Press Release

Make the Lottery Suit Education’s Needs

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RALEIGH – North Carolina’s education lottery would set aside too much revenue for unproven educational programs, a new John Locke Foundation report argues.

A better formula could lead to more school construction money for 22 school systems across the state. Those include some of the state’s largest districts: Charlotte-Mecklenburg, Wake, Durham, Forsyth, and Guilford.

Others that would benefit would be Alamance-Burlington, Brunswick, Buncombe, Cabarrus, Catawba, Chapel Hill–Carrboro, Currituck, Dare, Davidson, Henderson, Hoke, Iredell-Statesville, Johnston, Kannapolis, New Hanover, Pitt, and Union.

State law currently mandates 35 percent of lottery revenues to go toward education. In his new Spotlight report, Terry Stoops, JLF education policy analyst, examines the educational uses of those revenues and proposes better alternatives.

“The lion’s share of the lottery proceeds will fund class-size reduction and pre-kindergarten programs,” Stoops said. “The state’s own assessment of these programs found that they haven’t improved students’ academic performance. So why spend more money on them when there are other, more critical needs out there?”

Under the current law, more lottery proceeds would go toward class-size reduction and pre-K programs than for school construction. The lottery funds would replace general-fund money that already covers class-size reduction and pre-K programs. There’s no proof that those programs have significant educational benefits, Stoops said.

Stoops proposes increasing school construction and cutting back on the unproven programs. He also proposes funding school construction cost-saving incentives — programs that reward school districts and administrators for finding innovative, low-cost solutions to facilities needs.

“Construction expenses are rising and have dramatically increased the cost of new school construction,” Stoops said. “School districts have been unresponsive to these cost increases, however, since they have been able to pass them on to the taxpayers. That’s why it’s important to set up financial incentives for them to economize.”

High growth is a problem for some school districts, too, such as Wake County and Charlotte-Mecklenburg, the state’s two largest districts. Stoops proposes revising the distribution of lottery funds to direct money toward high-growth districts.

A major educational need that the lottery ignores is charter schools, Stoops said. His proposed distribution of lottery funds would include funding charter schools, too. As public schools, charters receive no state money for capital expenditures. The demand for charter schools, however, is growing exponentially. Charter-school enrollment has almost doubled in the last five years, and thousands of students are turned away from charters because of their limited facilities.

“Lottery revenue should go toward expanding charter-school facilities as well as to a charter school startup fund,” Stoops said. “If and when the state lifts the cap of 100 charter schools, the startup fund could help new charter schools hit the ground running.”

Terry Stoops’s Spotlight paper, “A Lottery That Helps Students: How Lottery Proceeds Should Be Spent for Education,” is available on the Locke Foundation’s website. For more information, please contact Terry Stoops at 919-828-3876 or [email protected]. To arrange an interview, you may also contact JLF communications director Mitch Kokai at (919) 306-8736 or [email protected].

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About John Locke Foundation

We are North Carolina’s Most Trusted and Influential Source of Common Sense. The John Locke Foundation was created in 1990 as an independent, nonprofit think tank that would work “for truth, for freedom, and for the future of North Carolina.” The Foundation is named for John Locke (1632-1704), an English philosopher whose writings inspired Thomas Jefferson and the other Founders.

The John Locke Foundation is a 501(c)(3) research institute and is funded solely from voluntary contributions from individuals, corporations, and charitable foundations.