HOPE began modestly as a way to give bright Georgia high school students without much money a chance to go to college.

Ten years later, HOPE has ballooned into a massive entitlement program in danger of busting its budget. Far more generous and costly than envisioned, HOPE is subsidizing 100,000 students at Georgia's colleges and universities.

More than half of the state's high school graduates last year qualified for the scholarship, which pays tuition, mandatory fees and some book costs.

Lawmakers dumped income standards long ago, extending HOPE to even the wealthiest families regardless of need.

Now HOPE scholars are disproportionately middle- and upper-class, an analysis by The Atlanta Journal-Constitution shows.

Most who get the scholarships would have gone to college anyway, researchers say.

HOPE also has led many students to take easier classes, drop tough courses and take longer to graduate, published reports and Journal-Constitution research show. And 58 percent (of HOPE scholars at Georgia's public colleges lose the scholarship or drop out by the time they reach 30 credit hours -- often the end of their freshman year.

For the 2000 freshman class, that represented at least $18 million in scholarships awarded to students who either quit school or couldn't maintain a B average their first year, the newspaper's analysis shows.

Over the last decade, the state has distributed about $2.1 billion in HOPE money, spreading it across Georgia and ensuring the program's popularity. Nine out of 10 Georgians consider the HOPE scholarship a good use of lottery dollars, a new Journal-Constitution/Zogby America poll shows.

Many see HOPE as an unqualified success. It is credited with keeping high-achieving students in-state. Its supporters say it has also pumped up SAT scores of incoming freshmen and raised admission standards at Georgia's public colleges. The program has become a model for states throughout the nation.

Now HOPE must change to survive.

If cuts aren't made, HOPE and the lottery-funded pre-kindergarten program are projected to begin dipping into their reserves in the 2006-2007 budget year and sink $434 million into debt two years later.

It's a stunning twist, fueled by slowing lottery sales, increased costs and growing enrollment. Those factors will quickly erase this year's expected $500 million surplus.

The state has created a commission to recommend ways to keep the program alive.

Scaling back HOPE will be a struggle, said David Mustard, a University of Georgia economist who has studied the scholarship for years.

"Once a subsidy is given out, it's impossible to cut back," he said. "People will fight like hell."

Goals fall short

At many Georgia high schools, winning HOPE isn't an accomplishment -- it's the norm.

The only standard for eligibility -- graduating high school with a B average -- often is meaningless because its valuee varies wildly from school to school. Because of a quirk in the way students' grade-point averages are calculated for the HOPE program, nearly a third of high school graduates eligible for HOPE don't have a 3.0, normally considered a B average.

And there is little evidence that HOPE has succeeded in one of its original goals: getting needy but promising students to go to college.

Though the state has paid tuition for more than 700,000 Georgians, the state still ranks 49th in the nation in the rate of young people it sends to college. The college-going rate for the state's 18- to 24-year-olds has crept up from 29.1 percent in 1990 to 29.2 percent in 2000, according to U.S. census figures.

Patrick Callan, president of the nonprofit National Center for Public Policy and Higher Education, is surprised the HOPE program hasn't bumped up the percentage of young people attending college.

"If it isn't increasing the college-going rate in Georgia, what is it doing?" Callan asked. "That was definitely one of the original goals."

Mark Musick, president of the nonprofit Southern Regional Education Board, which advises state leaders, said Georgia could have had a bigger impact on education if it had redirected HOPE's billions into need-based aid for college students. But Musick said he didn't believe there would have been enough political support for such a program.

"The problem may be less how HOPE was proposed and initiated than how it grew," Musick said.

Despite the data, U.S. Sen. Zell Miller, who founded HOPE when he was Georgia's governor, says that the programhas changed the way Georgians think about college opportunities.

"You can't forget how it was not that long ago, when most families in Georgia never allowed themselves to dream about their kids going to college," Miller said in a recent interview. "That was just something they didn't allow themselves to think of because it was beyond their means."

In the early 1990s, Miller repeatedly described HOPE -- which stands for Helping Outstanding Pupils Educationally -- as a way to help bright students whose families would find it difficult or impossible to afford college.

But recently Miller said that was not the ultimate goal.

"My dream was for it not to have anything to do with means but everything to do with merit," he said.

In fact, HOPE has grown well beyond the concept that he originally promoted.

