Senate backs lottery changes

Scholarship program rules would shift

SANTA FE — The New Mexico Lottery would no longer have to send at least 30 percent of its revenue to a popular scholarship program, under a bill that won broad approval Wednesday in the state Senate.

Backers say the proposal, Senate Bill 283, could give the lottery more flexibility and, eventually, lead to bigger prizes being offered.

“What you’ve seen is stable revenues, but we have not had the opportunities for growth,” said Sen. Jacob Candelaria, D-Albuquerque, one of the bill’s sponsors.

But the measure, which is similar to legislation that has stalled in the House in previous sessions, passed the Senate on Wednesday only after several changes were added.

Those changes include a provision the lottery would still have to pay a minimum of $40 million for scholarships during the coming budget year — and slightly more than that in future years.

In addition, starting in July 2022, unclaimed prize money would be funneled into the scholarship fund, instead of going into the lottery’s operational budget.

And under an amendment tacked on Wednesday, the 30 percent requirement would be reinstated if the lottery failed to meet the minimum payout to the scholarship program.

Lottery scholarship advocates lauded those changes, saying they would provide a safeguard of sorts.

Fred Nathan, executive director of the Santa Fe-based Think New Mexico, which has fought against previous attempts to remove the 30 percent distribution requirement, said the additions to the bill offer “important protections” to students.

Overall, New Mexico Lottery revenue levels have remained largely static over the past 15 years — going from $133.6 million in the 2003 budget year to $134.1 million last year, according to a bill analysis.

That’s led to stagnant funding for the scholarship program, which has faced increasing pressure in recent years due to escalating tuition costs and its widespread popularity.

The lottery-funded scholarship program used to cover all tuition for qualifying students, but it now covers only a portion after lawmakers enacted changes to the program. Roughly 26,000 scholarships are expected to be paid during the current school year.

During Wednesday’s floor debate, some senators said it’s time to try something new to generate more revenue.

“The lottery is here — we’ve got to maximize it,” said Sen. John Arthur Smith, D-Deming.

The bill ultimately passed the Senate 40-1, with Sen. Bill Soules, D-Las Cruces, casting the only “no” vote. It now advances to the state House.