Lottery Officials Warn Of Declining Revenues, Scholarship Trends

State lawmakers learned Tuesday that Arkansas lottery scholarships are being used increasingly by students attending four-year schools versus two-year schools.

The findings surprised many lawmakers and invoked concerns that due to higher costs at four-year schools, the state may want to alter its policies on the popular scholarship program.

The Arkansas News Bureau reports:

Informed that the percentage of students choosing four-year colleges over two-year schools has risen from 60 percent to 80 percent since the lottery scholarships began, some lawmakers suggested reducing the scholarship amounts for freshmen and sophomores and raising them for juniors and seniors.

Shane Broadway, interim director of the state Higher Education Department, said he was surprised by the jump in students attending four-year colleges. He said he expected students to understand that four-year schools are much more expensive and that the scholarships to two-year colleges actually cover much more.

The first lottery scholarships, awarded in 2010, were $5,000 a year to attend four-year institutions and $2,500 for two-year schools. This year, the Legislature reduced the awards to $4,500 and $2,250.

Several legislators exchanged questions regarding the need for changes to scholarship guidelines. You can read more in this report.

Also, Arkansas Lottery officials disclosed that five months into the fiscal year, the state lottery is projected to pull in $5 million less for scholarships this year. That could alter the size or the number of scholarships awarded, officials warned.