Expansion came easily

With lottery sales soaring, it was easy for lawmakers to expand a popular program that relied on lottery profits instead of taxes. And those lottery dollars are paid disproportionately by lower-income African-Americans, who live in neighborhoods that produce fewer HOPE scholars, the AJC analysis shows.

Unconstrained, Miller and other Georgia politicians expanded HOPE to spread the wealth to more families.

Among the first limits to go was a cap that allowed the scholarships only for students whose annual family income was less than $66,000. Miller pushed legislators to increase the cap to $100,000 and later to drop income limits completely.

At Miller's suggestion, state leaders expanded the program from covering just two years of tuition to four. They made it possible for students who lost HOPE to gain it back. They agreed to fund college fees and some book expenses. They increased scholarship money for students attending private colleges.

Even as legislators were doling out extra HOPE dollars, they were pouring $1.8 billion from the lottery into a host of projects, from outfitting public schools with satellite dishes to building a $50 million public broadcasting and telecommunications complex.

"We were flush with money," said former House Majority Leader Larry Walker (D-Perry). "We would get in the budget negotiations, get in tough situations, and somebody would say, 'Can we fund it with lottery money?' "

Lottery funds decline

Over the decade, the scholarship and the HOPE grant program for technical college students have received only about 8 cents of every dollar spent on the lottery. More than half the lottery dollars went to prizes. The remainder paid for pre-k programs, technology and building projects, and lottery operations.

But the lottery money no longer is growing fast enough to keep up with HOPE.

The state commission studying possible cutbacks in HOPE will hold its final meeting Thursday and plans to put its recommendations in a written report for the Legislature by January.

Critics have slammed just about every option presented to the commission. When Gov. Sonny Perdue asked the commission to consider changing the eligibility standards to include a minimum SAT score, he was accused of attacking African-American students who tend to fare poorly on the test. Two-thirds of African-Americans on HOPE scholarships at Georgia's public colleges would not have been eligible if an SAT score of 1000 were required.

The commission has informally agreed to recommend eliminating book and fee payments. That step could save $125 million in its first year and more in later years. But that's only enough to keep the program out of a deficit for five to seven years, researchers say. Students already are grumbling about possibly having to pick up fees and book costs, which would be about $1,200 a year at Georgia's biggest universities.

Some members of the Board of Regents, which has no authority over HOPE changes, are also criticizing some of the ideas. At a meeting this past week, Regent Elridge McMillan asked why there hadn't been much talk about restoring an income cap.

"We all know why it was necessary to let everybody under heaven get a HOPE scholarship," McMillan said. "It was political."

Georgians have their own ideas about how to bring HOPE back in line. Nearly 40 percent of likely Georgia voters said the scholarship should be limited to families making less than $100,000 a year, the recent AJC-Zogby poll shows. About 27 percent favored cutting the amount of money HOPE pays, and 22 percent supported increasing academic standards for eligibility.

Other states taking notes

HOPE is the largest program of its kind in the nation, and other states will be watching the debate closely.

More than a dozen states have established their own versions of merit-based scholarship programs, many based on HOPE.

HOPE looked so good, President Bill Clinton designated Georgia's program as the model for the federal HOPE tuition tax credit.

"HOPE has allowed students not only in Georgia but also in other states to go to college," says Bob Morgenstern, the executive director of West Virginia's PROMISE scholarship program, which is modeled on HOPE. "Absent HOPE, I don't know if PROMISE would have ever been created."

But in West Virginia and other states, officials tried to design their programs to weed out the troubles they saw in HOPE. They have required students to take full course loads or put a time limit on the scholarships. And they attempted to battle grade inflation by setting academic standards that included more than just high school grades.

More states also are creating programs tailored to help lower-income students. Tennessee, for example, opted to increase scholarship dollars for needy students and exceptional scholars.

Georgia is facing new limits, too.

Shelley Nickel, who oversees HOPE as the executive director of the Georgia Student Finance Commission, said the program must be scaled back. HOPE needs to return to its initial goals, she said, including inspiring kids to do better in high school and providing college access for those who can't afford it.

"HOPE moved away from its original intent," Nickel said. "We need to refocus and recenter on what it was supposed to be."

-- Staff writer Maurice Tamman contributed to this report.