College Funding Shortfall

[cannon_fodder]

In news totally unrelated to the $4million a year given to the NBA, Oklahoma is short about $3,000,000 in their higher education budget and will be making cuts:

http://www.ktul.com/news/stories/0408/511883.html

quote:Johnson says the shortfall is tied to the failure of the state lottery to bring in as much money as expected.

I thought the lotto money was in a lock-box and was "extra money" for schools and that it would not be relied on in budgeting?  

Has anyone seen a coherent assessment of actual dollars to schools since the lotto and what, if any effect it has had?  Or, like most states, have we just been shafted into thinking it was extra money and the siphoning already begun.  This from someone who was in favor of the lotto...

[Wrinkle]

Lottery proceeds are placed into the States' General Fund and Education budgets are established independent of actual Lottery contributions.

The effect being that Lottery proceeds are not 'extra', rather contribute to the education budget, contrary to the promises made by our Governor. But, then, his $300M in lottery revenues was out of his watermelon, too.

So, it does seem the State chose NBA over education here.

[TheArtist]

As I understood it. The state cut taxes and less revenue is now coming in. Each thing in the budged gets a percentage of the pie. Schools are getting the same percentage of the pie but since the pie is now smaller, they get less funding over all. If the pie had remained the same then the lottery would have made the amount of money the schools got an even larger amount. But when the pie got smaller even with the lotterry money it didnt make up the difference in the amount the pie got smaller over all.

They didnt cut funding for schools or decrease the "amount" per say, schools are still getting the same portion of the pie. Its just the pie and thus the proportions are smaller. And the "extra" lottery money wasnt enough to make up the difference let alone be more than they were getting over all before the tax cuts.

[cannon_fodder]

Artist, when it was put to the vote the lotto money was billed as being EXTRA money for Oklahoma schools.  They made explicit guarantees NOT to cut funding from other sources to be offset by lotto winnings.  

Per the measure we voted into law:

quote:The Oklahoma Legislature cannot use lottery money to supplant or replace other state funds supporting common education, higher education, or career and technology education.

http://findarticles.com/p/articles/mi_qn4182/is_/ai_n10163108

But I agree with you that it appears this is exactly what has happened.  APPEARS, I have not looked into it in detail... please correct me if I am mistaken or if this is a matter of perception.

[Wrinkle]

Artist, I would suggest you run for State Auditor. That, or stay completely away from economic issues alltogether.

State revenues have ballooned in recent years, thereby giving Education, and all other depts, huge increases in their regular budget funding.

This years 'cutback' represents less than a 2% decline in the huge increases of the last four or five years. About one NBA teams' worth of decline.

On whole, the 2008-2009 budget looks to be at least 35% larger than in 2004, which represents an average annual increase of around 9% per year, or about double the rate of inflation.

No one's hurting.

[Wrinkle]

CF, the legislature determines the budget. And, as I have been told flat out, the Legislature isn't beholden to the Governors' wishes or promises.

Besides all that, the Legislature can show where all Lottery proceeds are being given to education. It's just that those proceeds are lower than promoted, expected and budget for by Education, and who expect the Legislature to make up the difference between the estimate and the actual money received.

Woops...

Seems overbudgeting on the part of Education once again bit them (i.e. us) on the butt.

In 2004, education received a modest $380.5 million from the 1017 Fund, along with another $80 million from the Gross Production Fund IN ADDITION to their regular percentage portion of the General Fund.

In 2008, education received $690 million from the 1017 Fund, another $150 million amongst the newest Funds of Common Education, OK Student Aid and Higher Ed Capital Funds, and another $88.6 million from Lottery proceeds IN ADDITION to their regular percentage protion of the General Fund.

[cannon_fodder]

I got that much Wrinkle (Legislature holds purse strings), and also agree wholeheartedly with your notion of massive increases in recent year (holy crap, money in the state... take it and spend it to set a precedent!). Only in government does a 35% increase followed by a 2% decrease equal a net loss.

