States hope to boost revenue with Mega Millions craze
An increase in college scholarships for New Mexico students. A new bike path nestled on Colorado’s West Slope. More homeless shelters in Arizona.
When lottery sales skyrocket, the players holding the golden ticket aren’t the only ones to win. In the United States, state lottery systems use this money to boost education, tourism, transportation and more. Now that the giant Mega Millions lottery jackpot has soared to more than $1 billion, state officials hope the heightened national interest will translate into increased funding for their own causes.
However, critics of these lottery-funded programs note that low-income gamblers foot the bill for benefits they will not reap commensurately.
In South Carolina, lottery officials said 43 cents of every dollar spent directly supports the state’s education lottery account. The General Assembly then uses this money largely to fund scholarships. But the vast majority of South Carolina’s revenue goes to merit-based scholarships rather than need-based scholarships.
In New Mexico, some lawmakers and advocacy groups have criticized the lottery as a regressive source of revenue.
“People playing it have disproportionate incomes,” said Fred Nathan of the nonpartisan political group Think New Mexico. He successfully lobbied for the minimum contribution of 30% of state lottery revenue for college scholarships, but said concerns remain about how much of the lottery scholarships go to children of families. wealthy and middle-income.
Mega Millions is played in 45 states as well as Washington, DC and the US Virgin Islands. No one has matched the game’s six selected numbers since April. The next drawing will be at 11 p.m. Friday in Atlanta.
On Friday, the historic jackpot prompted Bryan Byrd, 36, to buy a ticket at a gas station in Columbia, South Carolina. Byrd said he usually only plays when the pot gets that big.
His first shot if he wins the prize?
“Probably put my two weeks notice,” Byrd said. “I hope I’m a winner.”
The game is coordinated by state lotteries, which derive revenue not only from Mega Millions, but also from scratch tickets, Powerball and other licensed games. The revenue is then used to help pay prices, retailers, state funds, and overhead.
The Michigan Lottery is on track to make its third consecutive $1 billion annual contribution to the state’s school aid fund, according to player relations manager Jacob Harris, who said jackpots like this were helping this cause. In Michigan, Harris said 28 cents of every dollar raised goes to the fund.
In Georgia, since the jackpot began rising in April, the state has raised nearly $22 million for college scholarships and pre-K programs, according to lottery officials.
Oregon recently released some of its biggest daily sales numbers for the Mega Millions draw, according to spokesman Chuck Baumann. The $1.4 million and $1.2 million raised on Tuesday and Wednesday, respectively, were good for the state’s eighth and tenth highest single-day sales.
“Whether it’s Powerball or Mega Millions, when the jackpots get big and people play, it’s good for the state of Oregon and for the people who get lottery dollars,” said said Baumann. Over the years, voters have approved moves to send lottery proceeds to funds for education, parks and veterans services.
In a typical Tuesday draw in Texas, statewide sales will approach $1 million for Mega Millions tickets. Last Tuesday, they sold $20 million, according to Gary Grief, executive director of the Texas Lottery Commission.
He expects record sales to continue. A typical Friday brings in around $5 million in sales. He expects this Friday to break 80 million dollars.
“As we near the end of our fiscal year, we were neck and neck with last year’s record pace of sales,” Grief said of the state’s lottery revenue. This amounted to $1.97 billion for the state Basic School Fund and $23.4 million for Veterans Aid. “It will push us beyond that.”
Ticket sales are skyrocketing in New York. In the week ending July 23, Mega Millions sales totaled over $26 million, according to a report from the New York State Gaming Commission. That’s more than double the more than $12 million raised the previous week.
In Ohio, where lottery funding is dedicated to education, lottery sales have remained constant, but jackpot sales often fluctuate more than other lotteries, said Danielle Frizzi-Babb, director of communications at the Ohio Lottery. Mega Millions jackpots are hard to predict – and this jackpot, topping $1 billion, has resulted in an increase in sales that is hard to predict long in advance.
“When we get to that kind of number, sales really, really, really go up,” Frizzi-Babb said. “And it’s just not something you can plan. But we are excited when it happens.
California had amassed over $224 million in sales Thursday afternoon for the Mega Millions streak. The estimated amount for education was $89.6 million, according to California State Lottery spokeswoman Carolyn Becker.
In fiscal year 2021, California generated about $1.8 billion from all games for public education — though Becker described those funds as “additional” given the number of school systems in the state. Most populous state in the country.
“Even though it pales in comparison to a school’s budget, we hear from teachers, administrators, etc., that every dollar counts,” Becker said, adding that the funds went toward teacher salaries, computers and music and gym equipment.
In Tennessee, recent Mega Millions ticket sales generated over $263 million that will be earmarked for scholarships, grants and after-school programs.
The Tennessee Education Lottery called the ever-expanding prize a “welcome development” as they saw more new players buy tickets in hopes of winning the prize.
Yet that hope comes as Americans are experiencing the highest inflation in decades, leaving far less money to spend on entertainment. Some states are already experiencing sales declines with their lotteries.
Iowa Lottery CEO Matt Strawn told board members in late June that rising gas and grocery costs were likely to blame for the drop in scratch-off sales, while also noting that inflation had also resulted in an 82% increase in their staff’s fuel budget. A lottery spokesperson said they believe an increase in Mega Millions sales will offset the decline in sales.
And even in a forecast year of record revenues in Texas, revenue from the lottery — which helps fund education and veterans aid — is somewhat muted due to its weakened purchasing power.
“The money that we’re handing over to (the Texas Education Agency), he’s going to buy something a little less than he bought a year ago,” Grief said.
Kruesi reported from Nashville, Tennessee. Pollard reported from Columbia, South Carolina. Stern reported from Reno, Nevada. Associated Press writer Morgan Lee of Santa Fe, New Mexico, contributed to this report.
James Pollard and Gabe Stern are members of the Associated Press/Report for America Statehouse News Initiative. Report for America is a nonprofit national service program that places journalists in local newsrooms to report on underreported issues.