It's an idea to improve the quality of the Michigan City-area workforce, and have a better chance at bringing in more new jobs and reverse declines in student enrollment, officials said.
Mayor Ron Meer said talks were recently held with Hammond officials to start the process of drafting a proposal to present to the City Council.
"This would be a pretty strong incentive to have your children enrolled in the Michigan City school system," Meer said.
Nothing specific has yet been crafted.
Meer said he will insist graduates have lived within the corporate boundaries of Michigan City for at least four years to be eligible.
City Council President Chris Schwanke said using casino funds to provide scholarships could be worthwhile if structured properly.
In Hammond, students receive more than $10,000 a year for college tuition from casino revenue if they meet certain academic and community service requirements.
The program is now in its 10th year, but Hammond Mayor Thomas McDermott Jr. has expressed a desire to extend the offer for another 20 years.
In Michigan, proceeds from Four Winds Casino are also used in New Buffalo to provide every graduating senior $5,000 a year to help pay for college.
Schwanke said he won't commit to the idea in Michigan City until an official proposal comes forward.
Recently, Michigan City embarked on an endeavor to provide mobile computer devices to every student beginning in the third grade.
Schwanke said another $1.7 million has to be raised for that to happen and he'd like to see that effort completed first before providing scholarships.
"I think we need to look at that avenue first and then look at potential funding some scholarship programs as well," he said.
Meer said a quality workforce is a key to attracting good paying jobs and one way to do that is giving more students the ability to go on to some form of higher education.
"We're finding more and more that continuing education is so important to potential investors and it's getting more sophisticated in those fields," Meer said.