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New Mexico lawmakers grapple with lottery scholarships

file imaeg

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SANTA FE, N.M. — New Mexico’s struggling lottery scholarship program is drawing the attention of lawmakers again this legislative session.

While no permanent fix is on the table, Gov. Susana Martinez has called for infusing the scholarship fund with an additional $6.5 million to ensure students get nearly all of their tuition costs paid for over the next three semesters.

Another proposal clears the way for credit card purchases of lottery tickets. Supporters say that would boost sales and resulting revenues could be funneled to the program.

But the independent think-tank Think New Mexico is concerned because the proposal would also eliminate a requirement that 30 percent of lottery revenues be dedicated to the scholarship fund.

Fred Nathan, executive director of Think New Mexico, said revenues would have to increase by nearly 30 percent for that to pay off, which could be a tall order since sales in New Mexico have declined seven out of the last 10 years.

“It is troubling that the New Mexico lottery is misleading legislators, the media and the public by hiding this radical change in a Trojan Horse bill that appears to be about something completely different,” Nathan said in an email to The Associated Press.

The lottery is already having trouble meeting the 30 percent requirement and often has to use unclaimed prize money to make up the difference, according to Lottery CEO David Barden. He said the discussion needs to focus on solutions rather than the status quo.

“The lottery will continue to provide options for improving ticket sales, which will result in more dollars going to students,” Barden said. “The reality is that the lotteries that return the most money to their beneficiaries focus on dollars rather than a percent.”

State officials and education associations were discussing funding for New Mexico’s colleges and universities before the Senate Finance Committee late Wednesday. The lottery scholarship program was on the agenda.

New Mexico lottery and education officials told lawmakers before the start of the 60-day session that without boosting ticket sales or finding another source of revenue, the scholarship fund will not be able to keep up as tuition increases and demand for financial assistance grows.

Solvency of the program has been an issue for nearly a decade. Lawmakers imposed the 30 percent requirement in 2007, which supporters say resulted in an additional $9 million a year above what was previously funneled to the scholarship fund.

More changes were enacted last year to shore up the program’s finances. Lawmakers also earmarked a portion of liquor tax money to keep the program solvent temporarily.

Nathan suggested that lottery officials and vendors are driven by contracts that reward them for increasing sales rather than maximizing the dollars that go to scholarships. He said students stand to lose out if the gamble doesn’t pay off.