Tennessee lawmakers decided in 2025 to move the vast majority of sports gambling revenue into a special fund to pay for new K-12 school construction as part of a deal to pass a statewide private school voucher program. (Photo: John Partipilo/Tennessee Lookout)
When Tennessee lawmakers legalized sports gambling in 2019, they hoped it would create a new revenue source.
But nearly seven years later, while Tennessee’s sports gambling tax revenue exceeds $100 million, the state’s Lottery-funded scholarship program faces an $80 million budget deficit. Now, higher education officials are warning that if the funding hole isn’t addressed, the state will have to dramatically reduce costs, like the number of scholarships it offers…