Business Is Brisk : Fanfare, $1 Fantasies Herald State’s Lottery

California leaped into the lottery business Thursday. Millions of residents, rich and poor, gambled that they could turn $1 investments in “California Jackpot” tickets into instant winnings of as much as $5,000 and a shot at a $2-million jackpot.

By design, most lost. “This game is like dollars with wings,” said Jack Gould, a Santa Monica College student. “Your dollars just fly away.”

Action was brisk at many of the 20,000 retail stores licensed throughout the state to sell lottery tickets. There were long lines at some outlets, and lottery officials said that ticket sales totaled 10.9 million by 9 p.m.

In Orange County, 1,800 lottery retailers started the day with about 55 million tickets. By 5 p.m. about 350 retailers had run out and gone to the lottery’s Anaheim headquarters to pick up from 2,000 to 10,000 additional tickets per store. In a major flaw, about one in five outlets around the state did not have tickets in time for the 12:30 p.m. commencement. In Orange County, however, regional director James Braxton said that all but a few retailers had their tickets in time.

21st State With Games

The lottery came 11 months after it was approved by voters, seven months behind schedule. With its lottery, California became the 21st state in the union to offer some form of game intended to enhance government revenues while providing a few fortunates with instant wealth. The nation’s capital also has a lottery.

California’s lottery operation is the nation’s largest. Sales of $1.4 billion have been forecast for the first full year. Half of the money is to be returned as winnings. A third will be distributed to public schools and universities, and the rest is supposed to pay for lottery administration and promotion.

The opening was commemorated with fanfare. In Orange County, skywriters streaked the word across cloudless blue skies in puffs of white smoke that said: “It’s lottery kickoff day” over Huntington and Sunset beaches, and “Lottery=School Support” over Seal Beach.

In San Diego, an audience of 1,000 stood in 92-degree heat to hear Debra Sue Maffett, Miss America 1983, sing “It’s a Good Feeling,” the official lottery anthem.

And in Los Angeles, a ragtag lottery parade of double-decker buses, vintage cars and a lone unicyclist picked its way through a crunch of lunch-hour traffic.

The parade terminated at Music Center Plaza. There, mimes passed out free lottery tickets among a crowd of 2,000. A barrage of green-and-orange balloons--the official lottery colors--were released into the sky, competing for attention with skydivers spewing plumes of orange smoke and a skywriter spelling out the message Loteria Empieza Hoy-- Lottery Begins Today. Actor Danny Thomas counted down the final seconds to 12:30 p.. “It’s very exciting and a good thing for California,” said Mark Michalko, the state’s 31-year-old lottery director.

Gov. George Deukmejian, who opposed the lottery, refrained from partaking in any of the opening-day festivities, as did Los Angeles Mayor Tom Bradley and almost all other ranking politicians in the state.

Even though the lottery is expected to produce $475 million for state schools annually, politicians and even school officials have questioned the wisdom of bringing another form of large-scale gambling to the state. Horse racing generates more revenues than the lottery is expected to return.

Despite all the staged hoopla--capped by a Hollywood gala later in the evening--the sense that California had embarked on something of a new era could be detected most dramatically in the tiny neighborhood shops, grocery stores, boutiques and convenience markets that had added lottery tickets to their stock.

It was in these outlets that the Californians gathered, and sometimes waited in long lines, for their first taste of lottery fever. Many found it quite catching. Merchants reported tickets being snapped up by the 100s in minutes.

And demographics seemed not to matter. Business was hopping in exclusive enclaves and in slums.

At a Beverly Hills pharmacy, limousine chauffeurs kept ducking in to purchase tickets while their employers ate lunch or otherwise conducted business.

In Costa Mesa, bowlers in the Jingle Bells Bowling League at Kona Lanes darted for the front desk when the “now open for business” announcement came over the loudspeaker at 12:31 p.m. First in line was Joyce McAllister, a 52-year-old grandmother of 17, who bought 10 tickets and said she would buy 40 more before the day was out.

“I’d rather do it this way than buy from every school kid that comes to my front door,” said McAllister, whose 10 tickets yielded four winners--three two-dollar prizes and a five. “I’m going to go hog-wild today. My husband knows about it.”

At the Martin Luther King Shopping Center in Watts, 110 people called on Alexander’s Lock and Key Service in the first hour for tickets.

“All I’m trying to do is make some money so I can get out of the rut,” said Harriett Witherspoon, an elderly woman. She was happy when her ticket paid off for $2--a $1 profit.

