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Schools get bigger payout

$850,000 windfall from education lottery to be used for construction projects

Robert C. Reed | Record Photo Illustration

By Sarah Newell Williamson | Hickory Daily Record

Published: July 29, 2008

HICKORY - School construction in Catawba County may get a financial boost in the coming months from money from the North Carolina Education Lottery.

A provision in the recently-approved state budget is the reason for the $850,000 windfall for Catawba County. The provision allows for counties that have effective tax rates at or below the state average to receive additional funds based on per-student allocations.

School systems in these counties will receive a student allocation of $97.94, an increase of $34.83 from what they received before, said Rep. Ray Warren, representing Catawba and Alexander counties.

Joyce Spencer, chairwoman for Catawba Count Schools' board of education, said the money will be helpful for the system.

"Any additional funding will be very advantageous to us," she said. "We might use the money to work on Murray Elementary renovations. We've had to delay those because the costs were too much."

Randy Isenhower, chairman for Newton-Conover City Schools' board of education, said although this money is beneficial, the amount NCCS will receive because it's a smaller system is not significant.

"The lottery hurts us when we want to ask for bonds. Any little bit helps, but this is not going to be enough to really help us," he said.

Like Isenhower, Sarah Talbert, chairwoman for Hickory Public Schools board of education, doesn't agree with the lottery, but is thankful for any money that comes to the school system. She said HPS will use the extra money it receives to retire existing debts for school construction.

When the lottery was established two years ago, its distribution formula allocated 60 percent of the funding for school construction evenly among the state's 100 counties. The additional 40 percent set aside for construction goes to counties with an effective tax rate higher than the state average. This essentially punished counties with low tax rates.

Some of these counties' extra funding amounted to as much as $1 million to $4 million or, in Mecklenburg's case, $8.8 million.

Catawba County's current effective tax rate is 52.4 cents. The state average is 53.63 cents.

State representatives for counties without access to the extra allocation of funds have, for the past two years, tried to get additional lottery funds for their counties. In the budget for the upcoming year, counties that have lower tax rates will get additional money for school construction this year.

Taken from the state lottery fund, the money will be distributed among the school systems that have tax rates lower than the state average.

"The reserve funds will be used, for a one-time distribution," said Warren. "Each school will receive money based on the number of students in the school.

"The students in the high-tax counties will continue to get more money, at $110.49 per student," he said. "The other school districts will receive $97.94 per student. It's not exactly even, but it somewhat equalizes what we consider a discrepancy."

The current lottery formula is still intact under this amendment, which will go into effect at the end of the year, Warren said.