Saturday, February 03, 2001
Powerball wants to add Ohio
21-state game dangles funding
By Spencer Hunt
Enquirer Columbus Bureau
COLUMBUS The director of the popular Powerball multistate lottery game says he wants to travel to Ohio to sell it to state lottery officials.
We've contacted them to try to set up a time to come in and talk, Charles Strutt told the Enquirer on Friday. We're certainly eager to talk to them about what our product can offer.
Ohio Lottery leaders already know. Thousands of Ohioans abandon their state's Super Lotto game and stampede to Indiana, Kentucky or West Virginia every time Powerball's jackpot hits $100 million or more.
Mr. Strutt's comments, coming just days after Gov. Bob Taft said Ohio should join a multistate lottery, sig nal new interest in Ohio becoming Powerball's 22nd member state. But Powerball's main competition, the seven-state Big Game, is interested, too.
In Ohio, I think the Big Game would go gangbusters, said Don Gilmer, lottery commissioner in Michigan, a Big Game state. We'd certainly welcome the opportunity to make a presentation to Ohio, if they are in a position to entertain one.
Does that set up a bidding war with Ohio as the prize? Mr. Strutt said no, but added: I think we can show Ohio would make more money from Powerball.
Mr. Taft thinks more than $70 million would be raised for public schools over the next two years if Ohio joins or creates a multistate game. The $44.8 billion budget plan he unveiled Monday assumes Ohio will do so next year.
Ohio faces a state Supreme Court order to fix its school funding system. Mr. Taft's lottery proposal would help raise money needed for his $808 million school spending plan.
While a budget battle simmers between the governor and conservative lawmakers in the statehouse, it's now clear lottery officials from other states will be waiting in the wings.
Ohio Lottery spokeswoman Sandy Lesko-Mounts agreed that her agency is in a good position to join a game, if a bill passes the General Assembly. She said the agency doesn't have a preference between the two multistate games.
All of it would be dependent on where we would be best placed to produce the most revenue, Ms. Lesko-Mounts said.
Mr. Strutt and Ohio Lottery Director Dennis Kennedy have sent each other several e-mails, according to Ms. Lesko-Mounts. She said a meeting could be in the works, but neither she nor Mr. Strutt would say when.
The Ohio Lottery estimates it loses up to $300 million a year in potential sales to the two multistate games. Ohio Lottery proceeds sent to the state education fund have declined from a $748.5 million high in 1997 to $686 million last year.
The state charted a $9.4 million drop in lottery ticket sales in May when the Big Game jackpot reached a record $363 million. That grand prize was split by two winners, in Illinois and Michigan.
In the Powerball state of Kentucky, Lottery Director Arch Gleason estimates 10 percent of tickets are bought by people who live in Southwest Ohio. That amounts to about $9 million to $11 million a year.
Mr. Gleason and Jack Ross, director of Indiana's Hoosier Lottery, were surprised to learn Mr. Strutt is coming to Ohio.
To have Ohio in Powerball would probably cost us sales, Mr. Ross said.
Powerball's 21 member states and the District of Columbia would have to approve Ohio by a weighted majority vote before it could join. Mr. Strutt has general authority to explore options that would expand or otherwise improve the game.
Mr. Ross and Mr. Gleason said they would have to determine if the potentially bigger jackpots created by Ohio's presence would create enough additional sales in their states to overcome any losses.
In Michigan, Mr. Gilmer already is convinced his state would see increased sales if Ohio is in the Big Game. Other Big Game states are Illinois, Georgia, Maryland, Massachusetts, New Jersey and Virginia.
He said the addition of Ohio's 11 million residents would push jackpots up faster, which would in turn generate more excitement among players to buy more tickets.
Mr. Strutt said he plans to perform cost-benefit surveys for Indiana, Kentucky and West Virginia that would show them what would happen to their revenues if Ohio became a Powerball member. He said Powerball produced several such surveys last year, but declined to share them.
Surprisingly, it looks pretty good, he said.
Powerball and the Big Game have each posted record-breaking jackpots within recents years.
1. $363 million: Big Game, May 9, 2000
2. $296 million: Powerball, July 29, 1998
3. $197 million: Big Game, April 6, 1999
4. $195 million: Powerball, May 20, 1998
5. $151 million: Powerball, June 30, 1999
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