Key shop manager Beverly Collins echoed the concern of many when she expressed fear that the lottery would prey on the dreams of have-nots.

“These are poor people,” she said of her clientele, “and they really can’t afford to spend all this money.”

But if some of the players were living on limited incomes, they sounded happy to be spending their cash on lottery tickets.

A giddy Penny Gower came out of a 7-Eleven store in Seal Beach with her second handful of lottery tickets. “I bought three tickets and I had two winners,” said the 40-year-old computer terminal operator.

“And I just won $2 more,” she exclaimed as she finished scratching the new cards. “You know, it’s going to be good exercise coming back and forth to buy tickets. Maybe I’ll lose weight. Actually, I’m on medical leave and I really shouldn’t be spending my money this way. Oh well.”

Many winners of the smaller prizes would reinvest their meager earnings in more tickets, spending until they were tapped out. They would back out of the stores, promising to be back.

Some took solace in the fact a portion of their losings would go to education.

Junior high school teacher Gary Lee bought 50 tickets at the Winchell’s Donuts across the parking lot from the In ‘n’ Out liquor store in Placentia. He won $17 in $2 and $5 tickets and used the money to buy more tickets.

“I blew $50 to get $17 so I figure I’ll just blow it all.” He felt some of the money would benefit public education. “What else does education have going? Any bill that helps education the public always seems to vote down.”

The odds against winning $2 on a $1 ticket are 10 to 1. For a $100 payoff, the odds are 4,000 to 1. For $5,000, the maximum prize for the so-called instant scratch-off, the odds against winning are 40,000 to 1.

Only $100 winners are eligible to participate in drawings that will pick 160 contestants for a prime-time televised show each week on which a giant wheel will be spun to award prizes ranging from $10,000 to $2 million. Odds against hitting the ultimate payoff are 25 million to 1.

Still, despite the long odds, a few players walked away with spectacular winnings. There were fifty-seven $5,000 winners reported by 5 p.m., 12 of those from Orange County, officials said.

Twenty minutes after the lottery began, Maurice Ghattas, a family-practice physician from Mission Viejo, bought a ticket at his cousin’s Santa Ana store and became the county’s first $5,000 winner.

“I bought 50 tickets and the seventh ticket I scratched, I saw I won,” he said. “I started screaming. You bet I started screaming. You work hard to get $5,000. I know I’m a doctor but I still work hard to get $5,000.”

“I can’t believe it, oh Lord, I can’t believe it,” said Johnnie Mae Kimbrough, who became a $5,000 winner at a Thrifty Drug in Watts. “There are so many people in need, I prayed that if I did get any money, I could help somebody.”

While the game was the same, it seemed to take on a different flavor depending on where it was played. At Lake Tahoe’s Kings Beach, many casino veterans bought tickets in bulk. In Santa Ana, courthouse regulars and county social workers ordered lottery tickets along with their sandwiches at a deli called Bud’s Meat Hut.

At the Los Alamitos Race Course in Cypress, the line stretched from the ticket windows across to the entry doors just before 12:30 p.m.

“We can’t stamp ‘em fast enough,” said Lester Luzar, who was drafted to fill in at the lottery ticket window because of the crush of customers. “We’ve sold 4,000 in the first two hours.”

Some of Thursday’s $2 winners sounded as excited as those who won $5,000. Marie Daetweiler, a retired school bus driver from Whittier, bought 11 tickets at a Santa Ana Alpha Beta and “I’m so excited. I won three times,” each time with $2 winners.

“Oh, I’m feeling lucky,” she said. “Now I’m gonna buy some more,” Daetweiler said as she bought six more tickets. She won $2, then switched lines to go back to the “lucky” checkout stand where she had won her first $2 prize.

Minutes before tickets went on sale at Hanshaw’s Liquor Store in Santa Ana, more than 100 people formed two lines to buy tickets.

Within two hours, there were “quite a few $2 and $5 winners and one $100 winner,” said a clerk at the store frequented by large noon-hour crowds from the nearby industrial parks. One lottery player bought $100 worth of tickets and others had walked out with bundles of 75, 50, 20 and 10 each, clerks said.

“I’d say 90% of them (winners) are paying the money back for more tickets,” said one clerk, who identified himself only as Chuck. “Out of 47 winners, I’d say I’ve paid back only two in cash.”

