A. The higher education department shall recommend an appropriation for each technical and vocational institute based upon its financial requirements in relation to its authorized program and its available funds from non-general fund sources; provided, the recommended appropriation shall be an amount not less than three hundred twenty- five dollars ($325) for each full-time-equivalent student.

B. The higher education department shall by rule provide for the method for calculating the number of full-time-equivalent students in technical and vocational institutes. No student shall be included in any calculation of the number of full-time- equivalent students if the student is enrolled in a course, the cost of which is totally reimbursed from federal, state or private sources.

C. The higher education department shall not recommend an appropriation greater than three hundred twenty-five dollars ($325) for each full-time-equivalent student for any technical and vocational institute that levies a tax at a rate less than two dollars ($2.00), unless a lower amount is required by operation of the rate limitation provisions of Section 7-37-7.1 N.M. Stat. Ann. upon a rate approved by the electors of at least two dollars ($2.00) on each one thousand dollars ($1,000) of net taxable value, as that term is defined in the Property Tax Code [Chapter 7, Articles 35 to 38 NMSA 1978], or any technical and vocational institute that reduces a previously authorized tax levy, except as required by the operation of the rate limitation provisions of Section 7-37-7.1 N.M. Stat. Ann..

D. The board may establish and grant gratis scholarships to students who are residents of New Mexico in an amount not to exceed the matriculation fee or tuition and fees, or both. The gratis scholarships are in addition to the lottery tuition scholarships authorized in Section 21-16-10.1 N.M. Stat. Ann. [repealed] and shall be granted to the full extent of available funds before lottery tuition scholarships are granted. The number of scholarships established and granted pursuant to this subsection shall not exceed three percent of the preceding fall semester enrollment in the technical and vocational institute and shall not be established and granted for summer sessions. The president of the technical and vocational institute shall select and recommend to the board as recipients of scholarships students who possess good moral character and satisfactory initiative, scholastic standing and personality. Beginning with the fall semester of 2010, a minimum of one-half of the gratis scholarships established and granted by the board each year shall be granted on the basis of financial need, and beginning with the fall semester of 2011, a minimum of two-thirds of the gratis scholarships established and granted by each board of regents each year shall be granted on the basis of financial need.