Disagreements over how to disburse tax revenue has often stalled Georgia sports betting legislation at the state Capitol.
In particular, there have been disagreements over how much tax revenue should be earmarked for the state’s merit-based HOPE Scholarship program and how much should go to other education initiatives, including needs-based scholarships.
The debate, like that in D.C., has become partisan in the Peach State and continues to be a problem that must be solved before Georgia sports betting can launch.
HOPE has helped more than 2 million Georgia students
Proceeds from the Georgia Lottery fund the HOPE Scholarship program. By most accounts, HOPE (Helping Outstanding Pupils Educationally) scholarships have been a resounding success in Georgia.
Launched in 1993, HOPE was designed to reward high-achieving students and entice them to stay in Georgia for their college studies and eventual professional careers. HOPE scholarships are available to high school graduates with at least a 3.0 GPA. Recipients must maintain a 3.0 throughout their postsecondary studies to remain eligible for the scholarship.
HOPE scholarships currently cover full tuition but not additional costs, like fees, books and housing.
The Georgia Student Finance Commission said that since its inception, the HOPE program has helped more than 2.1 million students attend college, funded by over $14 billion from Lottery proceeds.
According to a recent Lottery Geeks report, the University System of Georgia (USG) estimates that since 2005, 70% of students at the state’s public higher-learning institutions who graduated with a bachelor’s degree had received a HOPE scholarship. A 2019 USG report, however, found that less than half of HOPE recipients maintain their scholarships through graduation.
House Dems want sports betting taxes to fund needs-based scholarships
This year’s sports betting legislation was initially drawn up as a lottery game, with the Georgia Lottery granting licenses and regulating the industry as it would any offering. In that case, most of the tax revenue from sports betting, like revenue from lottery games, would have gone to HOPE and pre-kindergarten programs.
Lawmakers, however, added a constitutional amendment (and public vote) requirement. That allowed them to decide how tax revenue from sports betting would be dispersed. They proposed that 80% of tax revenue would be split between HOPE and fully funding pre-K education.
Ultimately, that measure passed the Senate. Democrats in the House, though, sought more revenue for needs-based scholarships, dooming the bill.
How to fund education has become a partisan obstacle that must be overcome for sports betting to make it out of the General Assembly.
Critics say program doesn’t help low-income, minority students
Critics of HOPE say the scholarships are disproportionately awarded to students from middle- and high-income families. They argue that minority students are less likely to receive HOPE assistance.
That has led to frequent calls to adjust the HOPE requirements to create specific funding for needs-based scholarships.
Last year, one piece of Georgia sports betting legislation would have created a new needs-based category of HOPE that would have lowered the GPA threshold.
Republicans in the Senate objected to the proposal.
High lottery profits have HOPE program currently solvent
The HOPE program has evolved over the years, with the monetary awards and academic requirements being adjusted due to economic recession, tuition hikes and fluctuating participation in Lottery games. In 2013, the GPA requirement was lowered to 2.0 for those seeking a HOPE grant to attend technical schools.
In 2011, most HOPE scholarships were cut to fund only 90% of tuition. Thanks to budget surpluses, Gov. Brian Kemp restored full tuition funding for the 2023 and 2024 fiscal years.
In recent years, the Georgia Lottery has seen record-high sales. Last year marked the eighth consecutive year that lottery profits for education topped $1 billion. According to the Georgia Budget & Policy Institute, the lottery’s education fund has nearly $2 billion in reserve to cover future shortfalls.
Those numbers suggest the Lottery’s HOPE funding is in good shape for the immediate future and does not depend on sports betting tax revenue. That fact could bolster arguments from lawmakers who want sports betting tax revenue diverted elsewhere.
