(A) All lottery proceeds are the property of the commission, to be held in a separate and distinct account, apart from the State Treasury. Annual administrative expenses must not exceed fifteen percent of gross lottery revenues for the year, including lottery retailer commissions and incentives. The General Assembly shall consider, in the allocation of funds from the Education Lottery Account, the allocation of monies in the amount the General Assembly determines for the Commission on Higher Education and for the Administrative Law Court, both to help defray their expenses incurred in the performance of their duties pursuant to this chapter; except that the amount of funding for the Commission on Higher Education and the Administrative Law Court must be allocated by the General Assembly in its annual general appropriations bill or any bill appropriating monies for previous or current fiscal years. As nearly as practical, an amount no less than forty-five percent of the amount of money from the actual sale of lottery tickets or shares must be made available as prize money, except that this item does not create a lien, an entitlement, a cause of action, or other private right, and rights of holders of tickets or shares must be determined by the commission in setting the terms of its lottery or lotteries.

(B) Before the sixteenth day of each month, the commission shall deposit to the State Treasurer, for credit to the Education Lottery Account for the preceding month, the amount of all net proceeds from the preceding month. The State Comptroller General shall account separately for net proceeds by establishing and maintaining a restricted account known as the Education Lottery Account. Upon their deposit with the State, monies representing a deposit of net proceeds become the unencumbered property of the State of South Carolina and the commission must not agree or undertake otherwise. The monies may be invested by the State Treasurer pursuant to state investment practices. All earnings attributable to the investments are also the unencumbered property of the State and accrue to the credit of the Education Lottery Account.

(C)(1) Pursuant to § 11-9-880, the Board of Economic Advisors, in conjunction with the commission, must provide to the General Assembly, in a separate estimate, the amount of projected net lottery proceeds for the upcoming fiscal year. The State Treasurer’s Office must estimate the annual interest earnings from commission funds. All interest earnings and other net proceeds must be used for educational purposes and programs.

(2) Appropriations from the Education Lottery Account must be for educational purposes and programs only as defined in § 59-150-350(D). These appropriations must be used to supplement and not supplant existing funds used for education.

(3) If expenditures for particular educational purposes or programs as defined in this chapter are less than the amounts appropriated, the excess may be retained in the account and expended the following fiscal year for those particular purposes or programs.

(D) At the beginning of the first fiscal year after the state lottery becomes operational, the Comptroller General shall certify the amount of net proceeds including investment earnings on the net proceeds credited to and accrued in the Education Lottery Account during the preceding fiscal year. The sum of certified net proceeds and investment earnings must be designated as annual lottery proceeds. Appropriations from the Education Lottery Account must be allocated only for educational purposes and educational programs by the General Assembly in its annual general appropriations bill or any bill appropriating monies for previous or current fiscal years. Funds made available from the Education Lottery Account must be used to provide Palmetto Fellows Scholarships to all eligible applicants, to provide LIFE Scholarships for eligible resident students attending four-year public institutions in those amounts provided by law; to the South Carolina State Library for public library state aid, to be distributed to county public libraries on a per capita basis and to be used for educational technology delivery, upgrade, and maintenance; to the Commission on Higher Education for tuition assistance at state technical colleges and two-year public institutions; for the SC HOPE Scholarship Program; to the Department of Education for school-based grants for pilot programs, to include programs providing deregulation as requested by school districts with an overall absolute or improved designation of average or better, with first priority given to schools reported as average, below average, or unsatisfactory in accordance with the Education Accountability Act; to the Department of Education to fund homework centers, and these funds must be allocated to the local school districts based on a per pupil basis and may be used for salaries for certified teachers and for transportation costs, provided that priority in the distribution of funds must be given to schools designated as below average or unsatisfactory in accordance with the Education Accountability Act; to the Commission on Higher Education for higher education assistance, including need-based grants, grants to teachers for advanced education with priority to annual grants earmarked for teachers working toward their masters’ degrees or advanced education in their areas of certification, or both; for the National Guard Tuition Repayment Program; and funding for elementary and secondary public education as determined pursuant to the Education Accountability Act of 1998 and education improvement legislation enacted into law after the effective date of this chapter; new programs enacted by the General Assembly for public institutions of higher learning, including public four-year colleges and universities and their branches and two-year colleges, as defined in § 59-103-5, and state technical colleges, which programs may include the creation of endowed chairs at the state’s universities, with an emphasis in the areas of, but not limited to, engineering, computer science, and the sciences; to the State Department of Education for the purchase or repair of school buses; to the South Carolina Educational Television Commission for digitalization; to the Commission on Higher Education to administer a construction and renovation fund for the historically black colleges and universities, and to the Higher Education Tuition Grants Commission to administer tuition grants. The proportion of total recurring general fund and special fund revenues of the State expended for the total of public elementary, secondary, and higher education allocations in any fiscal year must not be less than the proportions in the fiscal year immediately before the fiscal year in which education revenues are first received from a state lottery, and must not be reduced or supplanted later by revenues received from a state lottery.

(E) Appropriations by the General Assembly in its annual general appropriations bill or any bill appropriating monies for previous or current fiscal years for educational purposes and programs from the account not committed during the fiscal year must be credited to the Education Lottery Account.

(F)(1) A program or project started specifically from lottery proceeds must not be continued from the general fund, but the programs must be adjusted or discontinued according to available lottery proceeds, unless the General Assembly by general law establishes eligibility requirements and later appropriates specific funds within the general appropriations act. The provisions of this subsection do not prohibit the providing of supplemental funding to programs or projects in existence on the effective date of this chapter from lottery proceeds; provided, that funding for these existing programs or projects from the state general fund, the Education Improvement Act, or other nonlottery sources must not be reduced below that provided on the effective date of this chapter.

(2) A surplus in the Education Lottery Account must not be reduced by the General Assembly to correct any nonlottery deficiencies in sums available for general appropriations and vice versa, and a surplus in the Education Lottery Account must not be included in a surplus calculated for setting aside any nonlottery reserve, specifically, without limitation, the General Reserve Fund or the Capital Reserve Fund.