Skip to content
The Archive of The Carrboro Citizen
Menu
  • Home
  • News
  • Community
  • Schools
  • Business
  • Opinion
  • Obituaries
  • Sports
  • Mill
  • Flora
  • Print Archive
  • About
Menu

Lottery without limits

Posted on October 7, 2010October 13, 2010 by Staff

Chris Fitzsimon

The recent report by Sarah Ovaska of N.C. Policy Watch that the percentage of revenue raised by the N.C. Education Lottery going to education programs has dropped to 29 percent is sparking a renewed debate about the lottery and the wisdom of funding recurring programs with its proceeds. And it’s long overdue.

When lawmakers passed the lottery in 2005, the promise was that 35 cents of every dollar would go to fund early-childhood programs, class-size reductions and college scholarships. But as Ovaska reports, the lottery law was changed two years later to make the 35 percent a goal, not a mandate, with the promise that more money overall would flow to education from lottery proceeds.

Lottery officials are quick to point out that’s exactly what happened. But it’s hardly that simple. Ovaska reports that the lottery sent $419 million to the state for education programs in 2009-10, $8 million more than the previous year. But lottery sales increased $140 million over the same period. That means $140 million dollars was taken out of the state’s economy for an $8 million increase in education funding. And the numbers are worse when you consider some individual games.

Ovaska highlights one game with a $20 ticket that raised $6 million. But after payouts for prizes, advertising and other expenses, it raised only $222,000 for education. That’s just 4 percent, less than the state sales tax.

The reactions by Gov. Beverly Perdue and lottery officials to Ovaska’s report are almost as troubling as her findings.

Perdue says she doesn’t mind that the percentage going to education is dropping as long as the amount keeps increasing. Lottery spokesman Van Denton wrote in a response that it’s best to think of it all as a pie and when the lottery makes the overall pie bigger, each slice to the state is larger.

Perdue and Denton are willing to ignore the percentages and focus only on how much the lottery is raising for education. But surely there’s a point at which that makes no financial sense.

What if lottery officials need to keep boosting advertising and lowering the percentage that comes back to the state? How much money are they willing to take out of North Carolina’s economy for a dwindling return for education?

The nearly $1.5 billion spent last year on lottery tickets last year would not be stuffed under mattresses if the lottery did not exist. People would spend it on restaurants, travel, clothes, not to mention food and shelter.

Most of the purchases would be taxed and almost all of them would help create or sustain jobs in the state. That doesn’t happen with the lottery. The state’s share is the state’s share. The rest goes to advertising, administration, prizes and profits for out-of-state lottery companies.

It is objectionable enough that the state is funding schools and programs for at-risk kids by trying to convince people, including the poor, to waste their money on a one-in-a-million chance of striking it rich.

Now we have state officials justifying draining larger and larger amounts of money from the state’s economy in a desperate attempt to increase the funds the lottery sends to education.

In the long run, it’s a losing, inefficient and ill-advised proposition.

Chris Fitzsimon is executive director of N.C. Policy Watch

Web Archive

© 2025 The Archive of The Carrboro Citizen | Powered by Minimalist Blog WordPress Theme