Schools Study How to Spend Windfall From State Lottery

The receipt last week of higher revenues than expected from the state lottery has brightened the budget picture at area school districts and at the same time created long-term policy questions of how best to spend the windfall.

As school trustees in the Glendale, Los Angeles and La Canada school districts and Glendale Community College district begin this spring to plan budgets for the 1986-87 school year, they will have to decide how to divide the lottery windfall among such items as books, computers, building repairs and salaries for teachers and other employees.

Officials say that, although the money is a welcome supplement to local school budgets, it will represent only 1% or 2% of total annual expenses.

“It’s small, but it’s still money that we didn’t have,” one district superintendent said.

Allocation of lottery money, which will be distributed quarterly to school districts throughout the state, is based on district attendance.

$1.7 Million Windfall

The Glendale Unified School District received $996,400 last week from lottery revenues collected from October through December. Another $687,000 is expected for the first three months of this year, bringing the district’s total for the school year to almost $1.7 million.

Officials of the 19,000-student district expect to receive $2.5 million in lottery funds next year. The district’s budget this year is about $63 million.

The lottery money has already become fair game for employee salary increases in the Glendale district after teachers last fall negotiated a contract with a 2% pay bonus based on the expected windfall.

Although the district had agreed to a one-time salary bonus for this year to compensate for a new, longer school day, officials now expect that district employees will routinely ask for a share of lottery funds during contract talks.

“I’m sure it will become something else on the table,” said Charles Duncan, director of personnel and employee relations for the district.

Dividing Funds

Glendale School Supt. Robert Sanchis said the district’s board of trustees probably will consider a proposal to divide lottery income between a fund for individual school purchases and districtwide needs.

Sanchis said the board also may consider using the funds for a one-time cost-of-living bonus for teachers and other employees. But for now, “we have been cautioned by the state that, whatever policy is approved for the use of lottery funds, it should not include ongoing costs such as personnel,” he said.

Glendale Teachers’ Assn. President Jean Silverman said teachers should receive part of lottery funds, but only after a review of total district needs, including salaries, each year.

“I think it would be appropriate for decisions to be made on a yearly basis because the needs of the district will change,” she said.

School board member Charles Whitesell said it will be difficult to plan how to use lottery money because of the uncertainty of the amount the district will receive each year. But, he said, the board will consider using it for employee salaries as well as maintaining school property and buying supplies.

Meanwhile, all discussions of lottery funds in employee salary negotiations would be prohibited under a bill introduced last week by Assemblyman Tom McClintock (R-Thousand Oaks).

An aide to McClintock, Kevin Spillane, said the assemblyman believes that lottery revenues are insufficient to pay for increased salaries as well as school maintenance and supplies.

Most Money for Salaries

In most school districts, 75% to 80% of annual budgets go for salaries, so even a small percentage pay increase is costly. Districts are now free to use lottery money for any expense except research, buying land or construction.

If the bill passes, district employees could share in lottery funds only if a school board awards a bonus “out of the goodness of its own heart” and not as a part of the bargaining process, said Spillane, a legislative assistant to McClintock.

“There is going to be a lot of haggling about what the lottery moneys can and cannot be used for,” Spillane said. “Salaries are a big issue but the lottery money can’t cover salaries. It’s not an appropriate use.”

At Glendale Community College, trustees have agreed to keep in reserve the about $675,000 the college expects through March. The budget this year for the 11,000-student college is $19.7 million.

Not Treated Differently

“It’s not going to be treated any differently than any other money, “ said John Davitt, Glendale College president and district superintendent.

Negotiations between the district and the 500-member Glendale College Guild have been stalled more than a month over a request by teachers for a one-time 2% salary bonus to be paid for with lottery money.

Board member Robert Holmes said: “We have told them we have no intention of complying. . . . If we start with lottery money, then why not a piece of the action from vocational education money, federal grant money or property tax money?”

Glendale College Guild President Pete Witt said he is not sure how long districts will be able to depend on lottery money. He said that, although the law now prohibits the state from cutting back budgets by the same amount as the lottery money distributed to schools, that could be changed.

If things stay as they are, Witt said, teachers will consider asking for some of the lottery revenue in contracts. “It will depend on how fair the district has been to a bargaining unit,” he said.

46% of Funds to Teachers

The La Canada Unified School District board last May agreed to give its 142 teachers 46% of lottery proceeds each year for the next three years as a salary bonus.

The board probably will spend the rest of the money on supplies and equipment, said Mark Facer, district deputy superintendent.

The La Canada district has received $153,000 in lottery proceeds. The 3,000-student district has a budget this year of about $11.2 million.

In the Los Angeles Unified School District, the school board has decided to use its first lottery payment, which was $30.5 million, to relieve classroom crowding.

Board member Larry Gonzalez, who represents Northeast Los Angeles, said he would support legislation to remove the prohibition against using lottery money to build more classrooms.

“I would argue that to buy children new books or high school students new computers is fine, but if they are subject to inadequate classroom facilities, then buying new materials will not benefit them,” Gonzalez said.

“I will advocate that 100% of the money go to the construction of new schools because that is the highest priority in the district.”

Los Angeles schools have nearly 579,000 students enrolled at 618 campuses. The district’s budget is about $2.6 billion.

Funding Suggestion

Board member Jackie Goldberg, who also represents Northeast Los Angeles, agreed that the district’s priority should be to use the money to build more classrooms but said the state should reimburse the costs.

“Under the current funding mechanism, it is the state’s responsibility to house students,” Goldberg said.

The district also should consider using some of the money for building maintenance, employee salaries and reading and math programs, she said.

The Los Angeles Board of Education will begin discussion of how to use the lottery money in March, Goldberg said.