Holiday scratch-offs are no gift to Illinois schools
A closer look at Illinois’ lottery legislation shows lawmakers historically diverted funding away from the classroom. Despite recent legislation, outsized holiday scratcher sales still only translate to slight gains for public schools.
Illinois’ holiday scratch-off tickets are often peddled as providing good-will funding for public schools, but a closer examination of state policy shows how lawmakers historically diverted most of the lottery money before it reached the classroom.
Even new spending reforms leave just 25 cents of every Lotto dollar going to support public education.
When lawmakers first debated the Illinois Lottery in 1973, one key tenant of the proposal was that all proceeds would go to help fund education. They promised “the state share [0f lottery revenues] would be used entirely for public schools,” according to The Associated Press.
But the politicians didn’t stand by their promise. Instead, the first 10 years of lottery profits went to the state general revenue fund, paying for much more than just schools.
It wasn’t until 1985 that then-Gov. Jim Thompson signed a law rededicating the lottery revenues to the Common School Fund, the primary source of education funding in Illinois.
During the Great Recession, then-Gov. Pat Quinn went farther by capping how much lottery money could go into the Common School Fund to pay for a $31 billion capital bill.
During the past 12 years, the lottery has in turn contributed the same level of money adjusted for inflation as 2009. Any additional funding was siphoned off to pay for expenses, such as pensions.
Since 1985, lawmakers have boasted how the lottery “funds education,” and they were technically right. In Illinois, 25% of lottery proceeds went “to fund public education, infrastructure projects and other good causes.”
But Christopher Mooney, a political science professor at the University of Illinois Chicago, said the education dollars were really just part of a larger “shell game” until 2018.
“If the lottery provides $10 to the school fund, state officials have two choices: they can either spend that much more money on schools, or they can lower the contribution from the general fund by $10,” Mooney said. “Illinois officials have taken the second approach.”
These higher lottery profits in turn did not increase net education funding; they simply freed up more general revenue for lawmakers to spend on other projects.
It wasn’t until 2018 when a law was passed guaranteeing transfers to the Common School Fund from the lottery would be supplemental to what the state budgets for education rather than in lieu of spending.
Moody said this new law doesn’t change his general argument about how little the lottery revenues offset education costs despite officials claims. Scratch-off proceeds accounted for just 5.3% of the state’s $14 billion education contribution in 2021.
The Illinois Lottery website reported $834 million went to fund public education, infrastructure projects and other good causes in 2022.
Illinois nation-leading pension debt is responsible for driving residents’ property taxes to the second highest in the U.S. and steering valuable lottery dollars away from students.
Common School Funds are used to pay for education and contributions to the Teachers Retirement System, which held an estimated $74.7 billion in debt this September. The system’s annual contribution alone cost $5.87 billion in 2022.
Lawmakers have gambled with Illinois’ education dollars before and lost. Constitutional pension reform would promise to free up more funding for schools without the risk.