Category: Arkansas Lottery

Lottery’s Explanation of December Scholarship Funding Doesn’t Make Sense

Recently we wrote about how the Arkansas Lottery paid very little to scholarships in December despite taking in more than $46 million.

The Arkansas Lottery notoriously budgets very little of its revenue for college scholarships, but December was particularly dismal, with students receiving only 13.8 cents out of every dollar the lottery made.

This week KNWA asked lottery officials why so little money went to scholarships last month.

KNWA writes,

They [Arkansas Lottery officials] say the lottery actually makes more money from its draw games such as Powerball and Mega Millions, but also local draws like the Natural State Jackpot and the Cash 3.

Officials say the lottery makes about 43 cents on the dollar for those, but the instant ticket games that had record sales in December don’t make as much. It varies depending on which ticket amounts are being sold. That then affects the profits, and, in turn the amount going to scholarships.

In other words, lottery officials blame the poor scholarship funding on the fact that the Lottery sold a lot of instant (i.e. scratch-off) tickets in December as opposed to Powerball tickets.

If it’s true that scratch-off tickets aren’t as profitable for the Arkansas Lottery, then why does the Lottery work so hard to promote them?

Why would they keep rolling out scratch-off tickets like the $20 ticket we wrote about in December?

If these instant tickets are actually hurting the Arkansas Lottery’s bottom line, then why does the state lottery offer more than 50 different scratch-off tickets at stores and gas stations all over Arkansas?

It simply doesn’t make sense.

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Lottery Gives Students Less Than 14 Cents of Every Dollar Despite Good December

Today the Arkansas Lottery released its financial report for the month of December.

The report shows that the Arkansas Lottery took in more than $46.1 million last month, but paid less than $6.4 million to college scholarships — 13.8% of the Arkansas Lottery’s total revenue.

The Arkansas Lottery actually made nearly $275,000 more in December of 2019 than it did in December of 2018, but it still paid nearly $279,000 less to college scholarships.

In other words, the Arkansas Lottery made more money last December than the December before, but gave less money to students.

In fact, December of 2019 appears to have been one of the the best Decembers in the Arkansas Lottery’s history, in terms of revenue, but scholarship funding remained low.

This tracks with what we have said before: The Arkansas Lottery appears to be budgeting less money for college scholarships this year, but there isn’t a clear reason why.

So far this fiscal year the Arkansas Lottery has spent only 14.5% of its gross revenue on scholarships. For perspective, the average state lottery spends 30%.

Below is a breakdown of lottery revenue and scholarship funding so far in Fiscal Year 2020.

Month	Gross Lottery Revenue	Paid to Scholarships	% Gross Revenue
July	$41,239,173.79	$4,523,930.75	11.0%
August	40,899,086.75	4,942,736.97	12.1%
September	36,202,677.79	6,565,973.32	18.1%
October	38,932,640.23	6,318,099.21	16.2%
November	36,118,641.12	5,947,177.45	16.5%
December	46,134,469.21	6,371,983.49	13.8%
Total	$239,526,688.89	$34,669,901.19	14.5%

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