— Local lawmakers were unsuccessful in filling a $42 million hole in the Minnesota State Grant Program when passing legislation to finance the state’s colleges and universities this week, but they plan to keep trying as budget negotiations continue in April and May.

If the hole isn’t filled, nearly 85,000 college students across the state will face hundreds of dollars of cuts in their state grants next year.

 The House had a proposal to shift funds from other student aid programs and elsewhere to fully fund the grants, said Rep. Kathy Brynaert, DFL-Mankato.

“There wasn’t help from the administration or the Senate to fill that hole,” said Brynaert, who added that all grants will be reduced proportionately next year. “The student grants will be pro-rated and every student will have less money.”

The grants have broad-based support because they go to students, based on financial need, at all types of institutions — state universities such as Minnesota State, community colleges like South Central, private colleges like Bethany Lutheran and Gustavus Adolphus and even for-profit colleges and universities such as Rasmussen.

About one of every three undergraduate students at both public and private colleges in Minnesota receive grants, and the average undergraduate grant this year was $2,700, according to an organization that represents the state’s private colleges. If the $42 million hole isn’t filled, an estimated 9,363 students will lose their grants completely this fall and the rest will see a projected decrease of 18.5 percent.

For students at state universities, the continuing budget shortfalls at the Capitol mean that appropriations to the schools are being reduced — forcing up tuition — even as direct financial help through the grant program will be falling, Brynaert said.

State funding for state colleges such as Minnesota State University just passed an unhappy milestone, she said. It now covers less than half of the total cost of an education at a state institution.

“Tuition is now more than 50 percent (of the cost),” Brynaert said.

The traditional goal in Minnesota was that the state would cover two-thirds of the cost of attending a state college and tuition the remaining third.

The shortfall in the grant program was the result of the deep economic recession, which sends more students to colleges because of unemployment and a scarcity of jobs, Brynaert said. With the influx of students, more grants than anticipated were awarded this year — the first year of the state’s two-year budget cycle — and less was left for next year.

The bad economy also resulted in a steep drop in tax revenue, forcing lawmakers and Gov. Tim Pawlenty to pass a supplemental budget to erase a $1 billion deficit. The bill signed by Pawlenty on Thursday cuts $312 million, including reductions to colleges and universities, and does nothing to fill the gap in the state grant program.

Rep. Terry Morrow, DFL-St. Peter, said he no longer has hope of filling the entire hole in the grant program.

“There’s not $42 million out there to be found,” Morrow said.

But Morrow, whose district includes South Central and Gustavus, said there’s still a chance that a portion of the shortfall can be filled when bills trimming health and human services and K-12 education are approved.

“My job is to see what money I can locate,” Morrow said. “... I think we can find a good part of it.”