Can Tennessee cash in on Georgia's lottery model?

By Rozella Hardin

STAR STAFF
rhardin@starhq.com

   With the Tennessee lottery vote still months away, activists on both sides of the question are working diligently. Proponents of the lottery are betting on education as their best means of getting a lottery established in the state.
   Tennesseans for the lottery have used the "Georgia model" as a rallying cry, suggesting that free college educations for all students will be only the tip of the iceberg if voters just give them the green light. But what, exactly, is the Georgia model and why is it touted as such a success? In brief, the Georgia lottery was originally set up to help in-state students cover the cost of higher education, officials say.
   The Gambling Free Tennessee Alliance in its fight to vote down the lottery points out that a lottery will not help Tennessee's budget crisis, as not one penny of lottery money will go toward the budget. All funds derived from the lottery will go toward college scholarships with a small percentage going to capital improvements and the remainder to pre-school and after-school programs.
   The actual language which voters will consider is as follows:
   "...except that the Legislature may authorize a state lottery if the net proceeds of the lottery's revenues are allocated to provide financial assistance to citizens of this state to enable such citizens to attend post-secondary educational institutions located within this state. The excess after such allocations from such net proceeds from the lottery would be appropriated to:
   (1) Capital outlay projects for K-12 educational facilities; and
   (2) Early learning programs and after-school programs.
   Such appropriation of funds to support improvements and enhancements for educational programs and purposes and such net proceeds shall be used to supplement, not supplant, non-lottery educational resources for educational programs and purposes."
   Tennessee lottery proponents hope to use the Hope (Helping Outstanding Pupils Educationally) Scholarship program as a model for the lottery-funded scholarships in Tennessee.
   To qualify for Georgia's scholarship, students must get a B average or better in high school and maintain that average in college. The reward: full tuition, fees and a book allowance for a student who wants to attend an in-state public college or scholarship. Georgia students can also use the scholarship to attend an in-state private college. Students need grade-point averages in core classes of 3.0 on a 4.0 scale. Advanced classes help more because they are graded on a 5-point scale, meaning an A in an advanced class is worth 20 percent more than an A in a regular course.
   The HOPE scholarship, according to Rebecca Paul, Georgia Lottery Commission president, also pays up to $3,000 for students attending private colleges in the state and pays tuition for students at technical schools, regardless of their grades.
   Paul said so far, more than 600,000 students have saved more than $1.5 billion from the program, which is funded by the state lottery.
   The first HOPE scholarship was awarded on Sept. 1, 1993, and was originally limited to students from families making less than $66,000 and only good for the first two years of college. The scholarship was eventually opened up to all students and can now be used for all four years of college, as long as recipients maintain a B average in college courses.
   According to the Georgia Department of Education, the percentage of students in Georgia's university system receiving the HOPE scholarship rose from 12.1 percent in the fall of 1994 to 29.8 percent last fall. The number of students in technical schools almost doubled in about the same period, rising from 60,585 to 112,041.
   Paul said that today, 98 percent of freshmen from Georgia who are attending the University of Georgia are on lottery-funded scholarships. "The year prior to the lottery's beginning, only 24 percent of students with SAT averages between 1,500 and 1,600 stayed in Georgia; this year, 76 percent of them stayed in Georgia."
   Paul said the lottery had gross revenues of approximately $2.2 billion last year, of which roughly $691 million went to education.
   In Virginia, revenues from the lottery are also directed toward education said John Haggerty, who oversees the lottery in that state. "Each system is allocated a certain proportion of funds from the lottery, which they may spend as they see fit. Our lottery is not linked to a scholarship," he said.
   The West Virginia lottery allocates funds to help in various areas. Since 1985, West Virginia lottery officials said the lottery had provided more than $850 million, and since 1989, lottery profits have been dedicated to specifics such as higher education and arts, the Library Commission, infrastructure, school improvements, state parks, and the such.
   Anti-lottery spokesmen say awarding scholarships to students based on a "B" average rather than an ACT or SAT score takes away the student's incentive to work harder for scholarships. "There are scholarships out there if students are willing to work for them," said Ann Bennett, a mother from Indian Springs Baptist Church, Kingsport, and an activist for Gambling Free Tennessee.
   "Our current system rewards hard work and study with scholarships. The lottery system teaches our kids to get rich quick and trust in luck. A lottery sounds good, but there is no free money," Bennett said.
   "The lottery is one of the worst things that could happen to education in Tennessee," Bennett said.
   "We can have a lottery in Tennessee, but we are still going to pay taxes just like we do now," she said.