§ 23-115-801 — Lottery proceeds

Arkansas § 23-115-801

• Jurisdiction: Arkansas
• Title: 23

Text

(a) (1) Lottery proceeds are the property of the Office of the Arkansas Lottery. (2) (A) The office shall pay its operating expenses from its lottery proceeds. (B) (i) An amount of lottery proceeds determined by the office to maximize net proceeds for scholarships shall be made available as prize money. (ii) (a) Subdivision (a)(2)(B)(i) of this section does not create any lien, entitlement, cause of action, or other private right. (b) In setting the terms of a lottery, the office shall determine any rights of holders of tickets or shares. (3) The percentage of lottery proceeds determined by the office to be net proceeds shall equal an amount determined by the office to maximize net proceeds for scholarships. (b) (1) (A) On or before the fifteenth day of each month, the office shall deposit the net proceeds from the lottery into one (1) Lottery Scholarship Trust Account at one (1) or more financial institutions. (B) (i) The office shall establish the Lottery Scholarship Trust Account as required under subdivision (b)(1)(A) of this section to fund the Arkansas Academic Challenge Scholarship Program, § 6-85-201 et seq., the Arkansas Workforce Challenge Scholarship Program, § 6-85-301 et seq., the Arkansas Concurrent Challenge Scholarship Program, § 6-85-401 et seq., and any other scholarship funded with net proceeds from the state lottery in a financial institution into which the office shall transfer: (a) Excess funding returned to the office under § 6-85-212(d)(2)(B)(i) from the previous academic year; and (b) Net proceeds remaining in the Lottery Scholarship Trust Account from the previous academic year after the office: (1) Transfers under subdivision (c)(2) of this section the funds requested by the Division of Higher Education; and (2) Deposits the amount necessary into the Scholarship Shortfall Reserve Trust Account under § 23-115-802 to maintain an amount equal to twenty million dollars ($20,000,000). (ii) The funds transferred by the office into the Lottery Scholarship Trust Account for the Arkansas Academic Challenge Scholarship Program, § 6-85-201 et seq., the Arkansas Workforce Challenge Scholarship Program, § 6-85-301 et seq., the Arkansas Concurrent Challenge Scholarship Program, § 6-85-401 et seq., and any other scholarship funded with net proceeds from the state lottery as established under subdivision (b)(1)(B)(i) of this section shall be used for: (a) Arkansas Workforce Challenge Scholarships; (b) Any management fees charged by the financial institution to manage the trust account for scholarship award supplements; (c) Arkansas Concurrent Challenge Scholarships; (d) Arkansas Academic Challenge Scholarships; and (e) Any other scholarship funded with net proceeds from the state lottery. (iii) Annually, the office shall transfer to the division the funds from the previous academic year, if any, that were transferred by the office into the Lottery Scholarship Trust Account established under subdivision (b)(1)(B)(i) of this section for distribution of Arkansas Academic Challenge Scholarships, Arkansas Workforce Challenge Scholarships, Arkansas Concurrent Challenge Scholarships, and any other scholarship funded with net proceeds from the state lottery. (2) The office shall follow the investment policy guidelines of the State Board of Finance in selecting a financial institution and managing the net proceeds from the lottery deposited into the Lottery Scholarship Trust Account. (c) (1) The Commissioner of the Division of Higher Education shall certify to the office the amount of net proceeds from the state lottery needed to fund the scholarships awarded to recipients under the following scholarship programs for each semester of an academic year based on the contents of the Lottery Scholarship Trust Account at the end of the immediately preceding fiscal year: (A) The Arkansas Academic Challenge Scholarship Program, § 6-85-201 et seq.; (B) The Arkansas Workforce Challenge Scholarship Program, § 6-85-301 et seq.; (C) The Arkansas Concurrent Challenge Scholarship Program, § 6-85-401 et seq.; and (D) Any other scholarship funded with net proceeds from the state lottery. (2) (A) The office shall transfer the funds requested by the commissioner under subdivision (c)(1) of this section into one (1) or more trust accounts at one (1) or more financial institutions meeting the requirements of subdivision (b)(2) of this section maintained by the division. (B) The commissioner shall disburse trust account funds only in the name of the recipient: (i) To an approved institution of higher education; or (ii) If a recipient transfers to another approved institution of higher education, to the approved institution of higher education where the recipient transferred. (C) The following shall be based on the available funds from the previous fiscal year: (i) The amount transferred by the office for existing scholarships under subdivision (c)(2)(A) of this section; and (ii) Any new scholarship that is funded with net proceeds from the state lottery or the Higher