Maximizing the Value of Public Assets Selling California's EdFund will boost revenues while protecting students.

• EdFund should be managed by the private sector. In 1997 the state established EdFund, which guarantees in and out-of-state student loans. Because backing student loans is not a core mission or competency of state government, EdFund is a private non-profit that straddles the public and private sector. 
  
  
• Recent analyses show there could be significant opportunities to increase EdFund's efficiency and diversify into other businesses, generating greater revenues and profit margins for potential buyers.
  
  
• The sale will bring $1 billion to California. Selling EdFund will generate approximately $1 billion for the state but won't have an impact on students whose loans are currently guaranteed through the agency.

While a more profitable lottery will generate new funds for our schools, we don't need a lease to balance our budget.

• Leasing the lottery will maximize performance and returns. The Governor is considering leasing the state lottery in order to maximize its returns and improve performance for California's taxpayers. By allowing a private firm to run the lottery more efficiently and profitably, California will receive more money without giving up ownership. This money isn't future revenues we'll bank today-these are brand-new funds resulting from higher profits.
  
  
• Schools will be protected under any lottery lease agreement. Any lease deal will protect the lottery funding our schools get now and guarantee they'll continue to receive funding at current levels. If the lottery performs better under leased management, education stands to get more money.
  
  
• The May Revision does not assume the lease of California's lottery. The Governor's proposed 2007 budget and the May Revision already fully fund Proposition 98 and the Higher Education Compact.