Merit scholarships: Robin Hood in reverse?

Georgia's highly touted HOPE scholarship program, which doles out state college-tuition dollars to high school seniors who graduate with at least a B average, has been hugely popular since it began in 1993.

Nearly a dozen states followed its lead and started their own "merit-based" scholarships funded by taxpayers. The federal government has its own version too.

But a new analysis, "Merit Scholarships: Who Is Really Being Served?" released yesterday by Harvard University's Civil Rights Project, points to a host of problems in the four states studied. It warns of negative consequences to American society if such programs "lead to larger wage and income gaps along racial lines."

The laudable goals of such scholarship plans have been to promote college access to those who might not attend, encourage hard-working students, and slow the "brain drain" by giving the best students incentive to attend college in their home state.

Access is a critical issue because states are wrestling with how to open the doors of college to minorities and low-income students even as higher-education budgets are being slashed. And higher education is more critical than ever to finding a well-paying job.

But the unintended consequences of these programs, the report says, include:

• In Florida and Michigan, the highest proportion of merit scholarships were awarded to students graduating from high schools that already had the highest college-participation rates.

• In New Mexico, 80 percent of scholarship recipients were from families earning more than $40,000 per year, well above the state's median income of about $32,000.

• Georgia, which has the nation's largest such program, spent $300 million on HOPE (Helping Outstanding Pupils Educationally) in 2000-01. But only 4 percent of the funds resulted in increased college access in the state, while 96 percent of scholarships went to students who would have attended college anyway.

The latter result seems to be part of a broader shift away from public funding for the neediest and toward more funding for affluent students. Among the nation's 12 state merit-aid programs, $863 million in scholarships was handed out during the 2000-01 academic year, about triple the $308 million states provided in need-based aid.

"What this report shows is that pubic money is not being spent on those who need it – but on those who don't," says Antonio Flores, president of the Hispanic Association of Colleges and Universities, a lobby group based in San Antonio, Texas. "It's almost like Robin Hood in reverse."

This is one of the key findings of the in-depth look at merit-scholarship programs in Georgia, Michigan, New Mexico, and Florida.

"Many students who were already headed to college get funds even though they may not need them," writes coauthor Patricia Marin, a Harvard professor.

"In the meantime, students who need financial support to attend college have seen slower growth in need-based aid," she continues.

The study is the first comprehensive analysis of such programs based on data rather than anecdotes, says coauthor Donald Heller, an associate professor and senior research associate at Pennsylvania State University's Center for the Study of Higher Education.

"We're not saying there shouldn't be merit scholarships," he says. "But do we really want Ted Turner's kid to get this scholarship? Maybe people who read this report will ask themselves, 'Do we really want to give these scholarships to kids from families making $100,000 to $500,000 a year?' "

Such comments and findings are anathema in Georgia – and perhaps in the 11 other states with similar programs that have quickly become beloved by middle- and upper-middle-class voters.

Richard McCook and his daughter Brandy are some of the devotees of Georgia's HOPE scholarship.

Attending college was never a question for Brandy McCook. An honors student at her suburban high school near Atlanta, she was going no matter what.

Even so, she got about $30,000 in state merit-scholarship funds to attend the University of Georgia the past four years, her father estimates.

Those tuition payments have been terrific, says Mr. McCook, who owns a driving school in the Atlanta area. His other daughter, too, got the same HOPE scholarship. All that public funding for his kids' college left him with cash to pay for some nice extras.

"Having that scholarship money meant we were able to do more for them," Mr. McCook says. "Both girls are in a sorority – and we gave both of them cars. Brandy got a Chevrolet Cavalier and we got her older sister, April, a Mazda Miata."

• E-mail claytonm@csps.com