The popular HOPE scholarship program is overflowing with money these days, just three years after lawmakers worried it was going broke.

It is in such good financial shape that excess HOPE money is being shifted to other scholarship and education programs in the midyear budget. It has $744 million in reserves, almost three times what it had in the bank before limits on the program were approved in 2004.

After years of mushrooming expenses, HOPE spending is going down. Lottery revenues, which pay for HOPE scholarships, are at an all-time high.

It's the kind of balance sheet that has critics of the 2004 HOPE reforms wondering what all the fuss was about.

"It was a manufactured crisis," argued House Minority Leader DuBose Porter (D-Dublin), who was a floor leader for then-Gov. Zell Miller when the HOPE program was started in 1993. "They scared everybody into voting for this by saying HOPE was running out of money. It was all unnecessary."

House Higher Education Committee Chairman Bill Hembree (R-Winston) disagrees, saying the 2004 reforms have helped put the program on sound financial footing.

"I think it was a wake-up for us as legislators to say, 'Let's do something now before things get bad.' I think we did the right thing."

Before the 2004 session, lawmakers, educators, students and others spent months studying the future of the HOPE scholarship.

The lottery-funded program provides tuition, book and fee money to college students with at least a "B" average.

At the time, state officials said the number of students getting the scholarship, and the program's costs, were rising faster than the growth in lottery sales. Officials predicted reserves would be drained by 2007.

The next year, Gov. Sonny Perdue recommended a budget that cut book and fee payments to students. Lawmakers didn't approve that move, but they passed a bill that froze the amount of money students could get to pay fees, and created a trigger that would gradually eliminate book and fee money if the program's funds dipped.

The bill also called for a tougher 3.0 grade-point average requirement for students to qualify for the scholarship. And it limited the number of credit hours HOPE would fund.

Three years later, things have changed, rather dramatically.

The Legislature is considering bills that would eliminate the plan to automatically eliminate book and fee payments if HOPE revenue declines, make it easier for home-school students to get HOPE scholarships, and allow high schoolers to take dual-enrollment classes at colleges and not have it count toward the HOPE credit limit. The home school and dual-enrollment measures could marginally increase the number of HOPE scholars.

"We're moving a little bit in the direction of opening things up," said Hembree, who sponsored the home school and dual enrollment bills.

Fewer recipients

The number of students receiving HOPE scholarships and grants peaked in the 2003-2004 school year, when about 222,000 received money from the program, according to the Georgia Student Finance Commission. Last fiscal year, which included the 2005-2006 school year, that dipped to 212,000. It's about 190,000 so far this year, with only a few months left in the school year.

Because expenses were less than expected this year, about $8 million is being shifted in the budget for the rest of this fiscal year from HOPE to pre-kindergarten classes and Georgia Military College scholarships.

The proposed budget for next year calls for about a $20 million reduction in HOPE spending.

While expenses are going down, the Lottery Corp. announced in January that ticket sales set a record for the first half of fiscal 2007.

Part of the decline in HOPE expenses is due to changes in enrollment patterns.

Technical colleges have seen historic declines in enrollment the past few years. Technical college students working toward a certificate or diploma receive a HOPE grant regardless of their grade point average.

Some University System students are losing their HOPE scholarships faster because of the 2004 reforms. In the past, HOPE officials checked a student's GPA to make sure they'd maintained a B average every 30 credit hours. Now they check at the end of the spring semester, whether students have taken 30 credit hours or not.

Tim Connell, president of the Student Finance Commission, said capping the student fees paid for by HOPE has also kept down costs. State officials had long complained that colleges felt free to regularly raise student fees because the costs would be covered by HOPE. Those payments were capped at the amount granted to students in the 2003-2004 school year. When fees increase now, students on HOPE have to pay out of their own pocket.

Surplus may not last

Despite the current strong situation, Connell said the program's financial picture may not always be so rosy. He said it is getting harder and harder for the Lottery Corp. to increase sales each year. And college and technical school enrollment —- and the number of HOPE scholars —- could boom again. So he thinks lawmakers should be careful in tinkering with the program.

"Some of the [financial] comfort they are now seeing is a result of some of the things they did in 2004," Connell said.

Sen. Nan Orrock (D-Atlanta) disagrees. She voted against a Senate resolution last week that would limit the use of lottery funds to HOPE, pre-kindergarten classes, other college scholarship programs and reserves.

Orrock thinks the state should use lottery money for things not covered by the resolution, such as new computers and technology for elementary, middle and high schools.

Instead, she said, Perdue and his fellow Republicans continue to try to convince Georgians that HOPE is in danger.

"We went though a battle three years ago with Sonny when he came in with his big trumpets blowing," Orrock said. "The sky was not falling. The governor created this sense of a crisis so that there were cuts made. Those cuts were a mistake.

"The dire predictions about running out of HOPE money did not occur."