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The Truth-O-Meter Says:
Big Gamble NJ

"In 2011, our state-run lottery funded New Jersey classrooms by over $930 million."

Big Gamble NJ on Tuesday, November 13th, 2012 in a website

Group claims New Jersey’s classrooms received $930 million from the state’s lottery

Budget woes abound in storm-battered and cash-strapped New Jersey, and now one group claims the state is rolling the dice on its fourth largest revenue source: the lottery.

The Communication Workers of America, a union that represents lottery workers, and the Asian American Retailers Association, a group representing convenience and liquor stores and gas stations, has launched a campaign -- called Big Gamble NJ -- to oppose the state’s plan to contract with a private company to manage the lottery’s sales and marketing.

Last week Big Gamble NJ started promoting a website that argues such a move would hurt small businesses and taxpayers.

On Nov. 13, one slide on the group’s homepage read: "In 2011, our state-run lottery funded New Jersey classrooms by over $930 million." Another slide read: "New Jersey businesses earned nearly $150 million from lottery sales last year alone."

Under those slides, the website states, "tell Governor Christie and your state legislators not to gamble with New Jersey's lottery revenues" and provides a link to sign a petition.

Here PolitiFact New Jersey checked whether the lottery handed out more than $900 million to schools in 2011.

We learned that’s not quite the case.

A good chunk of the $930 million helped fund education in New Jersey, but not all of it.

The constitutional amendment voters passed in 1969 that authorized the establishment of the state lottery dictated that its "entire net proceeds" must go toward state institutions and education aid.  

The state lottery doled out $930 million to such causes in fiscal year 2011.

Nearly three-quarters of that money went toward education-related initiatives, according to the state lottery’s annual report.

More than $105 million funded programs in the state education department, including about $53 million for school construction and renovation.

The majority of the money -- more than $580 million -- benefited higher education.  More than half of that $580 million was dedicated to operating costs for public colleges.

Still, about a quarter of the the $930 million paid for other social services.

Roughly $156 million helped fund state psychiatric hospitals and centers for the developmentally disabled received nearly $47 million.

More than $36 million in lottery proceeds bulked up operating support for homes for disabled soldiers.

So education-related initiatives received a large majority, but not all, of the $930 million in contributions from the lottery in 2011.  

Seth Hahn, the New Jersey legislative and political director for Communications Workers of America, acknowledged the error on Wednesday afternoon. The website was updated that evening. It now reads: "In 2011, our public lottery funded classrooms & other services by over $930 million."

Still, Hahn said that didn’t change the fundamental issue that the proposal is bad for businesses and taxpayers.

The history of privatization in New Jersey is a "story of graft, fraud and cronyism leading to taxpayers being on the hook for political indiscretion," he said. "We believe that when it comes to funding education, care for the developmentally disabled, and services for our veterans, New Jerseyans deserve better."

Bill Quinn, a spokesman for the state Treasury Department, said the implication that the state is selling the lottery is false. He said a state agency "will still have an oversight function" and "the state is going to continue to get the money from the lottery."

Our ruling

Big Gamble NJ -- an advocacy group that opposes privatizing management of the state lottery -- said on its website that  "in 2011, our state-run lottery funded New Jersey classrooms by over $930 million."

The lottery funneled $930 million into education and other social services in fiscal year 2011. Nearly three quarters of that amount funded education-related initiatives.

So New Jersey’s classroom didn’t receive the full $930 million from the state lottery, but education aid comprised a significant majority of that money.

We rate this statement Mostly True.

To comment on this ruling, go to NJ.com.

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About this statement:

Published: Monday, November 19th, 2012 at 7:30 a.m.

Subjects: Education, Gambling, State Finances

Sources:

Big Gamble NJ, Education, accessed Nov. 13, 2012

E-mail and phone interviews with Judith Drucker, public relations manager for the New Jersey Lottery, Nov. 13-15, 2012

E-mail interview with Seth Hahn, New Jersey Legislative and Political Director for Communications Workers of America, Nov. 14, 2012

New Jersey Lottery, Revenue Recipients: Fiscal Year 2011, accessed Nov. 13, 2012

New Jersey Lottery, Annual Report: 2011, accessed Nov. 14, 2012

New Jersey Lottery, New Jersey Lottery Contributes More Than $950 Million to State Education and Institutions with Record Breaking Sales in Fiscal Year 2012, Aug. 20, 2012

New Jersey Treasury Department: Division of State Lottery, Financial Statements and Supplementary Information for June 30, 2011 and 2010, accessed Nov. 13, 2012

The Philadelphia Inquirer, New Jersey joins a list of states considering privatizing their lotteries, April 29, 2012

The Star-Ledger, Payout or gamble? Christie plan to privatize N.J. Lottery could bring in cash but cost jobs, Aug. 15, 2012

New Jersey Legislature, State Constitution: 1947, accessed Nov. 13, 2012

Fitzgerald’s Legislative Manual, State of New Jersey: 2011, accessed Nov. 13, 2012

Big Gamble NJ, Coalition Announces Campaign to Oppose Lottery Monetization, Nov. 13, 2012

New Jersey Legislature, State Lottery Law, accessed Nov. 14, 2012

New Jersey Lottery, About Us, accessed Nov. 14, 2012

New Jersey Lottery, Request for Information, accessed Nov. 14, 2012

BlueJersey.com, Christie's Secret Plan to Sell the New Jersey State Lottery and Destroy Small Business, Nov. 12, 2012

Interview with Bill Quinn, spokesman for the state Treasury Department, Nov. 15, 2012

Written by: Erin O'Neill
Researched by: Erin O'Neill
Edited by: Caryn Shinske

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