Georgia’s Lottery Funds Preschools, Scholarships. But It May Not Be As Much As You Think

Credit: Beau Evans (State Affairs)

Jul 29, 2022

The Gist

As Georgians who may not typically play lottery games rush out to buy Mega Millions tickets for what is shaping up to be the third largest lottery jackpot ever, they take solace in the fact that lottery proceeds help fund local preschools and college scholarships.

But few know that historically, only 27% of the billions spent to play the lottery each year actually goes to education.

What’s Happening

Like a Willy Wonka golden ticket frenzy, Georgians are flocking to lottery retailers  and online apps  to buy tickets for a  grand prize that has climbed to $1.28 billion and with odds at 1 in 302 million.

John Stephenson, a construction worker in Atlanta, has never bothered with paying the $2 for a Mega Millions ticket that likely won’t be a winner. But the $1.28 billion jackpot – with an estimated take home, after taxes, of $747.2 million – has changed his mind. “Do I think I’m gonna win? No,” said Stephenson. “But the numbers are so outstanding that I might as well try.”

Lottery tickets – including for the “Mega Millions” game – are sold in gas stations across Georgia. (Credit: Beau Evans for State Affairs)

Ticket sales for the “Mega Millions” game raised roughly $22 million for preschools and scholarships between mid-April and the most recent drawing on Tuesday, said Tandi Reddick, spokeswoman for the Georgia Lottery Corporation. Reddick did not know how many tickets – priced at $2 per ticket – had been sold at the time of publication.

A semi-government agency, the Lottery Corporation runs Georgia’s ticket games and slot machines. The governor appoints the corporation’s board, whose members pick a chief executive officer who runs the day-to-day operations. Unlike a true government agency, state taxes don’t fund the Lottery Corporation – ticket sales and slot-machine fees do.

Georgia’s governor and state lawmakers decide each year how much funding from lottery dollars will go to preschools and the HOPE scholarship. The state Department of Early Care and Learning then sends lottery funding to preschools, while the Georgia Student Finance Commission oversees HOPE scholarship awards.

Why It Matters

The most recent influx of Mega Millions money will add to the growing pot of lottery funds earmarked for Georgia’s preschools. Lottery proceeds are divided among 1,800 preschool programs that support around 80,000 4-year-olds each year across the state. A larger chunk of the lottery revenue will pay for the HOPE scholarship, available to Georgia high school students who earn at least a 3.0 grade-point average to attend in-state colleges and universities.

But exactly how much lottery money ends up in local preschools and for the HOPE scholarship?

From 1999 to 2021, Georgia’s  lottery raked in more than $83 billion in ticket sales and slot-machine plays. Most ticket proceeds went to paying out game winners, Lottery Corporation records show. The rest covered lottery operation costs such as staff salaries, third-party game vendors and for commission for retailers like gas stations that sell tickets and host slot machines.

This graphic breaks down where proceeds from lottery ticket sales went in Georgia between 1999 and 2021. (Credit: Brittney Phan for State Affairs)

In that same period, roughly 27% of ticket proceeds have gone to funding preschools and college scholarships, state records show. Since the lottery kicked off in Georgia in 1993, state officials say preschools and college students have received more than $25 billion from the lottery.

“Almost thirty years since its inception, the Georgia Lottery Corp. has had a massive impact on a generation of Georgians,” said Gov. Brian Kemp in a statement Thursday. “Students have been set on a path to lifelong learning through Pre-K programs and have been afforded the opportunity to advance their careers through higher education.”

Around 113,000 college students received the HOPE scholarship this year, state data shows. Lottery dollars are also intended  to fund about 84,000 preschool students at a cost of $4,733 per child, the nonprofit Georgia Budget and Policy Institute’s analysis shows. State data also shows Georgia preschools last year received on average nearly $200,000 per school.

Lottery for Schools

For many first-time lottery players like Stephenson, it’s news that purchasing a “Mega Millions” ticket will help pay for school kids. Stephenson said he might even buy more tickets after learning about the funds for preschools and scholarships. “That would make me play more since I know it’s going to kids,” Stephenson said.

For some, the education benefits aren’t so important. Fard Shahid, a limousine driver in Atlanta who’s bought a ticket every day since the Mega Millions pot reached $600 million last week, said winning is the only thing on his mind. “I’m glad the schools get some money,” Shahid said. “But I care more about me winning.”

Click the image above to read about how Georgia has lost thousands of preschool teachers amid the Covid-19 pandemic and why more lottery dollars don’t go toward helping increase teacher salaries. (Credit: Brittney Phan for State Affairs)

Amid wide support among state lawmakers for the lottery, opponents have long pressed for a different model to fund preschools and scholarships that doesn’t depend on a form of gambling – particularly since the lottery tends to be more popular among poorer Georgians who can least afford to play it, said Mike Griffin, a lobbyist with the Georgia Baptist Mission Board.

“No one would disagree with the need for education funding,” Griffin said. “But this ends up being something that is predatory by way of trying to pull people into it, and it does take a certain amount of money out of the economy by way of only 27% going to [education].”

Metro Atlanta resident Marcus Johnson said he plays the Cash 3 lottery game at least once a week; more frequently when his monthly social security check comes in. Johnson, who is unemployed and who plays at his local Texaco in Hapeville, said the chance of drawing the winning Cash 3 number is worth the $1 he pays for every ticket — even if it’s tight for his budget.

“I’m just trying to get a little bit of extra money with what I have, that’s all,” Johnson said. “And if it really helps the kids, that’s good.”

Many Georgia preschool teachers and advocates also say lottery dollars aren’t enough to cover all the costs for classroom supplies and salaries needed to run their programs. Preschool teachers take home a roughly $35,000 salary, an amount many advocates say makes it tough to hire more teachers after thousands quit the profession during the Covid-19 pandemic.

“Compensation is a real issue,” said Ellyn Cochran, president and chief executive of the advocacy and teacher-training group Quality Care for Children. “And now with inflation, that’s an even bigger challenge since it’s hitting [teachers’] bottom line.”

On Friday, Gov. Kemp said the state will use its Emergency Education Relief Funds to give teachers, and others who provide daily instructional support, $125 to use toward buying classroom supplies. Teachers also received the $125 stipend last January, costing the state $15.9 million,  Kemp spokesperson Katie Byrd told The Associated Press.

The Lottery Corporation declined State Affairs’ request for an interview with Lottery President and Chief Executive Officer Gretchen Corbin to discuss lottery funding for education. In response to questions, Lottery spokeswoman Tandi Reddick said Lottery officials “don’t administer the educational programs that we fund or appropriate dollars to those programs.” 

What’s Next?

The next drawing for the “Mega Millions” lottery game will be held Friday at 11 p.m. Drawings will be held every Tuesday and Friday in 45 states, until a winner claims the prize. Lottery players in Georgia who win prizes of $250,000 or more do not have to identify themselves publicly in order to claim their winnings.

State lawmakers are also scheduled to hold talks on how to overhaul Georgia’s funding systems for public k-12 schools and preschools during hearings of the Senate Study Committee to Review Education Funding Mechanisms, starting on Aug. 19.

Stay Informed

Follow State Affairs for updates on this story on Facebook (@StateAffairsUS) and Twitter (@StateAffairsGA).

Read State Affairs’ coverage of the lottery and school funding in Georgia:

Georgia has Lost Thousands of Preschool, Daycare Teachers. Can the Lottery Help?

Georgia Daycares Miss Out on Millions in Lottery Dollars

Meet Georgia’s Preschool and Daycare Chief

Do Georgia’s Low-Income Students Need More State School Funding?

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