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RALEIGH (AP) - A lawsuit over North Carolina's lottery legislation finally reached the state Supreme Court on Monday, 2 1/2 years after the first ticket was sold, with lawyers for lottery critics urging the justices to agree the law generates taxes.

The justices heard oral arguments in a lawsuit filed by taxpayers and groups who contend the lottery legislation wasn't passed properly in 2005 because the state constitution dictates the House and Senate must each hold two separate votes on separate days.

The multiple votes are required on bills that generate money for the state, raise money on the state's credit or pledge the state to repay any debt.

Instead, the House and Senate each took one day to vote on the bill and narrowly approved the creation of the North Carolina Education Lottery. Gov. Mike Easley signed the bill into law.

"The whole purpose for that constitutional provision is to allow for a democratic and deliberative process so that people - citizens and residents of North Carolina - can weigh in, have input and know how their legislators are voting," said Jack Holtzman, a lawyer representing some of the plaintiffs. "There's political pressure on the Legislature not to label revenue as a tax."

But the state's attorneys, representing the N.C. Lottery Commission and elected officials who were sued, argued the lottery isn't a tax.

A lottery ticket is purchased voluntarily, unlike sales and income taxes that must be paid, special deputy attorney general Norma Harrell said. The state acts as a vendor and any profit isn't automatically a tax, she said.

"This court has said clearly that a tax is a charge levied and collected with the contributions to the maintenance of the general government," Harrell said during the hour-long arguments.

Roughly 35 percent of lottery revenues are required to go to several state education initiatives.

The six justices on hand for the arguments didn't indicate when they would rule, but it usually takes months. A seventh member, Justice Mark Martin, recused himself. He gave no reason and isn't required to do so, court officials said.

If the court sides with the plaintiffs, the current lottery - which has generated more than $700 million for preschool and elementary school class size-reduction programs, college scholarships and to build public schools - would be deemed unlawful. But it could be allowed to continue operating while the Legislature decides to respond.

There's nothing to stop the General Assembly from re-enacting a lottery, said Bob Orr, a former Supreme Court justice and unsuccessful GOP gubernatorial candidate who represents other taxpayers and two conservative groups in the lawsuit.

"But it has to do so in compliance with the constitution of this state," Orr said.

The arguments followed similar discussions before a trial judge just before the first tickets were sold in March 2006, and again before the Court of Appeals in 2007.

The trial judge and the majority on the appellate panel dismissed the claim, but a dissenting opinion permitted the suing taxpayers, many of whom sat on the front row in the downtown Raleigh courtroom, to appeal the decision to the state's highest court.

The justices peppered the attorneys with questions, some recalling the emotional debates and razor-thin vote margins over the lottery bill. The House passed the bill 60-59. Lt. Gov. Beverly Perdue, now the Democratic candidate for governor, cast the tie-breaking vote in the Senate.

"The legislation seems to have been pushed through," Associate Justice Edward Brady said in court.

Orr argued that paying money to drive on a state toll road, which judges have said isn't a tax, is different from buying a lottery ticket.

But Justices Patricia Timmons-Goodson and Robin Hudson challenged him.

"If you paid a toll, you can't opt to not pay parts of those to the state," Hudson said.

Orr disagreed, saying ticket revenues, minus prizes and other costs, go to a broader general purpose of public education, instead of just paying for a toll road.

Brady and fellow Justice Paul Newby sounded skeptical when Harrell said she didn't believe the state is liable for paying off lottery prizes and other debt should the lottery commission run out of money.

"People believe they are to be paid directly or indirectly by the state," Newby told Harrell.