academic year for which the
124 student would otherwise be eligible.
173.1541. 1. This section shall be known and may be cited as the "Missouri
2 Higher Education W orkforce Policy Prioritization Act".
3 2. The Missouri department of higher education and workfor ce development, in
4 consultation with public institutions of higher education in this state, shall:
5 (1) Develop a funding model for public institutions of higher education that:
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6 (a) Aligns funding for higher education to develop educated persons to meet the
7 pr ofessional and workfor ce needs for the state of Missouri including, but not limited to,
8 incr easing the percen tage of the state's population with a quality postsecondary
9 cr edential, incr easing student persistence and graduation, addr essing the emerging and
10 unmet r egional and statewide workfor ce needs, increa sing collaboration and
1 1 cooperation among public colleges and universities, and ensuring the efficient and
12 effective use of state tax dollars;
13 (b) Pr ovides a level of stable, sustainable res our ces that allow public institutions
14 of higher education in this state to serve students well and fulfill such institutions'
15 missions;
16 (c) Builds on the work of the 2024 house special interim committee on higher
17 education performance funding, including the findings fr om the legislatively mandated
18 2023 study , and is developed in cooperation with public institutions of higher education
19 in this state and the Missouri department of higher education and workforce
20 development using data, mechanics, and calculations that are as simple and easy to
21 understand as practicable;
22 (d) Includes a pro cess for the allocation of the core appr opriations to public
23 four -year institutions of higher education; public community colleges, as that term is
24 defined in section 163.191; and State T echnical College of Missouri;
25 (e) Recognizes each institution's cost structur e and instructional mission and
26 incorporates accountability and an outcomes-based focus;
27 (f) Includes a performance component that is designed to enhance improvement
28 in student success, workfor ce alignment, and efficient operations; and
29 (g) Clearly specifies institutional actions that will support additional
3 0 performance or workfor ce appr opriations, such as instructional pr ogram changes;
31 institutional or statewide initiatives; graduation, re tention, or enr ollment
3 2 accountabilities; or other institutional impr ovements;
33 (2) Establish a plan for testing and implementing the funding model described in
34 this section, which plan, after having been review ed and consented to by two members
35 of the Missouri house of re present atives appointed by the speaker of the house of
36 r epresent atives and two members of the Missouri senate appointed by the pr esident pr o
37 tempor e of the senate, shall be consider ed for appr oval by the coordinating board for
38 higher education and, if appr oved, submitted to the governor and the general assembly
39 befor e August 31, 2026;
40 (3) Evaluate the effectiveness of the funding model test and submit a repo rt to
41 the governor , the speaker of the house of rep res entatives, and the preside nt pr o tempor e
42 of the senate before October 15, 2026; and
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43 (4) Pr esent the funding model to the coordinating board for higher education for
44 action befor e November 1, 2026.
45 3. Such funding model shall not become effective unless appr oved by the general
46 assembly by concurr ent res olution.
47 4. (1) Except as pro vided in subdivision (2) of this subsection, for the 2028-29
48 fiscal year and all subsequent fiscal years, the appr opriation of state funding to public
49 four -year institutions of higher education; public community colleges, as that term is
50 defined in section 163.191; and State T echnical College of Missouri shall be in
51 accordance with such funding model appr oved by the general assembly .
52 (2) Any appr opriation of state funding to an institution described in this
53 subsection for the 2028-29 fiscal year shall not be less than the appr opriation receiv ed
54 by that institution for the pr evious fiscal year unless the appr opriations for all
55 institutions described in this subsection ar e red uced pro portionately .
✔
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