The group Arcade Arkansas has spent more than half a million dollars on an effort to legalize thousands of casino-style gambling machines across Arkansas.
The group’s proposed constitutional amendment would allow some 15,000 gambling machines statewide under the Arkansas Lottery, and it could create miniature casinos all over the state — with little or no oversight to prevent fraud or corruption.
The group has put serious money into its effort. But Arcade Arkansas recently filed reports with the Arkansas Ethics Commission showing it conducted virtually no activity last month.
In February, Arkansas Lottery Director Bishop Woosley announced that he opposes the effort to legalize casino-style gambling under the auspices of state lottery.
Arcade Arkansas has until July 3 to gather nearly 90,000 valid petition signatures in order to place their proposed constitutional amendment on the November ballot.
According to KATV news, Arkansans have spent $17 million on state lottery tickets in the past seven weeks.
Lottery ticket sales have surged in the wake of the COVID-19 pandemic.
Lottery officials say the uptick in sales could be the result of lower gas prices, closure of the casinos during the pandemic, and simply boredom.
However, our office recently analyzed weekly sales from the Arkansas Lottery, and it appears that lottery ticket sales in Arkansas rose after Arkansans began receiving economic stimulus checks from the federal government.
In other words, there’s a very good possibility Arkansans have been spending their unemployment checks and federal stimulus money on lottery tickets.
Here are five points worth remembering about the Arkansas Lottery:
The Arkansas Lottery relies heavily on scratch-off tickets despite the fact that these types of tickets can feed problem gambling and gambling addiction.
The Arkansas Lottery continues to sell scratch-off tickets that cost as much as $10 or $20 a piece. People who spend $20 on these scratch-off tickets have roughly a 66% chance of losing their money.
The Arkansas Lottery currently spends about 15% – 16% of its revenue on college scholarships — which is about half of what the typical state-run lottery spends.
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.
