escheats fund

Cowell: Scholarship fund draining

ryanteaguebeckwith — Fri, 15 May 2009 15:13:44 -0400

A pool of state money used to help students pay for college will empty in three years, according to the state treasurer's projections.

State Treasurer Janet Cowell has told legislative and education leaders the escheats fund — which consists of money collected from sources such as unclaimed bank accounts, forgotten utility deposits and insurance policy proceeds, plus the investment interest — will be drained by 2012.

The state uses the money for college loans and scholarships, Lynn Bonner reports.

In a letter to legislators earlier this month, Cowell estimates the fund will be $59 million in the red by 2012. "That means money available today for an incoming college freshman for financial aid will not be there by senior year," she wrote.

The fund paid $210 million for scholarships this school year.

Cowell asked legislators not to withdraw $5 million from the fund, as the Senate approved in its budget, and urged them to maintain a $200 million minimum balance.

"In addition, I also urge you and your colleagues to revisit the fund's overall structure and sustainability," she wrote. "We cannot keep our promise to ensure that all North Carolinians have access to higher education if we are depleting the means for them to do so."

Document(s):
cowell-escheats-2009.pdf

Dome Memo: Bad News Bear Market

ryanteaguebeckwith — Fri, 20 Feb 2009 10:49:05 -0500

DEPRESSING STIMULANT: Gov. Beverly Perdue said the federal stimulus package is still about $150 million short. She plans to use $780 million from the feds to patch the state's $2 billion budget hole, with longtime go-to guy Dempsey Benton overseeing the state's spending. Still, she's going to have to dig a little deeper.

HEALTH PLAN BAILOUT?: Smoking and overeating could get more expensive for state employees. A proposal to keep the state health plan solvent would force smokers and the obese to enroll in the costliest coverage option. Pass the Nicorette and hold the donuts, please.

BAD NEWS FOR STUDENTS: The escheats fund sounds like something that would get you kicked out of school. But it actually helps students go — for now. State Treasurer Janet Cowell warned that the little-known fund for forgotten insurance policies and utility deposits is running dry, which could mean cuts to college scholarships it pays for.

CARD CHECK ... PLEASE? U.S. Sen. Kay Hagan may now have to pay her union dues. Although known as a pro-business Democrat in the legislature, she won labor's backing to the tune of $200,000 last year after pledging to support a "card check" bill that would make unionization easier. Now her vote in Congress could prove crucial to the bill's chances.

IN OTHER NEWS: Perdue's son, Garrett, joins Raleigh law firm as a lobbyist. Womble, Carlyle, Sandridge, Rice and Perdue? Nah, too long. ... The head of the N.C. Restaurant and Lodging Association says it will not oppose a smoking ban as written. Look for tobacco lobbyists to try to change the ban's wording. ... Lt. Gov. Walter Dalton didn't get his extra $63 a day for acting as governor while Perdue was on vacation, according to the state controller. No word on whether he turned down tips too.

Scholarship fund running dry

ryanteaguebeckwith — Mon, 16 Feb 2009 08:55:58 -0500

The state Escheats Fund could go dry soon.

The little-known fund, which is used for college scholarships and grants, has been flush for years with forgotten insurance policies and utility deposits.

It now has about $584 million. But it could go broke by 2012 if the legislature doesn't find another way to pay for student financial aid.

The fund will provide at least $210 million in aid this fiscal year, helping 54,000 students in the UNC system, among others.

State Treasurer Janet Cowell, whose office manages the fund, said lawmakers either need to cut back on scholarships or find another source of money. (AP)