Cindi Ross Scoppe

How the SC Legislature broke its lottery promise

It was all about education, according to supporters of the 2000 campaign to authorize the creation of the SC lottery.
It was all about education, according to supporters of the 2000 campaign to authorize the creation of the SC lottery.

THE LEGISLATURE promised, when it created the lottery, that South Carolina would be different.

In the other states, education didn’t actually benefit from state-sponsored gambling because lawmakers just used the lottery money to replace tax money that had been spent on schools. But here, our Legislature promised, lottery money would supplement tax money. The schools, our Legislature promised, would get all the lottery proceeds on top of the tax money they would have been getting anyway.

Our Legislature kept that promise for precisely as long as it was easy to keep that promise.

Then our Legislature broke that promise.

And kept breaking it.

And to this day, our Legislature is still breaking that promise. To the tune of $400 million this year.

The Legislature didn’t merely make a political promise back in 2001. It wrote that promise into state law, which says, at Section 59-150-350(D) … actually, you don’t want me to quote the law, because it’s convoluted (and you can look it up if you want to read it). What it says is that after the lottery started, the state had to keep spending the same percent of its non-lottery money on education as it spent the year before the lottery started. That, according to the state Revenue and Fiscal Affairs Office, was 56.71 percent.

Today, we’re down to 52.1 percent. Or $400 million a year short of what the lottery promoters promised.

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Cindi Ross Scoppe

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Read the lottery law’s education-funding promise, at 59-150-350(D)

Guess what the new state budget doesn’t do — again

A casino-funded road fix? Don’t bet on it

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Technically, the Legislature isn’t actually breaking the law. It’s … ignoring the law.

You know how there’s a state law that says the Legislature has to spend a certain amount of money per public-school student every year? And how every year since 2009, the Legislature has legally ignored that law because it has a sentence in the state budget that suspends the law for the next year? Well, it’s doing the same thing with the lottery-law requirement.

Now, to be clear: This does not mean that the Legislature is shorting the schools $400 million by suspending the lottery-law requirement and another $450 million by suspending the per-pupil requirement. It’s essentially the same money. If the Legislature were to meet the per-pupil requirement, it probably would meet the lottery requirement as well. (I can’t say that for sure, because it could fully fund public education and still break the lottery promise if it cut college spending even more, since the lottery promise is for public and higher education.)

What it means is that the promise of the ‘education lottery’ turned out, very quickly, to be a big fat lie.

What it means is that the promise of the “education lottery” turned out, very quickly, to be a big fat lie.

I will pause for a moment for you to imagine you can hear me saying, “I told you so.”

We’ve known all along about the Legislature suspending the per-pupil-funding requirement. Lawmakers first inserted a proviso into the 2003-04 state budget that allowed them to ignore any law that required them to spend more money than they were spending, and they promptly shorted the per-pupil requirement by $24 per student. After a few years, they worked back up to full funding, but they kept putting that proviso back into the budget. In 2009, they started using it again to underfund the per-student requirement, and have done so ever since.

What no one seemed to notice — or at least no one who objected — was that the proviso also allowed them to ignore the lottery-law requirement. And in 2010, they started doing that. That first year, total state education funding was $32 million short of the legal requirement. The shortfall grew to $268 million the following year and kept growing, reaching $400 million this year. Don’t be surprised if it keeps growing.

If the Legislature isn’t going to use the lottery money to supplement education, then there’s no justification for having the lottery.

Rex Rice was a House member when the lottery was created. And like a lot of us, he explained in a statement in the Senate Journal this spring, “I was concerned that South Carolina general education spending would be reduced because of the new money generated by the lottery.” So he worked to get that language into the lottery law that prohibited the Legislature from decreasing tax support for education. And every year during the budget debate, he would check to make sure the Legislature was complying. Then he ran for Congress instead of re-election, and apparently no one kept checking. I am embarrassed to admit that I never thought to check.

Mr. Rice was elected to the Senate last year, and this spring he checked the numbers, and discovered the $398,914,867 shortfall. In that statement in the Journal, he put his colleagues on notice that “This practice must be addressed in future budgets to meet our obligations for education spending.”

Back to “I told you so.”

Like Mr. Rice, I think the Legislature needs to start keeping its promise again. But even if you’re convinced that we already spend too much money on education, you still ought to be upset about the broken promise.

If the Legislature isn’t going to use the lottery money to supplement education, then there’s no justification for having the lottery. It ought to be shut down.

After all, we only approved it in order to generate more money for education. Right?

Ms. Scoppe writes editorials and columns for The State. Reach her at cscoppe@thestate.com or (803) 771-8571 or follow her on Twitter or like her on Facebook @CindiScoppe.

It’s the law The proportion of total recurring general fund and special fund revenues of the State expended for the total of public elementary, secondary, and higher education allocations in any fiscal year must not be less than the proportions in the fiscal year immediately before the fiscal year in which education revenues are first received from a state lottery, and must not be reduced or supplanted later by revenues received from a state lottery. SC Code of Laws, Section 59-150-350(D)

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