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California lottery didn't give $36M to schools, auditor says

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Posted at 2:43 PM, Feb 25, 2020
and last updated 2020-02-25 17:43:21-05

SACRAMENTO, Calif. (AP) — California's state auditor says the California State Lottery skimped on giving $36 million in revenue to fund public education funding and spent $720,000 on food and travel expenses without considering cheaper options.

The auditor's report made public Tuesday says the lottery agency should have accounted for an increase in profits for the fiscal year that ended in June 2018 by providing $36 million in public education financing.

The auditor also recommended that the state legislature amend the Lottery Act to ensure audits of the lottery's procurement process at least once every three years.

The California State Lottery says in a written response accompanying the audit that it disagrees with the auditor's findings and that the agency gives the most money it can for education.

“Lottery revenues and contributions to education were declining in the years prior to the passage of AB 142. The year before this change, the Lottery’s contributions to education were approximately $1.05 billion. In contrast, last year the Lottery provided $1.8 billion–the highest contribution to date. Had the Lottery utilized CSA’s interpretation of the law, it would have had to intentionally suppress sales for certain games, resulting in fewer dollars to public education," CA Lottery wrote. “The Lottery disagrees with CSA’s underlying conclusions of the value of its Fairs and Festivals program. The Lottery must continually raise brand awareness, incentivize and persuade California adults to voluntarily purchase Lottery products to meet its mandate to provide supplemental funding to education."