1. An Assessment of “HOPE-Style” Merit Scholarships Christopher M. Cornwell and David B. Mustard University of Georgia

2. Background  Growth of large-scale, state merit aid  Georgia’s HOPE Scholarship as the model  Common features Entitlement--based on high-school GPA (and sometimes test scores) No limit on # of award winners Scholars are eligible for multiple years  Common justifications: Increase enrollments in state universities Keep the best and brightest in state Promote academic achievement

3. Large-scale State Merit Programs  Arkansas Academic Challenge (1991)  Georgia’s HOPE (1993)  Florida Bright Futures (1997)  New Mexico Success (1997)  Louisiana Tops (1998)  South Carolina Life (1998)  Kentucky Ed. Excellence Sch. (1999)  U. of Alaska Scholars Program (1999)  Washington Promise (1999)  Maryland HOPE (2000)  Nevada Millennium (2000)  West Virginia Promise (2002)  Tennessee HOPE (2004)  Massachusetts Adams Scholarship (2005)

4. Georgia’s HOPE Program  HOPE – Helping Outstanding Pupils Educationally  Introduced in 1993 and funded by a state lottery  Almost $3.6 billion disbursed to over 900,000 students  Two types of aid: Scholarship – merit-based; for degree-seeking students Grant – not based on merit; for certificate and diploma seekers

5. Georgia’s HOPE Program  Scholarship awards Public schools – full tuition and fees + $300 book allowance Private schools – $3,000 voucher  Eligibility and retention ‘B’ average in HS core courses 3.0 in college, checked at systematic intervals

6. Georgia’s HOPE Program

7.  Significant program changes Income cap relaxed in 1994 and eliminated in 1995 Expanded to include non-traditional students (1996), home-schoolers (1998) “Add-on” scholarships (late 1990s) Removal of Pell offset (2001)  Growing concern that expenditures will outstrip lottery revenue

8. Georgia’s HOPE Program

10. Assessing HOPE  Financing Merit Aid  Enrollments Effect on Georgia institutions Effect on “brain drain”  College stratification  Academic achievement College GPA Course loads Course and major selection  But do they stay?

11. Financing Merit Aid  Methods of financing Lottery (Georgia, Florida, Kentucky, New Mexico, South Carolina, Tennessee) General revenue (Arkansas, Louisiana, Washington) Tobacco settlement (Michigan) Video gambling (West Virginia) Interest on land leases and sales (Alaska)

12. Financing Merit Aid

17. Enrollments GroupOverall 4-Year Publics 4-Year Privates 2-Year Publics 2-Year Publics + Techs All5.99.013.0ns Whites3.64.49.2ns Blacks15.826.016.8ns11.6 Percentage Increases in Freshmen Enrollments Attributable to HOPE By Institution Type and Race, 1988-97

18. Enrollments Students in State Residents in CollegeStayers Out-of- StatersLeavers Number1216280840376-560 t-ratio1.440.411.391.283.09 Out-of-State effect = Students in State – Stayers Leavers effect = Residents in College – Stayers HOPE Effects on Student Migration Numbers of Recent Freshmen in 4-Year Schools By Residency and Destination, 1988, 92, 94, 96

19. College Stratification

21. Quality MeasureAllUniversityComprehensive4-Year Mean SATM6.29.4ns Mean SATV4.914.36.9ns SATM sdns-2.2ns SATV sdns-3.5ns1.8 Top 10%ns7.61.7ns Effects of HOPE on SAT Scores and Class Rank By Institution Type, 1989-2001

22. College Stratification Quality MeasureAllUniversityComprehensive4-Year Acceptance Rate-7.5-8.4-3.6-9.9 Yield Ratens4.1ns3.5 Effects of HOPE on Acceptance and Yield Rates By Institution Type, 1989-2001

23. Academic Achievement Cumulative UGA Freshmen GPA Distributions Residents vs Non-Residents

24. Academic Achievement UGA Freshmen, by Residency and HOPE Status

25. Academic Achievement Percentage of Freshmen Completing a Full Load Resident vs Non-Residents

26. Academic Achievement  Course-Load Effects at UGA 5.1% drop in full-load enrollment rate 16.1% rise in withdrawal rate 9.3% drop in full-load completion rate 3100 fewer courses taken Effects concentrated among students predicted to be on or below the retention margin 63% increase in summer-school course- taking in 1 st summer; 44% in 2 nd

27. Academic Achievement  Core-Course Selection at UGA.63 credit (6%) drop in Math and Science credits in 1 st year 1.2 credit drop over first two years Consistent with substitution away from courses that have low expected GPAs  Major Selection at UGA 1.2 pct point increase in probability of declaring an Education major (~ 50 students) Effect stronger among women 1.7 pct point decrease in probability of declaring a Business major

28. But do they stay?

29. More on HOPE http://www.terry.uga.edu/hope/