Is our lottery a winner?

By Anthony Thornton

Published: October 20, 2005

Oklahoma's lottery generated $12.6 million in first-week ticket sales, which lottery officials and the governor called a success.

However, the $3.80 spent per-capita falls short of the startup week for several other lotteries, a random survey shows.

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While the per-capita amount was greater than Kansas attained 18 years ago, it was less than half the amount spent during the first week of instant ticket sales in Georgia and Tennessee.

The Oklahoma lottery's executive director, Jim Scroggins, called the first week's sales "a great start" and said he is confident that the lottery will raise $65 million for public education this fiscal year, which ends June 30, 2006.

"Perhaps the most encouraging sign we've seen since the launch is that retailer reorders are strong, which suggests that our four games are being well-received by players," Scroggins said.

Gov. Brad Henry labeled the first week a success and said "there is no reason to believe that the success will not continue."

A top official for the company running the lottery called it "a pretty good first week."

"We've done 33 domestic startups. This was one of the smoothest startups that we've ever had," said Jim Kennedy, senior vice president of sales and marketing for Scientific Games.

The first week didn't go without hitches, however.

Some retailers are questioning whether their 6 percent commission is worth the hassle.

Vance McSpadden, executive director of Oklahoma Petroleum Marketers Association, said reviews are mixed among store owners he represents.

Some mentioned lines so long to buy tickets that customers leave grocery items on the floor. Those items "have a 20 or 30 percent markup," so those stores are losing money by selling lottery tickets, which require more time and produce less profit, he said.

"Other stores say it's working out just great."

The major problem, he said, has been getting information "from certain people" at the Lottery Commission office.

"It seems like it's us against them. And it shouldn't be that way at all," McSpadden said.

McSpadden said he understands the first week has been hectic, especially since Scroggins held his new job just three months before last week's startup. Scientific Games, the company hired to run the lottery, was hired in August.

Additionally, some stores banned from selling tickets are upset and threatening legal action.

"I have customers who are really mad. They were counting on buying tickets here," said Jack Martin, who owns a check-cashing business and gift shop in Broken Arrow.

Martin said he was approved to sell tickets in mid-September and spent more than $1,000 on lottery-related signs, plus the mandatory $95 application fee imposed on all retailers.

At the governor's urging, the lottery's oversight board voted Oct. 11 to prohibit check-cashing businesses, pawnshops and payday lenders from selling tickets.

"To me, it's just flat-out discrimination," Martin said.

He said he's still waiting for a refund on his application fee.