Yikes. The AJC is reporting possible deeper cuts to HOPE starting with the fall semester in 2014. While HOPE once covered all tuition costs and some books and fees, it now covers 80 to 90 percent of tuition and no books and fees.
As I said in my first blogs about HOPE Lite last year: Start doubling up on those college savings as HOPE may eventually only cover the gas to Athens.
Earlier today, Tim Connell, president of the Georgia Student Finance Commission, gave legislators a grim outlook. To prevent further erosion of HOPE in 2014, Connell said the state would need an additional $107 million for the 2014 fiscal year.
According to the AJC:
The gap is expected to increase to $163 million by 2016, Connell told a joint economic development committee of the Legislature on Monday. Lottery revenue is projected to remain flat, and more students are expected to be entering colleges and be eligible for awards through HOPE.
Gov. Nathan Deal and lawmakers overhauled the popular scholarship last year, reducing payouts to prevent the program from running out of money. While Connell said those changes helped, the new rules include a provision over the use of reserves that would lead to a drop in the scholarship amount. The new rules require reserves to remain at a certain level, but the commission uses this money to supplement the funding provided by the Georgia Lottery. Reserves are large enough now that the commission can tap into that money to keep scholarship payments at the same level for the 2013 fiscal year. But starting in 2014, HOPE will have to rely just on lottery revenue, Connell said.
A drop in award payouts combined with expected increases in tuition and fees will result in students having a larger out-of-pocket expense for college.S While Georgia’s lottery is considered one of the most successful in the nation, it can’t keep up with soaring enrollment and tuition. More than 256,000 students received HOPE last year, while fewer than 200,000 received it a decade ago. “I’m not sure we can ever meet the demand doing what we’re doing currently,” said Margaret DeFrancisco, CEO of the Georgia Lottery.
–From Maureen Downey, for the AJC Get Schooled blog