Lottery’s September take rises $3.3M
The Arkansas Scholarship Lottery’s revenue in September increased by $3.3 million, compared with the same month a year ago, to $36.4 million, largely based on an increase in scratch-off ticket revenue.
The amount raised for college scholarships increased by nearly $1 million, compared with the same month a year ago, to $6.8 million, the lottery reported Monday.
Lottery Director Bishop Woosley said he doesn’t know how much of the increase in revenue in September is tied to a law that took effect Aug. 1 and gives retailers the option of accepting debit cards for ticket purchases. Before the new law, retailers had been limited to accepting cash for purchases.
Scratch-off ticket revenue increased in September
by about $3.14 million from year-ago figures to $30.3 million, while draw-game ticket revenue inched up by about $160,000 to $5.9 million, the lottery said Monday in its monthly report to Gov. Asa Hutchinson and the co-chairmen of the Legislative Council’s lottery oversight subcommittee. The lottery’s revenue also includes fees paid by more than 1,900 retailers.
“We had a terrific month of scratch off sales which continues a trend we have seen for the majority of this calendar year,” Woosley said in a written statement to the newspaper. “We have seen a huge increase on our $10 scratch off ticket sales which is attributable to the Willy Wonka and $300,000 Fortune tickets and now the Big Money Multiplier ticket we just launched.”
The lottery’s draw games are Powerball, Mega Millions, Cash 3, Cash 4, the Natural State Jackpot, Fast Play and Lucky for Life.
While Powerball and Mega Millions didn’t have large jackpots for the month, “we did see the Natural State Jackpot grow near the end of the month, but not enough to make a huge difference in sales,” Woosley said.
As for how much of the revenue increase in September is attributable to lottery retailers accepting debit cards, Woosley said, “We have no way of tracking debit card purchase” and could not provide specific figures.
But he added, “I would say that we have heard a lot from the field that people are taking advantage of the ability to purchase using debit cards.”
Woosley said he doesn’t have information about how many retailers are selling lottery tickets by accepting debit cards. He said lottery officials may consider doing a survey to determine which retailers accept debit cards but that it is not a priority at this point.
Some lottery retailers have said they decided not to accept debit cards for payment on ticket purchases because the fees charged to their stores by card companies may range from 30 cents to 60 cents per transaction. The fees outstrip the commissions that the lottery pays them and any additional business that can result from accepting debit cards on lottery ticket purchases.
But other retailers have said they’re accepting debit cards because the fees charged to their stores by card companies are lower than 30 cents to 60 cents per transaction. They also said they lose business to their competitors if they don’t accept the debit cards.
Last month’s net proceeds increased by nearly $1 million over the same month a year ago, to $6.8 million, largely because of an increase in lottery ticket sales, Woosley said.
“Also, I think the reduction in administrative costs at the lottery over the past two and a half years has increased our profit, as well,” he added.
The lottery reported unclaimed prizes of $91,576.92 last month to increase the unclaimed prize reserve fund to $2.7 million as of Sept. 30. At the end of each fiscal year, the lottery transfers the balance of the unclaimed prize reserve fund, minus $1 million, to scholarships under state law.
The Arkansas Scholarship Lottery has helped finance more than 30,000 Arkansas Academic Scholarships during each of the past seven fiscal years.
The Legislature has cut the size of the scholarships three times since it started selling tickets in September 2009. That’s because the lottery’s net proceeds for college scholarships fell short of the lottery’s initial projections and more students than projected have received the scholarship.
The lottery’s revenue and net proceeds for college scholarships peaked in fiscal 2012 at $473.6 million and $97.5 million, respectively, before dropping for three consecutive fiscal years. The lottery’s net proceeds for college scholarships rebounded in fiscal 2016 and 2017 to $85.2 million.
Fiscal 2018 started July 1. During the first three months of fiscal 2018, the lottery’s revenue totaled $122.6 million, up from $106.4 million during the same period last fiscal year, based on increases in both scratch-off ticket and drawgame ticket revenue.
So far in fiscal 2018, net proceeds for college scholarships have totaled $22.3 million, up from $19.9 million during the first three months of fiscal 2017.
The fiscal 2018 performance has been assisted by a $758.7 million Powerball jackpot that helped the lottery set August records for revenue at $49.3 million and the amount raised for college scholarships at $8.9 million.
Woosley has previously projected revenue of $459 million and net proceeds of $83.6 million in fiscal 2018.
Asked whether the lottery could break its records for revenue and net proceeds for college scholarships in this fiscal year, Woosley said, “At this point we are on pace to raise over $88 million in proceeds.”
“While that is great news, it would not be a record. That said, I would be very happy with $88 million, which would represent continued incremental growth for the past 3 years,” he said in his written statement.
Academic Challenge Scholarships paid out a total of $86.1 million in fiscal 2017 — down from $96.4 million distributed in fiscal 2016 — according to the state Department of Higher Education.
Department officials said in July that they were projecting a 3 percent to 5 percent increase in scholarship expenditures to bring the total to between $88.9 million and $90.5 million in fiscal 2018.
They reported that the number of new scholarship applications increased from 25,566 last school year to 30,883 this school year. Department officials have attributed this year’s increase to the marketing and communications for a new program called Future Grant and the high profile that higher education received during this year’s regular legislative session.