Democrats, Republicans Diverged on HOPE Scholarship Reforms

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Editor’s note: This article by APN’s News Editor was commissioned by, and will also be appearing on the Beacon Online, a North Fulton County publication.  In a unique partnership, the Beacon is also syndicating some of APN’s articles both in print and online.

UPDATE: Since this article was written, the HOPE bill passed the State Senate with several amendments.

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(APN) ATLANTA — Democratic and Republican legislators offered different packages to reform the HOPE scholarship at two hearings held at the Coverdell Legislative Office building at the Georgia Capitol, on Wednesday, March 2.

Democrat State Sens. Jason Carter (Dekalb) and Vincent Fort (Atlanta), Senate Minority Leader Robert Brown (Macon) and others offered the Democrat proposal for reforming the HOPE scholarship, in response to the Republican proposal, which already passed the Georgia House of Representatives this week.

Numerous college students, including members of Georgia Students for Public Higher Education, spoke passionately about preserving HOPE at the Democrat sponsored hearing, and held protests around the Capitol all day.

HB 326, introduced by Republican House Rep. Doug Collins (Gainesville) only two weeks ago, passed the Georgia House last Tuesday, by a vote of 152 to 22.

Democrat House Minority Leader Stacey Abrams (Atlanta) supported the reforms. However, Metro Atlanta area Democrats including Roberta Abdul-Salaam, Kathy Ashe, Tyrone Brooks, Dee Hawkins-Daigler, Stacey Evans, Nikki Randall, Sandra Scott, Pam Stephenson, and Gloria Tinubu, were among the no votes.

State Sen. Jim Butterworth (R-Cornelia) chaired the Senate Higher Education Committee, to review the legislation which had passed the House.

“We have a program where we spend $320 million more than we’re bringing in this year. We have a program that’s using its surplus fairly fast,” Butterworth said. “We have to reform or this program will be completely gone in one and a half years.”

Last year HOPE brought in 869 million dollars in lottery revenue, but spent $1.2 billion on educational expenses for students, he said.

“We have placed a shared burden on a lot of different shoulders,” Butterworth said, referring to the Republican proposal, which cuts benefits for students regardless of their income level, and which cuts a little bit into retailer profits and Lottery Corporation bonuses.

ALTERNATIVE FUNDING

One major change of the Republican plan, from the current HOPE Scholarship program, is to limit how much the scholarship will cover: from 100 percent to 90 percent of tuition [next year, with further cuts in future years]. This would save an estimated $133 million next year.

Collins, who presented the bill to the Senate committee, noted that low-income and middle-income students would still qualify for the federal Pell Grant, which does not offset HOPE.

Need-based federal aid is also available through the Supplemental Educational Opportunity Grant and federal loan programs. Undergraduates also may qualify for a variety of private scholarship programs, which can be merit-based, need-based, or both.

Still, many students rely on these additional forms of aid for other educational costs such as fees, room, board, books, transportation, and other costs, and therefore are counting on in-state tuition to be fully covered by HOPE.

“We are committed to doing this and doing it right. It’s not a partisan issue. It’s not a Black and White issue. If we didn’t have HOPE and we came to you with a new proposal that we’ll pay 90 percent of your tuition, you’d be so happy,” Sen. Ronnie Chance (R-Tyrone) said.

DEMOCRATS: “$35 BUCKS A WEEK IS A LOT OF MONEY”

But Evans said in her remarks during the House floor debate that, based on Georgia State University tuition, this could amount to $35 a week for some students. “$35 a week is a lot of money to some people,” Evans reminded her colleagues.

The Democrat proposal, presented by Carter, would continue funding 100 percent of tuition with the HOPE Scholarship, but would pay this only for students with family incomes of up to $140,000 per year. Carter maintained his plan would provide the same cost savings as the Republican proposal.

Both proposals establish a new one percent interest student loan program for students who lose their HOPE Scholarship, so long as they become certified to teach in certain fields.

Gov. Nathan Deal (R) had originally recommended that lottery retailers’ commission be lowered from seven to five percent, which would generate about $69 million per year into the program. The GOP bill would lower these commissions to six percent, which would only bring in about $34.5 million annually. Conversely, the Democrat plan would also lower the commission to five percent.

ORROCK: CUT BONUSES OF LOTTERY EXECS

As for Lottery Corporation profits, only 24 percent of the lottery revenues received by the Lottery Corporation are put towards educational programs each year.

State Sen. Nan Orrock (Atlanta), a Democrat on the Senate committee, noted that even though the Lottery Corporation does have some legitimate operating costs, their educational contribution of 24 percent is well below the national average of 29 percent.

“How much have we been able to verify the claims of the corporation?” Orrock asked. “Now that’s a big gap.  I don’t feel assured that we have our arms around the Corporation. We’ve been aghast at the bonuses they’ve [Ga. Lottery executives] been given.”

“In the law, they should be shooting for 35 percent. They’ve been so far behind for so long,” Orrock said.

The Republican plan does not mandate that a higher percentage of lottery funds be paid into the educational fund; however, it does limit Corporation bonuses and ties those bonuses to how much new money is paid into the educational fund.

The Democrat alternative on the other hand, would increase the amount paid annually by the Lottery Corporation into the educational fund by two percent. This would bring in an estimated $43 million per year, Orrock claimed.

The GOP solution also would cut Pre-K from a full day to a half-day program, saving an estimated $36 million. But the Democrats in opposition asserted that slicing Lottery Corporation profits could prevent cuts.

Butterworth emphasized his support for the HOPE scholarship. “There is a benefit. If you want to go to college, it is a relief to not be overly concerned withhow you’re going to pay for it. That is a blessing.”

“Please understand, I have four children and I’d love for each and every one ofthem to qualify. But something has to be done,” he said.

(END / 2011)

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