Missouri Student Loan Agency Still Wrestling With Portfolio Sale

by Mike Bevel, CollectionIndustry.com

Trouble's a-brewin' in Missouri between Attorney General Jay Nixon and Governor Matt Blunt.

Blunt is calling for the $350 million generated by the partial sale of the Missouri Higher Education Loan Authority’s (MOHELA) student loan portfolio to be funneled to the Missouri Development Finance Board for distribution to the state’s colleges, who would then put the money toward campus construction projects, scholarships, and endowments.

“Not so fast,” says Nixon, who’s been a critic of this plan from the get-go. Routing the funds through the Development Finance Board would be illegal because it violates a state law prohibiting the use of MOHELA assets for anything other than ensuring students have access to student loans, Nixon said in a nine-page letter to the MOHELA board.

Back in March, Nixon sued the MOHELA board for conducting what he called illegal private meetings, and is throwing around the big guns by claiming criminal accusations. So far, there has been no response from Blunt.