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Louisiana Lottery revenue has fallen to a three-year low, which could pose problems for state budget writers if the trend continues.\u00a0<\/span><\/p>\n But the numbers already are starting to bounce back, and a new proposal to sell tickets online might further boost revenue. Supporters will have to address the concerns of brick-and-mortar retailers, which have helped to tank previous efforts to expand to the internet.\u00a0<\/span><\/p>\n Rose Hudson, president and CEO of the Louisiana Lottery Corporation, says lottery officials are \u201calways looking at the broader marketplace and having thoughtful, responsible conversations about how the industry is evolving,\u201d including the potential for \u201ciLottery legislation\u201d and \u201cpartnership models\u201d with stores that sell tickets.<\/span><\/p>\n \u201cAny discussion during this legislative session would be about ensuring that the path forward prioritizes responsibility, public trust and ensuring long-term support for the state,\u201d she says.<\/span><\/p>\n The Louisiana Lottery Corporation ended its 2023 fiscal year with more than $653.3 million in revenue, its best year ever, the corporation announced at the time. Resulting transfers to the state treasury for K-12 public education were more than $212 million, up nearly $20.9 million from the prior year.<\/span><\/p>\n Over the following two years, announced revenue dipped to $642.8 million and $585.2 million. But a bit of a comedown was to be expected following the record highs driven by massive jackpots, and sales currently are trending higher, Hudson says.\u00a0<\/span><\/p>\n \u201cThose years created an unusually high benchmark, and as expected, performance has normalized as jackpot cycles and player behavior return to more typical patterns,\u201d she says.<\/span><\/p>\n According to the Legislative Fiscal Office, since 2016, year-over-year revenue changes have ranged from a dip of 10.5% from 2016 to 2017 to a 22.1% increase from 2020 to 2021. For now, the 1.6% and 9% declines over the previous two years appear to be \u201csafely in the realm of normal variation,\u201d Legislative Fiscal Officer Alan Boxberger says.\u00a0<\/span><\/p>\n Whenever there is a massive, multistate jackpot at stake, lottery sales tend to increase, even for tickets that aren\u2019t for the jackpot, says Greg Albrecht, the former longtime legislative economist who still crafts the revenue forecast for the fiscal office. But even outside of those spikes, the higher baseline since the beginning of the COVID-19 pandemic seems to be the new normal, he says.<\/span><\/p>\n \u201cHow do you tease out how much is the success of lottery strategy, and how much is the change in player behavior?\u201d Albrecht says. \u201cI think it\u2019s some of both.\u201d\u00a0<\/span><\/p>\n In fact, he\u2019s seen a similar sustained increase in other gaming sectors. While fewer people are visiting the state\u2019s casinos, they\u2019re spending more once they get there compared to before the pandemic, he says.\u00a0<\/span><\/p>\n While the proportion of revenue the lottery is required to hand over to the state has been slashed from 35% to 25%, lottery officials still typically remit over 30% each month, Albrecht says. The roughly $200 million remitted annually is dedicated by law to the state\u2019s Minimum Foundation Program that supports public schools, which allows lawmakers to save general fund dollars that otherwise would go toward the MFP, he says.\u00a0<\/span><\/p>\n A House Criminal Justice subcommittee has been studying the prospect of online lottery tickets. Rep. Vanessa Caston LaFleur, who chaired the subcommittee, says she is working on the final report, which should be ready in a week or so.\u00a0<\/span><\/p>\n Anti-gambling activists and advocates for in-person gaming have expressed fears about how the ease of buying tickets online might exacerbate problematic behavior.\u00a0<\/span><\/p>\n \u201cThis is just one more step in turning your phone or your computer into a full-blown casino,\u201d video poker lobbyist Alton Ashy said at a subcommittee hearing.\u00a0<\/span><\/p>\n LaFleur plans to submit legislation for this year\u2019s session to allow the lottery to sell online. She says she got some encouraging feedback from her colleagues when she submitted a bill to that effect last year that led to the study resolution, but says getting the retailers on board will be crucial for getting through the process this time.\u00a0<\/span><\/p>\n Jessica Elliott, executive director of the Louisiana Retailers Association, did not respond to a phone message left at the association\u2019s office.\u00a0<\/span><\/p>\n Other states with lotteries, such as California, have seen patterns similar to Louisiana\u2019s, with an increase in revenue during the pandemic, a more recent dip that still left revenue above the pre-COVID baseline, and spikes driven by big jackpots.\u00a0<\/span><\/p>\n A 2022 industry report states that early iLottery adopters such as Michigan, New Hampshire, Virginia and Pennsylvania found that digital lottery offerings \u201ccan successfully co-exist with other forms of gaming\u201d without cannibalizing retail sales. The Spectrum Gaming Lottery Group reports that lotteries with robust digital offerings can reach new consumers, including younger players not tempted by the retail products.\u00a0\u00a0<\/span><\/p>\n But while the consultants say retailers have not been hurt by the adoption of iLottery in the states they reviewed, lotteries have found ways to work with their retail partners to alleviate the concerns. Those efforts can include reviewing retailer commissions, enabling buyers to redeem online winnings at stores, sharing databases with retailers, and offering retailers free advertising opportunities to lottery players.<\/span><\/p>\n Hudson was not available for an interview for this column, but provided insight on the story\u2019s topics by email.<\/span><\/p><\/div>\n