The Arkansas Scholarship Lottery in October experienced its strongest ticket sales, at $35.2 million, for that month since 2011.
September sales of $38.1 million also were the strongest for any September since 2011.
Lower gas prices and scratch-off ticket sales are behind the increases, the lottery director said.
The lottery reported the $35.2 million in revenue and a yield of $6.02 million for college scholarships last month.
That's $2.3 million more in revenue and about $80,000 more in net proceeds raised for college scholarships than it reported in October 2014.
In October 2011, the lottery reported revenue of $37.7 million and $8.1 million raised for scholarships. It started selling tickets on Sept. 28, 2009.
After peaking in fiscal 2012, the lottery's revenue and net proceeds for scholarships have dipped each of the past three fiscal years. The Legislature has cut the size of the scholarships for some future recipients three times, after proceeds fell short of initial projections.
The Legislative Council on Oct. 16 authorized Gov. Asa Hutchinson's administration to contract with lottery consultant Camelot Global Services to develop a business plan for the lottery and help implement it. Earlier this year, Hutchinson and the Legislature enacted legislation to put the lottery under the control of the state Department of Finance and Administration and eliminate the nine-member Lottery Commission.
In October, scratch-off sales increased by $3.1 million over the same month a year ago to $29.7 million, while draw-game sales dipped by about $930,000 to $5.4 million, the lottery reported in its monthly report to Hutchinson and the Legislature's lottery oversight committee. The lottery also took in about $100,000 in fees from retailers.
"In addition to low gas prices, the strategies that we put into place over the last year and a half for our products, advertising and marketing and retail execution continue to help grow sales in the [scratch-off ticket] category," lottery Director Bishop Woosley said Tuesday in a written statement.
Scratch-off sales have increased during 13 of the past 16 months, he said, and the number of stores selling lottery tickets has increased by 23 to 1,905 from a year ago.
Draw-game ticket sales dropped last month primarily because the Powerball and Mega Millions jackpots "were relatively low throughout the month," Woosley said. "It typically takes those multistate jackpots getting to $100 [million]-$150 million before we see a spike in sales."
During the first four months of fiscal 2016, lottery revenue has increased by $8.1 million over the same period in fiscal 2015 to $134.3 million, the lottery reported. Net proceeds increased by $2.4 million over the same four-month period in fiscal 2015 to $23.9 million.
Woosley is projecting that revenue will be $411 million and net proceeds for scholarships will be $79.5 million in fiscal 2016 -- up from revenue of $409.2 million and net proceeds of $72.4 million in fiscal 2015. Fiscal 2016 began July 1.
The lottery revenue and net proceeds peaked at $473 million and $97.5 million, respectively, in fiscal 2012.
Asked whether the lottery is on pace to reach its projections for fiscal 2016, Woosley said it is about $370,000 ahead of its budget for scholarship proceeds for fiscal 2016.
"Whether we will reach projections depends on several factors," said Woosley, who has been lottery director since February 2012.
"That said, I am encouraged that we are ahead of budget and way ahead of where we were last year with very little sales boost from the multistate games this fiscal year. Hopefully, the low gas prices and our [scratch-off] ticket sales trends will continue and the changes made to Powerball will create higher jackpots and more ticket sales for scholarships," he said in his written statement.
A London-based spokesman for Camelot said Wednesday that the lottery's proposed contract with the firm likely will become effective the first Monday after Thanksgiving. That would be Nov. 30.
"The business plan will be completed within 14 weeks," Camelot spokesman Laura Pearson said in an email to this newspaper.
Fifteen employees for Camelot Global Services in Arkansas "will work on the business plan directly, with supporting staff from the Camelot Global network (+800 people) and third party consultants and agencies for research," she said. Camelot has offices in Philadelphia and London.
Under the proposed contract with Camelot Global Services, the consulting firm would receive base compensation and expense reimbursements up to $750,000 a year, but it also would be eligible for incentive compensation of at least 12.5 percent of adjusted operating income above $72.28 million in any fiscal year.
Camelot wouldn't receive incentive pay if the business plan is rejected by lottery officials, according to an amendment to the proposed contract. "If the plan is rejected, we'll be obligated to pay restitution for any services provided by Camelot, with a maximum amount of $200,000," Woosley said.
In addition to drafting a business plan, the proposed contract calls for Camelot to help the lottery renegotiate contracts with vendors; the savings would be used to help pay for Camelot's services. The proposed contract will run through June 30, 2020, with options for two one-year extensions.
"I feel like it is time for some fresh eyes [to review the lottery], and this is what we developed in order to provide additional money to the lottery scholarship," finance department Director Larry Walther told lawmakers last month.
The lottery reported it had 63 employees as Oct. 31 -- 13 fewer than it reported a year ago on the same day.
Through the first four months of fiscal 2016, employee compensation and benefits totaled $1.557 million, a $311,000 decline from the same period in fiscal 2015, according to lottery reports. Woosley is paid $165,000 a year as director.
Metro on 11/12/2015