Students need to be the sure bet in lottery changes

Students should come first. That was how the New Mexico Lottery was sold to the public when it was created back in 1996. That is how it should continue to operate.

Senate Bill 283, sponsored by Sens. Jacob Candelaria, D-Albuquerque, and John Arthur Smith, D-Deming, would revise the lottery’s enabling legislation by removing the 2008 mandate that 30 percent of gross sales go to scholarships. That’s a gamble, considering that every year before the mandate went in, the lottery kicked in around $36 million or less to scholarships. Post mandate, that number has exceeded $40 million for all but one year, 2017.

Candelaria and Smith’s argument for giving up the sure thing of 30 percent for students is one the lottery has made for years — if they can plow more money into prizes, attracting more players, then a smaller percentage of a bigger number means more for education.

And while the morality of that argument — let’s get more folks gambling in a state where one in two residents is on Medicaid and one in four is on food stamps — is highly suspect, a few amendments to SB 283 would make it more of a safe bet thing for students.

While the legislation would do away with the 30 percent mandate, it would require the lottery to put a minimum of $40 million into the scholarship fund in fiscal 2020, increasing to $40.5 million in fiscal 2021 and $41 million in fiscal 2022 and subsequent years. It includes a provision that if the lottery does not hit those contribution benchmarks, it would revert to the 30 percent requirement. However, that wording needs tweaking to make it a true sunset so the 30 percent would apply to every year going forward.

The bill would also set up a schedule restricting operating costs to no more than 17 percent of revenues in fiscal 2020, 16 percent of revenues in fiscal 2021 and 15 percent thereafter. (Operational costs, which include vendor contracts, are separate from the prize money and the scholarship fund.) Again, an important fiscal brake.

In addition, there is an amendment that puts unclaimed prize money into the scholarship fund, rather than into the prize fund as it does now. Twenty-nine states already do this, and an amendment from Senate Bill 80, sponsored by Sen. Bill Soules, D-Las Cruces, would bring New Mexico into that fold. Unfortunately, as worded it would include the unclaimed prizes in the revenues that add up to the $41 million. That measure needs to be revised so students are ensured $41 million for scholarships, with unclaimed prizes added on top rather than supplanting revenues. With the 30 percent mandate removed, the argument the lottery doesn’t have enough for prizes should be moot.

These precautions that protect students have the support of two groups normally on opposite sides of the issues: The University of New Mexico’s College Democrats and College Republicans, as well as Santa Fe think tank Think New Mexico.

Since 1996, more than 117,000 students from across the state have attended New Mexico public colleges, universities and technical colleges with the assistance of the Legislative Lottery Scholarship program. More than 66,000 of those students have already graduated from college, according to the lottery. With rising costs of a college education, and even given the smaller percentage of tuition it covers, the lottery scholarship is a way for thousands of New Mexico students to continue their educations past high school without being saddled with crushing debt.

And that needs to be the bottom line lawmakers focus on when making any changes to the New Mexico Lottery.