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story.lead_photo.caption State Lottery Director Bishop Woosley is shown in this file photo.

A bump up in the Arkansas Scholarship Lottery's scratch-off ticket revenue in April boosted lottery collections for the month to a record total of $42 million, exceeding the previous record of $39.4 million in 2012.

The lottery raised $7.1 million for college scholarships last month, but that lagged the totals of net proceeds for scholarships from six of its previous eight Aprils.

The amount raised for college scholarships dropped last month compared with the net proceeds of $7.8 million in April 2017 largely because of "prize expense and how large prizes can impact our bottom line," lottery Director Bishop Woosley said Thursday.

"We had a few larger prizes in the beginning of the month that had a significant impact."

Scratch-off ticket revenue increased in April to $36 million from $33 million in the same month a year ago, while draw-game revenue inched up to $5.9 million from $5.5 million a year ago, the lottery stated in its monthly report to Gov. Asa Hutchinson and the Legislative Council's lottery oversight subcommittee. Draw games include the Powerball, Mega Millions, Natural State Jackpot, Cash 3, Cash 4, Lucky for Life and Fast Play games.

The lottery reported it had 1,930 retailers on April 30 -- up from 1,927 a year ago. The other revenue includes retailer fees that totaled $57,181 last month.

Woosley said last month's increased scratch-off ticket revenue is consistent with the trend in the current fiscal year, and "the upward trend can be attributed to having quality games that are available in market, the advertising awareness and promotion given to our games, and the solid execution and attention to lottery at our retailer outlets."

Along with $20 million a year in state general revenue, the lottery's net proceeds help fund the Arkansas Academic Challenge Scholarships for college students. More than 30,000 students have received the scholarships during each of the past eight fiscal years.

The Legislature has sliced the size of the initial scholarships three times because net proceeds lagged initial projections, and more students than initially forecast started getting scholarships. But the rebound of the lottery led the 2017 Legislature to create a new college assistance program funded with excess lottery proceeds. The new program, the Arkansas Workforce Challenge Scholarship, will begin handing out scholarships this fall.

During the first 10 months of fiscal 2018, lottery revenue totaled $422.3 million, and that's the largest amount of revenue during the same period in any fiscal year, eclipsing the previous record of $402.7 million in fiscal 2012.

Since Aug. 1, retailers have the option under state law to accept debit cards for purchases of lottery tickets.

But it's unclear how much of the increased revenue in the current fiscal year, which started July 1, is a direct result of sales based on debit-card payments.

"We will likely never have actual hard data to show us exact amounts because our system does not track those transactions," Woosley said. "That said, I think debit-card sales have had a positive impact on sales and proceeds this year."

So far in fiscal 2018, the lottery has raised $70.5 million for college scholarships, and that's the largest amount for the first 10 months in a fiscal year since fiscal 2013, when the net proceeds totaled $71.4 million at this point.

The lottery reported $6.6 million in its unclaimed prize reserve fund as of April 30, after having $93,449 in unclaimed prizes last month. Under state law, the lottery transfers the balance of the unclaimed-prize reserve fund, minus $1 million, to college scholarships at the end of the fiscal year.

Last month, Woosley told the oversight committee that the lottery could raise $90 million for scholarships in fiscal 2018, which would be the third-largest amount raised.

"We're still on target to finish the year in that range," he said Thursday. "Obviously, circumstances can change, but if trends stay the same, we should come close."

A year ago, Woosley projected that the lottery would raise $459.5 million overall and $83.6 million for scholarships in fiscal 2018.

So far in fiscal 2018, the state Department of Higher Education has distributed $91.6 million in Arkansas Academic Challenge Scholarships to 34,940 students, said department spokesman Alisha Lewis.

In fiscal 2017, the department handed out $86.2 million for these scholarships, a drop from $96.5 million in fiscal 2016. For fiscal 2017, the eligibility standards were changed, and the scholarship size for first-year students was cut by the 2015 Legislature. The largest total monetary value of scholarships handed out in one year was $132.9 million distributed in fiscal 2013, the department has reported.

The deadline to submit applications for the Arkansas Academic Challenge Scholarship program is June 15, Lewis said.

The Arkansas Workforce Challenge Scholarships of up to $800 a year are for students enrolled in programs that lead to qualification for jobs in high-demand occupations.

There is no set deadline to submit applications for these new scholarships in the coming school year, "but we ask for students to apply 30 days prior to enrollment," Lewis said Thursday. "The application will be ready in a few days.

"We projected to spend $1 million on Workforce Challenge, but have more in reserves if necessary," she said.

Lottery revenue and net proceeds for college scholarships peaked at $473.6 million and $97.5 million, respectively, in fiscal 2012 before dropping in the next three fiscal years.

Total revenue and net proceeds rebounded to $456.3 million and $85.3 million, respectively, in fiscal 2016, with the help of a $1.6 billion Powerball jackpot in January 2016. The next fiscal year, total revenue slipped slightly to $449.9 million and net proceeds totaled $85.2 million.

For fiscal 2019, Woosley projects revenue at $482.9 million. He also projects that the lottery will raise $85.9 million for scholarships in fiscal 2019.

His proposed budget shows a $1 million increase in the advertising, marketing and promotions budget to $7.5 million in fiscal 2019. That budget plan reflects consultant Camelot Global's business plan for the lottery.

Woosley is forecasting $398.6 million in scratch-off ticket revenue in fiscal 2019 -- up from his initial projection of $337.1 million for fiscal 2018 -- and that increase is "in line with FY2018 actual sales," according to his report to the governor and oversight subcommittee. He also is projecting $84 million in draw-game ticket revenue in fiscal 2019 -- up from his initial forecast of $82 million for fiscal 2018 -- "due to revision of Mega Millions game," he reported.

A graph showing lottery revenue in April.
A graph showing lottery revenue in fiscal 2018.

A Section on 05/11/2018

Print Headline: Lottery reaches a record for April; $42M collected; net proceeds lag

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