DATE: Wednesday, July 30, 1997              TAG: 9707300006

SECTION: LOCAL                   PAGE: B8   EDITION: FINAL 

TYPE: Opinion 

SOURCE: BY PENELOPE W. KYLE 

                                            LENGTH:   60 lines

LOTTERY PROCEEDS DESIGNATED FOR THE CHILDREN

Where does the revenue generated by the Virginia Lottery go? This question has been asked by thousands of Virginians since the Lottery started selling tickets in September 1988. Recently, the answer was placed in more than 150 newspapers across Virginia. That advertising expenditure included your newspaper. Our cost overall to place those ads was approximately $225,000. The Virginian-Pilot was paid $15,000 to carry the advertisement. Advertising is not inexpensive. However, it is an efficient and effective way to inform the public. Since both a recent news story and your editorial page have criticized the Lottery's efforts to inform the public, I would like to set the record straight.

In 1987, when the lottery referendum went before voters, the law stated that all lottery revenues would go to the general fund. Lottery dollars were not designated to a specific program. That allowed the governor and the General Assembly to decide each year how best to spend lottery profits. During the first year, lottery revenues were used to fund capital building projects throughout the state. From 1990 through 1995, lottery proceeds were used to help balance the general-fund budget. In 1995, the General Assembly decided to designate all lottery revenues to public education, grades K-12. The law now states: ``100 percent of the lottery revenues transferred to the general fund shall be appropriated entirely and solely for the purpose of public education in the Commonwealth.''

Fiscal 1996 was the first year the revenues were earmarked for education, and the Lottery contributed $332.6 million to the general fund. For fiscal 1997, the Lottery turned over a record $343 million, just over 10 percent of the general fund budget for K-12 education.

It was also a record year for the Lottery's contribution to the Literary Fund. By law, all unclaimed prizes go to the Literary Fund, which is used to make low-interest construction loans to local school boards to fund teacher retirements and to purchase classroom computers. A total of $18.7 million was transferred to the Literary Fund by the Lottery for FY 1997. Since 1988, the Lottery has transferred $59.5 million in unclaimed prizes to the Literary Fund.

Since 1988, when the Lottery began, its communications programs have announced new games and information on how to play them. Research has consistently shown that the majority of Virginians (more than 70 percent) support the Lottery. This research, which is gathered by independent research organizations, also reveals that more than half of the state's residents say they do not know how the Lottery's proceeds are used.

Earlier this summer, we conducted research in Richmond, Roanoke, Fairfax and Norfolk. Two points were very clear: Virginians want to know more about how much money the Lottery raises and how that money is used.

The Virginian-Pilot criticized us for acting responsibly and informing Virginia citizens where their Lottery dollars go. At the very least, we owe our citizens disclosure regarding the money they entrust to us, the officials of the Virginia Lottery. Despite your unfair criticism, our message is now clear. As required by the law, all Virginia Lottery proceeds are designated to help fund the public education of our greatest resource - Virginia's children. MEMO: Penelope W. Kyle is director of The Virginia Lottery. KEYWORDS: LOTTERY REVENUE

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