DATE: Wednesday, September 10, 1997         TAG: 9709100009

SECTION: LOCAL                   PAGE: B10  EDITION: FINAL 

TYPE: Editorial 

                                            LENGTH:   43 lines

LOTTERY FUND EDUCATION

Lottery Director Penelope Kyle has wisely chosen to yank ads promoting her agency as a direct benefactor of public education.

Kyle could just as accurately (or inaccurately) have said that the lottery is a bonanza for prisons or mental health hospitals or parks.

That's because lottery proceeds - totaling $343 million last year - go straight to the general fund. Pooled there with tax dollars, the money is then parceled out to the various agencies included in the state budget.

In 1995, Democrats in the General Assembly made a show of decreeing that all lottery proceeds would go to education. But that was an exercise in political gamesmanship. The education budget wasn't increased one cent as a result of the declaration.

So long as schools are getting the same amount with or without earmarked lottery funds, the precise source of the $6.2 billion that the state spends on education each biennium is unidentifiable. It's misleading to suggest a direct link, as the lottery ads did.

This is not to say that the lottery does not contribute mightily to the financing of state government - including schools. For better or worse, it does. The lottery has become the fourth largest source of general-fund revenue, behind the sales tax and personal and corporate income taxes.

The reason for Democrats to obfuscate how the money is being spent goes back to the lottery's beginnings. The games were sold to the public as a revenue source for school construction.

But when the 1990 recession hit, the money was diverted to the general fund to help balance the budget. It has stayed there ever since, even as school building has languished.

The time has come for the money to be returned to its intended use. Officials should earmark lottery money for a badly needed school building program. An anticipated surplus from taxes should be used to fill the budget gap rather than to fund a decrease in the property tax on cars and trucks, which Virginia's gubernatorial candidates are proposing.

If that were to happen, Kyle could then resubmit her ads with a clear conscience. And voters could rest assured that they were finally getting some truth in advertising on the state lottery and its relation to education.

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