As county commissioners across NC prepare and submit their legislative goals for the upcoming year, it’s time to reflect on what moves have been made or resolved in regards to fiscal year 2013-2014 and speculate on which goals are likely to remain hot-button issues moving forward.
One topic sure to carry over from the prior year is the pursuit to reinstate the 40% allotment from lottery proceeds for school construction.
When the North Carolina Education lottery was first established (almost a decade ago now), 40% of its revenue was to be divided among all NC counties for the general purpose of “generating funds to provide enhanced educational opportunities and support school construction and renovation1”.
A key objective for these budgeted construction funds was to help counties maintain the pace of increased student enrollment by building and expanding existing facilities.
What happened to the 40% set aside?
In 2007, the “Great Recession” hit, causing an economic standstill that resulted in the largest collapse in state revenues recorded.2 By 2009, the lottery funds were shifted in order to support other areas of the NC budget, and the school construction distribution decreased to 20.8% of the revenue collected. This percentage continued to decline, dropping down to 17.1% in 2014.3
H.B.1107, titled “Restore Lottery $ for School Construction” was filed in May of 2014 and proposes a plan to steadily increase the percent each fiscal year until it again equals to 40% by 2016-2017. If approved, H.B. 1107 will increase the distribution to 27% for the 2014-2015 fiscal year as our county commissioners continue to advocate for their constituents.5
Why the Percentages Matter:
The original 40% contributed about $192 million annually to the Public School Construction Fund, and became a reliable funding source to the tune of $9.72 billion for school capital needs across the state.3
The budget cut for construction came at a time of increasing class size and student-to-teacher ratios – situations which often result in undesirable learning environments.
The lack of revenue has also placed a burden on local taxpayers due to the debt accumulated by projects that were started – based on the original budget assumptions that did not live up to expectations.
Restoring lottery funds is a goal that has gained traction in the past fiscal year and will remain an adamant concern of the NCACC as they continue promoting the best interest of their local communities.
Click here to see where your county stands as of FY 2013 in lottery fund distributions.
1 North Carolina General Assembly. “Legislation/Bills”. 2005 House Bill 1023. 31 March 2005. http://www.legislature.state.nc.us/sessions/2005/lottery/fulllotterybill.pdf
2 Center on Budget and Policy Priorities. “States Continue to Feel Recession’s Impact”. 27 June 2012. http://www.cbpp.org/cms/index.cfm?fa=view&id=711
3 Sean Holmes. “NCSBA Education Lottery Issue Brief.” 2013. 7 January 2013.http://www.ncsba.org/clientuploads/DocumentsWord/Advocacy/NCSBA Education Lottery Issue Brief.doc
4 North Carolina Education Lottery. “Education Programs Receiving Lottery Dollars”. URL.
5 North Carolina General Assembly. “Legislation/ Bills”. 2014 House Bill 1107. 15 May 2014. http://www.ncleg.net/Applications/BillLookUp/LoadBillDocument.aspx?SessionCode=2013&DocNum=7771&SeqNum=0