March’s ticket sales for the Arkansas lottery fell $4.4 million behind sales in March 2012, when ticket sales soared because of a $640 million Mega Millions jackpot, the lottery’s director told the Arkansas Lottery Commission on Monday.
The lottery raised about $3 million less for college scholarships last month than it did in March 2012, Bishop Woosley said.
During the first nine months of this fiscal year, the lottery raised $67.1 million for college scholarships, compared with $73.7 million during the same period last fiscal year. Total ticket sales of $327.6 million for the first nine months fell behind sales from the same period last fiscal year by $35.1 million, he reported. Monthly ticket sales have also lagged behind year-ago figures in eight of fiscal 2013’s nine months.
“Hopefully, we’ll make up some ground,” Woosley said.
The Mega Millions and Powerball jackpots “are kind of sitting on the edge of making runs,” he told the nine-member commission. “Knock on wood and cross your fingers; hopefully one of those will take off.”
A year ago, Woosley projected the lottery would raise $98.5 million for college scholarships in fiscal 2013. But he warned lawmakers in November that they “are probably safe to assume” that the lottery will raise “somewhere in the $89 million to $90 million” range for college scholarships in fiscal 2013 “if sales trends continue to hold.”
The lottery generated $94.2 million in net proceeds for scholarships in fiscal 2011 - the first full fiscal year of operation - and $97.5 million in fiscal 2012. The lottery started selling tickets Sept. 28, 2009.
The lottery has helped fund more than 30,000 Academic Challenge Scholarships during each of the past three years.
This year, state lawmakers cut the size of the scholarships for future first-time recipients. The cuts were necessary because more students than projected are receiving scholarships and the lottery’s net proceeds for college scholarships fell short of initial projections, officials said.
Woosley said lottery officials knew their ticket sales last month “would not compete” with the ticket sales of $51.4 million in March 2012, but they “competed very well even without [the $640 million Mega Millions] jackpot” as ticket sales totaled $47 million.
It appears the lottery’s sales of scratch-off tickets “are getting back on track” after scratch-off ticket sales in July, August, September and October “hit rock bottom,” he said. Scratch-off tickets are 82 percent of the lottery’s ticket sales, he noted.
Scratch-off-ticket sales last month totaled $38.7 million, nearly $1 million more than March 2012. The lottery’s March draw-game ticket sales, including Powerball, Mega Millions, Cash 3, Cash 4 and Arkansas Natural State Jackpot totaled $8.3 million - $5.3 million less than in March 2012.
The lottery raised $9.7 million for college scholarships last month, compared with $12.8 million a year ago, Woosley said.
“We knew we were going to end up a little bit behind for this month and sure enough we did, but I am pretty happy with where we came in at $47 million,” he said.
March was probably the fourth or fifth best month that the lottery has had during the past 3 ½ years of ticket sales,Woosley said.
“Lotteries typically have that honeymoon period, and it appears, hopefully, that our honeymoon period ended sometime in the summer of 2012 and now we are starting to like each other again,” said Woosley, who has been the lottery’s director since February 2012.
Woosley said the lottery’s tickets sales totaled $39.3 million in April 2012, and he expects similar sales this month.
The lottery has been fortunate to have several large Powerball jackpots during the past year, but the Mega Millions jackpot has exceeded $100 million only three times since the $640 million jackpot in March of 2012, he said.
“You can’t build yourself to where you get that extra income that really makes or breaks your year, so I think there are going to be changes to Mega Millions. I don’t know what they are going to be,” Woosley said. “Whatever they do, we are hoping that we will see the same results that we saw with Powerball.”
On Jan. 15, 2012, Powerball increased the cost of its ticket from $1 to $2 and increased the beginning Powerball jackpot to $40 million from $20 million.
Mega Millions tickets cost $1 and its beginning jackpot starts at $12 million.
Woosley said that the commission and some lawmakers want the lottery to sell more of the draw-game tickets, which are more profitable than scratch-off tickets, and increase the percentage of ticket salesthat go for college scholarships.
Earlier this month, a bill requiring that at least 25 percent of the lottery’s proceeds go to college scholarships failed to clear the Arkansas House Rules Committee. The percentage of the lottery’s receipts that has funded college scholarships has ranged from about 20 percent to 21.5 percent during its first three fiscal years of operation. Most of the money is returned to ticket buyers with winning tickets.
“The more we can return [to college scholarships], hopefully the issue can dissipate and go away over time,” Woosley said.
In other business, the commission agreed to reconsider its decision in 2009 not to advertise on college campuses. That decision limits the lottery’s ability to advertise to thousands of people attending certain events, Commissioner Mike Malone of Fayetteville said.
Afterward, Malone acknowledged that he isn’t seeking reappointment to the commission. House Speaker Davy Carter, R-Cabot, will appoint his replacement.
The lottery’s personnel committee authorized two percent cost-of-living raises for the lottery’s employees in the fiscal year starting July 1, contingent on Gov. Mike Beebe’s finding that there is sufficient funding for such raises.
Also Monday, the state Department of Higher Education announced that it notified more than 10,000 new Academic Challenge Scholarship recipients of their scholarship awards.
Under Act 234 of 2013, first time recipients of the scholarship in the coming school year will receive $2,000 as freshmen, $3,000 as sophomores, $4,000 as juniors and $5,000 as seniors at four-year universities. New scholarship recipients enrolling in two-year colleges will get $2,000 a year for both years.
Students first awarded the scholarships in the 2010-11 school year will continue to receive $5,000 a year to attend universities and $2,500 a year for community and technical colleges. Those who were first awarded the scholarships in the 2011-12 or 2012-13 school years will continue to get $4,500 a year at universities and $2,250 at colleges. Those amounts won’t change for those students as long as they remain eligible.
There are still more than 6,000 incomplete applications for students who are likely eligible for the scholarship, said Shane Broadway, interim director of the Department of Higher Education. These students have until June 1 to complete their applications, he said.
Front Section, Pages 1 on 04/30/2013