Virginia Commonwealth University

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Lottery Has Produced Billions for Schools

May 3, 2013

By Shelby Mertens
Capital News Service

RICHMOND – The Virginia Lottery was created after a statewide vote in 1987, making the Old Dominion the 29th state to establish a government-operated lottery.

Today, 44 states have lotteries – including Wyoming, which joined the club in March. Washington, D.C., Puerto Rico and the U.S. Virgin Islands also have lotteries.

Hawaii, Alaska, Utah, Nevada, Mississippi and Alabama are the only states without lotteries.

paul_ottoPaula Otto, the executive director of the Virginia Lottery, considers Virginia was the first real Southern state to have a lottery. (Florida created its lottery before Virginia, but with so many retirees from the North, it’s not your typical Southern state.)

“Virginia sort of cracked the South,” Otto said.

Perhaps it was fitting that Virginia did so. The Jamestown Settlement was funded by a lottery held in 1612 by the Virginia Company, and lotteries provided funding for the College and William and Mary and the University of Virginia before the commonwealth outlawed gambling in 1849.

In 1987, Virginia voters approved a referendum to create a state-run lottery. Initially, the General Assembly earmarked the lottery profits for construction projects and then for the state’s General Fund, which supports a variety of functions like education, public safety and social services. Lottery profits went to the General Fund for about 10 years.

“In part, the decision was made to have it go to the General Fund because no one was sure if a lottery would be successful in Virginia,” Otto said.

In 1999, the General Assembly designated lottery revenue to K-12 education. The following year, voters added that to the Virginia Constitution. Since 1999, the Virginia Lottery has generated more than $5 billion for public education, officials say.

Otto said the state budget lists 20 programs supported by lottery proceeds. Among them: class size reduction in kindergarten through third grade; tutoring for the Standards of Learning tests; and a fund for textbooks.

Otto said the Virginia Lottery has no control over where the money goes. She said the lottery gives the money to the Virginia Department of Education, which disburses it according to the state budget.

All unclaimed prizes go to the state’s Literary Fund, which also supports educational programs. The Virginia Lottery had almost $11.3 million in unclaimed prizes last year. Since its inception, the Virginia Lottery has had more than $224 million in unclaimed prizes.