New York State Higher Education Services Corporation

The first State financial aid to students at institutions of higher learning was a program of scholarships to Cornell University set up when the university was established in 1865 (Chapter 585). These scholarships were administered by the Department of Public Instruction and later by the State Education Department, and the first awards were made in 1868. In 1913 (Chapter 292) the Regents College Scholarships were established. These scholarships were awarded through a competitive examination and could be used at any approved college in New York State. Beginning in the 1930s, several additional scholarship programs were legislated, some awarded through examinations and others to members of targeted populations. These included scholarships for war service veterans; children of deceased or disabled veterans; and nursing, medical, and dental students. In 1961 (Chapter 389) the legislature created the Scholar Incentive Program of noncompetitive grants awarded largely on the basis of financial need. All of these programs were administered by the State Education Department.

The State program of educational loans for higher education began in 1957 (Chapter 367) with the establishment of the Higher Education Assistance Corporation (HEAC). This nonprofit corporation guaranteed repayment of loans made by private lenders to students. The federal government began guaranteeing most such loans in 1965 after passage of the Higher Education Act, and HEAC administered the federal program in New York State.

In 1974 (Chapter 942), HEAC was abolished and its loan programs were combined with the scholarship and grant programs administered by the State Education Department under a new nonprofit corporation, the Higher Education Services Corporation (HESC), established in the State Education Department. The same law abolished the Scholar Incentive Program and replaced it with a larger entitlement program, the Tuition Assistance Program.

HESC is administered by a fifteen-member board of trustees, including as ex officio members, the commissioner of education, the chancellors of the State and City Universities of New York, the president of the student assembly of the State University of New York, and the chair of the united student senate of City University of New York. The board is rounded out by ten gubernatorial appointees, which include students and representatives of banking institutions, academic institutions, and the general public.

Board membership was augmented from its original number of nine to thirteen members in 1977 (Chapter 915), fourteen in 1992 (Chapter 833), and finally to its current number in 1997 (Chapter 297).