The North Carolina State Lottery Act (HB1023, S.L. 2005-344), squeaked through each chamber of the General Assembly with a one vote margin. The distribution of the lottery revenue was one of many contentious issues when the lottery legislation was passed in 2005 and continued to be the subject of discussion two years later.
As it passed the House, House Bill 1023 specified the following distribution:
The Senate passed HB 1023 without a hearing in any committee other than the Rules Committee, and without changing a word of the bill. Yet the distribution above is not the distribution formula under which the lottery operates.
Why not? Prior to passing HB 1023, the Senate extensively changed the lottery bill and rolled these changes into the budget bill (SB 622). Senate budget negotiators then fought successfully to keep these changes in the final budget produced by the conference committee and signed into law.
Incorporating the Senate’s changes, the final distribution is as follows:
When the lottery was passed, the General Assembly estimated that it would generate $1.2 billion in revenue. By June 2007, estimates had declined to just over $1 billion (approximately $1.05 billion).Using the General Assembly’s initial revenue expectations, $97.5 million would be divided between the existing 115 Local Education Agencies for school construction and $52.5 million would be given to counties with higher than the median property tax rate based on average daily membership.
A county like Guilford would receive $10,111,739 from the lottery each year. In Guilford County the lottery revenue would almost build one elementary school, based on Department of Public Instruction estimates. But according to district officials, Guilford’s school population is growing by 1,500 students or more annually, enough to fill three elementary schools a year. The remaining construction costs are left to the responsibility of the county.