The Georgia Lottery

The Georgia Lottery

from the perspective of a Walker County, Georgia,

School Board Member

D. Michael North - October 22, 2000

Introduction

Education lotteries are touted as the solution to every societal ill. States without lotteries to are scrambling to enact them. In some states the campaigns of some candidates are based solely on this issue. But will a lottery accomplish all that is claimed?

I will not look at this issue in broad or general terms. I will not discuss the societal impact or morality of lotteries, though I have my opinions on those topics. I wish to look simply at the impact the Lottery has had on Walker County Schools, and evaluate the performance of lottery programs to date. Many of my statements will be answers to questions that have been asked of me by both Tennessee and Georgia Residents.

Capital Improvements

The Walker County school system has, since the adoption of the lottery, built 1 new high school and 3 new elementary schools. We have completely renovated 2 elementary schools. This fact is often pointed out by lottery proponents in Tennessee. What percentage of construction funds was provided by the lottery? 0%. None.

All of our capital improvements were funded by the passage of a 1% Special Purpose Local Option Sales Tax. Yes, there is a provision in the lottery legislation that allows for lottery proceeds to be applied to capital projects, but there must be special circumstances, almost an "emergency" need for your district to qualify for construction money.

Last year, the lottery only provided enough construction funding to build 7 average schools statewide. [1] This would not have covered expenditures for Walker and Catoosa Counties, much less the 178 other districts in the state.

Teacher Salaries

Most of the people I speak to are under the impression that Georgia's teachers are paid a drastically higher salary than Tennessee's teachers. It is true that Georgia's teachers are paid more than Tennessee's. The average teacher in the State of Georgia is paid $37,412 per year, while the average Tennessee teacher is paid $35,584 annually. [2] This is a significant difference, about 5%, but it is hardly earth shattering. And not one penny of that higher salary is the result of Georgia's lottery. Because of a commitment by the Georgia General Assembly, Georgia's teachers were paid more than Tennessee's before there was a lottery, and will likely continue to be paid more until Tennessee takes the next step toward socialism and adopts a state income tax.

Computers and Technology

This is the only area where the local school districts have seen any impact. As many have observed, Walker and Catoosa county schools have many classrooms and computer labs with new Imac computers. But is this a tremendous boost to our systems? According to the Heritage Foundation, computers in the classroom have done little to boost student achievement, and in some areas students who had computer instruction actually did worse than students receiving traditional instruction. [3] And the amount of the contribution? Walker County schools have a system-wide General Fund budget of approximately $50,000,000 dollars. Of that, less than $200,000 comes from the lottery.

That's right. $200,000, and we must spend it on technology. If we need teachers, or textbooks, or classroom space, we must raise property taxes to get it. The lottery is of no help whatsoever.

HOPE Scholarship

The HOPE Scholarship is the most popular lottery funded program in Georgia. It is the model to which other states aspire. The HOPE, however, is not all it claims to be. First, it is claimed that the HOPE is fully funded by the lottery, a voluntary tax.

Well, the HOPE, at present, is fully funded by the lottery. How long this may continue is in question. As lottery participation decreases, lottery revenue falls. As lottery revenue falls, the HOPE must either cut funding areas (in essence breaking its promise), or seek funding from some other source. At present, the HOPE is $44,000,000 short of needed revenue. [4] As the number of qualifying students increase, and revenues fall even further, pressure will be brought to bear to fund the shortfall from the General Fund.

There is already the admission on the part of some that the numbers qualifying may be inflated due to teachers giving students higher than deserved grades. In fact, SAT scores remain flat, while the percentage of students graduating with an A average has increased. [5] This would indicate that grade inflation is at least possibly a factor. The number of HOPE students requiring remedial classes upon entering college has at least one professor referring to the scholarship as the HOPEless scholarship.

"So what," you might say. "This program is funded by a voluntary tax. No one pays that doesn't wish to." That is not at all true. For each student that receives HOPE funding, the state pays approximately 200% more from the general fund to subsidize their education. In other words, If the HOPE pays $4,000 per student, the taxpayer kicks in another $8,000 out of the General Fund . [6] Hardly an involuntary tax, I would say.

Pre-Kindergarten

The Pre-Kindergarten program has taken the second largest share of lottery funds. While this program has been rated the most effectively administered lottery funded program, I would simply remind the reader that the local school district, K-12, does not benefit from this program in any way. In addition, the Pre-K program is becoming so popular among working families that if lottery money is insufficient to support demand in the near future, there will be tremendous pressure to fund this program from the General Fund.

Conclusion

Local school districts in Georgia do not benefit measurably from the lottery. The lion's share of lottery funds go to families of college students and Pre-K students. The number of college students and Pre-K students combined do not equal a fraction of the number of students in the state enrolled in K-12. In typical bureaucratic fashion, the money is directed to popular, high profile programs, while real needs go unmet.

Further, because these programs are "universal", and not subject to means testing, a huge portion of families benefiting from lottery funding could have afforded to pay for these services themselves. The average recipient of HOPE funds comes belongs to a family making $12,500 per year more than the state average. [7] Likewise, children of some poor families are left waiting for open Pre-K slots, slots which were taken by children of middle class families who could afford day care elsewhere.

The Georgia Lottery is a very popular red herring. Please do not buy the propaganda. Despite the dreams and promises, property and sales taxes continue to increase since the inception of the lottery.

References:

[1] Report on the Expenditure of Lottery Funds, Fiscal Year 1999, Council for School

Performance, p.5. Note: Based on 1999 expenditure of $70,648,547 and an average

cost per school of 10,000,000.

[2] American Federation of Teachers, 1998 annual salary report.

[3] Do Computers in the Classroom Boost Academic Achievement?, Kirk A.

Johnson, Ph.D., June 14, 2000.

[4] Is HOPE Scholarship in Trouble?, Chattanooga Times - Chattanooga Free-

Press, October 22, 2000.

[5] ibid.

[6] Report of The National Commission on the Cost of Higher Education, American

Council on Education, January 21, 1998

[7] Lottery Is a Bad Deal for the Poor; Poorly Educated, Barby Gifford, Chattanooga

Times - Chattanooga Free-Press, April 30, 2000.

All original material on this site is protected by Copyright Ó 2000, D. Michael North

[ Acknowledgements]