When you buy a California lottery ticket, where does the money go? Here’s what it funds

Cortlynn Stark, The Sum
·3 min read
2

The Powerball jackpot swelled to over $1 billion this week, the second jackpot in a row to cross that threshold. While we’re still waiting on a winner from this game, every ticket helps fund California’s public schools.

Here’s where revenues from the California Lottery go.

For every dollar spent on tickets, 95 cents goes back to the community, between public schools and colleges, prizes and retail compensation, according to the California Lottery.

For every $2 Powerball ticket sold, about 80 cents helps fund public schools, according to a news release from the lottery. In this sequence of the Powerball, the lottery has raised more than $69.5 million for public education.

Why does the California Lottery fund public education?

It goes back to 1984.

That’s when voters approved the California State Lottery Act of 1984, allowing the lottery to supplement public education funding. Administrative expenses were capped at 16% of sales at the time, while 34% would fund education.

In 2010, the California Legislature passed Assembly Bill 142 to increase sales and transfer more funds to public education. That amended the Lottery Act to ensure at least 87% of revenues would return to the public and not more than 13% would be used for lottery expenses.

How much funding public schools get? How can they use it?

Since the lottery began in 1985, it generated more than $41.5 billion for public schools. In the 2021 to 2022 fiscal year, it raised more than $2.07 billion for education, what the California Lottery calls an “unprecedented figure,” but still a “modest number for the state’s annual budget for public schools.”

Lottery funds make up less than 1.5% of education funding.

Funds from the lottery are mostly discretionary, meant to supplement funding for public education, and help schools attract and retain teachers and enhance learning environments. It’s up to the schools how those funds are used.

The State Controller’s Office determines lottery funding for public education institutions based on the average daily attendance for K-12 and community college school districts. For higher education and other specialized institutions, it’s based on full-time enrollment.

Here’s how the percentages break down:

  • K-12 — 79.9%

  • Community colleges — 14%

  • California State University System — 3.7%

  • University of California — 2.3%

  • Other educational entities — 0.1%

Sacramento County has received $66.7 million in lottery funding this year, according to the quarterly report released in August. Since 1985, the county has received more than $1.56 billion.

Los Angeles County, by comparison, has received more than $367 million this year and nearly $10.8 billion since 1985.

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