Volume 75
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Tennessee looks to Georgia for lottery hope

Published (Volume 75, No. 8)

It’s not like Georgia voters were trying to start a trend when they voted for a lottery back in 1992. But in the nine years since its inception, the story of Georgia’s lottery has become something of a modern-day fairy tale in the rhetoric of pro-lottery activists in surrounding states.

Tennessee is using “the Georgia model” as a rallying cry, suggesting that free college educations for all students will be only the tip of the iceberg if voters just give them the go ahead in the November 2002 election.

What is the “Georgia model” and why is it advertised as such a success?

In short, the Georgia lottery originally was set up to help in-state students cover the cost of higher education, officials say.

Over the years, however, the lottery’s economic success has allowed the programs it supports to grow far beyond their initial goal, according to Rebecca Paul, Georgia Lottery Commission president.

No matter how you crunch the numbers, the infusion of lottery dollars into Georgia’s public education system has provided opportunities that parents in other states can’t help but envy, Paul said.

The Georgia Lottery started in June 1993 and has since raised near $5 billion for educational programs.

Organized as a public corporation, the Georgia lottery is run by a seven-member board appointed by the governor and confirmed by the state Senate. The lottery had gross revenues of approximately $2.2 billion last year, of which roughly $691 million went to education, she said.

The Georgia lottery is required by law to donate $200,000 per year to the state’s Department of Health and Human Resources to fund a gambling addiction hotline.

Every year, state law dictates that “as nearly as practical to 35 percent” of the lottery’s earnings be donated to education, according to Georgia Lottery spokeswoman Parquita Nassau.

As a rule, roughly 51 percent of the money brought in by the lottery goes back to players in the form of payouts, although the number fluctuates from year to year.

And of the remainder, approximately 7 percent is used to cover operating expenses and 7 percent is split among the roughly 7,000 retail outlets that sell lottery tickets, the remaining cash, usually between 31 and 35 percent, is handed over for the education initiatives, Nassau said.

Since its inception, Tennessee legislators have deviated from Georgia in one important respect: They haven’t passed the all-important “enabling legislation” that spells out exactly how the lottery will be organized or how the money will be spent.

Before Georgia residents were allowed to vote on their lottery in a 1992 referendum, the appropriate legislation had been in place for several months.

But Tennessee legislators don’t plan on introducing the legislation until early 2003, several weeks after the planned referendum.

However, Tenn. Rep. Chris Newton, R-Cleveland, said a joint legislative committee is expected to publish their recommendations on how the lottery should be run one month before the November 2002 vote.

Lottery opponents could still find a way to derail the process even if the referendum passes. For instance, a majority of Tennesseans could approve a lottery only to have the Legislature refuse to pass the necessary laws, effectively killing the lottery before it gets off the ground.

A statewide poll this summer showed 64 percent of six hundred thirty two voters surveyed favored amending the constitution to allow a state lottery. Thirty percent were opposed, while six percent were undecided.

Approval would leave only Hawaii and Utah without legalized gambling. If the voters approve the referendum, that doesn’t mean the next day there will be a lottery in the state of Tennessee.