Before endorsing this idea, think about the shell game played with proceeds from the existing state lottery.
To refresh your memory, the exisiting lottery was "sold" to voters as a way to improve school financing in Michigan. Of course, we gullibles thought that meant more money for schools. Didn't work out that way at all, though. General fund contributions to school support were reduced by the amount of net lottery revenues (after all the promotional and administrative expenses are taken out of the gross) put into the school aid fund. No net gain for schools.
Lotteries are sucker bets in more ways than one.
Further, this proposal actually may result in reduced funding for schools, especially in this economy.
Taking care of military vets is very important. But it should not be done at the expense of or by risking education funding.