Taking a look at the Kentucky Lottery after 35 years
Republished from WEKU.
When it comes to gambling in Kentucky, you can take your pick. But, there are lots of ways to take your pick. Kentucky is horse country. The first wager on a horse race was the inaugural Kentucky Derby in 1875. Most recently, legalized sports wagering came on the scene in September of 2023. Now, there’s historical horse racing, charitable gaming, and the state lottery.
Former Kentucky Governor Wallace Wilkinson’s campaign carried a pledge to see a state lottery established in the Commonwealth. And the constitutional amendment vote proved he picked a winner. More than 60% of Kentucky voters said “yes” to the games of chance. The first day of lottery ticket sales occurred in early April of 1989 at more than 5000 retailers.
Kentucky Lottery Corporation President CEO Mary Harville said the lottery began with two scratch-off games, one more than many other starter states. Today, there are 70 to 80 scratch-offs and 60 to 70 online games. Even with big winners in national games, expectations rise, said Harville.
“Our last Kentucky winner was 128 million in 2010. We thought 128 million was huge, but we know now that we’ve had jackpots up in the billions and almost two billion right? So, it takes a lot more to get people’s attention,” said Harville.
There are various price points in lottery tickets including a 50-dollar scratch-off ticket. There are the national draw games, power ball, and mega millions. Internet sales started in 2016. Maggie Garrison is chief financial officer for the Lottery. Garrison said the lottery recorded two billion in sales in fiscal year 2024, a 14% increase over the previous year.
“And back in 2017, we hit one billion for the first time. So incredible to make up that difference and see that growth, absolutely and so record sales, record prizes to players and record cash transfers to the state. We eclipsed the $400 million mark of payments to the State, which of course is our ultimate focus and goal,” said Garrison.
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Money to the state initially went into the general fund, but in 1999 state proceeds started going for a college scholarship program. Kentucky Educational Excellence Scholarship or KEES awards are merit-based, but there are also two need-based scholarships and work-ready awards for community and technical college students. Mary Harville said students can earn as they go from a freshman to a senior in high school, maxing out about $25 hundred a year for tuition.
“And the intent at that time was by doing that we would encourage our young folks to stay right here in Kentucky. And we know if they stay here in Kentucky and pursue their education, they’re more than likely gonna stay here and raise their families too,” said Harville.
Harville said it wasn’t until 2014 that the Lottery was allowed through Kentucky law to advertise the money set aside for college scholarships.
Marketing of the Lottery has undergone some modification. Chief Branding Officer Edie Frakes said there are some 700,000 players on the lottery mailing list, out of about 3.5 million adults in the Commonwealth. And Frakes said a rebranding occurred in 2019.
“Our 30th anniversary gave us an opportunity to sort of modernize our logo and to incorporate our mission which is fueling imagination and funding education into our logo and our tag line. And so, it helps us to build our brand from the inside out,” said Frakes.
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Statistics have long shown that for a certain segment of Kentucky society legal gambling leads to a problem. About one and a half percent of Kentuckians are compulsive gamblers while about two to four percent are problem gamblers. Mike Stone is the long-time director of the Kentucky Council on Problem Gambling. He said former Lottery Director Arch Gleason stressed, years ago, a strong commitment to help those citizens recover. Stone said Kentucky’s responsible gaming criteria is used by the World Lottery Association.
“So his concept was not just in Kentucky, but his concept was taken worldwide by lotteries that they need to be responsible in how they sell their tickets, what their advertising message is and in the fairness of the games,” said Stone.
Stone said the Lottery Corporation helped fund the Kentucky Council on Problem Gambling and printed the 1-800 Gambler-help line number on tickets.
Stone said gambling expansion comes in many forms, but it definitely does come.
“Gambling always expands. It’s a legal enterprise and if it’s a legal enterprise, it has to compete for the dollars. And it competition for the dollars you either have to continue to expand and progress and innovate or you fall behind,” said Stone.
The gambling landscape in Kentucky now includes sports wagering. Stone expects it to become the number two most popular form of gambling, behind the lottery. And he noted right now sports wagering is generating the most calls to the gambler helpline. Stone also said the suicide rate of addicted gamblers is higher than any other addictive disorder.
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Nick Spencer is director of policy with the Kentucky Family Foundation. He said the Lottery’s goal of helping people afford higher education is laudable, but he said that could be considered a transfer of wealth from many low-income individuals to middle and high-income families. Spencer noted if the lottery is deemed entertainment, it’s still predatory on low-income citizens. And the Family Foundation official added it can impact young people, just starting a life after school.
“How much more difficult is it going to be for that individual to start a family, to buy a home, to really get ahead in the workplace when they’re crippled by all of this debt that they’ve racked up because they got entangled in legalized gambling and sports betting and even something like increased involvement in the Lottery,” said Spencer.
Mike Stone with the Kentucky Council on Problem Gambling said the stigma about compulsive gambling has faded, the moral indignation of years ago as well, and legal gambling has been normalized. And Nick Spencer with the Family Foundation said pastors are hesitant to talk about the subject.
“There still is a large amount of hesitancy whether that be because of particular tax implications which could come down the pike or just the fact that the Church has been told for 50-60 years that they don’t have the right to speak into these cultural issues and I think it’s scared a lot of churches,” said Spencer.
One of the more significant lottery retailers in central Kentucky is the Reynolds Road Food Mart in Lexington. There are signs in many spots of the convenience store, highlighting big lottery winnings. A large scratch-off board is positioned right next to check out.
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On this weeknight Chris Lee came in to buy his lottery tickets, something he does on a pretty much regular basis.
“Not really any reason behind it and I usually for the bigger drawings I wait for them to get to a certain number before I’d even consider playing. Only because I know the odds and I don’t want to waste my money like that, knowing I am right now wasting my money,” said Lee.
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Another regular to the Lexington store is Kevin Sparks who says he just plays scratch offs and uses a scanner to identify winners and losers.
“What’s the biggest hit you’ve had?…
500….Do you think you’ve spent more than that.?
Oh sure..yeah..by far yeah. I’ve put somebody through college,” said Sparks.
So, the legal gambling landscape has changed a great deal in three decades. And predicting the future when it comes to legal wagering is a gamble at best.
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Originally published by WEKU.
Republished with permission.
