Yesterday, a proposal was made to the Legislative Oversight Committee for the Arkansas Lottery in favor of reducing the amount of scholarship money awarded to each student attending college on the lottery’s dime.

The proposal would have reduced the scholarship awards by 10%, and was ultimately tabled until the legislators have had an opportunity to consider the proposal further.  However, there are a number of reasons why lowering the scholarship amounts is just a bad idea.

The lottery’s problem is its priorities, not its money. The lottery exceeded expectations during its first year of operation. The Lottery Commission has been rolling out new games left and right. By our best estimates, they are taking in (or planning to take in) nearly a half-billion dollars annually in lottery ticket sales.  So why isn’t there enough money to keep funding the scholarships at their current rate?

The answer is that approximately 78% of the lottery’s revenue gets spent on operating expenses, salaries, advertising, and prizes.  Only 22% (or a little less) goes to fund scholarships.  Arkansas’ Lottery Director is one of the highest-paid in the nation, and many of the people he supervises earn very large salaries. Do we really need to spend over $300,000 on a lottery director? As poorly as the lottery has been run these past 12 months, couldn’t Arkansas find a decent director who could run a tighter ship, and still “settle” for a salary of, say, $100,000-$200,000?

Personally, I think a salary like that is still pretty high—and I suspect most Arkansans would agree—but that would free up more than $100,000 to fund scholarships.

What about all the money that gets spent on TV ads? Those aren’t cheap. And what about those lottery ticket vending machines they bought last summer? A lot of kids could have gone to college with that money.

It just doesn’t make any sense. The lottery was implemented to fund scholarships, and yet when it looks like money may be tight, the first thing they suggest cutting are the very scholarships they’re supposed to fund.

If anything, the legislature should be looking at ways to increase the amount of money they award each student, not reduce it. I’m sorry, but $5,000 just won’t cover everything at a lot of four-year schools and universities.  At the University of Arkansas, $5,000 may only get you about halfway there (or a little over, in some cases); you’re still going to have to come up with another $3,000-$5,000 in order to cover all your expenses.

If the only scholarship you have is a lottery scholarship, you’re only options left are to work your way through school or go into debt to make up the difference.  Granted, people routinely go either route when paying for school, but the lottery was touted as a way to send kids to college.  As we’ve said before, the Arkansas Lottery simply is not living up to that promise.  They’re providing some money to help send some students to college, but it’s hardly paving the road to higher education the way they said it would back during the campaign to pass it in 2008.

If Arkansas’ legislators want the lottery to be successful in Arkansas—and by successful, I mean live up to its promises—then they should serious look for ways they can double the amount of scholarship money available to students.  And the way to do that isn’t by expanding the lottery’s already-saturated list of games and prizes or by spending more money on advertising. It’s by re-structuring the Arkansas Lottery and its priorities—placing scholarships ahead of every other item in the Arkansas Lottery’s budget.

Personally, I would just as soon they abolish the lottery altogether, and find a more efficient way to pay for college scholarships.  However, until Arkansans have decided they’ve had enough of this state agency and its shenanigans, we’ll all just have to settle for trying to inject some commonsense into the lottery discussion.