Since its origin 50 years ago, the Michigan Lottery has been a widespread tradition for millions of people wagering money for the chance of picking a winning combination of numbers or cashing in on other games regulated by the state’s Lottery Officials. According to the Lottery’s website, more than $45 billion has been paid to players since -1972. In 2021 alone, more than $3 billion was paid to winners, including the largest jackpot in Michigan Lottery history – $1.05 billion.
Lottery Officials also report that since the start of the state Lottery, more than $26 billion has gone into the Michigan School Aid Fund, an entity first created in 1955, to financially assist public schools in the state. Lottery sources estimate that approximately $7.2 billion, or 28 percent of the $26 billion was raised for schools over the last seven years. And in 2021, the Michigan Lottery conglomerate reported a record $1.419 billion added to the School Aid Fund.
“For 50 years, the Michigan Lottery has shared in winning experiences,” said Lottery Commissioner Brian O. Neill. “Lottery purchases help support Michigan schools and businesses. These incredible results would not be possible without our players, retailers, vendors, the dedicated team at the Lottery, and support across state government.”
While $26 billion raised for Michigan schools sounds like a lot of money – because it is – inquiring minds want to know how the money is distributed to the state’s public school districts, especially Detroit’s with its almost 50,000 students and 107 schools.
“The Michigan Lottery contributes to the School Aid Fund, which is funded by various taxes collected in addition to the Michigan Lottery,” said Detroit Public Schools Community District Superintendent Dr. Nikolai Vitti in a statement exclusively to the Michigan Chronicle. “The School Aid Fund supports all public schools in the state, and there are more than 500 schools in Michigan. The Legislature and Governor are strictly responsible for allocating the School Aid Fund. The Michigan Lottery makes no determination on how the School Aid Fund is spent and does not provide payments directly to any school district including Detroit Public Schools Community District (DPSCD).”
The Lottery’s contributions to the School Aid Fund make up only 6% of the total funding to Michigan public education. The State Budget Office reports that the top three sources of revenue added to the Fund last year were sales and use taxes (42.0%), personal income tax (18.8 percent), and federal revenue (12.5 percent).
The state’s school aid money is largely distributed on a per-pupil basis. Therefore, districts with more students seemingly would receive more money, and districts with fewer students would get less. However, this funding equation has variations, and the Lottery, in its present state, does not address funding inequities which allow some smaller school districts to receive thousands of dollars more per student than a Detroit public school student.
Sherry Gay-Dagnogo, a DPSCD board member and former Michigan House of Representatives lawmaker, would like to see a formula allowing the Lottery to play a more significant role in “direct funding” to public schools.
“I would like to see the lottery dollars changed to customer-based,” said Gay-Dagnogo. “For all of the money played into the Lottery by Detroit residents, a larger percentage should be appropriated directly back to the city. Other Michigan cities should see a certain percentage allocated back to their municipality based on customer-based participation.”
The Detroit school board member said that the Biden Administration’s Coronavirus Aid, Relief, and Economic Security Act (CARE Act) would provide emergency relief funds to help elementary and secondary schools in the state, especially DPSCD, provide equitable services to students and teachers.
“I am thankful for the dollars that are a one-time shot to get our students on the levels where they should be,” said Gay-Dagnogo. “But we must have a more long-term solution to addressing and maintaining equitable funding for our schools – post CARES Act.”
Gay-Dagnogo added that there also needs to be a reconfiguration of how to establish and maintain ways for public schools in Detroit to receive funding equity with neighboring public schools in Southeast Michigan cities like Bloomfield Hills, Birmingham, Livonia, and Troy. The Lottery, according to Gay-Dagnogo – does not address the funding inequities Detroit Public Schools face. Simply put: Detroit is not getting a return on its huge investment in the Lottery.
Vitti agrees.
“While the Michigan Lottery contributes revenue to the School Aid Fund, overall funding for public education in Michigan ranks among the lowest in the country,” the Superintendent said. “Various studies have shown that schools should have been receiving $10,000 per pupil funding prior to the pandemic while fully funding programs for special education, English Language Learners, and at-risk students. The Lottery does not address the inequity in our current funding system, which allows Birmingham, Grosse Pointe, and Southfield to average over $13,000 per student while Detroit receives $9,450 per student in general revenue, which is a combination of state and local funds that contribute to the overall public school funding formula. Although the Governor and Legislature have increased pupil per funding and narrowed the inequality gap…it still remains.”
Nevertheless, many who play the Michigan Lottery consistently feel they have greatly benefited public education in the state for decades. The Governor agrees.
“The Michigan Lottery’s record contribution to the School Aid Fund helps us keep kids safe and learning in-person, delivers critical funding to support K-12 programs, and ensures every family has access to a high-quality, public education,” said Gov. Gretchen Whitmer, who recently signed the state’s bipartisan education budget that includes the highest state per-pupil investment in Michigan history. “The Lottery’s record-setting performance over the last seven years has helped us put Michigan students first. Together, we have closed the funding gap between schools, raised per-student funding, and improved school facilities, all without raising taxes. I am grateful to everyone who has made this substantial investment in our kids possible.”
About Post Author
