Some worry that a more stable source of money should be used to cover recurring costs and programs the state can't afford to lose if lottery revenue sinks, as seen in some states.

"In the long term, we still think it's a lot healthier for the system if recurring programs are paid for with a more stable revenue source," said Jim Foster, spokesman for the state Education Department. "Once the state budget is a little healthier, we would like to see that change."

State law mandates that the lottery not supplant existing education funding. So much of its money is spent on adding to scholarship programs or creating new programs, such as the endowed chairs at the state's large research universities. New programs also include funding for assistance mandated by the state Education Accountability Act, such as teacher and principal specialists and homework center grants for struggling schools.

Some say using fickle lottery money for those programs shows the state's priorities are wrong.

"EAA funding is a core responsibility of the government, and those things need to be maintained and funded fully within the general fund," said state Rep. James Smith, D-Columbia. "We don't want to use the lottery as a crutch to lessen our commitment to public education in South Carolina."

Rep. Bobby Harrell, chairman of the House Ways and Means Committee, said the lottery does not pay for basic core curriculum education expenses. Lottery money enhances the EAA and education in general, he said. "If not for the lottery, a lot of those things wouldn't be funded at all."

South Carolina's lottery is expected to remain strong in its third full year. The state plans for about $243 million in revenue during the 2004-05 budget year, about $28 million more than this year.

Expenditures for the coming year include more than $163 million for scholarships, tuition assistance and grants and about $46.6 million for the Education Accountability Act.

Additions include about $2.7 million for testing costs and $2 million for data collection. Those are the kinds of operating expenses Foster said would be better covered by general fund money. But better lottery money than nothing.

"We had to have it, and we're happy there was some way to get it," he said.

Educators are cautious about such revenue after some states have seen a downturn in lottery money, causing concerns about whether programs funded with lottery money can continue.

"Certainly lottery money is a flow of money that is not stable. It will have its highs and lows," said Rita Allison, communications director for the S.C. Commission on Higher Education and former state representative. "If there is a decline in lottery money, that does present a problem."

There were worries earlier this year about Georgia's HOPE scholarship, which awards full tuition, mandatory fees and a book allowance to students with a B average or higher in high school. Even as the number of applicants rose, lottery ticket sales declined.

That caused some Georgia lawmakers to pass legislation to do away with the fees and book allowances if HOPE money continued to drop for three years. Lottery sales have started to go back up.

If people demand higher prizes and more advertising, that can eat into the money for education even if ticket sales hold steady. Couple that with rising college enrollment, and there could be trouble ahead for lottery-supported scholarship programs.

Research collected by Charlotte Advocates for Education in North Carolina shows that lottery money often supplants existing education appropriations, putting states in a tight spot if lottery money declines.

The organization found that Ohio put about $1.60 less toward schools from its general fund for every $1 in lottery profits the last time its lottery expanded. A downward trend in lottery sales in Ohio put the state about $26 million behind in payments to education in May 2003, according to the report.

In four years, the allocation of general fund money to education in Vermont dropped from 46 percent to 39 percent. In Florida, it dropped from 61 percent in 1986 to 53 percent in 2002.

Smith argues that South Carolina has supplanted education funding with lottery money. He said some $70 million in scholarships and programs being paid for with lottery money should be coming out of the state's general fund.

But Harrell said the state spends a higher percentage of its total budget on education now than before the lottery was added, even taking the lottery money out of the equation.

Some areas are murky.

The lottery pays for school buses, but it has been used recently to cover fuel and maintenance costs for existing buses instead of buying new buses. The state Education Department buys and runs most of the state's bus fleet.

"If we had not been able to pay for some of our parts and fuel costs with lottery money, we would not have been able to operate the bus system," Foster said.

There is no replacement plan for the state's aging buses. Hence the lottery money does not replace existing money to buy buses. But the state has decreased how much money it gives the Education Department for parts and maintenance from $12 million in 2003-04 to $9.5 million in 2004-05.

Money has been tight for state offices across the board, and Allison said people often mistakenly assume the lottery money can be used to make up all of the budget cuts made to education.

"The lottery is not a cure-all to education in our state," she said.

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