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Lottery has Winning Year

At least there was one piece of good financial news this week.

The Massachusetts State Lottery announced that it took in $120-million more than it thought it would.

Now, we all know, or are supposed to know, that lottery profits go back to our cities and towns, to help pay for schools, capital improvements, and police and fire costs. Westfield got $5.9-million in the most recent year.

But at least one financial guru in the State House-House Ways and Means Chairman John Rogers-says we might not send it all back. We just might spend some of it to decrease the budget deficit in the coming year. Just how the state will spend the money remains to be seen.

All we know right now, is that the Lottery is having a record year. All the totals won't be in for a few months, as the treasurer's department totes up wins, losses, and costs before printing the final annual report.

In the most recent annual report (2001), Treasurer Shannon O'Brien noted that the Lottery generated $864-million for cities and towns. She also reported, thankfully, that her office had made substantial changes in its management techniques since she took office in 1999 and that these changes helped make the Lottery even more successful.

Massachusetts is the most popular lottery in the country, and offers the biggest payouts.

Whatever the reason, last year was also a record year for the Lottery, with instant games and Keno being the biggest contributors. Overall, Lottery revenues climbed to $3.9-billion, a six percent increase from the previous year, according to the Treasurer.

Of that revenue, $2.7-billion was paid out in prizes. Another $223-million was operating expenses, and $74-million was spent in administrative expense.

Some of those expenses? Commissions, printing, salaries, even $1-million to fund the Massachusetts Council on Compulsive Gambling.

Leaving the net profit of $864-million for our cities and towns. That's the big picture.

Here's where some of the revenue came from. Instant Games, $2.7-billion; Keno, $593-million; Numbers Game, $374-million; the Big Game, $69-million; Megabucks, $54-million; Mass Millions, $44-million; and Mass Cash, $48-million.

Those Instant Games accounted for 69 percent of total sales. In 2001, the Lottery offered 21 new games, including its ten-dollar $400,000,000 Spectacular which, by the way, offered an 80 percent return to players.

Love it or hate it, Keno was the second biggest income producer, at 15 percent of gross revenues.

The Numbers Game is the oldest of the Lottery's offerings, with drawings seven days a week.

The Big Game was a loser-thanks to low jackpot levels, it suffered a 37 percent decline in revenue. It's just not as popular when the jackpots don't hit highs like the $363-million reached in 2000 or even the $197-million from 1999. It's a joint effort of seven states-Illinois, Georgia, Maryland, Michigan, New Jersey, Virginia, Massachusetts.

Mass Cash, Mass Millions and Megabucks also declined in popularity,

Now, why do people play the Lottery? Probably because it pays the most of any of the nation's lotteries-70 percent of the income goes back out in prizes. And, there's always hope and some people's dreams do come true. In 2001, the Massachusetts Lottery created 87 new millionaires, according to the annual report.

In its 30th year, the Lottery also started its anti-litter program, the Clean Fun Sweepstakes, which generated more than 10-million entries, and recycled 85 tons of losing tickets.

The Lottery isn't the only state-authorized gambling going on, of course. There's also "charitable gaming," or Bingo, or Beano. Which generates about $27-million for worthy causes each year.

If you're looking for a Bingo game, you're most likely to find one on a Wednesday or a Sunday, and they'll most likely be sponsored by a church or religious group.

In Hampden County, 63 organizations have Bingo licenses. They generated $14.3-million in receipts (or $27.37 per person). Westfield has 4 licenses, which too k in a total of $203,704 dollars (that's $21.77 per person). But those sponsors must have spent a lot of money to organize the games, because after the 5 percent tax, and after expenses, they only recognized a profit of $7,967.

Successful as it all may be, Massachusetts gambling just can't compare to the success of casinos when it comes to income. Is it time that we take a serious look at the options?


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