Lottery sets college scholarship record

Total revenue of $35.1 million in September slipped $1.3 million from ’17

The Arkansas Scholarship Lottery in September raised $7.7 million for college scholarships, eclipsing last year’s total for the month and the record set in 2011.

The lottery raised $6.7 million for scholarships in September a year ago, and the previous record for the month was $7 million in 2011.

But total revenue of $35.1 million last month slipped by $1.3 million from what was received in the same month a year ago. The total is the lottery’s fourth-largest for a September in nine years of operation. The revenue record for September was $39 million in 2011.

The lottery reported its results on Wednesday in its monthly report to Gov. Asa Hutchinson and the Legislative Council’s oversight subcommittee.

Lottery Director Bishop Woosley said the increase in draw-game ticket revenue last month compared with a year ago is the primary reason for the rise in money raised for scholarships.

The draw games include Mega Millions, Powerball, Natural State Jackpot, Cash 3, Cash 4, Fast Play and Lucky for Life.

A drop in scratch-off ticket revenue in September from a year ago also meant scratch-off expenses declined, he said.

“In addition, we continue to operate as lean as possible with, either the, or one of the, lowest number of staff members we have ever had, which helps with the overall bottom line. Increasing draw game sales is one of our primary business goals this

fiscal year, because they provide higher proceeds to scholarships,” said Woosley, who has been the lottery’s director since February 2012. The lottery reported it had 66 employees last month.

In September, scratch-off revenue slipped by nearly $2 million from a year ago to $28.3 million, while drawgame revenue increased by about $730,000 to $6.7 million, the lottery reported.

In a written statement, Woosley said scratch-off revenue dipped in September this year because July through September 2017, “we released the two most popular $10 instant ticket games we ever released and had the second-highest Powerball jackpot ever ($700 million) and a $545 million Mega Millions jackpot.”

July through September 2017 was the first quarter of fiscal 2018.

“As a result, we had a supercharged first quarter last year. Competing with that has been difficult, but we are currently above budget for the year in instant ticket sales, draw game sales and proceeds,” he said.

Woosley said draw-game revenue increased in September compared with the same month a year ago because “over the course of September, Natural State Jackpot, Mega Millions and Powerball all grew to where they are now. [And] the jackpots last September were lower as a result of all of them getting hit in early and late August.

“As a result, we had a great month in Mega Millions. We also had a strong month in our Fastplay games,” he said.

As of 6 p.m. Wednesday, the Mega Millions jackpot was $548 million, while the Powerball jackpot was $282 million and the Natural State Jackpot was $380,000, according to the lottery website.

The lottery also is paid fees by retailers that totaled $89,850 last month. Retailers totaled 1,931 on Sept. 30 — a slight dip from 1,935 a year ago.

The lottery started selling tickets on Sept. 28, 2009, and has helped finance more than 30,000 Arkansas Academic Challenge Scholarships during each of the past eight fiscal years. The scholarships also are financed with

$20 million a year in state general revenue and $20 million in reserve funds that covers temporary cash shortages.

After more students than projected received scholarships and the lottery raised less money than expected, the Legislature cut the size of scholarships three times during the first several years of the lottery. The total amount awarded for scholarships peaked in fiscal 2013 at $132.9 million, according to the Department of Higher Education.

The department has projected that about 35,000 students will receive scholarships totaling about $90 million in fiscal 2019. In fiscal 2018 that ended June 30, 34,943 students received lottery scholarships.

The 2017 Legislature created the Workforce Challenge Scholarship program using excess lottery proceeds. That program provides aid of up to $800 a year for students enrolled in certificate and associate degree programs for high-demand occupations in information technology, health care and industrial manufacturing.

This is the first school year in which the scholarship has been available. The department reported last month that about 700 students had applied for the scholarship and 600 of them have qualified for it. Updated figures weren’t available through the department Wednesday.

During the first three months of fiscal 2019, total revenue was $117.9 million, down from $122.6 million during the same period in fiscal 2018.

Scratch-off revenue reached $96.4 million during the first three months of fiscal 2019 — up slightly from $95.4 million in the same period last fiscal year — while draw-game revenue totaled $21.3 million in the first quarter this fiscal year, a drop from $26.9 million in the same period a year ago.

So far in fiscal 2019, the total raised for scholarships is $19 million — a decline from $22.2 million a year ago.

Unclaimed prizes totaled $197,904 in September to boost the unclaimed-prize reserve fund to $2.8 million as of Sept. 30. Under state law, the lottery transfers its unclaimed prize reserve fund balance, minus $1 million, to scholarships at the end of each fiscal year.

Although revenue and net proceeds in the first three months of fiscal 2019 are down compared with the same period last year, Woosley said, “We are very pleased with how we stand versus” the lottery’s budget.

“In total, we are up over $2.3 million versus budget for the year in sales. Most importantly, we are up $2,085,494 in the amount of proceeds we have raised for scholarships versus budget,” he said.

For all of fiscal 2019, Woosley has projected revenue of $482.9 million and net proceeds for scholarships at $85.9 million.

In fiscal 2018, the lottery raised $91.9 million for scholarships, the third-largest amount in its nine years of operation. Also last fiscal year, the lottery collected a record $500.4 million.