Restrictive measure will drastically reduce prizes, cut revenue, director says
Statement from Bishop Woosley, Director, Arkansas Lottery Commission
Friday afternoon, HB 2263 will be presented to the House Rules committee at the Capitol. HB2263 mandates that 25% of total lottery proceeds be used to fund college scholarships. The Arkansas Lottery Commission (ALC) strongly opposes this bill because of the immediate and detrimental effect it will have on lottery ticket sales, revenues paid to our retailers in the form of sales commissions and most important, college scholarship revenue.
To attain the mandate set forth in HB2263, ALC will be forced to significantly lower lottery game prizes paid to Arkansas players which, in turn, will reduce ticket sales. Reduced ticket sales will have the obvious effect of reducing scholarship revenue. When ticket sales shrink, retailer commissions paid to over 1,850 businesses across Arkansas will go down, cutting into their profits.
The Arkansas Lottery now responsibly operates at 13 positions below its allotted positions under statute. The agency has reduced its salaries paid out by more than $600,000 in the past 18 months, placing heavier workloads on staff members. To attain the mandate of HB2263, the agency will face new and deeper cuts in already reduced operational costs, including staffing.
Finally, this mandate will likely result in future lottery vendors demanding higher contract rates, further diminishing the amount of money the lottery will raise for scholarships for Arkansas students.
Arkansans don't have to speculate about what will happen if HB2263 is enacted. They need only look at the low per capita sales of the Louisiana and Oklahoma lotteries, where percentages are in place, and at the dismal sales of the Texas lottery following the enactment of similar legislation in Texas in 1997. That year, the Texas legislature imposed a prize payout limitation, and Texas lottery revenues slumped from $2.3 Billion to $1.4 Billion in two years. Upon convening in 1999, the Texas legislature reversed the legislation, but it took five years for the Texas lottery to return to its previous production levels. In those seven years, the Texas lottery's sales fell a cumulative $3.54 billion dollars, cutting Texas lottery profits for the state by almost $1.1 Billion dollars.
HB2263 would undoubtedly have a negative effect on the Arkansas Scholarship Lottery advertising budget. States with similar mandates have been forced to slash advertising dollars paid to statewide and local newspapers and television and radio stations.
Most important are the Arkansas students and their families who have relied on Lottery Scholarship funds for over three years and will continue to do so. If enacted, HB2263 will reduce by millions of dollars the scholarship funds for those students and families. Those scholarships in many cases make the difference between a student being able to attend college, or not, due to insufficient funds. For the sake of Arkansas students and families, and the thousands of businesses across Arkansas which profit when the Scholarship Lottery profits, the Lottery Commission will actively oppose HB2263.
The Director is right, lottery players are smart enough to know when playing is just not worth the cost.
So true
I am holding my breath here. Politicians responded favorably to the constructive feedback in Kentucky, set aside their agendas and made the right decision in the best interest of all.
Can they do it again?
Yeah, Maine came to their senses with their goofy scratch off name., just every now and then, someone wakes up.
That's right. I forgot about that one. I think we were in the middle of Lent and I was restricting my self to pure thoughts - lol.
Well, a third time can establish a positive trend of sensible decisions.
Let's hope so, Arkansas has been through enough
You can always count on government bureaucrats to do the opposite of what needs to be done. They see the same statistics we see but still they want to carry out their own counter-productive, feel-good, it's-the-thought-that-counts, we-meant-well plans that have been proven not to work everywhere they've been tried.
It reminds me of the way they panic and want to outlaw guns and create gun-free-zones everywhere when some nut goes on a rampage. Statistics show that where guns are plentiful there is dramatically less crime but they don't care. They want to do the feel-good thing and create even MORE gun-free-zones, which are the places nuts prefer to go to kill people because they know nobody can shoot back.
So Arkansas will do the counter-productive feel-good thing and then when everything they wanted to improve gets worse they'll say: "Sorry, but we meant well" and then they'll hop on a charter for a government employees workshop in Vegas.
Friday afternoon, HB 2263 will be presented to the House Rules committee at the Capitol. HB2263 mandates that 25% of total lottery proceeds be used to fund college scholarships.
25 percent?????should be 75 percent or better.They have no problem using the "schools" as a fulcrum to get the lottery through to begin with.
Yep
Arkansas you can always come back to Oklahoma lol
Believe it or not a Kentucky State Representative projected that after adding a 6% lottery ticket sales tax, the lottery could still increase their ticket sales by $90 million by just adding new games. It was rumored that several of the other committee members were heard saying "I'll have whatever he is drinking".
State lotteries are cash cows and how state legislators with no gaming knowledge believe they can cut the prizes and still increase profits is beyond me. A 30% profit margin after all expenses is huge (Massachusetts is at 17%), but these elected officials believe the Arkansas lottery can maintain a 25% profit margin without effecting ticket sales. Amazing.
Don't mess with the Dollar. Don't mess with the Dream.
And a comment about bigger work loads for staff. The trouble is many people can use a bigger work load. If you
have time to talk on your cell phone, send personal emails, talk at the water cooler, gossip about fellow workers
then you need a bigger work load. People get used to easy, cushy, comfortable jobs where they have at least
'some fun'. Some slugs do not want to do their share and will be the first to complain about additional duties.
I certainly do not feel sorry for anyone that fits that reason they're using as an excuse not to allow passing.
Let them take greed out of the equation and maybe something wonderful can be done. When you deal in
big bucks and profits, it's easy to whine there won't be enough money if some of the funds are redirected
or applied elsewhere. Let them start being accountable and honest. Those 2 words together are probably
impossible to mix.
I think it's more about their pay cut then keeping players happy.
I don't know a ton about the Arkansas lottery & how it's promoted, but if it's being sold in it's adverts as a way to fund scholarhips for needy students, then they've opened themselves up to political intervention. However, if it's being sold as "we voluntarily contribute money to help needy students", then they may have a way to counter the mandate. Otherwise, the politicos could argue that the lottery is not meeting it's expectatiions & they have the right to mandate changes...