HOPE 101: A study guide to possible changes in state scholarship

While the HOPE scholarship will continue for college students and their families, lawmakers warn it will look dramatically different.

The scholarship -- which is used by more than 200,000  Georgians annually -- is struggling financially as enrollment and tuition soar. HOPE covers all tuition and provides some money for books and fees for eligible students attending public colleges. Those at private colleges receive $4,000 a year.

A bill has yet to filed in the Legislature, but there's plenty of discussion.

Q: How will they change HOPE?

A: There are two basic ways to cut costs -- give the scholarship to fewer students or lower the amount of the award. Expect a combination of both, said Tim Connell, president of the Georgia Student Finance Commission, which oversees HOPE.

Q: What are some of the proposed changes?

A: Several are being tossed around, including:

• Increase the high school and/or college GPA eligibility requirement from 3.0 to 3.2 or as high as 3.5.
• Reinstate an income cap. When HOPE started, only students whose families earned less than $66,000 a year were eligible. The cap was lifted to $100,000 and then eliminated.
• Eliminate "second chance," which lets students regain the scholarship if their grades improve. College leaders oppose this because many students struggle freshman year but succeed later on.
• Require high school graduates to earn a minimum SAT/ACT score to be eligible. This would combat grade inflation, which allows some students to get the scholarship.
• Reduce the number of credits HOPE will cover. Current cap is 127 semester or 190 quarter credit hours, although there are exceptions.
• Reinstate the Pell Grant offset. The money low-income  students received from the federal program used to be deducted from the money they received for HOPE.
• Cut remedial classes from those covered by HOPE. This is supported by several lawmakers, but some educators worry it harms students who need one or two such classes to succeed.
• No longer cover all tuition. Instead use a flat amount or a tiered formula depending on the type of college or set it through an annual appropriations process.

Q: When would any changes take effect?

A: It's too soon to say and it depends on what is approved. If a higher GPA is required, lawmakers said it would be phased in over several years to give students time to raise their marks.

Q: Why is HOPE in trouble?

A: Funding comes from the Georgia Lottery, which can't keep up with growing demand. The state is dipping into reserves to cover costs. Reserves were once $1 billion, but will drop to about $321 million in fiscal year 2012.

Q: Why doesn't the lottery provide more money?

A: The law that created the lottery states that "as nearly as practical" at least 35 percent of proceeds should go to HOPE and pre-K. It's been 13 years since the lottery met that target. For the 2010 fiscal year, the lottery provided $884 million -- 26.1 percent of the profits.

Lottery CEO Margaret DeFrancisco said the percentage is not as important as the dollar amount, which has increased for 12 consecutive years because of strong ticket sales. Ticket sales, officials said, may go down if prizes aren't attractive.

DeFrancisco said when the 35 percent target was set in 1992 it represented more of the drawing games that pay out at a lower percentage than the scratch-off games that are popular now.

Q: Didn't lawmakers try to fix HOPE before?