How much lottery money goes to schools?

Posted at 6:29 PM, Feb 12, 2016
and last updated 2016-02-12 18:29:34-05

Many Michigan schools are struggling financially. It makes many ask, "where does the state lottery money go?"

7 Action News found out that while whether or not lawmakers are dedicating enough money to schools is up for debate, where the lottery money goes is not up for debate.

Jeff Holyfield, director of public relations for the Michigan Lotter, met us at the Shell Gas Station at Beck Road and I-96 in Novi to show us documentation of how money is spent. He says you have to remember, people play the lottery to win.

“Playing the lottery is fun, winning is better,” said Holyfield.

As a result, a large chunk of lottery money goes towards paying off prizes. The next biggest chunk goes to the lottery’s mission.

“Our mission is to provide resources for education in Michigan,” said Holyfield.

Taking a look at the numbers, for every dollar spent on the Michigan Lottery, last year, 61 cents went to prizes, 29 cents to the school aid fund, 7 cents went to commissions for retailers, and 3 cents went to administrative costs.

Holyfield says an independent audit is done every year to make sure money goes where it is supposed to. It found last year the lottery broke a record. It provided $795.5 million dollars to the state’s school aid fund.

The Michigan Lottery offices are used to calls from people who see needs unmet at their schools, who want to know if lottery money is really going to education. He reminds them that public education costs billions. The lottery results in only about $500 in funding per student.

“It sounds like a lot of money but the school aid fund is about $13 billion,” said Holyfield. 

The rest of the state school aid fund money comes mostly from numerous taxes including sales, income, property and tobacco taxes.