The Iowa Lottery reported Wednesday that its sales surpassed the $200 million mark for the just completed fiscal year 2004, a 16 percent increase in revenues and the culmination of a three-year rise in profits for the state.
Almost $56 million in profits will be added to the state general fund budget, which pays for most state government operations and services.
Lottery Commissioner Ed Stanek attributed the success to the variety of lottery games available and their convenience for Iowans who want to play. He said the agencys latest product developments have targeted each of those areas while focusing on entertainment value rather than gambling.
This week, the lottery unveiled an electronic version of the traditional scratch-off game that is scheduled to hit the market on a trial basis in Davenport, Cedar Rapids, Dubuque, Waterloo and Iowa City in mid-October.
We look at these new games as the evolution, or the next generation, of lottery products, spokeswoman Mary Neubauer said.
Sales of conventional instant-scratch tickets, which traditionally are the most popular of the lotterys products and were the inspiration for the future electronic version, increased by more than 12 percent during the 2004 fiscal year for a total of $95.2 million.
Neubauer described the new, handheld Quarter Play game as a battery-powered scratch ticket programmed for 80 plays. The portable device costs $20 and guarantees at least $5 in winnings. Points earned during each play are accumulated and totaled on the screen once all plays have expired. Players can redeem their winnings, which may amount to a maximum of $300, at Iowa Lottery retailers.
The Iowa Lottery Authority was created through legislation in May 2003 and restructured the lottery as a public enterprise based on a business model. The change was intended to produce greater profits for the state by giving the agency greater flexibility in daily business decisions.
Any business needs to be looking for the new product thats going to appeal to its customers, Neubauer said. If it stays static, it certainly wont be a successful business for very long.
Since the Iowa Lotterys creation in 1985, more than $883 million in revenues has been added to the states general fund and $1.77 billion in prizes has been awarded to players.
But gambling opponents insist that more convenience and availability of gambling options will lead to an increase in abuse.
This is like having a slot machine in your grocery store, said Mike Hartwig, vice president of the Iowa Family Policy Center. Studies have shown that an increase in gambling revenues equals a rise in social costs.
He said that research has shown that every $1 put into the gambling industry in Iowa creates $3 in social costs. The lottery has countered such claims by contributing a portion of its revenues to the Iowa Gambling Treatment Fund. The agency allocated more than $631,000 to the fund, a division of the Department of Public Health.
By the Numbers
According to statistics released Wednesday by the Iowa Lottery Authority, lottery sales increased 11 percent and revenues increased more than 16 percent for FY 2004. The lotterys profits to the state include more than $55.2 million to the general fund and more than $631,000 to the Iowa Gambling Treatment Fund within the Department of Public Health.
Despite a minimum age of 21 to buy tickets.