California Treasurer Proposes Trust Fund for Higher Education
California state Treasurer Phil Angelides has unveiled a plan to turn the state’s unused real estate holdings into a trust fund for scholarships and other programs to help high school students go to college.
His “21st Century Land Grant” plan would create a $5 billion endowment that he estimates would provide about $2 billion over 10 years for postsecondary education.
Mr. Angelides, a likely Democratic candidate for governor in 2006, has held rallies and other events in recent months to protest the rising costs of higher education in the state.
“Today, many young Californians face high hurdles in pursuing their college dreams,” Mr. Angelides said at a news conference in Sacramento to announce the plan. “It is a powerful challenge for California to open the college door wider to more students, but it must be done.”
As with lottery-financed programs in Georgia and Tennessee, the California treasurer’s plan would provide “Hope” scholarships giving students a lump sum toward tuition at a state university.
Mr. Angelides also proposes using some of the funds to expand high school programs that help students get to college, including Advanced Placement and honors classes.
The “land grant” label comes from Abraham Lincoln’s initiative that granted states land on which to build public colleges and universities.
Mr. Angelides’ plan calls for selling or leasing underused or excess office buildings, industrial buildings, and land owned by the state, and putting the proceeds in a trust fund. Mr. Angelides estimates that the fund would generate about $300 million in income a year.
The plan would have to pass the California legislature. Last week, some aides said they did not believe legislators would be interested in the proposal. “I think they’d be very skeptical,” said James Wilson, the staff director for the Senate education committee. “We already have fairly extensive scholarship programs.”
Gov. Arnold Schwarzenegger, a Republican, has criticized the state’s current policy for managing real estate assets, and wants a new plan.
Mr. Angelides’ real-estate-trust idea was endorsed by several professors from state universities. At the press conference, Patrick M. Callan, the president of the National Center for Public Policy and Higher Education, based in San Jose, Calif., said that the initiative “can be a key component of a new California strategy to stem the erosion of college opportunity.”
Vol. 24, Issue 10, Page 24Published in Print: November 3, 2004, as Financial Plan