Rammed into existence by a Democrat-controlled legislature 15 years ago, the N.C. Education Lottery has raised $8 billion for the state’s public schools since its inception.
What’s more, statewide revenues are up to about $3 billion a year, which translates to an average of $2 million per day spent on education.
Those are gaudy numbers, to be sure.
But has the lottery fully lived up its early promises of “champagne wishes and caviar dreams” (for a good cause, of course)? In a word, no.
Research by UNC-Charlotte professors suggests that the lottery has struck it big in terms of overall revenues. But the share of that revenue that goes to schools has not kept pace. Nor has the original legislation, which clearly dictated how the money would be spent.
As it was written and passed in 2005, the original bill mandated that 35% of lottery revenues would fund four major needs:
— Hiring more elementary school teachers to reduce class sizes.
— Creating free public prekindergarten.
— Financing school construction.
— Paying for college scholarships.
The rest of the money would be spent on prizes and expenses. And that’s what happened … until it didn’t … and lawmakers began to bend the rules.
In 2007, they loosened the spending guidelines and increased the amount of revenue that could go to prizes, to keep ticket sales up by amping the allure of the jackpot.
And as time went on, researchers Walter Hart, Jim Watson and Carl Westine of UNC-Charlotte told WFAE-FM of Charlotte, less money went to the classroom.
Now the percentage of lottery revenue that goes to education has receded to 30%.
In a 10-year analysis, Hart and Watson, who are both former superintendents, also found that lottery money began to be used more and more for expenses that previously had been covered by the state budget: support staff, custodians, office assistants and substitute teachers.
In 2020, $21 million of lottery revenue paid for school bus transportation, which previously had come from the state’s general fund.
Long story short, lottery revenue is indeed now doing what it originally was not supposed to do: Replace some money that used to come from elsewhere.
Hart put it well: “The lottery was sold as icing on the cake, and over time it’s become more and more of the cake.”
Also, Westine found no correlation between increased lottery revenue and increased per-pupil spending.
This is not the concept North Carolinians were sold in the beginning.
Gov. Mike Easley, a Democrat on whose watch the lottery bill passed, had pushed hard for it. Easley said he hated to see North Carolinians spend their money on lottery tickets in neighboring states.
“We were funding the other states,” Easley told WFAE, “so I wanted to go on and get one in North Carolina.”
But Easley said he was disappointed that the original intent for how the money was to be spent has been lost in the scratch-off shuffle.
That’s why he wanted an amendment to the state constitution that forced the lottery money to be spent as originally intended, Easley said.
But there was no such amendment.
To be clear, the News & Record never favored the lottery as a means to fund education.
State-sanctioned games of chance for which there are astronomical odds against winning — and which appeal especially to North Carolinians of lesser means — always have seemed to us a dubious proposition. Public school funding should be a shared responsibility of all taxpayers.
Then there are the overhead costs. For instance, in 2019 the lottery made $2.86 billion in revenue. But only $728 million of that went to education — out of a total education budget of roughly $10 billion. The rest went to prize money, advertising and other expenses.
Those arguments, obviously, have not convinced lawmakers. The cash cow is out of the barn now. The lottery is here to stay.
The very least the legislature can do is honor its original intent and use lottery in addition to, not instead of, other sources of school funding.
Wanna bet that they do? We can always hope. But we don’t like the odds.
— Greensboro News & Record