Looking for a way for the state to generate revenue without increasing taxes, the 1990 Louisiana Legislature approved Act 1045 amending the state's constitution to create a state lottery. Due to its unique operations, the legislature recognized a corporate structure would best suit the Lottery. Voters also liked the idea and passed a constitutional amendment creating the Lottery on Oct. 6, 1990 by a 69 percent to 31 percent margin statewide. The Lottery sold its first scratch-off ticket Sept. 6, 1991. For more information about the Lottery's history, click here.
Louisiana's citizens! The Lottery's mission is to generate maximum revenues for the state of Louisiana, which is the corporation's sole shareholder. Although many Louisiana businesses benefit indirectly from having a state lottery, only the state directly receives LLC profits which amount to 35 percent of its revenue. To date, the Lottery has transferred over $2.7 billion to the state treasury.
Public trust is paramount to the Lottery's success. To ensure the highest level of accountability, the following have varying degrees of oversight over the corporation, including review of its budget and administrative rules and drawings: the Governor of Louisiana, Joint Legislative Committee on the Budget, Senate Judiciary B Committee, House Committee on Administration of Criminal Justice and the Office of the Legislative Auditor.
In addition, the president of the Louisiana Lottery Corporation handles the daily activities involved with running the corporation under the supervision of the LLC's nine-member, governing board of directors. Board members are appointed to staggered terms from each of Louisiana's six congressional districts and threemembers are appointed at-large. Each member is appointed by the governor and confirmed by the Louisiana Senate before beginning a four-year term. The state treasurer serves as an ex-officio board member.
In addition to a succession of annual "unqualified" opinions from the Office of the Legislative Auditor, the LLC continues to receive recognition from the Government Finance Officers Association for excellence in financial reporting. To view current financial statements, click here.
No, the state's constitution dictates how Lottery proceeds are to be directed. Effective July 1, 2004, the state constitution provides that Lottery proceeds be dedicated to the Minimum Foundation Program, which funds public education in Louisiana. The dedication was a result of a 2003 constitutional amendment which was passed by voters, 64 percent to 36 percent.
The Lottery is totally self funded, retaining less than 10 percent of its revenue to fund statewide operations including its headquarters, five regional offices, distribution center, technology needs, staffing and ticket printing. According to an efficiency study conducted by TLF Publications, Louisiana ranked first among U.S. lotteries in percentage of revenue transferred to their government.
More than 50 cents of every dollar goes to tens of thousands of Lottery winners every week. Unclaimed prizes are returned to players in the form of increased scratch-offs payouts and promotions. At least 35 cents of every dollar goes to the state treasury, as defined by the Lottery's statute. Less than 10 cents of every dollar is used to operate the Lottery, which is completely self funded. About 5 cents of every dollar, in addition to incentives and bonuses, is paid as commission to Louisiana businesses who sell Lottery games.
The legislature's decision to pursue a state lottery was based on a 1989 study indicating expected sales between $129 million and $164 million, which the Louisiana Lottery has far exceeded every year. This is especially noteworthy considering the proliferation of additional, competing gaming venues in Louisiana, which have occurred since the Lottery was created.
The Lottery is the only state-owned form of gaming in Louisiana. According to a report from the Legislative Fiscal Office projecting data for 2012, Lottery transfers represents 19 percent of total gaming industry proceeds transferred to the state, but the Lottery's share of total state gaming spending is only 5.6 percent. The reason for this difference is the effective tax rate. The Lottery's effective tax rate, which is the share of net revenue after prize expense transferred to the state, is 76.2 percent compared to an effective tax rate of 30.2 percent for video poker, the next highest taxed form of gaming.
The Lottery employs roughly 125 people, including both full-time and part-time employees in its Baton Rouge headquarters and distribution center, as well as regional offices in New Orleans, Lafayette, Alexandria, Shreveport and Monroe.
According to state law, Lottery ticket purchasers must be at least 21 years of age. Individuals who sell tickets are required to obtain proof of age through a valid current drivers' license, a state issued ID card, a passport, or military or federal ID containing both a photo and date of birth.
Any person who knowingly sells to a minor can be fined between $100 and $500 for the first offense and $200 to $1,000 for each subsequent offense. Underage purchasers can also be fined up to $100.
The Lottery's retailer regulations hold retailers responsible for their employees' adherence to this law and retailer contracts can be suspended, revoked or terminated if retailers are found not to be compliant.
Individuals who are at least 21 years of age can give Lottery tickets to a person under the minimum age as a gift, although minors must be accompanied by a legal guardian or a family member who is at least 21 years of age in order to claim a Lottery prize. The Lottery statute does not contain a minimum age requirement to sell tickets; retailers are governed by employment law in that regard.
The 21 minimum age requirement to purchase Lottery tickets changed from 18 years of age in 1998 to coincide with the age requirement for other forms of gaming in the state. Louisiana is one of only a few states that require Lottery ticket purchasers to be at least 21 years of age. Most states with lotteries have a minimum age requirement of 18.
Administrative regulations do not prohibit the use of credit cards to purchase Lottery products. Even though regulations allow credit cards to be used to purchase Lottery tickets, retailers can decide what form of payment they will accept and some do not accept credit cards to buy Lottery tickets. Regulations do prevent retailers from extending individual store credit for the purchase of Lottery tickets.