Halfway through the current fiscal year, the Arkansas Scholarship Lottery's revenue is up slightly over the same period in fiscal 2021, while the amount raised for college scholarships is virtually flat.
The lottery's performance so far in fiscal 2022, which started July 1, is better than what lottery Director Eric Hagler projected last summer.
Hagler predicted declines in both total revenue and the amount raised for college scholarships compared with the records set last fiscal year.
During the first six months of fiscal 2022, the lottery's revenue has totaled $290 million -- up from $283 million in the same period in fiscal 2021 -- according to the lottery's monthly report dated Monday to Gov. Asa Hutchinson and the Legislative Council's lottery oversight subcommittee.
"We believe there has been a significant pandemic halo effect around level of play, including both new players and existing players," Hagler said Tuesday about the rise in figures.
"Interestingly, almost all of our growth has come from draw games, with our [scratch-off ticket] sales performing flat," he said in a written statement. "Sizable jackpots in primarily Powerball and Mega Millions are always strong drivers."
Scratch-off ticket revenue of $238.7 million so far in fiscal 2022 has lagged the $240.3 million taken in during in same period a year ago.
However, draw-game ticket revenue of $50.9 million thus far in fiscal 2022 has outdistanced the $42.3 million received in the same period in fiscal 2021.
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Draw games include Powerball, Mega Millions, Fast Play, Natural State Jackpot, Lucky for Life, Cash 3 and Cash 4.
During the first six months of fiscal 2022, the amount raised for college scholarships is $46.8 million, about $90,000 less than what was raised in the same period a year ago.
"Net proceeds are essentially performing in-line with last year," Hagler said.
At the end of each fiscal year, the lottery transfers the balance of the unclaimed prize reserve fund, minus $1 million, to scholarships. On Dec. 31, the unclaimed prizes reserve fund totaled $4.7 million, after receiving $1.06 million in unclaimed prizes in December.
FISCAL 2022 FORECAST
For fiscal 2022, Hagler had projected total revenue of $509.2 million -- which would be a drop from the record of $632.5 million in fiscal 2021 -- and the amount to be raised for college scholarships at $88.6 million, a decline from $106.6 million a year ago.
Lottery officials attributed the records set in fiscal 2021 in part to factors brought on by the covid-19 pandemic, such as people spending more time at home.
"Some of the factors that helped to stimulate sales in [fiscal] 2021 likely will not be present in [fiscal 2022]," lottery gaming director Mike Smith said in July. "We feel sales will normalize in [fiscal 2022], but remain competitive."
At that time, Hagler said he believes that the usual sales pattern will occur as businesses reopen, along with other forms of entertainment.
"Currently, with six months of the fiscal year booked, our gross sales are $49 million ahead of budget with net proceeds exceeding budget by $8.7 million," Hagler said Tuesday.
"It should be noted, however, that we are currently lapping several significantly robust sales months from [fiscal] 21."
Revenue in December increased from $50.3 million a year ago to $52 million, according to the lottery's report Monday.
Scratch-off revenue last month increased from $41.6 million a year ago to $42.5 million, while draw-game ticket revenue increased from $8.6 million a year ago to $9.4 million.
In December, Powerball ticket revenue increased from $2.6 million a year ago to $3.6 million and Fast Play ticket revenue increased from $1.6 million a year go to $1.9 million.
Mega Millions ticket revenue declined from $2 million a year ago to $1.4 million, according to the lottery.
The amount raised for college scholarships in December totaled $7.4 million, compared with $5.9 million a year ago.
Hagler said the majority of the increase in the amount raised for college scholarships compared with a year ago is the result of an intra-year accounting adjustment.
SCHOLARSHIPS
The Arkansas Academic Challenge scholarships are financed with lottery proceeds plus $20 million a year in state general revenue.
So far in fiscal 2022, the division has awarded those scholarships to 27,876 students and disbursed $39.9 million, said Nick Fuller, an assistant director of finance at the Department of Education.
The state Division of Higher Education forecast that it will hand out $90 million in these scholarships to 31,000 students in fiscal 2022, after awarding about $86 million a year ago.
The amount handed out for Academic Challenge Scholarships peaked at $132.9 million in fiscal 2013, going to 33,353 students.
Scholarship totals have dropped largely because the Legislature has cut the amount of the initial awards several times.
The 2017 Legislature created the Workforce Challenge Scholarship to use excess proceeds to provide up to $800 a year for students enrolled in programs that lead to qualifications in high-demand occupations. So far in fiscal 2022, the division has awarded those scholarships to 1,448 students and disbursed $243,339, Fuller said.
Division officials said they expect to distribute $450,000 for these scholarships in fiscal 2022, compared to $487,865 a year ago.
The 2019 Legislature created the Concurrent Challenge program. High school juniors and seniors are eligible to receive the scholarships for a semester or an academic year in which they are enrolled in an endorsed concurrent course or certain programs. For the Concurrent Challenge Program, the division has awarded scholarships to 5,383 students and disbursed $$1.1 million so far in fiscal 2022. For fiscal 2022, the division projects distributing $2.7 million in these scholarships to 13,000 students, compared with $2.4 million to 14,091 students a year ago.