Here’s The One Thing the Arkansas Lottery Can Do to Increase Scholarship Funding by Millions
For more than a decade we have written about how the Arkansas Lottery fails to make college scholarship funding a priority.
The Arkansas Lottery has one of the highest prize budgets of any state lottery in America.
At the same time, it budgets far less for education than the typical state lottery does — and far less than it is capable of budgeting.
So far this fiscal year, the Arkansas Lottery is spending about 16% of its revenue on college scholarships and about 70% of its revenue on prizes.
That means if the Arkansas Lottery takes in $450 million this fiscal year, its scholarship and prize budget will look something like this:
| Gross Revenue | Scholarships | Prizes |
| $450,000,000.00 | $72,000,000.00 | $315,000,000.00 |
The Arkansas Lottery can boost its scholarship funding by several million dollars. All it has to do is decrease its prize budget and spend that money on scholarships instead.
The typical state lottery spends closer to 60% of its gross revenue on prizes.
If the Arkansas Lottery reduced its prize budget from 70% of its revenue to 60%, it could increase its scholarship budget to 25% if its gross revenue.
If the Arkansas Lottery did that, here’s how much money it could pay to college scholarships, assuming the Lottery took in $450 million in a year:
| Gross Revenue | Scholarships | Prizes |
| $450,000,000.00 | $112,500,000.00 | $270,000,000.00 |
But Lottery officials have said for years that if they cut prizes and increase scholarship funding, fewer people will buy lottery tickets, and lottery sales will drop.
That has not been the case in other states, but let’s assume that did happen in Arkansas.
Here’s what Arkansas’ scholarship funding would look like if the Lottery raised its scholarship budget to 25% of its gross revenue — even if lottery ticket sales dropped:
| Gross Revenue | Scholarships | Prizes |
| $450,000,000.00 | $112,500,000.00 | $270,000,000.00 |
| $400,000,000.00 | $100,000,000.00 | $240,000,000.00 |
| $350,000,000.00 | $87,500,000.00 | $210,000,000.00 |
| $300,000,000.00 | $75,000,000.00 | $180,000,000.00 |
By budgeting 25 cents out of every dollar for college scholarships instead of 15 – 16 cents out of every dollar, the Arkansas Lottery would be able to spend millions of dollars more on Arkansas’ students — even if lottery ticket sales plummeted by $150 million.
There is really no excuse for the Arkansas Lottery to be stingy when it comes to funding college scholarships.
All the Arkansas Lottery has to do is simply spend less on prizes and more on education — just like other states do.
