NASHVILLE (MCT) – Tennessee Lottery officials upgraded revenue projections for lottery-funded scholarships to record levels -- more than enough to cover the scholarships this year for 102,000 recipients.
Less than two years ago, after one down year for scholarship funding from the lottery, the state legislature was considering raising eligibility standards for Hope Scholarships, the main lottery-funded grant for students. But lottery sales have been on a roll ever since, and some lawmakers are talking about expanding the program.
On Tuesday, Andy Davis, chief financial officer of the Tennessee Education Lottery Corp., presented revised estimates for lottery proceeds to the State Funding Board. Davis said he now projects the lottery will turn over between $328 million and $333 million to the scholarship program in the current academic year.
That's up from $321.5 million during 2012-13, and above the $322.7 million originally projected for this year.
The Funding Board compiles revenue estimates from all state government sources of funding and makes revenue projections on which the state budget is based. It also heard a presentation Tuesday from the Tennessee Student Assistance Corp., which administers all state-funded scholarships for Tennessee students, including those funded by the lottery.
TSAC Director Tim Phelps said all lottery-funded scholarships are expected to cost between $306 and $329 million in the current school year, although the target estimate is about $311 million.
"Given the revenue projections and expenditure estimates presented today, I think we are safe to say that lottery-funded scholarships will be fully funded for the current year," Phelps said.
About 102,000 students are receiving the various kinds of scholarships funded by the lottery, including the $4,000-per-year Hope Scholarship and the $2,000-per-year "Wilder-Naifeh Technical Skills" grants for use at Tennessee Colleges of Applied Technology.
Even at the high end of the scholarship cost projections, there's plenty of money to cover a deficit because the lottery has built up a reserve fund of about $400 million, which is generating interest income.
Some state legislators are proposing making the scholarships available to more non-traditional students.
State Senate Democratic Leader Jim Kyle of Memphis has proposed scholarships for adults who have some college credit to attend the state's new online-degree program that serves working adults, Western Governors University, and for others to earn technical certificates required for various trades.
Sen. Doug Overbey, R-Maryville, has proposed additional funding to help military veterans earn degrees and for more undergraduates to work on double majors.
The legislature reconvenes next month.