Georgia Lottery Scholarship Problems

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Georgia Wrestles with Solutions to Lottery Scholarship Problems

Special Report - October 30, 2003
Officials for the Georgia HOPE scholarship fund continue to grapple with ways to save the program from financial crisis as lottery ticket sales drop and the number of applicants increase. HOPE scholarships, which are funded by the Georgia lottery, have become one model for gambling proponents who are trying to sell a lottery in North Carolina. However, the costs to run the program have been projected to exceed lottery revenues by $200 million within the next few years, according to the Atlanta Journal and Constitution. This has state officials scrambling to find ways to cut costs in order to keep the program financially stable. So far the HOPE Scholarship Joint Study Commission, a committee formed to address the problem, has informally agreed to recommend that HOPE scholarships stop paying for student’s books and fees—a move that is expected to save well over $100 million in the next year. However, the commission was split on a proposal by Georgia Governor Sonny Perdue to require students to get a minimum score on the SAT as well as a “B” average in school to be eligible for a scholarship. Governor Perdue later revised his recommendation to allow students who score low on the SAT to receive a scholarship for their first semester wherein they must maintain a “B” average before being allowed to continue receiving the money. HOPE’s current policy evaluates a student’s eligibility after 30 credit hours (or roughly one college year). The governor put forward the proposal as an incentive to improve Georgia’s ranking as last in the nation on the SAT.

Others support linking the HOPE scholarships to the SAT to reduce incidents of grade inflation, where students are given higher grades than they deserve so that they can qualify for the scholarship program. USA Today recently reported that 40 percent of Georgia’s college freshmen lose their scholarship after the first year because they are not prepared for the academic rigors of college and cannot maintain the required minimum 3.0 GPA. However, critics say linking the HOPE scholarship to the SAT would immediately exclude large numbers of students, especially minorities. The commission will meet again in November to continue considering these and other options for fixing the HOPE scholarship fund. Georgia’s situation highlights the seemingly never-ending problems that arise when states become dependent on gambling revenue to fund programs such as education. In this case, grade inflation and backtracking on promised funding are just two more problems to add to the many other social and economic consequences of state-sponsored gambling.