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Taking a look at HOPE
Lottery sales boosted by many who dont use education programs
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HOPE is a burden carried mostly by Georgia’s lower income, its uneducated and its minorities.

The lottery-funded scholarship awarded on the basis of academic merit mostly props up those in economic classes above the ones who pay for it.

These conclusions have been drawn multiple times in research that University of Georgia demographer Doug Bachtel says show disparities that have existed “since Biblical times.”

“One only needs to look at some demographic data and just go to a convenience store and see who the folks are that are buying the lottery tickets,” Bachtel said. “They’re not wearing three-piece suits and carrying briefcases ... this is not some sort of statistical fluke here.”

Just this year, a study by the Georgia Department of Audits and Accounts found that “families of HOPE recipients at public universities are slightly better off than the general population.”

And research in the last decade has shown the players of state lotteries — including Georgia’s lottery games — are disproportionately minorities with low incomes and low levels of education.

In Georgia, a 10-year-old survey by the Carl Vinson Institute of Government found that race and education were bigger factors in lottery play than income. But two economists in the University of Georgia’s Terry College of Business found that counties with higher income levels received over 40 percent more HOPE college scholarships than counties at the lowest income level.

“(HOPE) didn’t substantially increase access to higher education,” said David Mustard, an associate professor of economics who co-authored the study. “...Who plays the lottery? Empirically, more poorly educated people. They spend a greater fraction of their income on that ... Students from those families are less likely to receive and retain the scholarship over a longer period of time.”

Bachtel, too, says his research shows per capita lottery spending increases in rural South Georgia counties where poverty levels are highest.

“They’re spending like over $500 per year per person on the lottery,” Bachtel said.

The price of lottery tickets has helped pay for pre-kindergarten programs and post-secondary educations in Georgia since 1993.

Between July 2009 and June 2010, some 250,000 students benefited from the lottery scholarship program, which provided more than $600 million that school year, according to the study by the Georgia Department of Audits.

The type of lottery funding sought or awarded was closely aligned with household income.

Of the Georgians who received money to complete a GED diploma in that year, 51 percent came from households with a collective income of $20,000 or less.

Those who used HOPE Grant to attend technical college were largely under the $60,000 income level as well.

But HOPE scholarships, which pay for tuition to colleges and universities in Georgia, were mostly accessed by families of higher incomes.

Fewer than half of the college students who used the HOPE scholarship to attend a public college or university had household incomes of $60,000 or less.

But those students whose families earned between $60,001 and more than $200,000 that year received almost 52 percent of the scholarships.

One reason could be that the good grades required to receive the HOPE scholarship are partly a result of parental guidance, Bachtel said.

Students of single-parent, low-income households might be less likely to receive that guidance, he said.

“It takes a tremendous amount of parental guidance to keep the kids studying and away from the TV sets and doing their homework,” Bachtel said. “Some of those things don’t necessarily go hand-in-hand with folks living below the poverty level.”

But also, children tend to follow in the paths of their parents. A child of higher income parents is more likely to grow up to live that lifestyle and vice versa, Bachtel says.

“Rocket scientists beget rocket scientists and high school dropouts beget high school dropouts,” Bachtel said. “It runs in families and neighborhoods.”

The Carl Vinson Institute survey found that lottery-funded pre-kindergarten programs disproportionately are used by black people and lottery players, however.

Joseph McCrary, who compiled the research for Carl Vinson’s study, would still speculate that, overall, white people of the middle and upper class are more likely to benefit from lottery funds.

“The pre-K and HOPE Grant (which pays for technical college) were a little better spread out,” McCrary said. “I’m not going to say they were disproportionately benefiting people in lower incomes, but they seemed to be better spread out.”

In the study, McCrary suggested ways to level the playing field. He and his colleagues suggested that lottery funds be used to create educational and mentoring services for those who are behind their peers academically.

Bachtel agreed.

“There really needs to be some mentoring programs associated with it,” Bachtel said. “...It’s going to take some people to take those kids under their wing and help them with their schoolwork and their study habits.”

McCrary suggested “means testing” for those who used the funds to attend four-year colleges, providing less funding to students above certain income thresholds.

An income cap was actually removed from the scholarship in 1996, five years before the McCrary’s report was published.

This year when Georgia lawmakers were seeking to reform the scholarship program to stem the consequences of revenue losses in the state lottery, Democrats suggested bringing the income limits back.

Republicans rebuffed the effort, however, saying that the scholarship program was never created to send low-income students to college. Instead, the scholarship was meant to reward hard-working students.

The program that was eventually passed into law, reorganized the scholarship, cutting benefits for most students and raising the grade requirements for students who sought full HOPE funding.

But those who paid for it stayed the same.

Though he says he is not “against the HOPE scholarship,” Bachtel calls the lottery a sort of “poor people’s income tax.”

And he says the hype over what opportunities the scholarship opens up tends to drown out the fact that the scholarship fund is paid for, many times, by poor people whose only benefit is the unlikely event that they hit the jackpot.

“It’s a disease; it’s gambling,” Bachtel said. “...And it appears that with the HOPE scholarship, it just makes it OK.”

The verdict is in and PoyntSource Soutions, Inc. will not receive the lower water rate from the county it was seeking but will receive money for damages and takings to their property from the county dumping rocks and debris on the side of the dam in Lakeview Estates.

After deliberating for about three hours in Rockdale County Superior Court on Monday afternoon, the jury in the lawsuit and counter lawsuit between Rockdale County and PoyntSource Solutions, Inc. found in favor of the county's claim that it did not need to give the same rate to PoyntSource, a private water system that supplies water to the 3000-plus residents of the impoverished Lakeview Estates neighborhood, as it did to Newton County. It awarded the county $93,039.53 in payments owed to Rockdale Water Resources from PoyntSource.

However, the jury also found in favor of PoyntSource's claim that the county dumping rocks on the side of the Lakeview Estates dam damaged water pipes and pushed the county's property boundaries slightly over the line into the property of PoyntSource and Libby and Randolph Poynter. It awarded PoyntSource $250,000 for its taking/due process claim.

Ralph Goldberg, the attorney representing PoyntSource, said that one of his clients was satisfied with some of the verdict. Libby Poynter declined to comment and Randolph Poynter could not be reached for comment.

Rockdale Water Resources Director Dwight Wicks said, regarding the verdict, "I was pleased with the jury finding for our claim of $93,000 past due. I was also pleased the jury did not award the $1.25 rate (that is) special to Newton County."

PoyntSource draws water from wells on its property but also purchases about a fourth of its water from Rockdale Water Resources, the county’s water agency, to supplement the supply for its more than 700 customers. PoyntSource alleged RWR overcharged with a commercial price of $3.21 per thousand gallons instead of the $1.25 per thousand gallons that Newton County is billed. 

After meetings and discussions with the county deteriorated, PoyntSource stopped paying its bills and the county sued the company in 2007 to collect about $77,000. PoyntSource then sued the county, claiming it was overcharged by more than $300,000 from 2000 to 2007.

PoyntSource also initially had a claim on the amount of water used by Rockdale firefighters for putting out fires in Lakeview Estates, but dropped that claim before closing arguments on Monday.