Governor signs Hayashi's bill to increase school funding from lottery proceeds

Measure will provide some relief to schools, Assemblywoman says

Governor Arnold Schwarzenegger has signed a bill authored by Assemblywoman Mary Hayashi (D-18th) that will help increase funding for schools through changes to the California State Lottery.

Hayashi, whose district includes part of Pleasanton, said the bill, AB 142, makes changes to the Lottery that increases the percentage of revenue that goes back to schools.

"California's budget crisis has had a devastating impact on education," she said. "Supporting our schools must be a priority, and according to the Legislative Analyst's Office, AB 142 will help increase public education funding by hundreds of millions of dollars per year."

"While there is much more to do, this bill will provide some measure of relief to our schools," she added.

AB 142 revises the California State Lottery Act, increasing the percentage of lottery revenue that goes back to the public by reducing administrative expenses from 16 percent to 13 percent. The bill brings California's lottery structure in line with other large state lottery systems, including Texas, North Carolina, and Florida, which have shown an increase in revenue through similar changes.

AB 142 passed with bipartisan support, including a unanimous vote in the Senate and a 68 to 1 vote in the Assembly. As an urgency measure, the bill is effective immediately.

Hayashi is the chair of the Business, Professions, and Consumer Protection Committee and serves the 18th Assembly District, which includes San Leandro, Hayward, Dublin, and parts of Pleasanton, Castro Valley and Oakland, as well as the unincorporated areas of Ashland, Cherryland, San Lorenzo and Sunol.

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Posted by Dark Corners of Town
a resident of Country Fair
on Apr 10, 2010 at 6:01 pm

The legislation does not increase the percentage of revenues for education. In fact, this measure removes the guaranteed percentage and allows for a commission to set the percentages for prize winnings and for education (Web Link)
"The intent of this bill is to allocate more money to prizes which in turn is expected to generate an increase in total sales revenue, allowing for an increase in the current level of funding allocated to public education. However, the exact impact of these changes will be a result of allocation strategies of the Lottery Commission, incentives to retailers, and other marketing events, all of which may ultimately influence the consumers' behavior on lottery spending."
Lotteries are regressive so the legislature is looking to dangle more money in front of those who are least able to pay, in order to fund education. The legislature is so unsure of this scheme, that it wrote into the bill a cancellation trigger to revert back to the current model if education funding is less than expected.
Given that lottery revenues have fallen in each of the last fiscal years from $3.318B in 06-07 to $2.055B, the amount for education has fallen from $1.206B to $1.048B, which is 1.3% of state total spending on education. This legistation is moving pennies around when instead our elected officials should be working on how to grow the economy, encourage business formation, and get people back to work, not how to get poor people to play the lottery.

1 person likes this
Posted by Dark Corners of Town
a resident of Country Fair
on Apr 10, 2010 at 6:04 pm

Correction: Given that lottery revenues have fallen in each of the last three fiscal years from $3.318B in 06-07 to $2.955B in 08-09...

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Posted by Earl Richards
a resident of Laguna Oaks
on Apr 10, 2010 at 6:06 pm

There is a leadership void in Sacramento. Why did the governor allow the budget crisis to happen in the first place?

1 person likes this
Posted by T.R. Ollman
a resident of Amador Estates
on Apr 10, 2010 at 6:19 pm

"There is a leadership void in Sacramento. Why did the governor allow the budget crisis to happen in the first place?"

This is a joke, right? I mean, the leadership part's a fair question, but the governor didn't "allow" this to happen.

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Posted by frank
a resident of Pleasanton Heights
on Apr 10, 2010 at 7:50 pm

Earl, tell us how the governor caused the economy to sink to depression-level depths and therefore cause horrendous shortfalls in tax collections? And did he stick the state with teacher's collective bargaining contracts(a local level phenomenon), where most of the education monies go? We are all ears to hear your arguments....

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Posted by tax revolt 2
a resident of Country Fair
on Apr 12, 2010 at 3:59 pm

tax revolt 2 is a registered user.

The California PTA and SEIU were supporters of this legislation (Web Link). I would hope that Debbie Look, Director of Legislation, and member of the California PTA Board of Directors would not be looking for ways to increase education funding by such non-productive means as the lottery/gambling.
It would take $1B more in lottery revenues to generate the several hundred million Hayashi is promising. This $1B is discretionary spending that will primarily come from those with lower incomes. This will result in $1B less in retail sales, with $100M less in sales tax revenue. Surely the PTA could be using its time more wisely to support legislation that would help improve society rather than encourage gambling.
I encourage everyone to read the analysis including the portion that debates whether this legislation should have been submitted to the voters for approval. "Legislative Counsel has long held the opinion that any changes to the Lottery Act that divert money from education need to go back to the voters for approval."
Unfortunately the California PTA has supported these manuevers and legislation to the overall long-term detriment of California.

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Posted by tax revolt 2
a resident of Country Fair
on Apr 12, 2010 at 4:02 pm

tax revolt 2 is a registered user.

Here is the link to the analysis (Web Link).

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Posted by Patriot
a resident of Another Pleasanton neighborhood
on Apr 12, 2010 at 9:09 pm

Agree with the above. The governor is doing the typical Republican thing here by encouraging people to gamble and saying it is good for society.

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Posted by jmb27
a resident of another community
on Apr 15, 2010 at 2:15 pm

Predatory Lending is a major contributor to the economic turmoil we are currently experiencing.

Here is an example of what I am talking about:
Scott Veerkamp / Predatory Lending (Franklin Township School Board Member.)

Please review this information from U.S. Senator Jeff Merkley regarding deceptive lending practices:
"Steering payments were made to brokers who enticed unsuspecting homeowners into deceptive and expensive mortgages. These secret bonus payments, often called Yield Spread Premiums, turned home mortgages into a SCAM."

The Center for Responsible Lending says YSP "steals equity from struggling families."
1. Scott collected nearly $10,000 on two separate mortgages using YSP and junk fees. 2. This is an average of $5,000 per loan. 3. The median value of the properties was $135,000. 4. Clearly, this type of lending represents a major ripoff for consumers.

Web Link

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Posted by Sandee Thompson
a resident of Valencia
on Nov 21, 2012 at 9:03 am

First of all- why is Los Angeles school dist not even listed- & my qustion is Why is there nothing being said about what lottery monies were SUPPOSED to do in the first place??? Help our schools!!!!

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Posted by ken san marcos ca.
a resident of another community
on Dec 23, 2012 at 10:19 am

the payments sent to schoolwere not to reduce their current amout they recieve. that does not the way it is. besides the money do get is ear marked for things th school may not need.

i believe chages have been made so the goverment gets more money than it shoild.

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