Swafford concerned about lottery revenues, new programs

September 02, 2008 07:53 pm

— Rep. Eric Swafford (R-Pikeville) said this week that he was concerned with the news that lottery revenues are beginning to lag. The General Assembly approved a radical overhaul to the HOPE lottery scholarship program and allocated the remaining funds from the lottery reserve account to various new programs in the waning days of session. Swafford was only one of two members in the legislature who voted against the measure, and says that he had the same concerns then that are appearing now.
“While it was apparent to me at the time that a vote against the lottery changes would be unpopular, I could not in good conscious vote to spend every penny of the lottery proceeds and the reserve account,” explained Swafford. “At the time, I felt that the program could not sustain itself as it was restructured, and that concerned me. Now, in light of the new information, it seems that we may have to revisit what we did last year, and make some changes.”
Lottery revenue collections are “maturing,” meaning the year over year growth is slowing, and will eventually plateau. The changes made by the legislature assumed a modest increase in net proceeds as well as the appropriation of interest earnings from reserves to fund the existing scholarship program, in addition to several new initiatives. Although no hard numbers have been released, recent revenue reports indicate a downturn in revenues impacted by the struggling economy.
“We have basically bled the program dry, and I’m concerned that it won’t be able to sustain itself into the future. The ‘newness’ of the lottery has worn off, and coupled with the tough economic situation most families are facing right now, revenues have simply declined,” Swafford concluded. “We will have to work hard next year to come up with a plan that can both sustain itself and save for the future.”