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Lottery sales no relief for schools

July 19, 2012

Wapakoneta City Schools Superintendent Keith Horner

Reports of record sales and profits from the Ohio Lottery does not automatically mean additional funds for school districts across the state.

“It doesn’t necessarily relieve our funds,” Wapakoneta City Schools Superintendent Keith Horner said. “At the local level, it doesn’t really give us any more money. It will help the state with its budget issues. If we get more money from the lottery, we get less from the state. The important thing for people to realize is we’ve been reduced dramatically in our state funding. Lottery money is a piece of it but a very small piece of it overall.”

Three statewide education management groups representing Ohio’s public schools on Wednesday released statements concerning that information released recently by the Ohio Lottery Commission could be misleading to local communities.

The Ohio School Boards Association (OSBA), the Buckeye Association of School Administrators (BASA) and the Ohio Association of School Business Officials (OASBO) released statements saying they want to set the record straight about lottery profits and their link to school funding.

The Ohio Lottery Commission issued a statement earlier this month touting a record sales year of $2.7 billion and a record year end transfer to education in Ohio, approximately $771 million after the fiscal year ending June 30.

The increase in sales is $2.6 billion up from the previous year with lottery sales in Ohio increasing for the past 11 years. The previous record profit transfer was set in 1997 at $748.8 million.

By law, lottery profits are given to the Ohio Department of Education to support schools and amount to approximately 6 percent of the department’s general revenue budget.

The three education organizations cautioned, however, that the lottery’s record-setting performance did not mean increases in funding to schools.

“While it is true that all Ohio Lottery profits are used by the state to fund education, the profit from increased sales was simply used to free up other state funds that had previously been set aside for schools, allowing more money to be transferred into the state’s rainy day fund,” OSBA Executive Director Richard Lewis said. “No increase in this year’s funding for school districts will be available as a result of these unexpected profits.”

BASA Executive Director Kirk Hamilton noted “the increase in lottery profits was positive news for the state of Ohio because of its recent devastating budget shortfall. However, we were disappointed to see reports implying that it is school districts that will benefit. In reality, when lottery profits exceed estimates, the total amount available for Ohio schools does not change.”

For fiscal year 2013, Ohio’s school foundation payment program funding for traditional and community schools is set at $7.2 billion, an amount established by Gov. John Kasich in his budget adopted in June 2011. The amount is not to increase as a result of more lottery profits without action by the governor and the legislature.

OASBO Executive Director David Varda said they are urging the governor to use the “extra” state money from the increased lottery profits to restore budget cuts to education that were included in the current state budget.

“It should also be utilized to help fund schools in the future as Governor Kasich develops a new school funding formula,” Varda said.

While school districts throughout the state have always received lottery money, Horner said they still have not received casino money and to date they have been given no timeline telling them when they will receive it.

“We’re still in the process of seeing where it falls in our funding,” Horner told the Wapakoneta Daily News on Wednesday. “We’ve seen projections, but nothing formal yet. We’re kind of waiting and seeing. Hopefully, it’s a good source of revenue for us.”

Rather than additional lottery and casino profits providing supplemental funding, Horner said they are considering it supplanted money, which instead of adding more money to school district budgets would replace funding from other state sources.

This year, the state reduced funding to Wapakoneta City Schools by close to $1 million. Overall funding to the district from Ohio has flat-lined in recent years.

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