Raid on lottery funds prompts call for name change
Posted March 10, 2009
Raleigh, N.C. — Some state lawmakers want to scratch "education" off the name of the North Carolina Education Lottery, saying funds are being used to balance the state budget and aren't going to public schools.
"Its just truth in advertising," said Rep. Thom Tillis, R-Mecklenburg, a co-sponsor of House Bill 518, which says the state-run numbers games should be marketed as the "North Carolina State Lottery."
Gov. Beverly Perdue last month pulled $50 million from the Education Lottery Reserve Fund as part of a $300 million emergency fund to help cover state operations, and the state held back another $38 million in school construction funds from counties.
"I have, I believe, succeeded in capturing the first round of money that is in trust funds that I can get my hands on," Perdue said Tuesday.
State law sets aside less than 2 percent of lottery sales proceeds for the reserve fund, which pays off huge jackpots. About a third of the money goes to education, half goes to general prizes and the rest pays retailers and administrative and marketing costs.
Lottery supporters used the concept of devoting proceeds to public schools to push the lottery through the General Assembly in 2005, and the name "education lottery" has been used to sell the games to the public ever since.
If lottery money is going to be shifted to other governmental uses, Tillis said, the name should reflect that it's no longer an "education lottery."
"If it's going to create, as in (the case of) the Highway Trust Fund, a practice where you take things intended for one specific purpose that people have trusted you to spend (it on) and then use it for something else, I think we need to be honest about it," Tillis said.
Former Gov. Mike Easley repeatedly urged lawmakers to pass legislation while he was in office that would lock lottery funds down exclusively for education, but the effort never gained traction.
Perdue said most of the state's general fund already goes toward education.
"Fifty-two percent of the bills I'm paying are related to schools – public schools and teachers," she said.
Last year, state Sen. Harris Blake, R-Moore, suggested dropping "education" from the lottery name because he didn't think schools and gambling should be linked. His bill never came up for a vote.
Tillis said he hopes his bill makes it through the General Assembly.
"We just need to put the heat on people who tell us that education is a top priority, who tell us that the lottery was passed to fund education and improve our situation here, that you really ought to look elsewhere when you need to try to fill a budget shortfall," he said.