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Changes Coming to How Idaho Lottery Will Fund Schools in the State

House Bill 521 will change which schools will receive funds from the lottery and what they are allowed to use them for

BOISE, Idaho (June 4, 2024) Since 1989, The Idaho Lottery has offered its tickets for residents to purchase in the state. It was created through a voter initiative in 1988 with the idea that it would benefit Idaho schools.

The formula for dividing the annual dividend among Idaho schools has changed over the years. But in 2024, the Idaho legislature passed House Bill 521, marking the third time the formula has been changed.

In 1989: 

  • 50% would go toward public school maintenance and operations.

  • 50% would be for the permanent building fund.

In 2008, the formula changed:

  • 37.5% to public school maintenance and operations.

  • 37.5% to the state's permanent building fund.

  • 25% to the bond levy equalization fund.  

At this time, "funds were used by the State Department of Education to help school districts to complete building maintenance, repairs and other operational projects," Spencer Barzee, regional director for the Department of Education. 

Traditional public schools and charter schools were receiving funds from the Idaho Lottery under the "public school maintenance and operations" umbrella of the 2008 formula. 

In 2024:

It will go back to a 50-50 split due to House Bill 521, which passed this legislative session. 

  • 62.5% will go to the school district facility fund.

  • 37.5% to the state's permanent building fund. 

The formula rework changes how schools can use the funds and removes charter schools from receiving Idaho Lottery Funds. 

Now, traditional public schools can no longer use the lottery funds for maintenance and operations. 

"[The funds] first goes to payment of existing bonds, payment of supplemental levies and then payment of plant facility levies," Barzee said. "So all of those expenditures, if they're all paid out, there's still money leftover they can go into another a separate building fund was districts can use for building related projects.

Some school districts that heavily depended on lottery funds for maintenance and operation costs may now be scrambling to find alternative funding sources.

Idaho is currently seeing school districts work through their budgets for next year. Some are making cuts because levies did not pass in the May primary election just weeks ago. 

Others are having to re-evaluate aspects of their budget because schools aren't receiving one-time covid relief funds any longer, and other state funding is changing from enrollment-based funding to attendance-based funding. 

"It's kind of a tough spot," Barzee said. "It's a lot of things coming in at once and all those things together have been hard for districts."

The formula essentially eliminates the use of lottery funds for charter schools, but funding will continue from a different source. 

House Bill 766 restores the "charter school's facility fund" through general tax to ensure charter schools are still getting the funding they need. 

Barzee said that money is almost equivalent to what traditional schools receive.

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