Alabama lottery bill would split proceeds between pre-K, college scholarships
A Powerball advertisement in Port Clinton, Ohio. Rep. Steve Clouse, R-Ozark, plans to file a lottery bill that would split proceeds between pre-K programs and college scholarships. (Photo: Jon Stinchcomb/News Herald)
The chair of a House budget committee will file a constitutional amendment that would establish a state lottery to fund pre-kindergarten programs and some college scholarships.
“I think we need to end the debate about where the distribution should go,” Rep. Steve Clouse, R-Ozark, said in an interview on Monday. “Most of the states around us have an education lottery.”
The legislation as currently drafted would allow paper-based instant lottery games and paper or electronic tickets for non-instant games. It would ban the use of video lottery terminals (VLTs), which look like slot machines. Clouse said he would expect the legislation — a constitutional amendment that would need voter approval — would bring in about $167 million a year.
“If we’d done it a lot earlier, we’d have a lot more revenue,” he said.
The bill will need approval from both chambers of the legislature. No lottery bill has gotten out of the Alabama Legislature in 21 years.
The legislation would put 50% of proceeds — roughly $84 million — into the state’s pre-kindergarten program. Another 50% would go to “scholarship awards distributed after the payment of other gift aid, such as grants, scholarships, etc.” One-quarter of 1% of proceeds — about $418,000 — would go toward programs to help compulsive gamblers.
Clouse said he envisioned the scholarships being needs-based.
The lottery would not be a windfall for the Education Trust Fund, which provides money for public education in the state. The $167 million projected from the bill is roughly 2% of the $7 billion budgeted to the ETF this year. Lottery revenues also tend to be stagnant over time, even as other costs rise.
Alabama is one of 5 states, and the only one in the South, without a state lottery. Mississippi, the only other state in the region that held out against lotteries, began selling tickets in November. The Alabama Constitution bans lotteries and games of chance, creating the need for an amendment.
Alabama State Rep. Steve Clouse looks over paperwork on the floor of the house of representatives at the Alabama State House in Montgomery, Ala., on Tuesday, May 21, 2019. (Photo: Jake Crandall/ Advertiser)
There have been several attempts to establish a state lottery over the last few decades. But voters defeated the only measure to get legislative approval in 1999. Legislators attempted to approve a lottery bill amid a budget crisis in 2016. Clouse brought a bill last year that would have sent 75% of proceeds to the General Fund, which pays for most non-education funding in the state, and 25% to the ETF.
But both efforts failed amid an ongoing standoff over gambling between the Poarch Band of Creek Indians, who run casinos in Atmore, Montgomery and Wetumpka, and dog track operators in Macon and Greene counties.
The Poarch Band operate under federal law, while the dog tracks operate under state law. In the past, representatives of dog tracks have expressed concerns about lottery proposals that require the games to be paper-based, which they say would bring Class III gaming — traditional casino games like slots and table games — to the state. They argued that because the Poarch Band operate under federal law, they would be able to access VLTs in a way that the dog tracks would not.
Some gambling experts, however, say that betting on dog races is Class III gaming and that the dog tracks already run these risks.
The Poarch Band have opposed efforts by the dog tracks to clarify the legality of electronic bingo at their operations. The fight helped doom Clouse’s lottery bill last year; it failed a procedural motion in the House by a single vote.
Gaming should be one of many major issues when the Alabama Legislature begins the 2020 session on Feb. 4.Gaming is expected to be a major issue when the Legislature returns on Feb. 4. ]]>