State News

NC lottery sales down, may miss goal by $40M

Posted December 15, 2010 4:26 p.m. EST
Updated December 15, 2010 6:28 p.m. EST

N.C. Education Lottery

— North Carolina lottery commissioners estimated Wednesday the program will earn $40 million less than expected in the current year because of weak ticket sales — another financial blow for a state education system already bracing for budget cuts.

The North Carolina Education Lottery Commission revised its sales estimate in approving a new budget. That plan projects the lottery will be able to provide about $402 million for state education programs for the financial year ending in the middle of 2011, well below the $441 million initially projected.

Alice Garland, the acting executive director of the lottery, said officials were still striving to match the initial goal and hope that sales will start coming back.

“We still have more than six months of sales left in this fiscal year, and we remain committed to maximizing the amount of money for education that we can produce," Garland said in a statement. "The decision to revise our revenue projections, however, was necessary to offer a realistic picture of what expectations should be.”

Garland attributes the lower-than-expected sales to the prolonged economic slump, with consumers having less money to spend on entertainment. Officials also said a factor was that the multistate Powerball game has seen no major jackpots to attract interest.

Proceeds from the lottery go to fund education programs, such as class-size reduction, school construction and scholarships. Gov. Beverly Perdue has already warned of budget cuts in education, and federal stimulus money that helped support programs last year will be drying up in 2011.

Record sales last year helped send more than $419 million in net profits to education programs, the highest annual transfer since the lottery began in 2006.

Lottery officials are looking to improve sales with new games and continued focus on building a network of retailers. The program will add more drawings starting in February for its numbers pick-em games and plan to roll out an instant ticket game that includes a top prize of $200,000 a year for life.

"We're working very hard to turn this around and improve our sales picture," Garland said.

Also Wednesday, the lottery commission named its four finalists to succeed Tom Shaheen as director. Shaheen stepped down in September to take a position with a company involved in the sale of lottery tickets through ATMs.

Garland, Arkansas lottery executive David Barden, Massachusetts lottery director Mark Cavanagh and gaming consultant Philip Green are the finalists. The commission will conduct background checks on each and will interview them next month.