Lexington Mayor Jim Newberry has asked the Urban County Council to fund Lexington First, a proposed pilot college scholarship program aimed at spurring key economic development in Fayette County with tuition scholarships focused on science, technology, engineering and mathematics, or STEM, disciplines. The actual award would be a need-based, last-dollar scholarship intended to cover the cost remaining after a family's expected contribution and all other available financial aid have been taken into account. Students who choose to attend more expensive institutions would receive up to the equivalent of the average in-state tuition at a four-year public institution. The mayor's proposal to invest $500,000 in this first phase of the program is controversial among members of council, some of whom question whether it is appropriate to invest tax dollars in scholarships and whether the city can afford such a program. LFUCG does have a projected $25 to $30 million budget shortfall in the fiscal year beginning July 1. Other community leaders have suggested that the private sector should step forward in support of at least an initial phase of the program. They include Lexington Legends founder and Ivy Wall's Management Company CEO Alan Stein. You can hear the entire interview by clicking on the Podcast below. The following is an edited version.
What is your opinion of Mayor Newberry's proposed Lexington First program?
AS: ... it's a terrific idea. It's the kind of idea that forward-thinking cities need to embrace and get behind. We own businesses around the country, and one of those happens to be (in) Battlecreek, Michigan, the sister and adjacent city to Kalamazoo, where the Kalamazoo Promise has come into such prominence. I have been able to actually observe the impact that the Kalamazoo Promise has had on all facets of economics and social life in Kalamazoo. It has inspired companies to come into their community. It has given hope to some kids in what is frankly a very challenging economic environment in Michigan these days. It has done an awful lot for the real estate business in Kalamazoo. Now what I would tell you is that the concept, the idea, of giving support to education is something that a city can do to say, "We believe in this; we recognize this is a way for us to step ahead, to get ahead of the crowd and be successful." I'm very much in favor of that. So we applaud Mayor Newberry in his support of the idea, conceptually bringing a city's power to the process of making sure that education is given as much importance as it can. I'm not exactly sure, given today's economic, budget and political environment, frankly, that the mayor's specific proposal is the way that we ought to go about doing this.
What would you suggest?
AS: I think that government does have a place in terms of prioritizing its budget even in tough economic times, to make a commitment to those things that will make us better in the future. No question in my mind that that's not inappropriate for government to consider. However I do believe that there are such great benefits that might inure from an educational support process, something that says we believe in education, that the private sector probably ought to take the lead rather than having government at this time take the lead.
We all recognize the tough situation our council and mayor are in in trying to make ends meet. We have dramatic and significant things that we need to deal with, not the least of which is about how do we become better? How do we envision ourselves with downtown entertainment, streetscapes, all of those things that are essential to the future and vision of Lexington? But I think that education can be one of those things as well. And what we need to do is make a statement as a community, and that statement would be to the rest of the country and to the rest of the world, that we value education, particularly in the science, technology, engineering and math environments, where we know we can get results very quickly by keeping the best and brightest in our community, giving some credence to the idea that these disciplines are where we might start. So, if the private sector can step up first, we can perhaps, in the vernacular, give a little cover to our council people and to government by not putting the onus on them but rather starting it in the private sector. And if it is important to the private sector and the private sector can seed the original dollars in this sort of program, ultimately we might have a secondary program where government does help us provide full scholarships to all of the kids in the STEM area, and then on a higher level, I can see us somewhere in the future trying to emulate the Kalamazoo Promise. That would be where every high school graduate in Fayette County gets the opportunity to have a college education, because we as a community and we as a private sector value that.
How would this make a practical difference to our city?
AS: Eighty-three percent of all of the dollars that come into government to run all of the things that we do, as well as trying to fund the things that we want, are based on the workforce - employees actually living, working, and supporting things that happen here in Fayette County. Unless and until we change that, our best bet is to increase the entire foundation of that payroll tax support, and the best way for us to do that is to attract new businesses. Getting new opportunities for higher paying jobs and education is the key to that. So what I would suggest to you is that perhaps in some way we could emulate what has been such a spectacularly successful program at the state level, the Bucks for Brains program, perhaps by seeding it first with private money and then asking government to tell us what they think it is worth beyond that in matching dollars. We can then see the impact of what the private sector can lead all of us into.
The mayor has proposed in this next budget the investment of $500,000 in a scholarship program. Are you proposing that the private sector pick up that entire line, and if so, do you know of any possible contributors?
AS: Well, let me answer the second question first. I think there is a significant group of business people, including myself, in Lexington who believe conceptually that this is a great idea, that we ought to be trying to give an opportunity for kids in Fayette County to understand that education, particularly in the STEM disciplines, is a very important thing. And so yes, I do believe that there is the opportunity for the private sector to step up and fill some of this gap. I'm not suggesting, however, that it fully be funded by the private sector, only that it be seeded and begun by the private sector. And at that point perhaps our council people, our people in the community, would see that there is a worthwhile opportunity for us to make it an even better program. So while the mayor may be asking for a $500,000 line item in the budget, what I would suggest is that the private sector should try to raise the first $250,000 of that, and that government in its budget would perhaps put in a line item for $250,000 that would only be tapped into in terms of matching whatever the private sector would do. So they would cap it at $250,000. The private sector would raise as much as it could. If it raised less than $250,000, the government would put in less than $250,000. And in fact if the private sector can't raise the money, then perhaps it's not as good an idea as some of us think. So I think that by starting it, by seeding it, and by having the whole impetus start from the private sector, the public sector then can only get behind it if it has enough impetus and is capped so that we know that the government side is going to be less.
What's in it for the corporate community? Why do you regard this as so important?
AS: What's in it for the private sector is making Lexington a better place by being able to expand our tax base - again referring back to the essence of our payroll tax being the major funding element in our budget. It makes for a better community, whether you quote Richard Florida or whomever amongst those economists who have talked to all communities about how you grow and how you become better. We know what to do and how to do it; we have incredible assets and resources here in our community. The one thing that we can do is grow education to the point where it is valued enough that other companies and other leaders come into our community; and then we keep the best and the brightness amongst our children here in the community. So for us, we're getting a better workforce, a better tax base and a better community.