Rauner fires Illinois Lottery private manager
Increased sales were outweighed by richer payouts.
The bad news just keeps coming for the Illinois Lottery.
Not only is the state of Illinois failing to make good on payments to Lottery winners, but also a report from the Commission on Government Forecasting and Accountability, or COGFA, shows the amount the state paid out in prizes versus what it contributed to the state in revenue dropped by $125 million, even though Lottery sales increased by $39 million.
This marks the first time since fiscal year 2009 that Lottery transfers to the state decreased. The 15 percent revenue-transfer drop happened because the Lottery increased its payout ratio, possibly to encourage people to buy more tickets. That change cost $77 million more in prize payouts and only brought in an additional $39 million in sales. In fiscal year 2015, the Lottery only transferred $8 million to the Capital Projects Fund, a decline of almost 95 percent from the previous fiscal year.
Lottery revenue funds multiple state programs, including education. The state fund most affected by this drop is the Capital Projects Fund, which uses Lottery revenue to pay down debt-service costs and new costs associated with projects such as school and building renovations. According to COGFA, Lottery transfers to the Capital Projects Fund fell to just $8 million in fiscal year 2015 from $145 million in fiscal year 2014.
On top of a $125 million drop in Lottery revenue, the state is still unable to pay winners with prizes of $25,000 or more because politicians have failed to pass a balanced budget. On Sept. 18, Gov. Bruce Rauner fired Northstar Lottery Group, the private company former Gov. Pat Quinn hired in 2010 to manage the Illinois Lottery. Northstar will be removed fully from its responsibilities Jan. 1, 2017, or when the state choses a new private manager, according to a release from the governor’s office.
The state has been without a budget since July 1, though many Illinoisans have claimed winning lottery tickets since then. Illinois Comptroller Leslie Munger doesn’t have the authority to cut checks to the Illinois Lottery without a budget on the books.
Illinoisans across the state continue to suffer as many in the General Assembly refuse to do the right thing and pass a balanced budget the state can afford, instead of continuing to deficit spend. With more than $100 billion in pension debt and more than $6 billion in unpaid bills, more of the same won’t work. It’s time to stop the bleeding. Until then, people depending on a life-changing lottery ticket, the poor and disabled, and taxpayers across the state will lose out.