Despite Uptick, Arkansas Lottery Still Coming Up Short

Arkansas Lottery,

The Arkansas Democrat-Gazette reports an uptick in ticket sales at the Arkansas Lottery. According to the article, sales for September, 2015, were the highest of any September since 2011.

Here’s the bad news: Despite this uptick in sales, the Arkansas Lottery only allocated 18.3%–$6.6 million–of its gross revenue for scholarships last month.

While we’re still only one quarter of the way into Fiscal Year 2016, these numbers put the Arkansas Lottery on track to pay out roughly $71 – $75 million in scholarships this fiscal year–$80 million on the high side.

To put these numbers into perspective, $75 million is a full $25 million less than lottery proponents insisted the Lottery would provide for scholarships six years ago, and 18.3% is barely better than half of the percentage Louisiana’s lottery allocates.

What’s more, according to Lottery officials, the Lottery’s uptick in sales during September was bolstered in part by a new $20 scratch-off ticket and a high PowerBall jackpot.

This is more of the same failed strategy. The Lottery’s strategy since Day One has been to prop up ticket sales artificially by rolling out new games. People are always excited to try the new lottery games, but as soon as the novelty wears off, ticket sales decline again. (more…)

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Lottery Ticket Sales, Scholarship Funds Drop in August

Arkansas Lottery

Lottery scholarship revenue dropped by nearly $300,000 in August as ticket sales fell, according to the latest monthly report from the Arkansas Lottery.

The Arkansas Lottery took in nearly $31.3 million dollars during the month of August, but only paid out about $5.5 million.

Altogether, only 17.6 cents of every dollar the Arkansas Lottery makes goes to fund scholarships.

While the Lottery is only two months into Fiscal Year 2016, scholarship funding is on track to come in around $70 million for the year–$30 million less than lottery proponents promised Arkansans when the Lottery was first instituted in Arkansas. Of course, we have written time and again about a few simple changes Lottery officials could make to increase scholarship funding.

Below is a breakdown of lottery ticket sales and scholarship funding for Fiscal Year 2016.

Month (FY16) Gross Lottery Revenue Paid to Scholarships % Gross Revenue
July $ 31,665,651.14 $ 5,784,683.09 18.3%
August  31,265,177.55  5,490,094.00 17.6%
Total $ 62,930,828.69 $ 11,274,777.09 17.9%

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One Simple Way the Arkansas Lottery Can Pay More in Scholarships

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We keep saying it over and over again: There is one simple way the Arkansas Lottery can pay out more in scholarship money. All Lottery officials have to do is increase the percentage of lottery revenue budgeted for scholarships.

As we wrote earlier this week, the Arkansas Lottery only paid 18% of its revenue last month toward college scholarships.

And for Fiscal Year 2015–which ended last June–the Arkansas Lottery paid a paltry 17.7% of its gross revenue toward scholarships.

To put these numbers in perspective, the State of Louisiana has a law on the books requiring its lottery to pay 35% of its gross revenue toward education. That’s why Louisiana’s lottery is able to make less money in lottery ticket sales than the Arkansas Lottery, but still pay out more in education funding.

Lottery officials continue to insist that if they set aside a larger percentage of gross revenue for scholarship funding, then the Lottery will have less money for prizes, marketing, and so forth; this, they say, would cause lottery ticket sales to go down, and fewer ticket sales would mean less money for scholarships.

The argument, essentially, is that by keeping the percentage of gross revenue allocated for scholarships lower than most states, Arkansas is somehow able to sell more lottery tickets and make more money for education as a result.

To show how flawed this argument is, here is a breakdown of the numbers: (more…)

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