Yesterday, the Arkansas Lottery Commission revised its projections for college scholarships, indicating that, with only days remaining in the state’s fiscal year, scholarship totals would come in around $80.5 million–roughly $9 million less than originally projected.
Lottery officials continue to say the goal is to “raise” as much money as possible for college students, but the Lottery’s actions tell a different story. For instance, at yesterday’s meeting the Arkansas Lottery Commission:
- Hired an $89,000 public relations aid;
- Authorized an extra $500,000 in lottery advertising;
- Hired a security director with a salary of $98,500; and
- Lowered scholarship projections for the year.
The Arkansas Lottery continues to cut scholarship projections, and yet it also manages to find money to hire employees and pay for advertisements the Lottery has done without for the past several months. I don’t think anyone really believes the lagging ticket sales the Lottery is experiencing are the result of not having a public relations person.
Additionally, the Arkansas Lottery Commission seems dead-set on implementing “monitor games” in Arkansas–despite objections from state legislators and the Lottery Commission’s own projections showing monitor games will not make the Arkansas Lottery a booming success.
So what is really going on down at the Lottery Commission?
Why Are Scholarship Funds Dropping at the Arkansas Lottery?
So why are scholarships suffering under the Arkansas Lottery? There are two chief causes.
First, the Lottery’s novelty is fading. We said from the beginning that experience in other states shows lottery ticket sales start high and gradually decline as the “newness” wears off with lottery players. To prop up their lottery, states end up rolling out new games to keep players coming back.
By contrast, the Arkansas Lottery rolled out more gambling more quickly than any other state lottery we know. Where other states waited months or years to introduce new lottery games, Arkansas waited no time at all. We started with many lottery games; we brought out brand new games before people got tired of playing the old ones; and we kept adding more and more lottery games to the program, creating an artificial wave of excitement. That wave is crashing.
As I heard a representative from one lottery vendor say in a Lottery Commission meeting some months back, the Arkansas Lottery “matured quickly.” He did not say it as though it were a good thing. Lottery officials pulled out all the stops from the very beginning. Now ticket sales are dropping, and they have no new cards to play–except ridiculous proposals like these “monitor games.”
The second reason scholarship funds are down is the Arkansas Lottery’s mismanaged priorities. In a best-case scenario, the Arkansas Lottery awards students about 19 – 20 cents out of every dollar it receives in sales. That’s one of the lowest rates in the nation. Last we checked, most state lotteries awarded closer to 30 cents on the dollar, while our neighbors to the south in Louisiana award a full 35 cents on the dollar.
We have written before how the Arkansas Lottery could pay out more for scholarships even if lottery ticket sales plummeted by $150 million. All they have to do is raise the percentage of revenue allocated for college students from the current 19% – 20% to 30%.
If the Arkansas Lottery really is about providing scholarships for college students, raising that percentage is a no-brainer. The fact that Lottery officials continue cutting scholarship funds while bolstering things like advertising seems to show a lack of priorities.
Family Council has talked about the problems state lotteries create for roughly seven years, now. When Lt. Governor Halter pushed for a state lottery during the 2007 Arkansas Legislative Session, we spoke up. When proponents campaigned for the Lottery in 2008, we talked about the problems other states have had with their lotteries. When the Arkansas Legislature created the Arkansas Lottery Commission in early 2009, we pointed out how it was one of the loosest state lotteries in the nation. And since the Arkansas Lottery opened shop in September of 2009, virtually every prediction we have made about the Lottery has come true.
The Arkansas Lottery needs to be thoroughly reworked, from top to bottom, if it’s going to come close to meeting any of the promises made back in 2008 and 2009. Based on yesterday’s Lottery Commission meeting, however, the Lottery seems convinced the only way out of the hole it has dug itself into is to keep on digging.