Bureaucracy to prevail at expense of the taxpayer

S.C. Education Lottery Expenditures

By Paul Gable

A story making its way around the state is that S.C. Education Lottery scholarships are costing taxpayers money from the state’s general fund budget.

This is one way of looking at expenditures on the LIFE and Palmetto Fellows scholarships, but it’s too simplistic.

The LIFE scholarship pays up to $5,000 per year to qualifying students statewide while the Palmetto Scholars scholarship pays $6,700 for the freshman year and $7,500 for the sophomore through senior years of college matriculation to qualifying students.

Both scholarships must be used at in-state colleges and universities.

According to the records of the S.C. Budget and Control Board, lottery appropriations for LIFE scholarships in the 2013-14 school year were $109.3 million while those for Palmetto Fellows totaled $30.8 million.

To those amounts, the state’s general fund budget added $59.7 million for LIFE scholarships and $20.5 million for Palmetto Fellows.

A quick read of those statistics tells us the lottery appropriated $140.1 million while the state general fund appropriated $80.2 million for LIFE and Palmetto Fellows scholarships last year.

The quick conclusion drawn is lottery proceeds don’t cover the amount needed for the scholarships promised to qualifying state students when the lottery referendum passed in 2000.

Not so fast.

Total lottery appropriations in FY 2013-14 were $301 million, according to those same S.C. Budget and Control Board statistics, more than enough to cover the total of $220.3 million spent on LIFE and Palmetto Fellows scholarships.

Of course, only $140.1 million of that $301 million was spent on LIFE and Palmetto Fellows scholarships.

Where did the rest of the money go?

A total of $47.4 million went to tuition assistance for students at the state’s 2 year college and technical schools while $8 million went to tuition grants.These both seem like beneficial uses of excess lottery funds.

A total of $22.6 million was spent on construction and maintenance projects while an additional $9.6 million went to technology for the state’s 2 and 4 year colleges.

This is double dipping by colleges – collecting lottery funds for tuition and also getting lottery appropriations for building and maintenance projects.

A total of $40.9 million was spent on K-12 education, including $7.01 million on school buses.

As you can see, state legislators have found many ways of spending lottery funds each year in addition to the amounts spent on the LIFE and Palmetto Fellows scholarships the lottery was originally intended to fund.

Now, legislators are reportedly considering reducing the amount of the scholarships or tightening the criteria to qualify for them.

Seems to me the S.C. General Assembly should look at cutting its own profligate spending habits before cutting the promises made to South Carolina voters in the 2000 lottery referendum.

Link to SCB&CB lottery appropriations: http://www.budget.sc.gov/webfiles/OSB/historical/Lottery_Web_Info_updated_1.9.14_final_appropriations.pdf


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