The NC Education Lottery’s sales are up, but schools are getting less. Let’s fix that. | Opinion

Every day on my way to drop my son off at school, I pass a massive N.C. Education Lottery billboard touting the latest jackpot. I’ll admit it: When the total gets up above a billion dollars, I usually stop and buy a ticket.

It’s a little bit of fun, and a lot of the money is going to help the schools, right?

That’s becoming less and less true. A new state audit released Monday shows that as our lottery gets bigger and more aggressive, the amount actually going to education is getting smaller.

North Carolina just had a record year for lottery sales, bringing in about $6.6 billion — more than $1 billion higher than the year before. Yet the amount going to public schools actually decreased. And the share of lottery revenue going to education hit a record low: 16%.

In the state-by-state comparisons, that puts North Carolina at the bottom. This shouldn’t just be an embarrassing statistic. It should be a tipping point.

The fix isn’t complicated. The legislature should reinstate a 35% minimum to schools and stop letting the lottery treat “education” as whatever is left after prizes and growth targets. If lawmakers won’t enforce the name, they should stop using it.

A system born of trickery

If it feels like a little bit of trickery, well, that’s kind of par for the course for the North Carolina lottery.

In 2005, after decades of debate, there still weren’t quite enough votes in the Senate to create a state-sponsored lottery. So the Democratic majority waited until two Republican opponents were absent — one in the hospital, another on his honeymoon — to schedule the vote.

With those two opponents gone, the chamber deadlocked. Then–Lt. Gov. Beverly Perdue broke the tie, and the N.C. The Education Lottery became law.

At the time, the legislation required at least 35% of lottery revenue to go to education. But even before the first scratch-offs were scratched, that became more like a guideline.

In 2007, the General Assembly changed that 35% from a requirement to a goal to pursue “to the extent practicable.”

Lottery 2.0

When I saw the drop in the education percentage, my first instinct was to look for administrative bloat — a commission fattening itself up while schools got shorted. That’s actually not the case.

Lottery overhead has stayed roughly the same. What’s increased? The prizes.

Over the past two years, the N.C. The Education Lottery has introduced a new method of gambling known as “digital instants.”

These are scratch-offs rebuilt for your phone, instant-win games sold through the lottery’s online platform. In fiscal year 2025, digital instants generated roughly $2.6 billion in sales, nearly 40% of the lottery’s entire revenue.

That’s staggering. It also tells you what kind of game the lottery is playing.

Traditional lottery play, for all its flaws, had friction. You had to go to a store. You had to make a discrete decision. You had to do it in public. Digital instants remove all those guardrails.

And crucially, digital instants also change the economics. The lottery commission itself acknowledges that instant-win games tend to come with higher prize payouts. That drives higher engagement and higher sales. But it also means there’s less margin left over for education.

That’s the core of what the audit is showing. More play. More prizes. Less education. That’s what today’s N.C. Education Lottery is designed to create.

A bipartisan problem

Historically, the lottery is a Democratic problem. Democrats pushed it for years. Democrats passed it in 2005. A Democratic governor signed it.

But it’s also true that North Carolina has leaned further into gambling in recent years under Republican legislative leadership. Monday’s audit arrives in a political climate that has been increasingly comfortable with vice as a revenue strategy.

Lottery defenders will still point to the top-line number, more than a billion dollars for education, and argue that the big check is worth it.

But this isn’t a normal business transaction. State-sponsored gambling has costs, like addiction, family stress, and regressive taxation. When the state makes gambling easier, faster, and more habitual, it isn’t just “raising money.” It’s shaping behavior.

That’s why the percentage matters. It’s the clearest signal of whether education is truly driving the enterprise, or whether it’s simply the justification for a growing gambling operation.

If the lottery is going to keep expanding onto people’s phones, the state has to stop pretending that a mushy “to the extent practicable” guideline is oversight. It isn’t. It’s abdication.

The original law understood something we’ve spent years unlearning: if you’re going to run state-sponsored gambling under an education banner, the education commitment must be non-negotiable.

So restore it. Put the teeth back in. Reinstate the 35% minimum.

An institution optimized to sell tickets will always optimize away from anything that slows that down. That’s where we are now. The audit’s message is simple: the lottery is thriving. The education mission is not.

If that doesn’t trigger a hard rethink now, it’s hard to imagine what ever will.

Contributing columnist Andrew Dunn is the publisher of the Longleaf Politics newsletter, which offers thoughtful analysis of North Carolina politics and policy from a conservative perspective. He can be reached at andrew@longleafpol.com.

This story was originally published December 30, 2025 at 10:34 AM with the headline "The NC Education Lottery’s sales are up, but schools are getting less. Let’s fix that. | Opinion."