Lawmakers Turn to Lottery to Help Build Veterans Trust Fund

In an attempt to fulfill a promise made to Iowa veterans in 2003, lawmakers have turned to a familiar source of revenue: gambling. By a vote of 75-21 Wednesday, the House passed House File 2359, a bill that would direct the Lottery Authority to develop two additional scratch tickets and two additional pull-tab tickets with the profits dedicated to the Veterans Trust Fund (VTF) until the fund reaches $50 million. After that, the lottery game revenue would flow to the Department of Veterans Affairs.

The trust fund was created to "assist veterans and their dependents who slip through the cracks of the federal system," Rep. McKinley Bailey, D-Webster City, said on the House floor. "As the wars in Afghanistan and Iraq continue, those cracks become more and more apparent. As a state we have an obligation, a sacred obligation, to ensure that our veterans are taken care of when they come home. That means picking up the slack for the federal government when it lets our veterans down."

Bailey estimated those games would produce up to $3 million a year for the trust fund at a minimal impact on the general fund.

Lawmakers, led by the Republican majority, created the VTF in 2003 with the intent of giving the state flexibility with regard to Iowa’s returning veterans and their families, in particular issues that aren’t covered by federal funding such as job training, unemployment assistance, travel expenses for wounded veterans related to follow-up medical care, nursing home care, counseling programs and honor guard services.

Moreover, lawmakers intended for the VTF to eventually contain $50 million. The current balance is $5 million, and Gov. Chet Culver’s 2008 budget does not contain any additional revenues for the fund. The reason Culver didn't propose more money is that only the interest is being spent, Charles Krogmeier, the governor's staff member who put together the budget, said in a January statement.

The proposal did not receive overwhelming support in the House. Some of the Republican lawmakers took issue with using lottery funds, arguing the revenue stream is unreliable and that creating a lottery for just the veterans doesn’t seem fair to other causes. Rep Scott Raecker, R-Urbandale, offered an amendment to fund breast cancer research, domestic abuse prevention and the Senior Living Trust by expanding the number of lottery games.

Bailey argued the amendment would destroy the bill, contending lottery officials told him the bill would work if there was only one cause benefiting from the games.

House Minority Leader Christopher Rants, R-Sioux City, wondered if the next step would be to have a bake sale rather than continue general fund appropriations to veterans programs, the Cedar Rapids Gazette reported. Ironically, he added, it was Gaming Day at the Capitol, sponsored by the Iowa Gaming Association."How appropriate," Rants said.

The bill now moves on to the Senate.

Originally Posted on "Iowa Independent"