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States lottery sees record profits despite sour economy
Cashier Alice Lindstrom sells a lottery ticket Tuesday to Brian Doherty at the E Z Buy BP Gas Station on U.S. 129 in Gainesville. - photo by SARA GUEVARA

Gainesville resident Freddie Blake has a daily routine.

Part of that routine involves picking up a few scratch tickets or Mega Millions lottery tickets, hoping for the next big win.

Although, he notes, that hasn’t happened ... yet.

“Nothing, really,” he said when asked how much he’s won on the Georgia Lottery. He used to play Cash 3 or Cash 4, but now puts his money on Mega Millions and the latest addition to the Georgia Lottery family, Powerball. The multistate game was added last month and recently awarded a $200 million prize.

Still, he said, while waiting in line at the E Z Buy BP Gas Station on U.S. 129 in Gainesville, you never know.

“You’ve got to be in it to win it ... You’ve got to feed the kitty.”

And that’s the sentiment shared by millions of Georgia Lottery customers across the state, who have helped make the first half of fiscal year 2010 the most profitable yet. Profits for Georgia Lottery Corp. have totaled more than $429 million, surpassing the previous record set in 2009 by more than $8.49 million, despite a weak economy.

“As economic conditions change, spending habits change,” said Tandi Reddick, media relations manager for the Georgia Lottery.

“Lottery tickets are an entertainment product, not a necessity. The economy impacts our business as it does other organizations that offer entertainment products.”

Reddick said because they only cost $1, it’s easy for many to afford a ticket. And even though gambling isn’t recession proof — many Las Vegas casinos have noted a drop in revenue in recent years, for example — new games such as Powerball and the large jackpots it may award can contribute to sales.

“There are many factors that affect sales such as the economy, jackpot size, new game introductions and our beneficiary programs,” she said.

Georgia’s lottery puts profits directly into funding for the HOPE Scholarship, pre-kindergarten education and technology grants to train teachers.

And other states are beginning to see gambling as a potential revenue stream, too.

Pennsylvania, which recently legalized casinos, is now allowing table games such as blackjack and craps. New York OK’d video lottery terminals at a racetrack and Florida recently installed lottery ticket machines in grocery stores, along with joining Powerball.

But Clyde Barrow, a gambling expert at University of Massachusetts-Dartmouth, said states rationalize gambling “as a voluntary tax because nobody has to gamble.” He said studies show that many respond to the temptation.

“We do know the closer you put casinos to people the greater propensity to gamble,” Barrow said.

Alice Lindstrom, the clerk at E Z Buy, said she sees a steady stream of people throughout the day buying lottery tickets and scratch tickets. A display of scratch tickets next to her holds dozens of colorful varieties, and Lindstrom jokes with the regular customers, who come in and swap their winning tickets for more chances to win.

“Everyone says it’s a very lucky store,” she said as customers line up. Next to the cash register she keeps a pile of winning scratch tickets already turned in for the day, all of them for more than $20 apiece.

All those lottery customers have helped make this year the 11th consecutive year the Georgia Lottery has seen a profit, according to a news release.

Since its start in 1993, the Lottery has returned more than $11.4 billion to the state to pay for the HOPE Scholarship program, as well as the state’s pre-kindergarten program. In Hall County, 8,430 university system students have received more than $50.6 million in HOPE Scholarship money and more than 13,000 students have benefitted form the pre-k program, which has received $17.4 million since 1993.

But that still comes with a price, according to Keith Whyte, executive director of the National Council on Problem Gambling.

During a recession, Whyte said, gambling becomes an issue because money that could be used for groceries or rent for some families turns into a lottery ticket — and the winnings never materialize.

“We’re concerned that some people, maybe more in a recession, are gambling to pay the rent or to afford groceries or whatever,” he said, although he added that there isn’t evidence to show gambling problems necessarily increase during a recession.

He said his organization is also concerned with the lack of resources the lottery puts toward funding prevention.

“Our other concern is that the Georgia Lottery is not doing anywhere enough to prevent or treat people with have an issue with gambling,” he said. “The lottery does very little (to support) responsible gaming methods, and the state — the lottery — only takes a pittance from the lottery to support health programs.”

The Associated Press contributed to this report