Are HOPE Scholarship and HOPE Grant recipients subject to the Fair and Open Grants Act, which regulates state grants?

Plain-English summary

The Director of Scholarships and Grants at the Georgia Student Finance Commission asked whether recipients of the HOPE Scholarship, HOPE Grant, and other state scholarship and grant programs had to comply with the Fair and Open Grants Act (FOGA). The AG said no, on a structural reasoning that did not require analyzing FOGA's specific exclusions. FOGA implements the constitutional grant-to-local-government clause (Art. VII, Sec. III, Para. III), which addresses grants to "counties and municipalities," meaning grants to public entities. As 1993 Op. Att'y Gen. 93-13 had already explained, FOGA's definition of "grant" turns on whether the recipient is a "public" entity. State scholarships and grants to individual students are not grants to public entities; they go to private citizens. They are also authorized by separate constitutional provisions: Art. VIII, Sec. VII, Para. I(a)(1) (general authorization for student grants, scholarships, and loans) and Art. I, Sec. II, Para. VIII(c) and (c)(1) (lottery proceeds for educational programs including grants, scholarships, and loans). FOGA therefore does not reach the HOPE programs.

Currency note

This opinion was issued in 2002. Subsequent statutory amendments, court decisions, or later AG opinions may have changed the analysis. Treat this page as historical context, not current legal advice. Verify current law before relying on any specific rule, deadline, or remedy mentioned here.

Historical context

The Fair and Open Grants Act, codified at O.C.G.A. §§ 28-5-120 through 28-5-127, was the General Assembly's effort to bring transparency and procedural regularity to state grants to local governments. Before FOGA, grants from line-item appropriations to local governments were sometimes made without clear public-purpose review. FOGA established disclosure, application, and review requirements for grants that are not specifically identified in the appropriations Act.

The constitutional anchor for FOGA is Art. VII, Sec. III, Para. III, which authorizes the General Assembly to make grants "to counties and municipalities within the state." That clause is structurally about grants from the state to public entities (local governments). FOGA implements that authority.

The 1993 AG opinion (1993 Op. Att'y Gen. 93-13) had already wrestled with FOGA's scope. The opinion observed that FOGA's definition of "grant" used the phrase "for a public purpose" in a context that would otherwise be redundant, since any state appropriation must be for a public purpose. The "logical, special meaning" of the phrase, in context, was that "grant" referred to a grant for a "public" entity rather than a grant for a "private" citizen.

Applying that reading to HOPE Scholarships and HOPE Grants, the AG concluded the analysis fell outside FOGA's scope. State scholarship and grant programs flow to individual students. The students are private citizens, not public entities. So FOGA does not apply.

The AG also noted that state scholarship and grant programs have their own constitutional authorizations distinct from FOGA's local-government-grant authority. Art. VIII, Sec. VII, Para. I(a)(1) authorizes the expenditure of public funds "[t]o provide grants, scholarships, loans, or other assistance to students and to parents of students for educational purposes." Art. I, Sec. II, Para. VIII(c) and (c)(1) (added with the lottery amendment) specifically authorizes the use of lottery proceeds for educational programs and educational purposes, including grants, scholarships, and loans for college. These are independent constitutional grants of authority for student aid, conceptually separate from the local-government grant authority that FOGA implements.

The AG's reasoning meant the Student Finance Commission did not need to apply FOGA's procedural requirements to its scholarship and grant programs. The Commission could administer HOPE Scholarship eligibility, HOPE Grant eligibility, and other student aid through the program-specific statutes (e.g., O.C.G.A. §§ 20-3-519.1 through 20-3-519.12 for HOPE Grants) without layering on FOGA disclosure or application requirements designed for local-government grants.

For the Georgia Student Finance Commission at the time

The Commission could administer HOPE Scholarships, HOPE Grants, and other student aid programs without FOGA compliance. Eligibility, disbursement, and reporting were governed by the program-specific statutes and the Commission's own regulations.

For HOPE Scholarship and Grant recipients at the time

Recipients did not have to comply with FOGA disclosure or application requirements. The applicable rules were the program-specific eligibility and continued-eligibility requirements (academic standing, residency, etc.).

For higher education institutions disbursing HOPE funds at the time

Institutions did not need to apply FOGA-style review processes to HOPE disbursements. Standard financial-aid administration practices applied.

Common questions

Q: What does the Fair and Open Grants Act do?
A: FOGA establishes procedural requirements (disclosure, application, public-purpose review) for state grants to local governments where the grant is not specifically identified in the appropriations Act. The aim is transparency in state-to-local-government funding decisions.

Q: Why isn't a HOPE Scholarship a "grant" under FOGA?
A: Because FOGA's definition of "grant" turns on whether the recipient is a public entity. HOPE Scholarship recipients are individual students, who are private citizens, not public entities.

Q: Does this mean HOPE Scholarships have no transparency requirements?
A: No. They are governed by separate program-specific statutes (e.g., the HOPE Grant statute at O.C.G.A. §§ 20-3-519.1 through 20-3-519.12) and by the Student Finance Commission's regulations and audit requirements. The opinion only addresses FOGA's applicability.

