The Arkansas Scholarship Lottery sold more scratch-off tickets but fewer draw-game tickets, such as Powerball and Mega Millions, during the first six months of fiscal 2015 compared with the same period in the previous fiscal year.
The drop-off in draw-game ticket sales is exceeding the gain in scratch-off tickets, leading to a decline in lottery revenue and net proceeds raised for college scholarships.
Lottery spokesman Patrick Ralston said the "major drag" on Arkansas' lottery ticket revenue continues to be a nationwide decline of 40 percent in Powerball ticket sales and 25 percent in Mega Millions ticket sales.
The Powerball and Mega Millions jackpot games are the most profitable games for lotteries, he said.
The state lottery's ticket sales and the amounts raised for college scholarships have declined each of the past two fiscal years.
The lottery has helped finance Arkansas Academic Challenge Scholarships for more than 30,000 students a year in each of the past five fiscal years. During recent years, the Legislature has twice cut the size of the scholarships for future recipients partly because of lottery proceeds falling short of initial projections.
These latest figures on the lottery's performance come as the Legislature considers the possibility of abolishing the nine-member Lottery Commission and instead having the governor appoint the lottery director and creating an Arkansas Lottery Division in the state Department of Finance and Administration.
During the first six months of fiscal 2015, overall lottery revenue fell by $8.2 million from the same period in fiscal 2014 to $191.2 million, the lottery indicated in its reports to the Legislature's lottery oversight committee.
During this six-month period ending Dec. 31, the amount raised for college scholarships by the lottery slipped by $4.1 million from same period in fiscal 2014, to $32.5 million, the reports show.
Lottery Director Bishop Woosley, who has been the lottery's director since February 2012, projected in August that lottery revenue would be $416.8 million, with net proceeds for college scholarships at $78.2 million.
Woosley is projecting that fiscal 2015 scholarship proceeds will be the lowest of any year since the lottery started selling tickets Sept. 28, 2009.
As for whether Woosley intends to reduce his forecast for lottery revenue and net proceeds for scholarships for fiscal 2015, Ralston replied that "we are entering a period when sales usually rise.
"That coupled with the current Powerball and Mega Millions run (with jackpots of $194 million and $270 million, respectively) may help us make up ground over the next few weeks," Ralston said Friday.
"We want to gauge the size of that sales bump in a few weeks before we contemplate changes," he explained.
During the first six months of fiscal 2015, the lottery's scratch-off ticket sales increased by $5.6 million over the same period in fiscal 2014 to $157.2 million, the lottery reported.
During the first six months of fiscal 2015, the lottery's draw-game ticket sales fell by $13.8 million from the same period in fiscal 2014 to $33.7 million.
At the request of Sen. Jimmy Hickey, R-Texarkana, the Senate last week amended Hickey's Senate Bill 7 that would abolish the nine-member Arkansas Lottery Commission that hires and supervises the lottery's director, so the lottery would be moved into the Department of Finance and Administration rather than the state Department of Higher Education as he originally proposed.
The governor would appoint the director for the Arkansas Lottery Division under the bill.
Gov. Asa Hutchinson said in July that he favors making the lottery a state agency accountable to the governor's office. Earlier this month, Hutchinson said it would be better for the lottery to be placed in the finance department instead of the Higher Education Department.
Hickey, a critic of the lottery, said he'll probably ask the Senate State Agencies and Governmental Affairs Committee to approve SB7 within the next few weeks.
Last week, Senate President Pro Tempore Jonathan Dismang, R-Searcy, appointed Hickey as the Senate's chairman of the Legislature's lottery oversight committee, while House Speaker Jeremy Gillam, R-Judsonia, appointed state Rep. Chris Richey, D-Helena-West Helena, as the House's chairman of the committee.
Asked about SB7, Gillam said he has asked questions about the logistics of moving the lottery into the finance department and whether it would make the lottery more efficient.
"I am still not really up to speed on it to start making determinations and trying to lead the discussion on that yet," Gillam said.
He said he'll visit with the House's six members of the lottery oversight committee that he appointed last week for their input during the next few weeks.
In addition to Richey, they are Reps. Joe Farrer, R-Austin; Joe Jett, D-Success; John Vines, D-Hot Springs; Matthew Shepherd, R-El Dorado; and Robin Lundstrum, R-Springdale.
The Senate's other members of the lottery oversight committee appointed by Dismang last week are: Sens. Ron Caldwell, R-Wynne; John Cooper, R-Jonesboro; Stephanie Flowers, D-Pine Bluff; Missy Irvin, R-Mountain View; and Bobby Pierce, D-Sheridan.
Several weeks ago, a consultant hired by the Legislative Council at Hickey's request said the Arkansas Scholarship Lottery has too many scratch-off and draw games, lags behind its peers in per capita sales and profits, pays more than its peers do to its vendors, and isn't perceived to be trusted by the public.
The lottery should shift "from a gambling organization to a consumer goods sales and marketing organization," Camelot Global Services Inc. said, and recommended that the governor appoint a majority of the nine-member Lottery Commission.
Woosley has told lawmakers that the Lottery Commission has either discussed or authorized the implementation of many of the consultant's recommendations.
Woosley said commissioners would discuss the consultant's report during their meeting scheduled for Wednesday in Little Rock.
Metro on 01/18/2015