This is the flaw in the lottery/HOPE Scholarship formula that very few if any among us saw coming.
HOPE has been one of Georgia’s great higher education success stories. That was the case for years as the economy chugged along, lottery sales were dependable and college costs fell within those parameters.
The warning signs have been there for some time, even before the onset of the recession, as the soaring increase in college costs far exceeded the overall inflation rate. The threat to HOPE now — and it is imminent — is that tuition increases are so outpacing lottery proceeds as to render the popular program unsustainable.
Last year Gov. Nathan Deal tried to slow the growing HOPE deficit by drawing up legislation that cut scholarship payments for all but the most academically elite students to 90 percent of tuition, and in amounts fixed at the time a student entered college. The HOPE award does not rise with tuition costs over the course of a college career.
That legislation kept HOPE affordable — for a while.
The Georgia Student Finance Commission, which administers HOPE, now estimates that there could be as much as a 38 percent reduction in a student’s scholarship award in less than four years. By mid-2015, HOPE would cover less than half a student’s expenses for a semester.
Commission President Tim Connell said last week that the growing problem with HOPE isn’t just financial; a really scary prospect for Georgia is that it threatens to force some of the state’s best students — the ones whose good academic credentials qualified them for HOPE in the first place — out of school. “The cost of attending college is the biggest reason now why people drop out,” Connell said.
The murmurs you’re already hearing from this brand-new session of the Georgia General Assembly might very well become a swelling chorus: a call for casino-style video gambling, and maybe pari-mutuel gambling as well, as a means of shoring up lottery revenues and sustaining the scholarship program.
Nobody really knows whether that math will work in the long term. What isn’t debatable is that the Georgia Lottery Corporation is having trouble increasing, or even maintaining, lottery sales as the economy continues to sag and tuition continues to rise.
The Lottery Corporation has the authority to approve video terminals, but its president Margaret DeFrancisco has said lottery executives “would not step out on our own … we really need a public discussion about that.” The governor, meanwhile, has repeatedly made it clear he opposes any expansion of legal gambling in Georgia.
It will be interesting to see how the legislature approaches the issue, which right now looks like an administrative and political stalemate.