Q: What about HOPE-funded grants to institutions, rather than to students?
A: The opinion does not specifically address grants from the lottery to institutions. Such grants might require a separate analysis, looking at whether the institutional recipient is a "public" entity for FOGA purposes (state universities are public; private colleges are not).

Background and statutory framework

The HOPE Scholarship and Grant programs are funded by Georgia Lottery proceeds and administered by the Georgia Student Finance Commission under O.C.G.A. §§ 20-3-519 et seq. The lottery's constitutional authorization at Art. I, Sec. II, Para. VIII directs that net lottery proceeds go to specific educational uses including HOPE-style aid and pre-K programs.

The general authorization for student aid at Art. VIII, Sec. VII, Para. I(a)(1) predates the lottery amendment and provides a separate constitutional basis for state scholarships and grants. State student aid is therefore both pre-lottery and lottery-funded, with the constitutional architecture distinct from local-government grants.

FOGA at O.C.G.A. §§ 28-5-120 through 28-5-127 implements the local-government-grant clause. Its definition of "grant" is the gateway: it captures only "any line item appropriation of funds that will be disbursed for a public purpose of which such amount, purpose, and recipient is not identified in the appropriations Act." The 1993 AG opinion's gloss (recipients must be public entities, not private citizens) is the doctrinal hook that excludes the HOPE programs.

Citations and references

Constitutional and statutory:
- Ga. Const., Art. VII, Sec. III, Para. III (local-government grants)
- Ga. Const., Art. VIII, Sec. VII, Para. I(a)(1) (student grants/scholarships/loans)
- Ga. Const., Art. I, Sec. II, Para. VIII(c), (c)(1) (lottery proceeds for education)
- O.C.G.A. §§ 28-5-120 through 28-5-127 (Fair and Open Grants Act)
- O.C.G.A. §§ 20-3-519.1 through 20-3-519.12 (HOPE Grant program)

Prior AG opinions:
- 1993 Op. Att'y Gen. 93-13 (FOGA reaches grants to public entities, not private citizens)

Source

• Landing page: https://law.georgia.gov/opinions/2002-2

Original opinion text

This is in response to your letter requesting that we advise you whether recipients of the HOPE Scholarship, HOPE Grant, and other state scholarship and grant programs must comply with the Fair and Open Grants Act (FOGA). See O.C.G.A. §§ 28-5-120 through -127. Your letter refers to the exclusion in the Fair and Open Grants Act for "any grant, by law, which is apportioned entirely by formula." O.C.G.A. § 28-5-121(1)(C). You state that the law governing the HOPE Grant program requires recipients to meet a list of criteria in order to be eligible for the Grant. O.C.G.A. §§ 20-3-519.1 through –519.12. As I understand it, you believe this excepts the HOPE Grant program from FOGA under O.C.G.A § 28-5-121(1)(C) which provides that the term "grant" in FOGA does not include "[a]ny grant, by law, which is apportioned entirely by formula." I have not analyzed whether this is true because there are sufficient other reasons to conclude that recipients of these scholarships and grants are not required to comply with FOGA. The Fair and Open Grants Act implements the Constitutional power of the General Assembly to regulate the making of grants to local governments. See 1993 Op. Att'y Gen. 93-13. State funds may be granted to counties and municipalities within the state. The grants authorized by this Paragraph shall be made in such manner and form and subject to the procedures and conditions specified by law. GA. CONST. Art. VII, Sec. III, Para. III. Under the Fair and Open Grants Act, "grant" is defined as "any line item appropriation of funds that will be disbursed for a public purpose of which such amount, purpose, and recipient is not identified in the appropriations Act." O.C.G.A. § 28-5-121. In interpreting this definition, this office has advised that "FOGA regulates only those expenditures which conform to the ordinary meaning of grant, i.e., those which are in the nature of a gift or aid for a particular purpose." 1993 Op. Att'y Gen. 93-13, at 37. That opinion also concludes that: FOGA defines "grant" as pertaining to an appropriation for a "public purpose." Since any appropriation must be for a "public purpose," the language is redundant unless it has some special meaning. The logical, special meaning is a grant for a "public" entity rather than a grant for a "private" citizen. Id. at 38. State scholarships are to "private" citizens, not for a "public" entity. A separate part of the Georgia Constitution from that which is implemented by FOGA authorizes the expenditure of public funds "[t]o provide grants, scholarships, loans, or other assistance to students and to parents of students for educational purposes." GA. CONST. Art. VIII, Sec. VII, Para. I(a)(1). The Constitution also specifically authorizes the use of lottery proceeds for "educational programs and educational purposes," including "grants, scholarships or loans" for college. GA. CONST. Art. I, Sec. II, Para. VIII(c) and (c)(1). From this I conclude, and it is my official opinion, that it was not the intent of the General Assembly that the Commission comply with the Fair and Open Grants Act in administering the HOPE Scholarship, HOPE Grant, and other state scholarship and grant programs. Prepared by: Shereen M. Walls Assistant Attorney General