In Costa Mesa, bartender Larry Smith could hardly keep pace with the afternoon crowd at the Flint Cocktail Lounge. Not a stool was empty at the bar, which was littered with worthless tickets and half-filled drinks. Behind the bar, Smith furiously stamped the bar’s logo on more tickets to meet the demand.

“I stamped 500 in advance, but I sold those out in the first hour,” Smith said. “I think it’s just a fad, though. It’ll slow down in a few days.”

There were problems with the state’s maiden voyage into lotterydom. Orange County recorded one of the state’s first thefts of lottery tickets.

About $300 worth of tickets were stolen Thursday afternoon from the Video Hits store in Los Alamitos when a clerk set the tickets on a counter and turned away for a moment, lottery agent Wayne Mackley said. The Los Alamitos Police Department and lottery investigators are seeking a white female between 20 to 40 years old, he said.

But the numbered tickets have been invalidated, and lottery officials said a surprise awaits anyone trying to redeem what would have been a winning ticket: they will be referred first to state security agents. “Even if you’re innocent, you’re gonna have security come out and talk to you,” regional director Braxton said.

About 12 Orange County merchants reportedly jumped the gun, selling tickets up to 45 minutes before the official 12:30 p.m. start. Lottery investigators will be checking the complaints today and could revoke the merchants’ licenses to sell tickets.

Workers in several locations around the state complained that computers often were not working, making it impossible for them to process retailers’ orders from warehouses.

In some cases, huge piles of tickets waited on loading docks at metropolitan warehouses as anxious retailers tried to call regional office telephone numbers that were always busy, several vendors complained.

In Imperial County, one retailer’s son was forced to drive 56 miles through the desert to El Centro to pick up tickets and did not return to the small border town of Winterhaven until late afternoon, disappointing many excited ticket buyers.

One frustrated retailer from Santa Catalina Island rented a plane and flew to the lottery’s regional headquarters in Anaheim Wednesday afternoon to pick up his overdue tickets.

At 12:31 Thursday at the Seal Beach Pier bait and tackle shop, David Anderson was watching the clock and casting an anxious eye toward shore for his boss, who was due any minute with lottery tickets.

When shop co-owner Sharon Leonard finally arrived from the Anaheim distribution center, she and Anderson snatched up the first ticket, which will be framed untouched on the bait store walls.

“It wouldn’t be a novelty if we scratched it,” said Leonard, exhilarated by the rush of business.

By evening, Orange County watering holes were still celebrating the lottery. At Charlie’s Bar in Huntington Beach, owner Charlie Covina announced each lucky ticket over a hand-held megaphone--interrupting the Angels-Royals game that seemed to be of more interest to most patrons.

At the Honest Lawyer pub in Garden Grove, Boake Shimizu thought the hype was a bit overdone. “The novelty will wear off in a few days,” said Shimizu, who lost about $20 on lottery tickets Thursday.

“People are buying 20 tickets at a time now, but next week, they’re going to buy just one--and that’s going to come out of the bartender’s tip.”

The lottery has progressed sluggishly since it was approved by voters in November, 1984. The initiative mandated the governor to appoint a five-member Lottery Commission and a lottery director by early December. But Deukmejian, saying he wanted to make sure no underworld-connected people were named, waited until almost February to select the board.

The governor took until May to finally name a lottery director, after many false starts, including the misplacement for several months of the application of one would-be contender.

By law, the games were supposed to have begun March 21, but without a director or any concrete plans for running the lottery, there was no hope of meeting that deadline.

When lottery director Michalko arrived in Sacramento from a post as legal counsel to the Ohio lottery, he announced that he would follow a “cautious approach” through the summer to ensure that the games ran properly. At one point in the spring, a Santa Clara Valley schoolteacher unsuccessfully sued the state, claiming that the delays were costing California education as much as $1 million a day.

It was not until June that the contract for the instant games was awarded, under a cloud.

Scientific Games, a division of Bally Manufacturing Corp., got the $40-million contract in what amounted to a giant payoff for its role in the passage of the initiative.

The Georgia-based lottery firm had bankrolled the Yes-on-Proposition 37 campaign to the tune of $2.1 million out of the $2.4 million spent, and a Scientific Games lawyer wrote the terms of the initiative in such a way that only Scientific Games was eligible to bid.

Contributing to this story were Times staff writers Heidi Evans, Mark Landsbaum, Kristina Lindgren, Greg Lucas, David Reyes, Andy Rose and Robert Schwartz.