Mount Vernon News

MOUNT VERNON — With a $700 million budget shortfall predicted by the end of fiscal year 2009, Ohio Gov. Ted Strickland has requested that each state department implement budget strategies that will reduce expenditures and/or increase revenues.

With regard to the State Department of Education, the budget reduction target is $51,833,533 for FY 2008, and $49,682,040 for FY 2009. Strickland mandated that any moves to reduce the budget must exempt services critical to direct pupil education, including foundation funding.

Roughly 9 percent of local school districts’ foundation funding comes from lottery profits. That funding could be negatively impacted by the $73 million in budget cuts the Ohio Lottery Commission has been asked to make for FY 2009.

According to Keith Dailey, press secretary in the governor’s department of communications, the Ohio Lottery Commission will achieve its budget target by enhancing lottery revenues through refreshing game products and adding games, such as Keno and other monitor games. These games would be limited to age- and time-controlled settings, such as bars and other similar venues.

“The lottery — a voter-approved, state-regulated and state-monitored system — has a long tradition of offering new products like this,” Dailey said. “Keno is not slot-like electronic gambling. It’s like the traditional lottery in that you’re not playing against a machine, you’re playing against every other Ohioan who has purchased a ticket. Unlike traditional lottery, the game [Keno] is played at a greater frequency. Your opportunity to win is more frequent than the traditional lottery, which is drawn once or twice a day. {Keno] drawings would occur several times a day. The winning number, rather than players having to watch and wait until 7:30 at night to see who has won, is displayed on a television monitor in age-appropriate environments.”

Dailey said the decision to offer new lottery products is just one element of Strickland’s comprehensive budget plan to both reduce state spending and to ensure the state maintains a balanced budget.

“The new lottery games,” he said, “are part of this overall plan to meet the $700 million shortfall projected for the biennium which ends at the end of fiscal year ’09.

“Specifically,” Dailey continued, “the governor has authorized the Lottery [Commission] to offer the products to support the increase in funding for our local schools. [In the budget which passed last year, the governor proposed and the Legislature supported, a 3 percent annual increase to the foundation formula.] ... The governor sees education funding for local schools as a priority, and though we’re faced with the need to make significant sacrifices to maintain a balanced budget, he wanted to ensure that would not require any cuts directly to local schools.”

The proceeds from the additional lottery games, estimated at $73 million per year, Dailey said, will go to the Lottery Profits Education Fund, to be used exclusively for schools. An amendment to the Ohio Constitution in 1987 earmarked all lottery profits for kindergarten through grade 12 education.

Dave Southward, superintendent of the Knox County Educational Service Center, said there are two schools of thought regarding the use of gambling proceeds to fund education. First, he said, Ohio is surrounded by states that derive large revenues from gambling, and it would be fair to assume that many Ohioans go out of state to gamble, taking discretionary income with them. It would perhaps make sense to keep some of the money in Ohio; providing more gambling options would probably one way to bring in more money for schools.

“We can’t just ignore a potential source of revenue,” said Southward.

On the other hand, he continued, people need to realize that current lottery profits do not generate a significant amount of money for schools compared to the total state education budget.

According to the October/November school finance newsletter published by the Buckeye Association of School Administrators, lottery profits in 2007 accounted for less than 4 percent of total K-12 education funding.

Howard resident Nick Clark thinks adding keno to the state lottery offerings is OK as long as it does help education and is confined to age-appropriate environments.

“Gambling is a choice,” he said, “and people are already doing it. ... Anything that helps education, I vote for.”

Dick Maxwell, editor of the BASA school finance newsletter, does not believe relying on uncertain lottery profits is the best way to pay for education in Ohio.

“I’m beginning to understand exactly how the state lottery helps education,” he wrote. “Every time I buy a losing ticket, I get a little smarter.”