Michigan Lottery: Where's the money going?

In Michigan, as with other states across the country, the lottery is big business. So, why is there still a barrage of school closings and major cutbacks, including layoffs?Ask most Detroiters, and they don't believe that the lottery's winnings ever trickle down to their communities.

Detroit resident David Clark, 69, recently saw a report on TV about Michigan's School Aid Fund. He doesn't understand how it actually benefits the children going to public schools, especially in Detroit.

"All of the money for the lottery is supposed to be going to the schools, but that's all over Michigan," Clark said. "But it still looks like $640 million is a lot and they're always begging for money for school. Maybe it's not that much money, but it's a lot to me. Six-hundred and forty million should help a lot of schools."

According to the lottery commission, $724.5 million was contributed by the lottery to Michigan's educational system in 2009. They also claim that since 1972 they have provided more than $15 billion for public education, which, according to M. Scott Bowen, lottery commissioner, is the lottery's primary mission. Total lottery sales in 2009 amounted to $2.38 billion.

Additionally, the more than 10,000 retailers across the state saw a 1-percent increase in commissions.

"The lottery's unclaimed prize money goes directly into the School Aid Fund, which is the beneficiary of all of the Michigan Lottery's profits," said Andrea Brancato, director of public relations for the Michigan Lottery. "The lottery profit does not go to anything other than the School Aid Fund, which pays for education for K-12 students in Michigan public schools. So, really, if someone is looking to find out how the money benefits, say, roads or senior programs, it does not."

Kevin Fite, an educator in metro Detroit, has worked for both the charter and public school systems. He wonders about the School Aid Fund and its purpose. In fact, it puzzles him.

"I don't think we scrutinize it enough, considering a whole lot of people play the lottery," Fite said. "I just think it needs to be monitored a little better. School districts are being closed down; they're all downsizing. It seems like… what exactly is the money going toward? It's so broad. I don't know enough to say what percentage goes to this community. One thing I do know is a lot of people are playing. It makes you wonder why the education sector is downsizing and the lottery is filling its pockets."

Doug Pratt, director of communications, Michigan Education Association, sees the lottery's impact on public schools as minimal. The organization is the largest school employee union in the state, representing more than 157,000 teachers, education support professionals, higher education faculty and staff, student-teachers, and school retirees.

"Frankly, the lottery has very little to do with school funding," Pratt said. "The approximately $700 million from the lottery that goes toward school funding pays for public education in this state for about one week."

He added that the money from the Michigan Lottery supplants – not supplements – other funding for schools.

"So, if the lottery brings in more money, less money comes from other sources," Pratt said. "It's not a cash cow for schools. The billboards talking about the billions of dollars the lottery has brought to schools are misleading in that way."

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