Regional Legislative and Regulatory Roundup

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Regional Legislative and Regulatory Roundup

NEW YORK -- Arkansas was the 25th state to enter the Union (in 1836), but when it came to the lottery it was the 43rd to join up.

Tickets go on sale Sept. 28, and Ernie Passailaigue, Arkansas’ lottery director, estimates first year net revenues will be $125 million on gross sales of $449 million.

With such a potential tax windfall, what took Arkansas so long to adopt a lottery? Too many special interests, declared the voters every time a lottery was proposed.

But last November an amendment to the constitution allowing a lottery won an overwhelming victory at the polls.

What turned the nays to yeas, said Lt. Governor Bill Halter, was the guarantee that the net proceeds would be given to Arkansas citizens who attend in-state colleges—making the Natural State (its official nickname since 1995) the only one where all lottery proceeds will go to college scholarships. The awards range from $1,250 to $3,000 a year at two-year colleges, and $2,500 to $6,000 at four-year colleges.

"Now I hope we will all work together in moving Arkansas up from 49th in higher education," Halter said.

Not the least of the beneficiaries will be Arkansas retailers. "We worked in support of this legislation for a long time," said Ann Hines, executive vice president of the Arkansas Oil Marketers Association (AOMA). "Now Arkansas citizens won’t have to cross into Texas, Missouri or Oklahoma to buy tickets. That accounted for more than just lost lottery revenue, since lottery buyers often purchase other items while in the store."

As in most states, Arkansas retailers will receive a vendor allowance for handling the tickets: 5 percent of lottery sales, in addition to a percentage of winning tickets bought in their stores.

Where there are winners there have to be losers, and Oklahoma expects to lose $10 to $12 million annually in ticket sales, according to a spokesman for the Oklahoma Lottery Commission, with Missouri losing $25 to $30 million.

Texarkana, Texas-based E-Z Mart Stores Inc., whose headquarters practically straddle the Texas-Arkansas border and has stores in Arkansas, Louisiana, Missouri, Oklahoma and Texas, didn’t expect any negative impact on its business.

"It seems crazy to me for Arkansas money to go to the Texas lottery, said Jeri Brown, E-Z Mart’s district supervisor, speaking from an E-Z Mart on the Arkansas side of Texarkana.