Legislature tweaking how gambling money is divvied for schools

Last year Missouri voters overwhelmingly approved a statewide initiative that capped the number of casinos in the state, removed the loss limits on gamblers and designated the anticipated significant increase in revenue for public education. As pointed out before the election, the initiative proposal was poorly crafted. Indeed, without legislative action more than a fifth of Missouri's 524 school districts would see no benefit at all from the plan.

The Missouri Legislature is well down the road in taking care of the funding disparity. The Senate has already approved Senate Bill 291, which is a catch-all bill addressing a multitude of education issues, including the distribution of the casino revenue. The House is considering the plan.

The bill would change how new tax revenue is distributed to schools. New gambling money would go into a state fund that already receives other casino tax revenue. And it would remove a cap on how much the state's education funding formula can grow each year, resulting in a $40 million boost for K-12 schools. Schools would also receive an increase in funding for gifted students.

The changes being made in how the casino revenue is spent appear to closely match the intentions of the initiative proponents, whose aim of limiting the number of casinos and removing the loss limits was made palatable to voters by directing the revenue to education instead of to the general fund, where legislators would decide how best to spend the money.

Last year, proponents of the casino plan estimated a $130 million bump in school funding. As the legislature continues its deliberations on the funding plan, the Missouri Gaming Commission now estimates the new law will generate $75 million to $125 million. While casino revenue this year has increased, it's still too early to say that trend will continue in a prolonged national recession. A word to school districts: The good news is that the legislature is trying to find a way to distribute gambling money equitably. But don't spend any expected windfalls until you cash the check.