Lottery funds provided to education are allocated annually on a per student basis to K-12 and community college districts, the California State University (CSU), the University of California (UC), and other educational institutions. [...] In 2005-06, K-12 education received eight out of every 10 lottery fund dollars (80.8 percent), and community colleges received approximately one out of seven dollars of lottery proceeds (14.2 percent).1 Lottery Money Represents a Small and Declining Share of Public School Funding The state lottery provides a small share of the total support for California's public schools. [...] In 2005-06, expenditures from the state lottery fund accounted for just 1.9 percent of total K-12 spending, 3.0 percent of community college spending, and less than 1 percent of spending for each of the CSU and UC systems.2 Despite successful efforts to increase lottery revenue, the share of total K-12 spending provided by the lottery has declined since 1985-86. [...] In 2003, the California Department of Education (CDE) surveyed 100 school districts representing 18 percent of the state's K-12 students.5 The survey showed that between 1986-87 and 2001-02, districts spent an average of 79.5 percent of the funds they received from the lottery on salaries and benefi ts, while spending an average of only 8.3 percent of their lottery funds on books and supplies.6 In. [...] Research suggests that the money Californians spend on the lottery may result in a reduction in what they spend on other goods, including goods subject to the state's sales tax.14 To the extent lottery ticket buyers spend less on taxable goods, the lottery reduces state sales tax revenues and thus the funds available for public education.