California Lottery’s Scratchers to pay more prizes
Scratchers, the California Lottery’s rub-off card games, will pay more prizes under a new plan aimed at boosting gambling revenue for the state.
Lottery officials estimate an annual $75 million more in prizes starting in June under a new law that raised the limit on the share of Scratchers revenue that could be allocated to prizes. Lottery officials say increasing payouts has paid off handsomely in other states.
“There are more prizes to give out, so people are going to win more often,” said lottery director Joan Borucki. “When people win more often, they feel like playing more often, which in turn will increase sales, and as sales go up . . . our contribution to education goes up.”
Money for schools is expected to increase by as much as $400 million a year, she said. This year’s lottery proceeds for public education were $1.07 billion. Lottery funding generally makes up 1.3% of the state education budget.
The Lottery Commission on Wednesday approved the first new game, a $5 Scratcher to begin June 1, in which the number of $1-million winners will grow to 25 from the 10 or so winners currently paid. The panel determined that the new game would direct an additional $15 million to schools through June 30.
Scratchers games costing $1 and $2 also will have larger prize pools starting in June.
The California Coalition Against Gambling Expansion opposes the new plan.
“Whenever the lottery says it’s going to get more Californians to play, what that means is they are going to be fleecing more Californians of their hard-earned money,” said coalition leader Fred Jones. “Gambling doesn’t create wealth. It only gives wealth to some people at the expense of other people.”
Borucki responded: “We have a lot of gambling in this state already. We try to do it responsibly.”
More than 61% of the money from Scratchers sales, up from 57.5%, will go to prizes beginning in June. If sales hit the $2 billion that officials anticipate, that would mean an extra $75 million in Scratchers prizes over a year, said Bill Ainsworth, a lottery spokesman.
That could mean 7.5 million more $10 winners or 3 million more $25 prize winners, Ainsworth said, adding that payout details are still being finalized.
In other states where prize pools were enlarged, sales went up, Borucki said.
In Florida, sales and profits from Scratchers tickets more than tripled between the 2002 budget year and 2006, after that state’s lottery increased prizes, she said.
Other states whose sales rose when prize pools increased include New York, North Carolina and Texas, Ainsworth said.
Of the 10 most populous states with lotteries, Borucki said, California has had the lowest per capita sales and overall payout percentage.
