COMPTROLLER'S CORNER WHAT'S NEW WITH THE ILLINOIS LOTTERY By Loleta A. Didrickson, Comptroller, State of Illinois

The Illinois State Lottery is an important revenue source for state government, the fifth largest source of state funds into the General Funds in fiscal year 1996. The lottery has also been financially beneficial to education. In fact, gambling revenues, including the lottery, were the second largest state source of funding for education. Together, the lottery ($594.1 million or 14.9%) and Riverboat Gambling ($151.9 million or 3.8%) accounted for 18.7%.

Lottery ticket sales, which fluctuate from year to year, reached their highest level ever, totaling $1.637 billion this past year. This is an increase of $63 million or 4.0% over fiscal year 1995.

It has been the dramatic growth in sales of the Instant games that account for the overall increase in Lottery ticket sales. Instant game sales have experienced more than a threefold increase during this same time period, growing from $197 million in fiscal year 1987 to $647 million in fiscal year 1996. This $450 million increase was partially offset by the decrease in Lotto ticket sales.

Ticket sales from the other games, Daily (Pick 3), Pick 4, and Little Lotto, were $627 million in fiscal year 1996. The Little Lotto game began in fiscal year 1988 and since fiscal year 1989 sales from all other games have been fairly consistent.

The Illinois Lotto game has recently had some difficulty in generating the level of sales that it once enjoyed. Lotto sales totaled $363 million in fiscal year 1996, $282 million or 43.7% less than fiscal year 1987 sales of $645 million. Last year's sales were the lowest since fiscal year 1984, the first full year of sales after the inception of the game.

To combat declining sales, the Department of Lottery changed the game in fiscal year 1989 to make it more difficult to win, thereby creating more rollovers and larger prizes. While larger prizes did increase sales, Lotto sales peaked at $634 million in fiscal year 1992 and have continued to decline.

In another effort to reverse this trend, the Department recently announced a new game. "The Big Game" is a new multi-state lotto game which has substantially larger jackpots. Illinois has joined with Maryland, Massachusetts, Michigan, Georgia and Virginia in offering this game which began at the end of August. Drawings are held weekly on Fridays and jackpots are a minimum of $4 million.

The new game is a little different from the Lotto game. Players will still choose 6 numbers, except 5 of those numbers will be from a pool of 50 and 1 number from a pool of 25 or the "Big Money Ball." There are multiple prize levels, including matching just the Big Money Ball which increases the odds of winning. It is hoped that the larger jackpots and more prize levels will make the game a hit with consumers, generating additional sales.

Although the game is designed for a population of up to 50 million, the six initial states have a population total of 45.8 million. While there is some room for expansion, if the game is successful, sales from border states will quickly put the game over the 50 million mark. Current estimates are that the game will generate over $500 million in sales for the six states combined. States will share receipts based on the sales generated within each state. Also, prizes other than the grand prize will be paid from the state's share.

Currently, there are no plans to change the Lotto game. Recent estimates by the Lottery Department are that Lotto sales will decline approximately 20% as some players switch to the new game. Expectations are that ticket sales for the Big Game will generate about $100 million for Illinois. •

October 1996 / Illinois Municipal Review / Page 17