Here’s How States Profit from Powerball Madness
Business + Economy

Here’s How States Profit from Powerball Madness


No one has taken home the record-setting Powerball prize yet, but there are already plenty of winners from the 44-state lottery. School children, seniors, veterans and college students are benefiting from the hot sales of lotto tickets across the country.

The jackpot for this run of Powerball, which started in early November, hit $1.5 billion on Tuesday, the biggest in its 24-year history. Proceeds from ticket sales go to participating states and profits from Powerball are nearing records.

Lottery profits support a range of people and services depending on the state. In Maryland, the lottery is the fourth-largest contributor to its general fund, which supports public health, public safety, education and the environment.

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Lotto funds support Iowa’s veteran’s trust fund. In Pennsylvania, all lottery money goes to services for older residents. Wisconsin uses lottery profits to offer property tax relief for homeowners. And Nebraska distributes the profits to a host of areas including lake improvement, recycling projects and state fair facilities.

In an ironic twist, lotto money in four states — Kansas, North Dakota, Washington and Louisiana — goes to funding programs for gambling addicts.

“I don’t want to speculate about how much Nebraska will benefit from the current jackpot run while it’s still going on,” says Neil Watson, a state government spokesman. “But I can say that in the past these types of large jackpot events have had a significant impact in the quarterly proceeds transfers to our beneficiary funds.”

Here are some other interesting Powerball facts from the states:

  • In Wisconsin, last week’s Powerball sales totaled $21.7 million, seven to 20 times the average range and closing in on the $22.3 million record set in August 2001.
  • Michigan lotto players bought $29.5 million worth of Powerball tickets for Saturday night’s drawing, versus $13 million that the previous drawing brought in when the jackpot was over $500 million.
  • Kansas has sold nearly $6.8 million in Powerball tickets, a new record for a single drawing in the state.
  • Maryland has netted $14 million more in profit from all lotto ticket sales in the last five weeks compared with the same period a year ago.
  • In Florida, Powerball sales last week totaled almost $108 million, or nearly 1,500 percent more than the same week last year and 545 percent higher than the previous week.
  • Powerball sales in Oklahoma last week came in at almost $14 million, compared with $900,000 in an average week. A state lottery spokeswoman said sales for all lotto games increased as well.
  • In Colorado, the typical week for Powerball sales is about $1.3 million. In the past week, sales in the state hit nearly $20 million.

“This is Colorado’s win,” says Brooke Christopher, spokeswoman for the Colorado Lottery. “We are definitely looking at positive dividends based on this run alone and stronger numbers going to the spillover fund, thanks to lottery players.”

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Proceeds from lotto sales in Colorado first go to preserving and improving the state’s parks, trails, wildlife, rivers and open spaces. Any additional monies go to the state’s education system.

States that tax winnings get even more money if the winner resides in their states. For instance, if a Maryland jackpot winner takes the cash, the state will pocket $79.5 million in taxes.

Retailers that sell tickets also are reaping the rewards for the unprecedented $1.5 billion Powerball. In Maryland, retailer commissions are up $2.7 million in the last five weeks compared with a year ago, according to a spokeswoman from Maryland Lottery and Gaming.

Convenience stores sell about half of all lottery tickets and earn about 5 percent to 6 percent in commissions, or roughly a dime per $2 ticket, says Jeff Lenard, a spokesman for The National Association for Convenience & Fuel Retailing.

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“We won't have sales data from members till later in the week but it is certainly within reason to consider that Tuesday and Wednesday may be the busiest days in our history,” Lenard says.