Most revealing, Miller and Pierce fnd thatRegardless o the state or the time at which its lottery operated, educational spending declinedonce a state put a lottery into operation. Hence, the pattern o a declining rate o spending isnot simply an artiact o state fscal problems in the 1980s. The present analysis indicates thatstates
lotteries maintained and increased their educational spending more than states
(Emphasis in original.)Miller and Pierce conclude that lottery revenue is not used to increase education spending, and as to where thoserevenues go, they note that “lottery revenue constitutes a very small percentage o total revenue” and posit that theunds replace general revenue. In short, they fnd thatTo conclude, lottery revenue is unlikely to materially increase unding or education--and per-haps any other purpose. However, such revenue has political returns or governors that aresignifcant.
Lottery unds going to replace general revenue (also called supplanting) rather than supplement education spend-ing is a problem that has overtly dogged the NC Education Lottery rom its onset, just as critics predicted.
In early2006, beore the frst lottery ticket was even sold, Gov. Mike Easley announced that hal o the expected $400 millionrevenues would go to replace current education spending.
In 2009 Gov. Bev Perdue transerred $50 million rom theLottery Reserve into the General Fund, as well as $37.6 million intended or school construction (later returned).
By 2009 the problem had gotten so bad that some state legislators sponsored legislation to remove “Education”rom the name o the North Carolina Education Lottery, out o concern or truth in advertising.
In 2010, WRAL pub-
igur 2. componn o h Gnrl und, y 1996-2010
Public education, lottery transers, stimulus unds, and the rest