BUT, we were sold the notion and voted on the notion that lottery money would supplement and NOT replace state funds for education.  I was just curious to see if that was what is happening or, as it appears, State money is funneled elsewhere and lottery funds are supposed to fill the gap?

[Wrinkle]

As I stated, I think the Legislature CAN show ALL Lottery proceeds went to Education, even though it is deposited into the General Fund.

Oklahomans spent $3.429 BILLION on Education this year, or 49% of the entire State Budget.

Education claims that in prior years, Education received in excess of 50% of the State's budget, thus are shorted. But, the huge increases do not warrant such.

[cannon_fodder]

I understand that Wrinkle.  I guess I'm not being clear.

Specifically, we were told that if we voted YES for a lottery the State would continue to fully fund education AND give it a certain portion of lotto revenue.  Now we are diverting funds from education and supplementing with the lotto money. We still end up with higher funding than we would have otherwise, but they are doing exactly what they said they would not do.

Which was pretty much guaranteed from the git-go.  Who's to say what "fully funded" is or what counts as supplementing funding.   I guess what I'm trying to point out is that it looks like, yet again, the government is doing exactly what it told the voters it would not do.

and yet again, if it just looks that way - let me know.  Sorry to ramble, just frustrated with the Okie legislature lately.

[Wrinkle]

If I gave you $10 this year, then promised not only that I'd give you $10 again next year, but another $5 to boot, you'd expect $15 next year.

When next year comes and I give you $25, can you say I didn't give you the $10 plus the extra $5 I promised?

If the budget grew by, say 10%, would you then expect $11 plus $5.50, or $16.50 instead of $15?

The State's budget grew so much that finding Lottery money is abstract at this point. But, it can be said, it's in there.

Education contends that since the State budget went from $1 to $1.35, they should receive 35% more, plus the Lottery funds. Oh, and all those Revolving Fund proceeds as well.

When they only got $1.30 (wild guess), they claimed Lottery funds were being used to reduce their regular share. Yet, all $88.6 million of Lottery proceeds were accounted for and given education, even though this fell short of the $93 million or so they budgeted as Lottery income.

They also received huge amounts in the Revolving Funds mentioned above. So, what went where is really arbitrary and, general speaking, there was so much money, they had trouble allocating it.

[Wrinkle]

I need to correct myself on one item posted several items ago....

quote:  Lottery proceeds are placed into the States' General Fund and Education budgets are established independent of actual Lottery contributions.

Lottery proceeds ARE NOT placed into the General Fund, they have of Fund of their own, called the OK Education Lottery Trust Fund.

It is termed a "Restricted Fund" unlike most other Funds. Not sure the distinction, but I presume it means 'lockbox'.

[TheArtist]

quote:Originally posted by Wrinkle

Artist, I would suggest you run for State Auditor. That, or stay completely away from economic issues alltogether.

State revenues have ballooned in recent years, thereby giving Education, and all other depts, huge increases in their regular budget funding.

This years 'cutback' represents less than a 2% decline in the huge increases of the last four or five years. About one NBA teams' worth of decline.

On whole, the 2008-2009 budget looks to be at least 35% larger than in 2004, which represents an average annual increase of around 9% per year, or about double the rate of inflation.

No one's hurting.

Would be wise to keep me away from anything to do with money. I am a complete idiot with money.

I probably just misread something some where. I kept thinking when I wrote that, that surely with all the money we were getting from oil revenues we should be doing ok, if not better even with the tax cuts.

If the state has been getting all that extra money for college education... Where has it been going? Sure havent seen it here in Tulsa. Tulsa taxpayers and local donors have been chipping in a lot for most of the new stuff we have gotten here lately.

[perspicuity85]

quote:Originally posted by TheArtist

If the state has been getting all that extra money for college education... Where has it been going? Sure havent seen it here in Tulsa. Tulsa taxpayers and local donors have been chipping in a lot for most of the new stuff we have gotten here lately.

If you're referring to the Vision 2025-funded education initiatives, keep in mind that those were passed in 2003, before the state's budget surpluses began appearing.  From what I understand, the budget surpluses have only occurred in the past year or two.