Amendment 50: Casino Money Won't
Help Schools
September 18, 2008
By Jerry Kopel
Casino officers are going to spend whatever is necessary to cram their
Amendment 50 down the throats of Colorado voters.
Why? It will allow casino gambling 24 hours every day with bets 20 times
greater than now permitted.
This will increase the value of their Colorado real estate, their own
annual salaries, provide higher dividends for shareholders, gain better
control over who oversees their operations , and hide their good fortune
behind an easy touch: Colorado community, local district and junior
colleges.
Community colleges have been part of our education system for 41 years,
and Amendment 50 adds 78 percent of a second tier of new tax revenue
received by the state from casinos to "help" the colleges.
That money, however, would not necessarily increase the budget for the
colleges. Their budgets are determined by the Joint Budget Committee,
which will have the option of substituting the new income for funds that
otherwise would have come out of the state's general revenue fund.
The new first tier money goes to the gaming commission and other
administrative agencies plus annual adjustment to current recipients such
as the general revenue fund and the state historical society.
According to the 2008-2009 state budget (2008 session laws, page 2822)
$293 million (in round numbers) is the community college appropriation,
divided between:
(1) $149 million from student share of tuition
and academic and facility fees, and
(2) $144 million from student stipend payments, the College Opportunity
Fund Program fee-for-service contracts and college-level curriculum
development.
The local district junior college general fund
appropriation is $16 million.
The Legislative Council research staff on Amendment 50 assumes $100
maximum bets over a five year period resulting in $300 million in
additional tax revenue at a 20 percent tax level. That money comes from
one billion five hundred million dollars in additional net taxable casino
revenue, or "profits".
Of the $300 million, the research team estimates community colleges and
junior district colleges would receive $222 million, averaging $45 million
per year.
That sound like a lot of money, listed in the constitutional amendment as
"to supplement existing state funds for student financial aid programs and
classroom instruction programs."
"To supplement existing state funds". In the Concise English and Oxford
Illustrated Dictionaries it means "an addition supplying deficiencies".
"Existing" means "actual or current".
The legislature is not required to provide a separate budget sum greater
than the preceding year with casino tax revenues added to make it an even
greater sum.
To do that would have required language similar to Article 9, Section 17
(1) on education, stating in Amendment 50 something like "the state
funding for community colleges shall grow annually at least by the rate of
funds received under Amendment 50 adopted by the electors in November
2008."
The legislature has the authority under our constitution to create a
deficiency for community colleges, to be made up from gaming tax funds as
supplemental to a thinner but existing appropriation.
Now that is great for every other recipient of state appropriations (from
Agriculture to Treasury) who can, in future years, once the spotlight is
turned off, gain all or part of the $222 million. But that is not how
Amendment 50 will be sold.
You will hear these sums boasted as being an addition "on top" of the
"regular" community college budget. And the community colleges will be
climbing over each other to urge passage of Amendment 50.
States that were sold on voting lotteries into law "for education " have
seen this technique resulting in a loss of other state revenues for
education, replaced by lottery net tax revenues.
On Oct, 7, 2007, the New York Times ran a full-page expose on the
failure of additional funding for education through lotteries. One quote
worth repeating:
Legislators merely substitute general revenue funds with lottery dollars
so the schools don't really gain any additional funding" said O. Homer
Erekson, dean of the business school at the University of Missouri in
Kansas City, who co-wrote a national study on lottery money and school
financing.
More on Amendment 50 next week.
(Jerry Kopel served 22 years in the Colorado House.)
"To supplement existing state funds". In the Concise English and Oxford
Illustrated Dictionaries it means "an addition supplying deficiencies".
"Existing" means "actual or current".
The legislature is not required to provide a separate budget sum greater
than the preceding year with casino tax revenues added to make it an even
greater sum.
To do that would have required language similar to Article 9, Section 17
(1) on education, stating in Amendment 50 something like "the state
funding for community colleges shall grow annually at least by the rate of
funds received under Amendment 50 adopted by the electors in November
2008."
The legislature has the authority under our constitution to create a
deficiency for community colleges , to be made up from gaming tax funds as
supplemental to a thinner but existing appropriation.
Now that is great for every other recipient of state appropriations (from
Agriculture to Treasury) who can, in future years, once the spotlight is
turned off, gain all or part of the $222 million. But that is not how
Amendment 50 will be sold.
You will hear these sums boasted as being an addition "on top" of the
"regular" community college budget. And the community colleges will be
climbing over each other to urge passage of Amendment 50.
States that were sold on voting lotteries into law "for education " have
seen this technique resulting in a loss of other state revenues for
education, replaced by lottery net tax revenues.
On Oct, 7, 2007, the New York Times ran a full-page expose on the failure
of additional funding for education through lotteries. One quote worth
repeating:
Legislators merely substitute general revenue funds with lottery dollars
so the schools don't really gain any additional funding" said O. Homer
Erekson, dean of the business school at the University of Missouri in
Kansas City, who co-wrote a national study on lottery money and school
financing.
More on Amendment 50 next week.
(Jerry Kopel served 22 years in the Colorado House.)
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