Study Questions Merit of Georgia’s Popular Scholarship Program

Study Questions Merit of Georgia’s Popular Scholarship Program
Hope program boosts in-state Black student enrollment, but does little to increase
access to postsecondary education overall
By Scott W. Wright

Georgia’s Hope Scholarship program, which provides up to $3,000 a year in
college aid to high school
students graduating with a B average, has significantly boosted Black student enrollment at the state’s four-year colleges and
universities.
The number of African American students enrolled at Georgia’s public four-year schools jumped 24 percent from 1993 to 1998, a leap largely attributable to the
7-year-old program, which is the nation’s largest state-financed, merit-based aid program.
The 48-page report, The Enrollment Effects of Merit-Based Financial Aid: Evidence From Georgia’s Hope Scholarship,
reveals that Black student enrollment at private four-year colleges in the state also rose by 12 percent.
But the report, released in January by two economics professors at the University of Georgia, concludes that those enrollment gains at Georgia colleges and universities likely came at the expense of historically Black colleges and universities located in surrounding states.
The study found that in 1994, enrollments at nearby predominantly Black institutions such as  Florida A&M, Alabama State, Tuskegee, Alabama A&M and Tennessee State dropped 34 percent from 1992, the year prior to Hope’s introduction.
“The bottom line with this scholarship is that it is not something that is generating large, new enrollment increases,” says Dr. Christopher Cornwell, co-author of the report and an associate professor of economics at the University of Georgia.
Instead, the report indicates the
program’s broadest impact has been to entice top-notch students to attend in-state colleges and universities in record numbers. Today, 76 percent of Georgia high school students with combined SAT scores greater than 1500, out of a possible 1600, now attend college in state, compared with just 23 percent in 1992.
Cornwell and his research partner, Dr. David B. Mustard, an assistant professor of economics, found that the scholarship program had almost no measurable effect on enrollment at the state’s two-year colleges.
The researchers say a leap in enrollment at the state’s two-year colleges would be strong evidence that the scholarship program has had a profound impact on increasing access to postsecondary education. But they found no such evidence.
The researchers also say first-time freshman enrollment in the state increased a mere 11 percent over the seven-year period studied, but it came at a time when institutions nationwide were posting record enrollments.
Georgia’s lottery-funded Hope program, which has been replicated in at least a dozen other states and also served as the basis for President Bill Clinton’s federal Hope tuition tax credit, has distributed more than $1 billion to more than 500,000 students since its inception in 1993.
In fact, its success has pressured the neighboring states of Alabama, Florida, South Carolina and Tennessee to propose merit-based scholarships of their own. Florida officials approved a similar program, the Bright Futures Scholarship Program, in 1997. That program gave out more than $160 million in scholarships to some 100,000 students in its first two years, the study states.
The only other study to examine the impact of Georgia’s Hope Scholarship found that the program increased the college-going rate of 18- to 19-year-olds from 7 percent to 8 percent. The study Hope for Whom: Financial Aid for the Middle Class and Its Impact on College Attendance was released last year.
In that study, Dr. Susan Dynarski, assistant professor of public policy at Harvard, concluded that students from higher-income White families accounted for most of that increase.
Favoring the Middle Class
Financial aid programs traditionally have focused on students who needed help paying their tuition, but with a twofold goal, experts say.
The first goal is to expand overall access to a postsecondary education for those who otherwise would not be able to afford to go to college. The second goal is to broaden the number of institutions available to students on limited budgets.
Studies have shown that the federal Pell Grant program, for instance, the granddaddy of all
student financial aid programs and by far the most popular, raised college enrollments nationwide from 10 percent to 20 percent in the late 1970s.
But in the late 1980s, politicians began shifting the focus of
financial aid programs from need-based to merit-based, largely to cater to the nation’s vast middle class. Merit-based aid has been wildly popular with middle-class Americans who represent the country’s largest single swath of American voters.
“Merit-based aid represented a relatively small fraction of total student financial aid, being largely confined to individual institutions’ attempts to attract academically proficient students,” the Georgia study states. “However, over the last few years, many state governments have committed millions of dollars to merit aid, in many cases dropping means tests entirely.”
While students from poor families often qualify for such merit-based aid, financial aid experts say those students’ families may find it more difficult to take advantage of such programs because they
often rely heavily on income tax credits or deductions, which still require up-front payment of college costs.
In fact, since 1993, state funding for merit-based financial aid programs has jumped a whopping 336 percent in real dollars, according to a report released last month titled, Access Denied: Restoring the Nation’s Commitment to Equal Education Opportunity.
The 29-page report was
produced by the Advisory
Committee on Student Financial Aid Assistance, a nonpartisan group created to provide Congress and the Department of Education with an analysis of financial aid programs. The study reported that funding for need-based programs had risen only 88 percent over the same time period (see Black Issues, March 15).
The report warns of an
impending “access crisis” and
predicts the situation will worsen unless federal officials “immediately revitalize” financial aid programs for needy students. The decision on whether to improve those students’ chances to obtain a higher education will have
profound consequences for the
nation’s economic and social well- being for decades to come,
committee members said.
“You want to reward hard work and academic achievement, but what gets lost are the hurdles that low-income students face,” says Dr. Charles Terrell, the advisory committee’s vice chairman and also the associate dean of
student affairs at Boston University Medical Center. “Merit is fine, but I do believe we have to meet need first.” 



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