The Iowa Board of Regents met in Ames Wednesday to discuss a proposal to phase out the tuition set aside program.
If it moves forward the board must find a way to fill that void, and pay for need-based scholarships.
The current practice earmarks about 20 percent of each student's tuition to fund scholarships for others.
More than 25,000 undergraduate students at Iowa's three universities received on average around $4,000 in need based scholarships.
The proposal presented on Wednesday wants to phase out the tuition set aside program and instead ask the legislature for $39.5 million to provide a state-funded student financial aid program. One of the regents says this proposal will not only help students who are paying in full for their education but also those students who need some extra financial assistance.
"the receipt of both of those dollars would result in the decrease in tuition for in state students, so it is not new state dollars that the universities are going to receive, it's a substitute for the students in need then we would reset the tuition clock and lower in state tuition when we received those dollars,"says Regent Bruce Rastetter.
A final report will be presented at a board meeting in Iowa City on October 25, 2012.
That report will also include public input on the proposal. The board hopes to phase out this program within the next five years.
If you would like to share your thoughts on the proposal you can email firstname.lastname@example.org