Lotto flat but holding on in wake of casinos, cafs

June 16, 2013

LIMA — Ohio Lottery sales are essentially flat this year, holding their own against casinos opening, but with instant tickets losing business to Internet cafés.

Overall sales are down about 1 percent, with instants seeing a 4.6 percent decrease this past fiscal year, online games up 3.6 percent and Keno up 21 percent, lottery spokeswoman Marie Kilbane said.

The lottery relies on 10,000 retail locations in the state, Keno in taverns and now regulation of gaming at two racinos.

The 1 percent decline is better than the estimated 5 percent decline in sales lottery officials predicted with the opening of the casinos, and lottery officials told lawmakers last week they believe instant ticket sales will rebound with the closing of Internet cafés.

“We’re always trying to find ways where we can be innovative and interest players,” Kilbane said. “The instant lottery market is a little different than gambling at casinos, which are entertainment destinations. With the lottery, you’re picking up a ticket at the convenience store and taking it home to your kitchen table.”

Lottery sales remain strong in Allen County, especially at Fat Jack’s Pizza. Fat Jack’s North West Street store is tops in the county for sales and prizes cashed in, and the other two Fat Jack’s locations are in the top four.

Popular lottery sales locations are built on location and good service, Kilbane said.

“It’s the same as you would expect from any retail establishment,” Kilbane said. “Those attributes make for a good store.”

Fat Jack’s owner Dave Boyles agreed.

“It’s because of our service. We handle things accurately. We actually fix a lot of mistakes made at other locations,” Boyles said. “Our clerks are knowledgeable about the lottery. We cash a lot of tickets that we didn’t sell. We probably do 80 percent of the claims in Lima.”

Lottery sales contribute directly and indirectly to sales, Boyles said. The store receives 5 percent of sales and 1 percent of cash prizes. The three Fat Jack’s sold nearly $3 million in 2012, and cashed $2 million in prizes.

Plus, people are in the store every day buying lottery tickets and other items, Boyles said.

The Ohio Lottery was given permission to re-up a Georgia-based firm to operate the nation’s ninth-biggest state lottery last week after state lawmakers grilled officials about the lottery’s lackluster performance over the past year, The Columbus Dispatch said.

Intralot Inc. received a $57 million, two-year extension to operate the lottery, the firm’s third two-year renewal. Intralot won a 10-year contract to operate and maintain the state lottery in 2007, with options to renew every two years.

The seven-member State Controlling Board, which oversees state agency spending, released money for the contract, but some members expressed disappointment about the performance of the lottery, whose net proceeds help fund Ohio’s schools.

Greg Bowers, the state lottery’s finance director, said that profits are up nearly $30 million, to a total of $741 million, through May over the last fiscal year mainly because of revenue generated by slot machines at the racinos, at horse-racing tracks in Columbus and suburban Cleveland. Intralot operates the video lottery terminals at the racetracks, according to The Dispatch.

Lottery sales