The legislative oversight committee for the state lottery learned today that funds could be depleted by 2014 if changes are made to the eligibility or payout of scholarship funds.
Legislators heard from Shane Broadway, interim director of the state Department of Higher Education, and Bishop Woosley, director of the state lottery, regarding lagging sales and rising requests.
John Lyon with our content partner, the Arkansas News Bureau, reports:
Shane Broadway, interim director of the state Department of Higher Education, told the legislative oversight committee on the lottery that if the department continues awarding scholarships in the current amounts it is projected to run out of funds in February 2014.
The lottery, which launched in 2009, had been projected to raise $98 million in the current fiscal year, but state Lottery Director Bishop Woosley told the panel Tuesday that if current trends continue it will not meet that goal.
Woosley told the commission the lottery’s gross revenues in the first four months of the fiscal year that began July 1 totaled $33.9 million, or $4.3 million below forecast. He said the lottery’s net revenues for scholarships during the same period totaled $6.6 million, or $1.2 million below forecast.
“I think at this point you’re probably safe to assume (net proceeds will be) somewhere in the $89 million to $90 million range if sales trends continue to hold as they have,” Woosley said.
That would be at least a $7 million drop from the previous fiscal year, when the lottery raised $97 million for scholarships. Woosley said a hot summer and high gas prices likely contributed to the decline in sales.
While lottery sales are down, interest in the Academic Challenge Scholarship is up, according to Broadway, who told legislators that 1,218 more students received the scholarship this year than last year.
Lawmakers are struggling with several options to address the situation. Read more here regarding those efforts.
Talk Business Staff
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