Mega millions for schools?
Analysis from CSBA’s Policy and Programs Department
Published: May 1, 2012
Three big winners split that recent $640 million Mega Millions multistate lottery jackpot, and 29 tickets in California matched five of six numbers, worth $227,955.
More significant than the income taxes those winners will be paying is the state’s increased income from sales of tickets for the largest-ever Mega Millions jackpot—but those revenues provide less help for schools than many people assume.
More than $53.8 million has been raised for K-12 education through in-state lottery sales so far this year. That translates to approximately $8.67 per student in additional lottery funds that should start to be apportioned to schools in July. Even with all that money, though, lottery funds still make up less than 2 percent of most school district budgets.
Before you get too excited, remember that the same rules still apply. This is one-time money and will not balance your budget three years out. Likewise, half of the new money must be used for instructional materials.
According to the California Department of Education, the law authorizing the lottery requires school districts, including charter schools, to use lottery funds “exclusively for the education of pupils and students” and specifies that “no funds shall be spent for acquisition of real property, construction of facilities, financing of research, or any other non-instructional purpose.”
In addition, Proposition 20, the Cardenas Textbook Act of 2000, provides that half of the growth in lottery funds for education over the level set in the 1997-98 fiscal year must be allocated for the purchase of instructional materials.
Last year’s per-student apportionment was approximately $114 in non-Prop 20 funds and $19.40 in Prop 20 funds, for a total of $133.40 per ADA.
Current-year budget cuts of $326 per student will be offset by approximately 4 percent with this year’s lottery income. While it may help your cash flow, it makes only a small dent in the 30 percent of district apportionments that are deferred by the state into next year.
As school districts prepare for the potential of another ongoing $370 per-student reduction if Gov. Jerry Brown’s budgeted tax initiative fails next November, we cannot reiterate enough the need to be clear to your community that lottery funds are one-time money and will not solve the structural problem.
While many Californians still believe the lottery should have solved all of education’s financial concerns, the funding was always intended to supplement, not supplant, base state revenues. Lottery funds are counted outside the Proposition 98 guarantee.
A data function on the California State Lottery website allows you to query how much each school district or county office of education has received over the 20 years of lottery play in California. Remember that the numbers look big to the public, but when you divide them by the numbers of children you serve over the years, it really is just the cherry on top, not the answer to all your funding concerns; $8.67 won’t buy a new textbook.
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