Originally created 08/05/99

Big jackpots boost lottery



The news coming out of the Georgia Lottery last month would have been a shocker in most other states.

Sales had jumped nearly $300 million in just-completed fiscal year 1999, making Georgia's lottery the first ever to increase the take in each of its first six years and providing the state with about $100 million more for education than officials had planned.

Just like the booming U.S. economy, the feeling has been that Georgia's lottery gold mine has to play out sometime soon. But the end isn't yet in sight.

Sales were up on last year's record pace during July, the first month of fiscal 2000, Georgia Lottery President Rebecca Paul said.

And ticket sales have soared for instant-win games, not the kind of plays that experts say attract lots of folks from Alabama and South Carolina, two border states considering starting their own lotteries.

"People drive across the border to play jackpot games. People don't necessarily drive across the border to buy instant tickets," said David Gale, executive director of the Cleveland-based North American Association of State and Provisional Lotteries.

Some South Carolinians who buy their lottery tickets in Augusta said Wednesday that Georgia would lose their business if their state had its own lottery for them to support.

"I'm hoping that one day we get something like that," said Willie Mae Samuels of Aiken, who purchases Georgia lottery tickets at least four times weekly. "We spend a lot of money in Georgia. We are bringing all of our money to Georgia."

Georgia Lottery watchers are predicting some type of slowing in sales if border states approve their own games next year.

In the meantime, the money continues to roll in for Georgia.

Sales for the eight main categories of games jumped from $1.736 billion in fiscal 1998 to $2.034 billion in fiscal 1999, which ended June 30.

Sales of instant-win tickets and Cash 3, the two most popular games, grew 30.5 percent and 7 percent.

Instant-game sales, which climbed from $609.8 million to $796.2 million, took off after Georgia Lottery officials rectified a problem that occurred during the first quarter of fiscal 1998.

Sales slowed because prize payouts were cut. Lottery officials raised the pot of money available to be paid out for prizes, and ticket sales rose.

"Instant ticket sales rebounded pretty quickly," Mrs. Paul said.

The Big Game, which produced a $116 million jackpot Tuesday won by a Tennessee man who bought his ticket in Rossville, Ga., was initially slow to catch on in Georgia. But big jackpots in the past year caused a sales spurt in The Big Game from $110 million to $199 million.

Having never reaped any cash rewards, Freddie Moore of Augusta said he quit playing the Georgia lottery because he couldn't afford to "just give away money anymore.

"I was putting money in and not getting any money out," said Mr. Moore, an iron worker. "Ever since they got this thing started, when someone hits, it seems like it's always someone from out of town. It's a good cause for the schools and everything, but I give up."

Martha Dunbar says her 11-year-old daughter spends her allowance on Lucky 7 scratch-offs.

"She does her little chores and gets her little allowance and says, `Buy me some scratch-offs,"' said Ms. Dunbar, a downtown Augusta bank employee who picks up the lottery tickets at Broad Street Amoco. "It's just the thrill to look behind something and see if you have won."

Multi-state lotteries like The Big Game have been increasingly popular nationally because, with such high odds and so many people playing, jackpots grow huge rapidly, Mr. Gale said. That, in turn, attracts more sales from players somewhat jaded by ever-larger prizes.

"Combining efforts has been a very positive move for each of our lotteries," said Virginia Lottery Director Penelope Kyle.

Still, Mr. Gale called Georgia's performance "very unusual."

"Traditionally, what happens is the third or fourth year (of a lottery), sales start to decline," he said. "That's a typical sales trend in our industry and in the entertainment industry. The novelty wears off."

Mrs. Paul and her staff have done a good job of using the past failings of other lotteries to help maintain the sales uptick, Mr. Gale said.

For instance, Georgia officials keep the lottery fresh by putting out 52 new quick-win games a year.

Supporters also point to where a good chunk of the money goes: HOPE college scholarships and pre-kindergarten classes. Those are two popular programs that reach thousands of Georgians -- rich, poor and middle class -- each year.

"It's hard to find anyone in Georgia who isn't personally impacted by lottery dollars," Mrs. Paul said. "People feel very personally about the lottery."

Voters last fall overwhelmingly approved a constitutional amendment assuring that HOPE scholarships and the pre-kindergarten programs would be fully funded before lottery proceeds are spent on anything else.

But now Gov. Roy Barnes and lawmakers may have to come up with some new ideas. The state's lottery reserve fund -- padded by six years of growth -- stood at $272 million July 1, more than enough to pay for a year's worth of HOPE scholarships.

Mr. Barnes and lawmakers budgeted $543 million this year for HOPE, pre-kindergarten and other lottery-funded school programs. The state -- which gets about 35 percent of lottery revenues -- received $641 million in proceeds for the year that ended June 30.

Joselyn Butler, the governor's spokeswoman, would only say that Mr. Barnes will make recommendations about how the excess money should be spent.

Mrs. Paul said the lottery was $24 million ahead of fiscal 1999's record pace last month. And that was before The Big Game windfall of the past few days.

Staff Writer Clarissa J. Walker contributed to this article.

James Salzer is based in Atlanta and can be reached at (404) 589-8424 or mnews@mindspring.com.