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One question I often receive is whether the proceeds from the Texas Lottery are dedicated to public education.
The Texas Lottery began in 1992. Since that time, more than $11 billion has been generated for the State of Texas. Originally, the proceeds from the lottery were not dedicated to education, but rather went to the state's General Revenue Fund to be used for general state spending. Between 1992 and 1997, about $4.9 billion in lottery revenues went to the General Revenue Fund.
Legislative action in 1997 dedicated lottery revenue to the Foundation School Fund. The Foundation School Fund provides the majority of state funding for school districts. Since 1997, $5.9 billion has gone to the Foundation School Fund, used for school districts' public education services at the local level. In Fiscal Year 2003, lottery contributions equaled $888.2 million, or about 9.5 percent of the $9.4 billion appropriated from the Foundation School Fund.
For each dollar that is spent to purchase a lottery ticket, approximately 58 cents is used to pay off winning tickets. Seven cents is used to pay for the administration of the program and five cents is paid to retailers who sell the tickets. The remaining amount, approximately 30 cents, is dedicated to the Foundation School Fund. Unclaimed lottery prize funds revert to the state to be appropriated for health care, medical education and other programs authorized by the state legislature.
Another question I am asked is, "Wasn't the lottery supposed to solve funding problems with the education system?" Texas' public school population is over 4.3 million students with about 80,000 students being added to the system each year. That is the equivalent of adding a school district the size of Austin ISD each year. In fact, nearly one out of every eleven students in the United States is educated in Texas. Keep in mind that while the lottery generates close to $900 million per year, total federal, state and local spending on public education is over $24 billion per year. That equates to the lottery contributing about 3.75 percent of total public education spending in the state.
Please feel free to contact me if I may be of assistance regarding any matter of state government. You can contact me by writing to P.O. Box 2910, Austin, TX 78768-2910 or by e-mailing me at larry.phillips@house.state.tx.us.
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