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Tenn. lottery fans make fewer runs for the Kentucky border

Aug 2, 2004, 9:52 am

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Gene Dotson is something of a video-game-stool philosopher of luck.

As a regular lottery player, the retiree from Nashville has good reason to think about these things.

''Is there such a thing called luck?'' Dotson asked Tuesday, a twinkle in his eye and a cigarette between two fingers as he played a video poker game at a lottery outlet just north of the Tennessee-Kentucky line, 36 miles from home. ''Is it who you are? &

''Why do people keep doing it? Why do I keep doing it?''

Whatever the cosmic answer might be, Dotson says he's ''doing it'' buying lottery tickets, that is much less often in Kentucky since the Tennessee lottery started about six months ago.

And he's not the only one.

Between the Tennessee games' Jan. 20 debut and the June 30 end of the 2004 fiscal year, the 16 Kentucky counties that border Tennessee saw their lottery sales drop $12 million, or 22%, from the same time a year earlier, according to the Kentucky Lottery Corp.

About $9 million of the loss came between April 1 and June 30, said Larry Newby, the Kentucky lottery's research chief. Tennessee added Powerball, a multi-state game its neighbor to the north has featured since 1992, on April 19.

And Kentucky expects the bleeding to intensify. Tennessee residents have bought 20% of the Powerball tickets sold in the Bluegrass State over the years, according to a recent news release by the Kentucky Lottery Corp.

''While all of those sales won't go away, it's estimated Kentucky will lose 90% of the dollars spent by Tennessee residents on Powerball and other online game purchases in Kentucky, and 80% of the dollars formerly spent on scratch-off tickets and pull tabs,'' the announcement said, though its main point was an overall statewide sales record.

Tennessee lottery advocates aren't offering Kentucky much sympathy.

''I can't say that breaks my heart,'' said state Rep. Chris Newton, R-Benton.

But if Kentucky's public pronouncements about the impact of Tennessee's lottery are unusually gloomy for a typically upbeat industry, the three other lotteries surrounding the Volunteer State, all with much shorter shared borders, say they're less concerned:

" Georgia's six border counties actually saw ticket sales rise 4.8% for the entire 2004 fiscal year, beating the statewide increase of 4.1% that produced a record sales year, according to data provided by the Georgia lottery. Newton, who lives near the Georgia line, said Georgia's offering of Mega Millions, another multi-state game, might be bringing in many Tennesseans.

J.B. Landroche, a Georgia lottery spokesman, said there were three Mega Millions jackpots of at least $150 million in the fiscal year that ended June 30.

''So that certainly helps with people traveling in and out of the state,'' Landroche said.

" The 24 retailers in Missouri's lone border county, Pemiscot, were down 3% overall and took a 34% hit in Powerball sales over the past six months. But the losses are a drop in the bucket of statewide sales, lottery spokeswoman Susan Goedde said.

Tennessee's impact is a bit broader than one might think. Missouri also has lost business from Alabama customers who used to drive there for Powerball tickets but don't need to go that far anymore, Goedde said.

" Two of Virginia's three border counties and its border city, Bristol, saw sales decline anywhere from about 1%-4.5%, director Penny Kyle said. But Washington County's sales rose nearly 6%. The lottery won't release overall sales figures for the year until this week, but Kyle said the total will surpass last year's record of $1.13 billion.

In any case, Kyle said, the border with Tennessee is relatively small. Tennesseans have bought just 1.5% of all tickets over the years.

But Virginia can still count on customers such as Dick Hamilton of Bristol, Tenn. Hamilton won $50,000 in Bristol, Va., last year, then won $15,000 there in a scratch-off game in May.

Hamilton said he plays in Tennessee as well, but he finds the Virginia lottery more customer-friendly, from the convenience of playing certain games to the better training of the sales clerks across the border.

''I play some in Virginia nearly every day,'' he said.

Hamilton, who lives four miles from the border, said he especially appreciates how Virginia pays winners cash, while Tennessee sometimes awards another ticket. Also, Tennessee players can't make a ''quick pick,'' a random selection of their numbers by an in-store computer, in the Cash 3 game.

Kym Gerlock, a Tennessee lottery spokeswoman, said she hadn't heard many complaints about the practice of awarding tickets, which she said is ''very common'' in lottery states. And there are no plans to change the way Cash 3 is played.

Gerlock said the Tennessee lottery, which will introduce a new online game soon and regularly rolls out new instant games, hasn't been able to study its players in detail yet. Only winners claiming prizes of $600 or more have to say where they live.

In general, Gerlock said, the lottery sees itself competing with other products more than other states. But lottery supporters say Tennessee residents who stay in the state to buy tickets also are buying other things, such as cigarettes, potato chips and soft drinks, which adds to the state's sales tax revenue.

''We knew that would be a result of the Tennessee lottery: keeping money in the state,'' said state Sen. Steve Cohen, D-Memphis. ''I don't know why there's any reason to cross the line.''

Newton said people who understand that lottery revenue will pay for college scholarships for Tennessee students also have more reason to play in the state.

In Kentucky, retailers and lottery leaders are relying on a mix of faithful customers, better payouts, cheaper taxes, short drives and new games to cure their Tennessee blues. Jeff Milam, manager of Lotto Land just off Interstate 65, which has traditionally been one of the state's top lottery sellers, said sales are down 50% since the Tennessee startup.

''We'll just hang in there till Kentucky comes back with something else,'' he said.

Bobbie Cummings, a cashier at T Mart on U.S. 31W , said the store has seen some drop-off and depends on ''steady regulars that are constantly faithful'' in crossing the border to buy lottery tickets.

''We asked 'em why they don't get 'em there,'' Cummings said. ''They said, 'We want to get 'em here.' ''

Even Gene Dotson gets 'em there when he's in the neighborhood, making him a two-state lottery player.

He planned to buy a few tickets Tuesday at the plainly named Exit 2 Lottery and Tobacco Outlet off Interstate 65.

''Increase the odds a little bit,'' he explained. ''Not that you have a prayer anyway.''

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