Lottery a bright spot for state revenue collectors

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BOSTON — As state officials try to balance this year’s $38.4 billion budget in the face of under-performing tax revenues, one source is bringing in more money than it did last year: the Massachusetts Lottery.

In a presentation to the Lottery Commission on Tuesday morning, Executive Director Michael Sweeney reported that the Lottery’s adjusted net profits over the first 10 months of fiscal 2016 increased $4 million over the same period last year, and sales through April were $199.5 million more than last year.

The 4.8 percent year-to-date increase in sales has been buoyed by sales increases of $90.3 million for scratch tickets, $66.3 million for Powerball tickets and $46.4 million for Keno sales. Only Mega Millions, Lucky for Life and the outgoing Jackpot Poker have seen declines in sales to this point in the year.

Estimated to produce $962 million in profits this fiscal year to fund local aid for cities and towns, the Lottery so far has collected $841.5 million through April, according to officials.

Despite the year-to-date increase, Sweeney told the commission that overall Lottery sales for April were down $5.5 million from April 2015, calling the month’s performance “not impressive.”

And though the Lottery is bringing in more money through sales, it is also paying more of that money out as prizes than it did last year. The year-to-date prize payout for fiscal 2016 is 73.34 percent, Sweeney said, up from 72.42 the previous year. In April, the prize payout was 74.41 percent, up from 70.70 percent last April.

The Baker administration earlier this month ordered an immediate suspension of all state spending on “non-essential” goods and services in an array of categories, including outside consultants, leases and office equipment and computers as it grapples with a budget gap estimated to be at least $200 million.

April tax collections — historically the biggest month of the year for receipts — declined by 3 percent from last year, leaving collections well below benchmarks. Tax collections are up 1.9 percent over the first 10 months of fiscal 2016, but the budget Gov. Charlie Baker signed last year was built on tax revenues growth of 4.8 percent.

A consistently under-performing part of the Lottery’s product portfolio, Jackpot Poker is slated to be scrapped by mid-July. The monitor game, which launched about three years ago as a replacement for the Daily Race Game, has been a dud on the Lottery’s sales reports and has been the butt of jokes at Lottery Commission meetings.

The commission on Tuesday voted to replace Jackpot Poker with All or Nothing, a game that will give players a chance to win a top prize by matching either all or none of 12 numbers drawn.

“I’ve been waiting for this game since I arrived,” Treasurer Deborah Goldberg said during the commission’s meeting.

All or Nothing is expected to be rolled out to Lottery retailers in mid-July, Goldberg said.

— Written by Colin A. Young

Copyright State House News Service