LITTLE ROCK — The first month of newly begun fiscal year was a slow one for the state lottery, with net proceeds for college scholarships $2.4 million lower in July than the same month a year ago, Lottery Director Bishop Woosley said Monday.
Woosley told the state Lottery Commission the lottery grossed $33.8 million and collected net proceeds of $4.75 million last month, compared to gross revenue of $36 million and net proceeds of $7.15 million in July 2011.
The lottery’s budget forecast for last month called for $36 million in gross proceeds and $7.1 million in net proceeds for scholarships.
“There’s no way to sugarcoat this. We just did not have a very good month of sales in July,” Woosley said.
Sales may have been affected by high gas prices and high temperatures, he said.
“That really translates when you open up your electric bill and it’s 100 or so more dollars than it was the month before,” he said.
Woosley said one bright spot in his monthly revenue report was a spike in sales of Powerball tickets. The multi-state jackpot reached $320 million last week, driving sales of Powerball tickets in Arkansas up to $6.5 million in the run-up to the drawing, he said.
Also Monday, the nine-member commission voted to create a new committee that would deal directly with vendors. Board Chairman Ben Pickard of Searcy said the commission has a committee to deal with retailers, but in the past the commissioners have not interacted with the vendors.
“We were involved kind of on the outskirts when the contracts (with the vendors) were originally done. We were here, but our knowledge was very limited at that time,” Pickard said.
The lottery recently renegotiated some terms of its contract with its vendor for scratch-off tickets, Scientific Games of Alpharetta, Ga., after the former internal auditor for the lottery, Michael Hyde, raised questions about the contract.
Hyde questioned the legality of the contract, arguing that former Lottery Director Ernie Passailaigue had given Scientific Games more favorable terms than the company originally proposed, some of them without the knowledge or approval of the commission or state legislators. The commission voted to reaffirm the contract but accepted an offer from the company to make some changes to the terms. Hyde later resigned.
Commissioner Mike Malone of Fayetteville said Monday he did not want to create a structure that could be used to circumvent the lottery’s staff.
John Campbell of Fayetteville suggested that lottery director and auditor be included in the vendor committee. A motion by Bruce Engstrom of North Little Rock to create the committee and include the director and auditor as members passed in a voice vote that was not unanimous.
Woosley told the commission the lottery owes a $362,080 payment to the multi-state game Decades of Dollars, but its grand prize reserve for the game is only $203,000. The commission voted to authorize Woosley to transfer money out of the lottery’s unclaimed prize fund to make up the difference, as permitted by a revision state legislators made last year to the 2009 state lottery law.