King-size jack­pots give lot­tery record Oc­to­ber

Arkansas Democrat-Gazette - - FRONT PAGE - MICHAEL R. WICKLINE

Buoyed by $1.5 bil­lion Mega Mil­lions and $700 mil­lion Power­ball jack­pots, the Arkansas Schol­ar­ship Lot­tery’s rev­enue of $57.5 mil­lion in Oc­to­ber was the sec­ond-largest of any month for the 9-year-old lot­tery.

And the $11.2 mil­lion raised for col­lege schol­ar­ships last month was the third-largest amount of net pro­ceeds in any month, said lot­tery Di­rec­tor Bishop Woosley.

“We had an in­cred­i­ble month,” he said Fri­day. To­tal rev­enue and net pro­ceeds also were by far the most col­lected in any Oc­to­ber.

The record for any month was $58.7 mil­lion in rev­enue and $13.8 mil­lion in net pro­ceeds in Jan­uary 2016, when the lot­tery was bol­stered by a $1.6 bil­lion Power­ball jack­pot run.

The sec­ond-largest month for money raised for schol­ar­ships was $12.8 mil­lion in March 2012, Woosley said.

The de­part­ment projects that about 34,200 stu­dents will re­ceive $92.6 mil­lion in Arkansas Aca­demic Chal­lenge Schol­ar­ships in fis­cal 2019, which started July 1, said de­part­ment spokesman Alisha Lewis.

The lot­tery started sell­ing tick­ets Sept. 28, 2009.

The lot­tery 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 cover tem­po­rary cash short­ages.

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

The de­part­ment projects that about 34,200 stu­dents will re­ceive $92.6 mil­lion in Arkansas Aca­demic Chal­lenge Schol­ar­ships in fis­cal 2019, which started July 1, said de­part­ment spokesman Alisha Lewis. In fis­cal 2018, 34,943 stu­dents re­ceived $91 mil­lion in the schol­ar­ships.

In ad­di­tion, 159 schol­ar­ships have been awarded through a new lot­tery-fi­nanced pro­gram called the Work­force Chal­lenge Schol­ar­ship, and an­other 582 “are pend­ing ac­cep­tance,” Lewis said. They would cost roughly $600,000 if they are all awarded, she said. The 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.

OC­TO­BER’S DE­TAILS

Draw-game rev­enue in­creased from $5.6 mil­lion in Oc­to­ber 2017 to $24.2 mil­lion last month, while scratch-off ticket rev­enue de­clined slightly from $34 mil­lion to $33.2 mil­lion, the lot­tery re­ported Thurs­day in its monthly re­port to Gov. Asa Hutchin­son and the Leg­isla­tive Coun­cil’s lot­tery over­sight sub­com­mit­tee. Rev­enue also in­cludes fees paid by re­tail­ers that to­taled $81,920 last month. On Oct. 31, the lot­tery had 1,929 re­tail­ers.

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

“Mega Mil­lions sales went through the roof dur­ing the $1.5 bil­lion jack­pot run and Power­ball sales were also high, given the $700 mil­lion jack­pot,” Woosley said. Oc­to­ber was the sec­ond-best month for draw-game rev­enue, be­hind the $27.4 mil­lion col­lected in Jan­uary 2016, he said.

Scratch-off ticket rev­enue dipped slightly in Oc­to­ber from a year ago be­cause “we had an in­cred­i­ble in­stant month, but just hap­pened to be com­pet­ing with the 2nd high­est Oc­to­ber ever for in­stant sales that in­cluded our first over-sized $10 game,” Woosley said in a writ­ten state­ment, adding that “we had two huge jack­pots that drew our play­ers across from in­stants.” Scratch-offs also are called in­stant tick­ets.

THE YEAR SO FAR

Oc­to­ber is the fourth month in fis­cal 2019.

In that pe­riod, rev­enue to­taled $175.5 mil­lion, com­pared with $162.4 mil­lion col­lected in the first third of fis­cal 2018, ac­cord­ing to the lot­tery.

Com­par­ing the first four months of the past fis­cal year to this year, scratch-off ticket rev­enue inched up from $129.4 mil­lion to $129.6 mil­lion this year, while draw-game ticket rev­enue jumped from $32.5 mil­lion to $45.5 mil­lion. Draw-game tick­ets are more prof­itable than scratch-offs.

So far in fis­cal 2019, the lot­tery has raised $30.2 mil­lion for col­lege schol­ar­ships, up from $27.9 mil­lion in the same pe­riod in fis­cal 2018.

The un­claimed prize re­serve fund to­taled $3.5 mil­lion on Oct. 31, af­ter in­creas­ing by $697,477 in Oc­to­ber. At the end of the fis­cal year, the bal­ance of that fund, mi­nus $1 mil­lion, is trans­ferred to col­lege schol­ar­ships.

Woosley has pro­jected rev­enue of $482.9 mil­lion and net pro­ceeds at $85.9 mil­lion by the end of fis­cal 2019.

In fis­cal 2018, the lot­tery col­lected a record $500.4 mil­lion in rev­enue and raised $91.9 mil­lion for schol­ar­ships. The lat­ter was the third-largest amount ever for the lot­tery.

CASINO IM­PACT?

The lot­tery is­sued its monthly re­port two days af­ter vot­ers ap­proved a con­sti­tu­tional amend­ment that autho­rizes the state to li­cense four casi­nos, in­clud­ing the ex­pan­sion of the elec­tronic games of skill al­lowed by a 2005 state law at Oak­lawn Rac­ing and Gam­ing in Hot Springs and South­land Gam­ing and Rac­ing in West Mem­phis.

The amend­ment also will al­low casi­nos in Jef­fer­son and Pope coun­ties, pend­ing lo­cal ap­proval.

Asked how casi­nos would af­fect the lot­tery, Woosley said Fri­day, “It is dif­fi­cult to quan­tify the im­pact, but any new busi­ness that may take away money pre­vi­ously spent on lot­tery will def­i­nitely have some im­pact on our sales.

“We will just have to be dili­gent in what we do and con­tinue to of­fer prod­ucts that peo­ple want to buy,” he said.

Last month, an of­fi­cial rep­re­sent­ing con­sul­tant Camelot Global in Arkansas told the lot­tery over­sight sub­com­mit­tee that voter ap­proval of the con­sti­tu­tional amend­ment could present chal­lenges.

“I can see there is ob­vi­ously dis­cus­sions tak­ing place around sports bet­ting and the in­tro­duc­tion of po­ten­tially two new casi­nos and the up­grad­ing of Oak­lawn and South­land,” said John Skrimshire, vice pres­i­dent of com­mer­cial op­er­a­tions for Camelot Global, which has of­fices in Philadel­phia and Lon­don. “They’re all chal­lenges and I think this lot­tery is very fit to rise to those chal­lenges, but … I think it is im­por­tant they be given the op­por­tu­nity to at least have a level play­ing field on that.”

He said the lot­tery faces “threats” not only from com­pe­ti­tion in the gam­bling in­dus­try but also from changes in the way peo­ple shop.

“Ba­si­cally, you have got play­ers who are no longer go­ing into gas sta­tions and even gro­cery stores or liquor stores and they’re not buy­ing lot­tery tick­ets be­cause they can’t get them any other way,” Skrimshire said. “And this isn’t a sales pitch or this isn’t say­ing that we need to im­me­di­ately ap­prove in­ter­ac­tive or on­line … lot­ter­ies, but cer­tainly we need to make sure that we have it in mind that the re­tail en­vi­ron­ment is chang­ing.”

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