Legislative Testimony for LB920: Change provisions for the distribution of lottery funds

Legislative Testimony for LB920: Change provisions for the distribution of lottery funds

Good afternoon, Vice Chair Walz and members of the Education Committee.  My name is Nicole Fox, and I am the Director of Government Relations for the Platte Institute.  I’d like to thank Senator Groene for introducing this bill.  I am here today to testify in support.

The Nebraska Constitution requires that 44.5% of Nebraska lottery proceeds be used for education as the Legislature directs. LB519, which was passed in 2015, requires the Education Committee to make recommendations every 5 years regarding how the funds should be allocated to best advance the educational priorities of the state.

Current allocations of those proceeds are set to expire June 30, 2021.

LB920 is the result of a 2019 interim study which looked at current lottery distributions for education.  It proposes adjustments as to how the lottery proceeds should be allocated for the next five-year period beginning with fiscal year 2021-22.

While a majority of LB920 deals with changes in the distribution of lottery funds used for education, language has been added which would require allocations to be distributed directly to the agencies responsible for management of the funds.

LB920 would then require standardized financial reporting regarding the use of money received in a manner prescribed by the Auditor of Public Accounts starting in September of 2022.

Subsequently, LB920 would direct the Auditor of Public Accounts to compile a consolidated summary of those reports for submission to the Legislature before January 1 of the following year starting in 2023.

LB920 also provides that an audit of fund recipients could be requested.  The Auditor of Public Accounts would prescribe the reporting forms for the audits, and the audit reports would be published online.

Even though we are talking about proceeds that are voluntarily generated as opposed to revenues generated through tax policy, the Platte Institute supports the concept of prudent spending. 

At a time when institutional knowledge is lessening due term limits, the financial reporting aspect of LB920 would enable future Education Committees to better understand and track the allocation of these funds and make well-informed policy decisions for enhancing education in Nebraska moving forward.

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