follow us:Google+FacebookLinkedInTwitterVimeoRSS Feeds

advertisement

Bipartisan Senate bill could help Pennsylvania Lottery

By

Back to Top Comments Email Print

State Sens. Mike Brubaker, R-Lancaster County, and John Blake, D-Lackawanna County, announced a plan Wednesday that could help the Pennsylvania Lottery with game management and marketing while generating more revenue for the commonwealth.

The proposal from the majority and minority chairmen of the Senate Finance Committee would lower the mandated margin rate to 25 percent from 27 percent in the 2014-15 fiscal year.

The mandated margin rate determines the percentage of gaming proceeds going into the Lottery Fund to pay for programs benefiting older Pennsylvanians.

That rate had been at least 30 percent of revenue from ticket sales but was lowered to 27 percent in 2008.

"As this commonwealth's population of older citizens continues to grow and demand for Lottery-funded programs increases, this industry must grow profits to satisfy that demand," Brubaker said in a statement. "By reducing the artificial margin mandate, the Lottery will have greater ability to fully meet this demand and maximize sales and profits at a time when additional revenues are needed to also meet the demand on our vital senior services and programs."

Over the last five years, consumer demand has continued to shift from high-margin terminal-based games to lower-margin instant lottery games, or scratch-off tickets. These games — specifically higher-price-point instant games — demand a much higher payout percentage, and therefore, deliver a lower profit margin for the Lottery.

The proposal, which has not been formally introduced, could drive up to $200 million in additional revenue over the next five years, Blake said. Pennsylvania is one of four states that have a minimal margin mandate.

In the last year, the lottery generated more than $1.1 billion in profit at a 27 percent margin.

Jason Scott

Jason Scott

Jason Scott covers state government, real estate and construction, media and marketing, and Dauphin County. Have a tip or question for him? Email him at jasons@cpbj.com. Follow him on Twitter, @JScottJournal. Circle Jason Scott on .

advertisement

Comments


Be the first to comment.



Please note: All comments will be reviewed and may take up to 24 hours to appear on the site.

Post Comment
     View Comment Policy
advertisement
  
  
advertisement
  
  
advertisement
Back to Top