Our View: Steps needed to protect state’s prized program

Six years ago, policy-makers rescued Georgia’s signature education initiative, the HOPE scholarship, by adopting sound proposals to keep it solvent. Adopting proposals by a special panel, academic fees were frozen and qualification standards for high schoolers were standardized, ensuring that the required B average was legitimately obtained and ending the fuzzy accounting that let unqualified students squeak through.

Between 2004 and 2008, those changes saved $179 million. And that wasn’t the only benefit. Students now work harder to qualify for the scholarship, and more students take Advanced Placement courses.

Unfortunately, HOPE is once again facing shortfalls. State officials project that lottery revenue, which funds HOPE and pre-k for 4-year-olds, will dip below expenses sometime next year and possibly even sooner. While students aren’t in immediate danger of losing scholarships, officials are planning to impose a 50 percent cut in book allowances, a step recommended by the 2003 commission but considered unnecessary until now. (Pell scholars are exempt.)

That’s not likely to be enough. Both HOPE and pre-k are larger now, and college costs have soared. To keep HOPE solvent and effective, Gov. Sonny Perdue should convene a new study commission to sort through the difficult options available, including:

• Decouple tuition and HOPE awards.

When the Board of Regents increases tuition at public colleges, HOPE awards automatically increase. In fact, 80 percent of the cost increases tied to HOPE since 2004 have been caused by tuition increases; 20 percent are from more students receiving awards.

Those automatic increases may have to end.

No one knows whether the existence of HOPE has driven tuition increases, but we do know that the steepest tuition increases have occurred at Georgia’s research universities, which also attract the most HOPE scholars. In 10 years, tuition at these elite institutions has more than doubled, with annual increases of 7 percent or more almost routine.

The scholarship amount may have to be fixed based on the money available, not on what regents choose to charge. While that might mean that HOPE could cover only 85 percent of tuition, for example, such a change may be necessary to ensure scholarships for every student who qualifies.

• Leverage HOPE reserves.

The lottery’s unrestricted reserves — money that theoretically could be invested elsewhere — now exceed $643 million. Right now, that money can’t be touched for scholarships unless the bottom falls out on lottery revenues. However, that money could potentially be leveraged in other ways. Placed in a trust, for example, investment proceeds might pay for HOPE’s book and fee allowances, freeing up money for the scholarships.

• Fund HOPE grants from general tax revenues.

Unlike HOPE scholarships, HOPE grants are available to any Georgian at a state technical college without regard to academic performance or ability to pay. While those grants have trained thousands of Georgians for gainful employment, they are an economic development tool, not a merit — or even needs-based — scholarship.

As such, state officials should consider funding the grants from general revenue, just as they fund other economic development tools.

• Streamline funding for early childhood programs.

Just over a third of lottery revenues go to Georgia’s pre-k program for 4-year-olds, administered by Bright from the Start: Georgia Department of Early Care and Learning.

State and federal funds for young at-risk children also flow to the state Departments of Human Resources and Education. Channeling those funds to the agency responsible for early learning could free up lottery funds for HOPE.

• Pre-k means testing.

Ample evidence suggests that pre-k programs open to all children, regardless of background, help kids the most. At-risk children especially benefit from learning with kids from better-educated families. But Georgia’s pre-k program covers tuition for some children whose families could afford it. Policy-makers should explore having this group defray the cost of pre-k or limiting the free program to those who truly need it.

None of these options is ideal, and there are no doubt others. But much is riding on the outcome. HOPE and pre-k are the envy of the nation, and both put Georgia first in categories in which it has forever remained last.

It’s in everyone’s interest to keep it that way.

• Ken Foskett, for the editorial board (kfoskett@ajc.com).