Arizona Game & Fish Commission

Where Does Arizona’s Lottery Revenue Go?

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(Source: Arizona Republic,  July 1, 2016) – The Arizona Lottery celebrates its 35th anniversary Friday.  And while that has meant 35 years of big dreams, winning tickets and some dashed hopes, it has also meant 35 years of increased revenue flowing into the state coffers.

Since  the Arizona Lottery’s launch on July 1, 1981, its sales revenue has totaled $11 billion, with nearly $3.5 billion of that directed back into state funds and programs. While a majority — and growing — portion of that money has gone into the general fund where the governor and Legislature canThis was the first Arizona Lottery ticket. spend it as they choose, about $1.8 billion has been returned to Arizona communities through grants and programs that help people who are homeless, victims of domestic abuse and children in the foster care system.

“Whenever you hear lottery, people always think about jackpots and what they’re going to do with the dollars,” lottery executive director Gregory Edgar said. “But for us, it’s drilling into the numbers and seeing the impact we can have in our community. The investment of $3.5 billion over 35 years is a pretty significant impact.

Changing agendas

  • 1980: Arizona voters approved the creation of the Arizona Lottery by a narrow margin. Ballot literature promised proceeds would “pay for law enforcement, health services, education and other vital programs.” But the original proposition wording required only that at least 30 percent of revenue go into the general fund.
  • 1990: Voters required that $20 million in lottery revenue a year go into heritage funds for Arizona State Parks and the Arizona Game and Fish Department.
  • 1993: Lawmakers required up to $23 million a year in lottery revenue to be put into a fund for local transit projects and up to $7.6 million a year to be divided among counties.
  • 1996: Voters required that $17 million in revenue be spent annually on specific health and social-service programs, including teen-pregnancy prevention, food assistance for infants and mothers, and disease research.
  • 2010: The Legislature borrowed against future lottery revenue, eliminated allocations to the counties and essentially cut in half lottery allocations to both the transportation fund and the heritage funds, sweeping nearly an extra $30 million a year into the general fund.
  • 2015: The Legislature allocated $900,000 a year in lottery revenue to the Internet Crimes Against Children Enforcement Fund, $100,000 to the Victims’ Rights Enforcement Fund and up to $160,000 a year to the tribal college dual enrollment program.

Where the money really goes.

An Arizona Republic analysis of 35 years of Arizona Lottery revenue and disbursements found that about $1.8 billion in lottery revenue has gone to the specific programs voters and lawmakers designated.

Local transportation projects got $782 million; economic development efforts got $201 million; the Game and Fish Department Heritage Fund, which supports outdoor recreation and protects critical wildlife, got $384 million; health and welfare programs like teen-pregnancy prevention and food assistance for children and mothers got $219 million; the Court Appointed Special Advocates program for foster children got $39 million; homeless shelters got $8 million; a state program for problem gamblers got $3.6 million; and a program to help law-enforcement agencies fight internet crimes against children got $2 million.

“The dollars touch every corner of the state,” Edgar said. “My dream as director would be that every time someone puts down that dollar, they’ve got the thought that I’m having some fun playing a game but also having some impact in our community.” As annual lottery revenue has grown over the years, the money allocated to these programs has remained relatively stagnant due to limits the Legislature and voters set.

Transportation programs got less in 2015 than they did in 1982. Counties for years got $7.6 million a year, but since 2011 have gotten nothing. The Game and Fish Department Heritage Fund got $10 million in 2015, compared with the $20 million a year it got during the 1990s and 2000s. Programs for economic development, health and welfare, foster-care advocates, homeless and gambling addiction have remained stagnant for decades.  The real winner in Arizona’s lottery game has been the general fund

Who really controls the money?

The lottery, overseen by a five-member, governor-appointed commission and an executive director, controls the marketing. But it’s the Legislature that has taken control of where the revenue is allocated.

As lottery revenue has grown and disbursements to specific programs have shrunk or remained stagnant, the Legislature has directed more money into the state’s general fund, where it is impossible to track how specific dollars are spent. That revenue might have gone to schools and public-welfare programs as lawmakers promised and the Lottery markets on its website, or it might have gone to private prisons and lawmaker pensions.

The general fund over the past 35 years has received $1.7 billion.  In fiscal 2015, $72 million — 9.7 percent of the lottery’s $750 million in annual revenue — went directly to programs touted to voters. Another $103 million went into the general fund. That compares with 19 percent going to designated programs in both 2005 and 1995.  Before the recession, the general fund received about $30 million a year. Over the past several years, the annual allocation has topped $100 million. This year, that trend is expected to continue.

Arizona Game & Fish Heritage Fund O&M Resolution Workgroup Meeting Summary, 08/06/14

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nazsr_landscapephoto_600webArizona Game & Fish Heritage Fund O&M Resolution Workgroup Meeting Summary, 08/06/14

Attendees: Bob Vahle, Bill McLean, Josh Avey, Beth Woodin, Allen Taylor, Jim Unmacht, Jim deVos, Jim Hinkle, Jorge Canaca, Pat Barber, and Marianne Cox. Not attending: Bob Hernbrode Location: AGFD Headquarters

Meeting Summary:

  • Review of agenda, identification of additional agenda items including:
    • Addition of crowd funding to agenda for discussion
    • Clarification of the agenda: ‘discuss mechanisms/ability/guidance for Commission to consider regarding removal of non-historical structures properties that…’
    • June 16 meeting summary correction to incorporate suggestion to seek repayment of Heritage Fund funds previously swept by legislature to the list of approaches considered.
  • Group reviewed summary of Fiscal Year 13, 14, and 15 costing (budgeted and expenditure) as well as anticipated deferred maintenance costing for Heritage Fund acquired properties.
  • Discussion and agreement amongst group to allow recommend changing recommended modification to 17-298 whereby the Heritage Fund acquisition portion of the fund would change from 40% to 35% to allow for funding Heritage Fund acquired property operation and maintenance costing from the non-acquisition portion of the fund.
  • Discussed recommending amendment of Commission Policy to require annual Commission approval for use of Heritage Fund grant funds towards Heritage Fund acquired property operation and maintenance costing.
  • Discussed the need to utilize an open comment process to identify support for the recommendation to reduce the Heritage Fund acquisition portion from 40% to 35%; it was noted that this work group was established with membership intended to represent stakeholders on this issue and that the expectation is that work group membership should be providing information regarding recommendations to the Commission, expressing positions to the work group and serving as liaisons and conduits of information in support of public process and transparency.
  • Discussed approach and recommended modification to 17-298 such that acquisition may include fee simple title, or any possessory or non-possessory interest in land.
  • Disposal of property that does not carry the Heritage Fund value is already possible albeit cumbersome.
  • Structure removal on existing or future properties was discussed as a suitable recommendation.
  • Recommendation to minimize acquisitions that have structures that would have regular operation and maintenance costs.
  • Discussed approaches and feasibility for use of endowments (long term) and crowd funding and corporate sponsorship approaches in building a privately held endowment fund.

A suite of options to present to the Commission at the September Commission meeting was developed that entail: 1) long term funding generation/savings (solutions), 2) Short term funding generation/solutions, and 3) Legislative changes. See list of options below.

Work group reviewed the objective and tenets put forth by the Commission and determined that they met those objectives to the extent possible. No further meetings are needed.

Action Items:

  • Send list of recommendations for Commission consideration – Marianne Cox
  • Present options developed by workgroup to Commission for consideration at September Commission meeting – Jim deVos

Adjourn

 

Arizona Game & Fish Heritage Fund O&M Resolution Workgroup Recommendations List for Commission Consideration, August 6, 2014

Long Term Funding Generation/Savings (solutions)

  • Endowment – held by 501(c)3
  • Divest of non-sensitive species value properties (those portions that no longer meet intent of purchase)
  • Remove non-value-added (non-historic) structures from properties
  • Investigate the economic potential of new programs such as a wildlife watching Heritage Fund stamp
  • Modify Heritage Fund language to change acquisition fund percent from 40 – 35% so 5% ends up in IIPAM from where O&M expenditures can be made
  • Modify Heritage Fund language to allow for acquisition via non-possessory language and the divestiture of these properties using same
  • Seek corporate sponsors
  • Develop an O&M assessment with each new property being considered for purchase

Short Term Funding Generation/Solutions:

  • Minimize acquisitions that have structures that need O&M
  • Crowd funding for specific O&M actions
  • Seek legislative refunding of funding swept by prior legislature in 2003 – $10 million from Heritage Fund acquisitions fund

Legislative Changes:

  • Change percentage in Heritage Fund Acquisition fund from 40% to 35% so extra 5% ends up in IIPAM from where O&M expenditures can be made
  • Allow for non-possessory acquisition such as conservation easement and disposal of property or portions of properties by “conservation buyer” under a conservation easement

Hands off the Heritage Fund, lawmakers

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[Source: Arizona Republic Editorial Board] – Lawmakers, show some respect for voters.

In 1990, Arizonans overwhelmingly approved the Heritage Fund, directing $10 million a year in Lottery revenue each to the Arizona Game and Fish Department and the Parks Department. This reflected a deep commitment to some of Arizona’s greatest resources: a rich history, diverse wildlife and dazzling natural landscapes.

The Legislature took the state parks’ share during the recession, and has unwisely rejected a number of efforts to restore that funding.

Now some of the Game and Fish share is at risk.

A portion of Game and Fish Heritage money is supposed to be spent on acquisition of land as habitat for threatened and endangered species. A strike-everything amendment to a House-passed bill would allow it to be used for operation and maintenance.

This goes against the “heart and soul” of what voters intended when they passed the Heritage initiative, says Beth Woodin, member of the Arizona Heritage Alliance and former Game and Fish commissioner.

What’s more, it’s sneaky.

This is a stealth effort to do something the public probably would not approve.

To that point, the altered bill was held in a Senate committee last week after it began to attract attention and opposition. It should disappear entirely.

If the Game and Fish department needs more money, let it ask for the funding. Then invite the Heritage Alliance and others who respect the spirit of this voter-approved law to be part of a discussion about what changes make sense.

Game and Fish seeks public input at meeting on Heritage Fund wildlife areas

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[Source: Karen Warnick, White Mountain Independent] – Five large wildlife management areas in Apache County are owned and operated by the Arizona Game and Fish Department. Four of the areas are Heritage Fund sites: Becker Lake Wildlife area, Wenima Wildlife area, Sipe Wildlife area, and the Grasslands area. The fifth is the Springerville Marsh Wildlife area.

Employees of Game and Fish held a public meeting March 6 at the Eagar Town Hall for a property management review and to encourage the public to comment on the next six years of operation in the five areas.