Lump-Sum Bonanza For Lotto? Sagging Fortunes Linked To Players’ Lack Of Interest
A slump in Lotto sales has prompted state lottery officials to consider giving jackpot winners the option of a lump-sum payment instead of 20 annual installments.
“People aren’t as excited anymore about getting $1 million or $2 million spread out over 20 years,” Tim Brown, the lottery’s planning and research manager, told The Seattle Times.
Lotto sales dropped 33 percent in the past fiscal year. They are down another 7 percent in the current year, which ends June 30.
However, total sales for all lottery games are running about 9 percent ahead of last year because of successful Quinto and scratch-ticket games.
In an effort to jump-start Lotto’s sagging sales, Brown will ask members of the state Lottery Commission on Friday to consider lump-sum Lotto payouts.
The proposal would give players an option of receiving the full jackpot amount over 20 years, or a cash payment for half the lottery’s advertised jackpot, with 28 percent withheld for federal income taxes.
For example, if a player won a $2 million jackpot, the player would receive $72,000 a year over 20 years.
Or the player could choose to receive a $720,000 lump sum, Brown said.
Brown will also ask the commission to raise the game’s minimum jackpot from $1 million to $2 million.
“People have gotten accustomed to hearing about triple digit jackpots and our jackpots are small compared to a Florida or California,” Brown said.
“For a lot of people, that’s not enough to stand in line to get a ticket.”
Brown also wants the commission to consider reinstating “Double Lotto,” a promotional feature used last year, in which players could double their potential jackpot by paying an extra $1 for their ticket.
If the commission approves all three suggested measures to help Lotto, it could boost the game’s annual sales by about $40 million, he said.
Quinto has grown steadily, partly because its prizes are paid out all at once, Brown said.
For the first time in more than a decade, Lotto fell below scratch-ticket “instant winner” games in sales last year: Lotto took in $139.9 million while scratch-ticket games collected $164.6 million.
Total lottery sales for the year were $389.9 million, a 2.8 percent drop from 1995, the Times reported.
Even if the Lottery Commission favors the lump-sum payment plan, Brown said it could take up to six months to formally change lottery rules to allow it.
If commissioners approve a certain option, “we would then have to start going through a process of rule changes, and we wouldn’t be able to implement anything sooner than January,” he said.
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