The following is an excerpt from our May issue:

Pop quiz: who has a better chance? A gambler trying to win a prize on a scratch-off lottery ticket or a student trying to graduate from a four-year college on a Tennessee Education Lottery Scholarship (TELS)?

Actually, that’s a bit of a trick question, as the odds of success are about the same. According to current projections, as few as 25% of students will keep their lottery scholarships through graduation, mirroring the odds of most instant win games.

The statistics are troubling to Shelby County Mayor A.C. Wharton, who serves as secretary on the Tennessee Higher Education Commission (THEC) and chairs a state advisory committee charged with studying the situation. Wharton and THEC staff recently held a forum in Memphis to brief the public and seek feedback. Wharton said his premise going into the study was “to prepare up and not dumb down.” Other committee members said they did not advocate a reduction in standards for high school students, saying it would be “a disincentive to performing well.”

When it came time for the committee to present its recommendations, however, that’s exactly what they proposed – lowering the HOPE scholarship’s retention GPA from 3.0 to 2.75, as well as relaxing the requirements for obtaining the ACCESS scholarship available to lower-income families.

The state lottery referendum passed with the support of 58% of voters in 2002, on the premise that the funds would benefit the brightest students who simply needed some financial help to obtain a college degree. The Lottery’s website announces that “everyone wins… especially students and families,” and its 2006 annual report says every ticket sold means “a win for education.” But as the third full school year draws to a close, it’s clear the program isn’t exactly living up to these claims.

Less than half of the first class of TELS students returned with the scholarship in their sophomore year, and at the start of year three that number dropped to 35%. What’s more, low-income and African American students were more likely to lose their scholarships, with only 9% of ACCESS juniors still reaping the benefits of the lottery scholarship.

Furthermore, these very same low-income families are more likely to play the Lottery, meaning the TELS basically boils down to the poor subsidizing the education of those who are better-off.

With a total of $763 million raised by the Lottery for education scholarships to date, only about 4,000 students are projected to keep them through to graduation day. And since a THEC survey of high school students found that only 10% said they would not be able to attend college without the scholarship, it’s likely that most of these graduates would have earned a degree even without the TELS. In fact, the majority of students who lose the TELS continue without it.

According to Tenn. State Sen. Thelma Harper (D-Nashville), “What it says is that poor people are sending wealthy kids to school, children that will be going to college anyway.”

So while Tennessee continues to pump billions of dollars into the Lottery, the chances of the state realizing any real educational returns are not much better than a gambler hoping to hit the Powerball jackpot.