Education Grants Fund Account, as applicable. (D) (i) (a) However, if available funds are insufficient to meet the amount requested under subdivision (c)(1) of this section to fund all scholarships funded with net proceeds from the state lottery or the Higher Education Grants Fund Account, as applicable, the first priority for the award of scholarships funded with available funds is the award of scholarships under the Arkansas Academic Challenge Scholarship Program, § 6-85-201 et seq. (b) If available funds are insufficient to meet the amount requested under subdivision (c)(1) of this section to fund all scholarships under the Arkansas Academic Challenge Scholarship Program, § 6-85-201 et seq., then the available funds shall be distributed to recipients of scholarships under the Arkansas Academic Challenge Scholarship Program, § 6-85-201 et seq., on a pro rata basis as determined by the division and reviewed by the Legislative Council or, if the General Assembly is in session, the Joint Budget Committee. (c) The commissioner shall immediately notify the Legislative Council or, if the General Assembly is in session, the Joint Budget Committee, upon becoming aware that available funds are insufficient to meet the amount requested under subdivision (c)(1) of this section. (ii) (a) If available funds remain after the award of all scholarships under the Arkansas Academic Challenge Program, § 6-85-201 et seq., then the available funds shall be distributed to recipients of scholarships under the Arkansas Workforce Challenge Scholarship Program, § 6-85-301 et seq., and the Arkansas Concurrent Challenge Scholarship Program, § 6-85-401 et seq., on a pro rata basis as determined by the division. (b) Distribution of scholarships with remaining available funds on a pro rata basis under subdivision (c)(2)(D)(ii) (a) of this section shall ensure the equal distribution of scholarships to student scholarship recipients enrolled in two-year institutions of higher education and four-year institutions of higher education. (3) By August 1 of each year, the commissioner shall provide to the Secretary of the Department of Finance and Administration and to the Legislative Council for the academic year just ended an accounting of all trust accounts maintained by the division, including without limitation: (A) Total deposits to all trust accounts; (B) Total disbursements from the trust accounts; and (C) The balance remaining in the trust accounts. (d) (1) The General Assembly finds that: (A) The administration of scholarships with proceeds from the lottery are expenses of the office; and (B) Because the division has the expertise and experienced staff needed to efficiently and appropriately administer the scholarships, the office shall use the services of the division to administer scholarships funded with net proceeds from the lottery. (2) (A) Annually by April 1, the division shall provide to the office and to the Legislative Council the division's budget for the administrative expenditures allowed under this subsection. (B) Annually by October 31, the division shall provide an invoice to the office for reimbursement of the administrative expenditures allowed under this subsection, including without limitation: (i) For each employee the: (a) Type of position, whether full-time, part-time, permanent, or temporary; and (b) Salary paid; (ii) A description of other expenditures requested in the invoice; and (iii) An explanation of the increase, if any, of actual expenditures over the budgeted expenditures. (C) Only direct expenditures of the division to administer scholarship funding with net proceeds from the lottery may be invoiced to the office under subdivision (d)(2)(B) of this section. (3) (A) Annually by November 1, the office shall file a copy of the invoice with the Legislative Council for its review. (B) The Legislative Council shall review the invoice and forward its comments, if any, to the office. (C) (i) The office shall reimburse the division for the costs of administering the scholarship awards funded with net proceeds from the lottery after the Legislative Council's review under this subsection. (ii) After the reimbursement of funds received by the division from the office under subdivision (d)(3)(C)(i) of this section, the division may refund the funds to the: (a) Division of Higher Education Fund Account; or (b) Higher Education Grants Fund Account.

Legislative History

Amended by Act 2023, No. 870,§ 42, eff. 7/1/2023. Amended by Act 2023, No. 786,§ 48, eff. 4/12/2023. Amended by Act 2021, No. 636,§ 6, eff. 7/1/2021. Amended by Act 2019, No. 456,§ 2, eff. 7/24/2019. Amended by Act 2019, No. 910,§ 3548, eff. 7/1/2019. Amended by Act 2019, No. 910,§ 3547, eff. 7/1/2019. Amended by Act 2019, No. 910,§ 3546, eff. 7/1/2019. Amended by Act 2017, No. 613,§ 5, eff. 3/23/2017. Amended by Act 2015, No. 1262,§ 2, eff. 7/22/2015. Amended by Act 2015, No. 1258,§ 36, eff. 7/22/2015. Amended by Act 2015, No. 218,§ 25, eff. 2/26/2015. Amended by Act 2013, No. 1173,§ 17, eff. 4/12/2013. Acts 2009, No. 605, § 1; 2009, No. 606, § 1; 2010, No. 265, § 32; 2010, No. 294, § 32.