Last updated on 2016.02.12
My post on Madison Central's proposed $6.3 million bond issue to build an unnecessary gym alongside its dedication of $8.2 million to make necessary renovations to the high school sparked a conversation about rededicating video lottery money to K-12 funding. Rep. Charlie Hoffman (R-23/Eureka) and Rod Goeman lament that the state has broken its promise to spend those gambling revenues on education.
But has the state broken that promise? Rep. Susan Wismer (D-1/Britton) contends the state has increased its K-12 funding by an amount equal to the revenues from video lottery. Moreover, Rep. Wismer says the argument that the state "broke their promise" deters legislators and voters from supporting the additional funding that our schools need.
Here is Rep. Wismer's complete analysis and commentary, edited just slightly for style:
I'm going to take a stab at this debate because I believe a correct understanding of it is critical to consideration of the proposed sales tax initiative, also because I believe that this blog attracts people capable and willing to appreciate "the rest of the story," and finally, I need the practice.
The debate to which I refer is that of "they broke their promise to dedicate the video lottery money to education." They did not.
Before I launch into a history of video lottery, you must remember this as well: A piece of the puzzle is that around 1995 there was a property tax revolt brewing. Gov. Janklow changed the education funding formula in two ways, effective @ 1997: first, to a per-student allocation. Second, he changed it so that the state picked up a larger share of education costs to take the pressure off local property tax rates. The change also happened to coincide with not only increasing video lottery revenue but crashing enrollments, so as schools lost students they lost funding. The price paid for that increase in state aid was a forced decrease in local education funding, and a new state limitation on what the locals could raise themselves by forcing the "opt-out" votes if the local boards felt they needed more than what 3% or the rate of inflation would raise. I was raising my kids then so I may have missed some of that story.
Video Lottery's first year was 1989. It took a while for the revenue to really grow, between the lawsuits and the gradual increases in the state's share of machine income, but by FY99 the state's share of video lottery revenue was $92 million. Twelve years later, the video lottery net state share is forecast to be around $100 million, which is a $10 million decrease from two years ago. General aid to education in FY96 was $84 million; in FY98 it was $232 million. It would take another historian to explain the fine points of how much of that increase was due to the change in the ed funding formula in 1997 I discussed in the preceding paragraph and how much was due to other factors.
Budgeted State Aid to education in FY12 was $329 million. So the state is kicking in $97 million more for state aid to education per year, even after the carnage this year, than they did 14 years ago, and $245 million more per year than they did 16 years ago. Pick your increase: either one is most or double what the state was putting into education before video lottery. And yes, my years don't coincide exactly because in this little two hour research project, I can't find the right years.
Bottom line to me is this. Education has received a funding increase equivalent to video lottery revenue every year. So get off it. Whatever the annual amount of video lottery revenue is, that and more, in addition to what the state put in before video lottery, is going to education. But it's not enough.
Would the crisis have come earlier without video lottery? You bet, and education would have been better off. We've been putting bandaids on this problem for 30 years: contractors excise tax, video lottery, property tax limitations because we don't trust locals to run their own show, fees and more fees and more fees, nickel and diming and bake sale-ing everyone to death because it's more fun to buy into the national rhetoric, ignore the fact that this state has been run by our conservative ancestors for 100 years and never went to the excesses exhibited by the rest of this crazy world, and vote for people who tell us what we want to hear rather than what our parents' civics teachers taught us.
Moral of the story for anyone who cares about education: don't let people get away with the old "they broke their promise on video lottery last time, so I'm not going to support an increase in taxes cause I don't trust them to spend the money where it should be spent." Set 'em straight and keep banging the drum.
[Rep. Susan Wismer, e-mail, 2011.09.22]