Lottery Funds Fat, But Gresham Still Wants to Cut Scholarships

Despite record Tennessee lottery sales and a huge lottery reserve fund, state Sen. Dolores Gresham of Somerville said today she is pushing ahead with a controversial plan to make it more difficult for students to win the popular $4,000 a year Hope Scholarships.
More from Rick Locker:
The Senate Education Committee that Gresham chairs heard an updated financial report today from Tennessee Lottery executives who said lottery proceeds for education are already up $10 million for the first seven months of the fiscal year over the same period a year ago. Lottery President Rebecca Hargrove told the committee she believes the lottery can sustain that increase in the future.
That’s more than half the previously projected $17 million to $20 million annual gap between the lottery’s educational proceeds and the cost of the scholarship program that the state is trying to close. The scholarship program has reserves of over $300 million built up in the early years of the lottery, so if the annual gap is cut to $10 million, the reserve would cover annual deficits for 30 years.
But Gresham, R-Somerville, told reporters after the committee heard the latest financial report of Lottery Corp. that she will still press ahead with her plans to tighten eligibility for the Hope Scholarship. The plan would require students to obtain a high school grade-point average of at least 3.0 AND score at least 21 on the ACT college entrance test to qualify for the basic $4,000 per year Hope Scholarship at four-year universities.
Since the program began in 2004, students qualified by achieving one of the two standards – either a 3.0 high school GPA or a minimum 21 ACT score.
Asked if she intends to proceed despite the new lottery revenue projections, Gresham said, “Sure. Absolutely. We’re spending more than we’re taking in. You can’t do that. Right now we have sufficient reserves to take care of Tennessee’s lottery scholarship students for a few years more, which is why the recommendations of the Lottery Task Force would not take effect until 2015.”

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