The new N.C. Lottery made its first ever transfer of proceeds to education on October 19, seven months after the games began. The state lottery commission will make periodic transfers to the Education Lottery Fund. At least 35 percent of net lottery revenues must be used for education initiatives such as pre-K programs, reducing class size, school construction, and college scholarships for needy students. The recent $95 million transfer represents 35.6 percent of the $233.1 million total the lottery collected since July 1 and another $12 million generated before that date. The lottery also made a $50 million transfer in late June, but that went into a reserve account.
State law requires that at least 50 percent of the total proceeds from the lottery be paid out in prizes, no more than 8 percent for administrative costs, 7 percent to retailers, and the remaining 35 percent to education. Of the funds for education, 50 percent goes to cutting class size in early grades to 18 students per teacher and to the More at Four program for at-risk pre-kindergarten children, 40 percent for school construction, and 10 percent for need-based scholarships for college, university, and community college students in