Arkansas Lottery revenue rises $4.2 million for September

An Arkansas Scholarship Lottery touch-screen machine is shown inside an Arkansas Walmart in this March 10, 2020 file photo. (Arkansas Democrat-Gazette/Michael R. Wickline)
An Arkansas Scholarship Lottery touch-screen machine is shown inside an Arkansas Walmart in this March 10, 2020 file photo. (Arkansas Democrat-Gazette/Michael R. Wickline)

Bolstered by a boost in Powerball ticket sales with a jackpot that reached nearly $1 billion by the end of September, the Arkansas Scholarship Lottery’s revenue for September increased by $4.2 million over the same month a year ago to $47.2 million.

With the help of the increased Powerball sales, the amount raised by the lottery for college scholarships in September increased by $2.2 million over a year ago to $10.1 million.

In October, the Powerball jackpot ballooned to an estimated $1.73 billion — the second-largest Powerball jackpot ever — prior to Wednesday night’s drawing.

The lottery has been selling tickets since Sept. 28, 2009, and has helped finance Arkansas Challenge Scholarships for more than 30,000 college students during 11 of the past 13 fiscal years.

The lottery’s scratch-off ticket revenue increased from $35.8 million in September 2022 to $36.3 million last month, while the lottery’s draw game revenues increased from $7.2 million in September 2022 to $10.8 million last month, the lottery reported this week in its monthly report to Gov. Sarah Huckabee Sanders and the Legislative Council’s lottery oversight subcommittee.

The lottery’s Powerball ticket revenues increased from $1.8 million in September 2022 to $4.2 million last month, while Mega Million ticket revenues remained virtually flat at about $1.4 million in September 2022 and last month, according to the lottery’s reports. The lottery’s other draw games include Fast Play, Cash 3, Cash 4, Natural State Jackpot, Lucky for Life and LOTTO.

Lottery Director Eric Hagler said Wednesday the lottery’s primary driver for ticket sales in September was scratch-off ticket sales, and “the ‘kicker’ for the month came from the draw game category with the sales of the Powerball game totaling over $4.2 million.” The Powerball jackpot totaled $969 million around Sept. 30, he said.

According to the Power-ball website, the estimated Powerball jackpot totaled $1.73 billion for Wednesday night’s drawing. That is the second-largest Powerball jackpot and U.S. lottery jackpot, trailing only the world record $2.04 billion Power-ball jackpot won in California on Nov. 7, 2022, according to Powerball.

In September, Hagler said in a written statement that the Arkansas Scholarship Lottery “saw tremendous sell-through of [the lottery’s scratch-off ticket] portfolio that was supported in market by a very strong new game launch.” Regarding lottery’s increased draw-game ticket sales in September, the lottery’s sales of the Powerball and Mega Millions tickets “were the catalyst for noteworthy performance, while the Natural State Jackpot weighed in for the month at just over $1 million,” he said.

The lottery raised $10.1 million for college scholarships in September — up from $7.9 million a year ago.

Hagler said the lottery’s net proceeds for college scholarships in September “benefited from sales through the draw game category, which produces greater margin spread” than scratch-off ticket sales.

“When multi-state game jackpots are rolling high, enhanced net proceeds will follow,” he said.

Hagler said the lottery was a beneficiary of the rising tide, but most importantly it serves to increase the amount available for scholarships for Arkansas students. “Also, the monthly accounting adjustment swung to the positive for September.”

FISCAL 2024 DETAILS

September is the third month of fiscal year 2024, which started July 1 and ends June 30, 2024.

During the f irst three months of fiscal year 2024, the lottery’s revenue totaled $156.7 million — up from $144.6 million in the same period in fiscal 2023, according to the lottery’s reports.

So far in fiscal 2024, the lottery’s scratch-off ticket sales have reached $115.5 million, compared with $112.8 million in the same period in fiscal 2023, and the lottery’s draw-game sales have totaled $41 million, compared with $31.6 million in fiscal 2023.

During the f irst three months of fiscal year 2024, the lottery has raised $30.3 million for college scholarships, compared with $26.4 million in the same period in fiscal 2023.

At the end of the fiscal year, the lottery transfers its unclaimed prize reserve balance minus $1 million to college scholarships under state law.

The lottery’s unclaimed prize reserve balance totaled $4.5 million at the end of September after getting $106,942 in unclaimed prize money in September, according to the lottery In fiscal 2023 that ended June 30, the lottery raised $114.7 million for college scholarships, the largest amount the lottery has produced for college scholarships in any fiscal year. The lottery’s previous high was $106.6 million raised in fiscal 2021 that ended June 30, 2021.

