No Luck With Lottery Loot
Mecklenburg County stands to lose upwards of $9 million in lottery revenue the state is withholding this year, a disproportionate hit compared to what other counties will suffer from the state’s money-grab.
Wake County, for example, is in line to have all of $100,000 withheld from its share of lottery revenue.
Mecklenburg County – $9 million; Wake County; $100,000. So, what gives? Blame, in part, Mecklenburg’s higher-than-state-average tax rate, according to a report county commissioners received Tuesday night.
The General Assembly is withholding about $63 million in lottery revenue from all 100 counties, to help fill shortfalls in the state budget and pay for teachers positions funded with state dollars. In doing so, legislators have revised the formula used to distribute lottery money that counties use to pay debt service on capital schools projects.
That debt service still needs to be paid by the counties. With their share of lottery revenue reduced, the money needs to found elsewhere in local budgets.
“They (legislators) are robbing local dollars used for schools and then trying to claim credit for being education’s best buddy, while engaging in a case of domestic violence against schools,” said Mecklenburg Commissioner Bill James, a Republican. “If local government was the wife and Raleigh was the husband, then Raleigh just beat the crap out of local governments across North Carolina and now wants to get credit for being a good husband. In my book, that’s absurd.”
Previously, 65 percent of lottery revenue due to counties was doled out based on a per-pupil allotment, while 35 percent of the revenue was distributed among counties, including Mecklenburg, that have tax rates higher than the state average.
The revised formula nixes the fund distribution based on tax rates and uses only a per-pupil allotment, leaving Mecklenburg hanging out to dry with far less lottery money than it typically receives, while other counties, like Wake, walk away relatively unscathed.
Under the old formula Mecklenburg was slated to get $20.2 million. With the new rules in place, it will receive only $10.7, for a net loss of $9.4 million.
The county, however, has about $6.2 million in unallocated lottery funds being carried forward from the recently completed fiscal year, which would leave it with $16.9 million in total available lottery funds. This year’s county budget calls for $21 million in lottery proceeds, leaving a shortfall of $4.1 million.
That’s a $4.1-million gap commissioners will likely have to fill with money pulled from other parts of the budget, triggering further funding reductions for county programs and services that could include Charlotte-Mecklenburg Schools, the public libraries, social services, and parks and recreation.
Or not. The county budget includes a $2 million contingency fund to offset any losses incurred by state action. That could reduce the funding gap left in the wake of the General Assembly’s lottery-grab to only $2.1 million, which would needed to filled with revenue from other parts of the county budget.
Or not. In addition to the state’s lottery-grab, Mecklenburg also faces other potential woes from cuts in the state budget that impact local programs and services. The state budget, for example, includes funding reductions for money received by the local Department of Social Services for its foster care/adoption and adult in-home care programs; the local public health department, for its child immunization program; and some local programs and services funded with money from the state’s environmental health department, which lost $6 million in the state budget.
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