Government

Iowa Lottery revenues and prizes drop, but it meets budget

Cedar Rapids Hy-Vee outlets remain state's top sales locations

The Crossword game is among those in a display of lottery tickets at the Wilson Avenue SW HyVee on Thursday, March 12, 2
The Crossword game is among those in a display of lottery tickets at the Wilson Avenue SW HyVee on Thursday, March 12, 2009, in Cedar Rapids. The Wilson Avenue store is the top lottery sales location in Iowa. (Liz Martin/The Gazette)

Iowa Lottery ticket sales, revenue earned for the state and prize money awarded to players all dropped during the past fiscal year, but the lottery still met its budget targets despite the coronavirus pandemic.

Preliminary figures released Friday show the Iowa Lottery generated about $81.5 million in proceeds to state causes from $372 million in sales during the 12 months that ended June 30. Players collected about $236.3 million in prizes.

The unaudited results also show that west-side Cedar Rapids Hy-Vee stores continue to be leaders in lottery ticket sales statewide. The Johnson Avenue Hy-Vee reported $911,523 in lottery sales, with the company’s Wilson Avenue store recording lottery sales of $897,610. The Hy-Vee Drugstore on Sixth Avenue SW had the fifth highest sales at $775,258.

Overall, the lottery paid out $24.3 million in commissions to retailers.

Although the lottery met its budget targets, sales in fiscal 2020 decreased 4.8 percent from the previous year’s total of $390.9 million. Revenue turned over to various state causes dropped 12.3 percent and prizes to players decreased 2.3 percent from the previous year’s total.

Those numbers were largely impacted by two main factors: the COVID-19 pandemic and a relative lack of big jackpots in national lotto games, according to Iowa Lottery Chef Executive Matt Strawn. The largest lottery prize over the past 12 months was a $1 million Powerball payout to a Correctionville man and a $1 million Mega Millions prize paid to the “Just Us” group in Eldora.

Large jackpots for Powerball and Mega Millions — one more than $1.5 billion in October 2018, the largest jackpot in the game’s history — attracted players. However, in fiscal 2020, both games’ jackpots were repeatedly won with increased frequency at comparatively lower levels — $40 to $100 million.

That in turn meant lower overall sales in both games. The COVID-19 emergency further impacted the lotto category, with lotto sales nationwide falling during the pandemic, lottery officials explained.

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Scratch-ticket sales in Iowa, which have set annual records each year since fiscal 2015, did so again in fiscal 2020, totaling $262.4 million. That is an $11.8 million increase from the previous year.

Strawn noted that scratch games long have been the Iowa Lottery’s leading product category. In recent months, Iowans who suddenly had large amounts of time at home made scratch tickets part of their hard-copy entertainment options.

In general, the type of lottery product that sells best in a given year has a big impact on overall lottery results.

In a year like fiscal 2020 when scratch tickets sold particularly well, lottery profits overall will likely be a smaller percentage of total sales simply because scratch games have a smaller profit margin.

Sales in lotto games are largely jackpot-driven and therefore often fluctuate greatly from year to year, while sales of scratch games, pull-tab games and InstaPlay games are more consistent over time.

The lottery raised $2.5 million for the Iowa Veterans Trust Fund, bringing the amount raised since 2008 to $30 million. In fiscal 2020, the lottery raised funds for the first time for the new Public Safety Survivor Benefits Fund, which helps with insurance costs for the families of Iowa peace officers and firefighters who die on duty.

Since the lottery’s start in 1985, its players have won more than $4.6 billion in prizes while the lottery has raised more than $2 billion for state programs.

Comments: (319) 398-8375; james.lynch@thegazette.com

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