Arkansas Gambling on a State Lottery

The Arkansas lottery is getting closer to becoming a reality for the states convenience store and gas station customers.

Last month, Gov. Mike Beebe signed both the identical Senate and House bills passing the Arkansas Scholarship Lottery Act. Arkansas will soon join boardering states Louisiana, Missouri, Oklahoma, Tennessee and Texas in the lottery fraternity, according to the Lottery Post an online magazine that tracks state gaming.

The act requires the formation of a commission that will oversee the lottery. The Arkansas Lottery Commission will have a total of nine members. Three will be elected by the governor, three by the speaker of the House of Representatives and three by the president pro tempore of the Senate. A chair will be collectively appointed by the commission. These members will serve two, four and six-year terms.

The commission will determine the amount of lottery proceeds that will be used as prize money, and they will also determine how much will go towards educational scholarships to students attending public and private two and four-year colleges.

The bill encourages the commission to prompt minority and female owned businesses to participate in the lottery. In subchapter four of the bill, the bill states, “It is the intent of the General Assembly that the Arkansas Lottery Commission encourage participation by minority owned businesses and female owned businesses.” The bill instructs the commission to create a plan that will gain the interest of minority and female owned businesses.

As part of the bill, retailers will receive compensation in the form of commissions “in an amount of not less than 5% of gross sales of tickets and shares and may provide for other forms of compensation for services rendered in the sale or cashing of tickets or shares.”

Those who are under 18 or are incarcerated at the time are not eligible to win a lottery prize. Retailers who sell lottery tickets to those under 18 will either be fined or have their retailer license suspended or revoked. Any combination of these penalties can be used depending on the frequency of breaking the law.

Video lotteries are not allowed. Defined by the bill, a video lottery is any lottery that uses a computer or an interactive computer terminal device.

“Estimates on yearly revenues from the lottery range from $55 million to $100 million. Because of that uncertainty, the dollar amounts of the scholarships funded by lottery proceeds have been set on a sliding scale, depending on revenue generated and whether a particular award is for attendance at a two-year state college or university–from $1,250 a year to $3,000–or at the more expensive four-year schools–from $2,500 a year to $6,000. Lawmakers hope to set specific amounts next February during their budget session, with the first scholarships good for the 2010-2011 school year,” according to an Arkansas legislative update.

Susan Goedde, a representative from the Missouri Lottery Commission, said the state estimates it will lose $25 million to $30 million within the first full year that Arkansas has its lottery running, according to the report.

That amount, she said, is if Arkansas chooses to go with Powerball and factors in the price of gas and ticket costs. She said Missouri receives an estimated $995 million from the lottery each year.

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