The Seventh Osage Nation Congress unanimously approved an amendment to the Scholarship Fund Act during its second special session to address unpaid invoice amounts to the third-party administrator, Scholarship America.
On Aug. 13, the Congress passed ONCA 20-61 (sponsored by Congressman RJ Walker), which increases the limit on third-party administration costs from $220,000 per calendar year to $280,000 per calendar year to address costs owed to Scholarship America, which currently administers the Nation’s scholarship program and is paid out of the Higher Education Scholarship Fund per the law.
“We are trying to get the fees paid because of the law the way it’s written says we need to stay within these limits as they exist now,” Principal Chief Geoffrey Standing Bear told the Congress at the special session’s start on Aug. 5. “According to Scholarship America, I am told, they need their money now, not in the future, or they’re not going to process our students’ papers. And so, we’re going to have to find a solution – both short-term and long-term. And the long-term solution has been looked at before, I think we should revisit that especially in the upcoming session in September.”
Treasurer Jim Littleton met with the Congressional Education Committee to discuss the justification of ONCA 20-61 and said issues with payments to Scholarship America were discovered when invoices were researched and those amounts conflicted with the maximum amount specified in the law to be paid to the third-party administrator. The Nation and Scholarship America are under a current two-year contract executed in July 2019 after a previous three-year contract expired, Education Department Director Mary Wildcat told the committee.
The Nation entered into its first contract with Minnesota-based Scholarship America in October 2014 after discontinuing in-house scholarship management by the Education Department that year.
“When we looked at what we’re being charged, we saw that there were some years we were charged more than ($220,000) so we went back to the contract … But there was also a clause in there that they could charge us so much per applicant above a number,” Littleton told the committee. “Then as we looked at the newest contract that we are under right now, that contract said that they set the administration fees at $258,000 plus $200 for every applicant above a certain number, so the law and the contract that has been approved and signed are not in agreement and so this bill is an attempt to try and make those in agreement.”
In his research, Littleton referenced a September 2016 contract that the Nation signed with Scholarship America for three years with the amount not to exceed a total of $660,000. Congressman Joe Tillman asked if that contract exceeded that limit and Littleton said the total payment to Scholarship America for the former contract was $640,130.
Littleton said he also put inquiries in with Scholarship America on a breakdown of fees invoiced to the Nation and he was still awaiting responses when the special session started. He said he questioned how certain fees were calculated including a $15,000 technical fee.
After further committee discussion, Walker asked Littleton if the new $280,000 per calendar year limit amount would be sufficient to continue paying Scholarship America for the remainder of the contract and Littleton said it would and he would return to Congress if any future invoice amounts did exceed that limit.
Congressman Eli Potts motioned for the committee chair (Walker) to request the two most recent copies of the Nation’s contract with Scholarship America and to request the presence of the Attorney General’s Office at a future meeting as he also questioned the execution of the current contract. The committee motion passed unanimously on Aug. 6.
Congress unanimously passed ONCA 20-61 on Aug. 13 and Standing Bear later signed the bill into law.