The Iowa Lottery has approved the budget it is sending to the legislature for the new fiscal year. Iowa Lottery CEO, Terry Rich, says they are expecting to generate 68.7 million dollars)in profit, which is a 10 percent increase from what they had budgeted last year. “We hope to beat that budget, but we want them to be able to be budgeting in a way that they know that they can receive the monies that we are talking about,” Rich says. Rich says they have used 60 million dollars as a baseline goal since 2009, and always shoot to hit that much or more each year.
The proceeds to the state will be well below the record 85 million dollars in the 2013 fiscal year. Rich says a couple of things boosted revenue to that record. “It was like a perfect storm in that Powerball had three huge runs…and that immediately drives extra dollars to the bottom line. As did the gamebook which was a huge success for the scratch tickets,” Rich explains. “But we try not to budget those, because we don’t know in any given year when one of those big years will happen.”
Rich compares it to farming where there may be a year where bin-busting yields add to the bottom line, but the farmer can depend on them happening every year. He says the lack of big jackpot runs and the weather kept the profits lower in the just ended fiscal year.
Gambling opportunities will be expanding in the state as regulators approved a new casino for Greene County. Rich says casinos led to a drop in lottery revenue by about 20 percent when they first started operating. “It did decrease the amount of monies wagered on the lottery, so in some ways it competes. On the other side, it’s my believe that gaming in general has a certain level of activity and I think we need to work everyday so that people see ours as a fair and honest product,” Rich says.
The Iowa Lottery is in a different situation than casino gambling as there are many more opportunities to purchase lottery tickets at convenience stores and other retail outlets across the state. Rich says that helped the Iowa Lottery weather the economic downturn a little better than the casinos. “Because people weren’t traveling and they wanted to be at home,” Rich says. He says when people were out getting gas, they were willing to spend an extra dollar to buy a lottery ticket and that kept them going in the downturn. Rich says the casinos have come back as the economy improved.
Lottery sales in the last fiscal year topped the $300 million mark for the third year in a row, despite the slight decline from the previous record year. Rich says the organization is in a good position to continue the strong sales in the new fiscal year.