The lottery’s revenue in fiscal 2023 totaled $608.2 million and lagged the $632.5 million collected in fiscal 2021. In fiscal 2021, lottery officials attributed the lottery’s performance in part to factors brought on by the covid-19 pandemic, such as people spending more time at home.

Hagler attributed the record amount of money raised for college scholarships in fiscal 2023 to collecting more draw-game ticket revenue in fiscal 2023.

In fiscal 2024, the lottery has projected total revenue of $567.9 million and raising $100.7 million for college scholarships.

SCHOLARSHIPS

So far in fiscal 2024, the state Division of Higher Education has disbursed $23 million in Arkansas Academic Challenge Scholarships, said Department of Education spokesperson Kim Mundell. She said 27,560 students have been awarded Academic Challenge Scholarships.

In fiscal 2023, the Division of Higher Education disbursed Arkansas Academic Challenge Scholarships totaling $74.3 million to 26,109 students. For fiscal 2024, the Division of Higher Education projects it will award 27,000 students Academic Challenge Scholarships totaling $75 million.

Fiscal 2023 is the second consecutive fiscal year in the past 13 fiscal years that Arkansas Academic Challenge Scholarships were awarded to fewer than 30,000 students. Last year, Nick Fuller, assistant director of finance at the division, said fewer than 30,000 students were awarded the scholarships in fiscal 2022 because of the continued trend of overall enrollment decline in higher education and the total number of high school students continuing to get smaller, leading to a smaller pool from which scholarships are awarded.

The amount handed out for the Academic Challenge Scholarships peaked at $132.9 million in fiscal 2013, with awards going to 33,353 students. Scholarship totals have dropped largely because the Legislature cut the amount of initial scholarships several times.

The Arkansas Academic Challenge scholarships are financed with lottery proceeds, plus $20 million a year in state general revenue.

The 2017 Legislature created the Workforce Challenge Scholarship to use excess proceeds to provide up to $800 per year for students enrolled in programs that lead to qualifications in high-demand occupations.

So far in 2024, the division has disbursed $362,182 in Workforce Challenge Scholarships, Mundell said. She said 854 students have been awarded Workforce Challenge Scholarships.

In fiscal 2023, the Division of Higher Education disbursed Workforce Challenge Scholarships totaling $521,277 to 701 students. For fiscal 2024, the division projects awarding Workforce Challenge Scholarships totaling $750,000 to 2,000 students.

The 2019 Legislature created the Concurrent Challenge program that allows high school juniors and seniors to receive scholarships for a semester or an academic year in which they are enrolled in an endorsed concurrent course or certain programs.

So far in fiscal 2024, the division has disbursed $875,185 in Concurrent Challenge Scholarships, Mundell said. She said that 1,844 have been awarded Concurrent Challenge scholarships.

In fiscal 2023, the division disbursed Concurrent Challenge Scholarships totaling $2.6 million to 13,982 students. In fiscal 2024, the division is projecting distributing Concurrent Challenge Scholarships totaling $3 million to 17,000 students.

The Challenge Plus Scholarship will first be awarded to students who qualify in the 2024-2025 academic year, according to Mundell.

Act 386 of 2023 created the Arkansas Challenge Plus Scholarship program to provide additional funds for students based on their financial need.

Under Act 386, a student will be eligible for the new program for an academic semester or academic year if the student applies for and maintains eligibility for a scholarship under the Arkansas Academic Challenge Scholarship program and demonstrates financial need as determined by the Free Application for Federal Student Aid, known as FAFSA.

The scholarship will be awarded in increments of $1,000 for each eligible student in each academic year with a maximum of $4,000 for each eligible student in each academic year, as determined by the Division of Higher Education under Act

386. The scholarship amounts may vary each year depending on the amount of funding available under the law.

The sum of an Arkansas Challenge Plus Scholarship and Arkansas Academic Challenge Scholarship won’t exceed $5,000 in total for each eligible student in an academic year under Act 386.

Under Act 1105 of 2015, the scholarship size for Arkansas Academic Challenge Scholarship recipients is $1,000 for the freshman year at two- and four-year colleges. The scholarship size is $3,000 for recipients for the sophomore year at a two-year college, $4,000 for the sophomore and junior years at four-year colleges, and $5,000 for the senior year at four-year colleges.

The Challenge Plus Scholarship is projected by the state to cost about $13.5 million a year, according to an estimate from the Division of Higher Education.

  photo  Lottery revenue in September
 
 


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