Amid revenue shortfall, officials launch new campaign to boost ticket sales
New Mexico Lottery officials this month are celebrating the 15th birthday of the lottery program with a special anniversary scratcher ticket and a new ad campaign.
Amid a revenue shortfall and the possibility that the lottery's scholarship money could be out of cash by 2014, the celebration is bittersweet.
"This is a new era for us because we don't know how many people are going to play the lottery from now on," said Senate President Pro Tem Tim Jennings, D-Roswell, a longtime supporter of the scholarship.
"We have never been through this big of a recession since we started the lottery."
The lottery has sent 68,000 New Mexico students to college, many of whom would have otherwise not gone on to higher learning.
To qualify, students must have graduated from a New Mexico high school and register for college in the semester after graduation and maintain a 2.5 grade point average.
While the lottery has made universities more popular, the lottery itself has become less so. As of late February, gross revenues for the scholarship program in the 2011 fiscal year are down 5 percent, or $4.3 million from last year.
Adriana Binns, director of marketing and communications for the lottery, said a weak economy factors into the dip in revenues, as does a reduction in the number of places lottery tickets are sold. The lottery in FY 2011 has lost 37 stores, including 27 Chevron Redi-Marts.
"What we have to remember the lottery is raising more money than ever ... even though sales aren't quite where we would want them to be, we are still happy about that," she said.
Just more than half of lottery revenues go back to players in the form of prizes, while 30 percent goes to the scholarship fund. To date, $475 million has gone to education. The remaining amount goes to administrative expenses, retailer commissions, advertising, shipping costs and vendor fees, Binns said.
To deal with the shortfall and keep students going to school with the scholarships, lawmakers this Legislative session considered a tuition freeze for recipients, as well as allowing students on the scholarship to take a one-year break in their studies, either before or during college — but those measures failed. Another measure that was not approved would have given students up to 16 months after graduation to register for college, instead of requiring registration right away.
Jennings said lawmakers need to revisit the issue — as do university officials.
"The universities, in my opinion, they quit raising fees. All they do is raise tuition because its paid for by the state. They have kind of gamed the state a little, in my opinion," he said.
Jennings said the problem "isn't insurmountable," but said students should prepare to pay a little more in the coming years.
"We might have to lower the amount we pay," he said.
To try to boost revenues, lottery officials have launched a new marketing campaign, called "Whatchagonnado?" The strategy is aimed at getting people to think about what they would do with the money should they win. Future ads will work to get potential college students to think about what they could do with a degree.
"That's the main thing, is trying to remind players that the lottery is available and that it's a fun gaming entertainment," Binns said. At the same time, Binns said, the lottery wants to reach out to new players and maybe get back some former players.
For the anniversary, the lottery just launched special edition $3 tickets, in tuxedo black, that have a top prize of $25,000.
New ad campaigns aside, though, some say bigger changes need to be made in the scholarship program.
Jennings said lawmakers before next session again will discuss what to do with the issue.
"We are going to have to do something. But if the money isn't there, it isn't there," he said.
Binns, who said the lottery doesn't take positions on legislation related to the lottery, said the topic is a tough one to broach.
"That's a difficult discussion, trying to figure out, are you going to make the scholarship available to less people, or maybe give less to everyone who is eligible for it?"
By the numbers
- Number of students who have gone to college on the lottery scholarship: 68,000
- Number who have graduated as of this spring: 29,300
- Prizes since the lottery started in 1996: $1.03 billion
- Value of tickets bought: $1.88 billion
- Money spent on education: $475 million
- Number of new millionaires because of the lottery: 31
- Projected shortfall this year: $4.3 million
Thanks to shagadelica for the tip.