BuSiNeSS PlAN - California Lottery

Figure 4.2 is a list of some of the key events which have impacted CSLsales since 1986:Figure 4.2 – KEY SALES EVENTS OVER TIME1985–86 Scratchers sales begin on October 3, 1985; salesare more than $ 10 million per day, but quickly dropas expected based on the experiences of other newlotteries. Fiscal year sales end up at over $ 1.7 billion.1986–87 Scratchers sales drop as expected, but theintroduction of Lotto offsets much of the sales decline.1987–88 to 1988–90 Lotto sales grow, aided by the introduction of twiceweekly draws. Scratchers sales gradually decline.1990–91 to 1991–92 Scratchers sales decline over this time period forunknown reasons, while Lotto sales soften. Lotto ismodified to a 6/53 matrix (players pick 6 numbersfrom a field of 53 numbers instead of 6 numbers froma field of 49 numbers) which appears to accelerate thegame’s sales decline.1992–93 to 1994–95 Lotto is re-launched with a 6/51 matrix and salesrebound. Three successful draw games, Fantasy 5,Daily 3, and Keno are introduced. All three gameshelp fuel sales increases. The Lottery implementsa multiple Scratchers strategy and installs vendingmachines. Scratchers sales almost double in the nextfour years.1995–96 Keno is terminated on June 24, 1996 as a result of aCalifornia Supreme Court ruling. In addition, vendingmachines are removed from retailer locations basedon an Attorney General’s opinion.1996–97 to 1999–00 Keno is replaced with Hot SPOT; the Legislatureapproves the reinstallation of vending machines; andLotto is again modified with positive results. The Lotteryimplements a policy of redirecting funds into additionalScratchers prizes. Sales increase significantly.2000-01 to 2002-03 A State Controller’s Office recommendation resultsin unclaimed Lotto jackpot annuity prize moneyreverting to education as a lump sum, rather thanover the term of the annuity. This results in a onetime revenue windfall of approximately $36 millionin fiscal year 2000-01.2003-04 to 2004-05 New gaming contract saves the Lottery about $ 40million per year. These funds are invested in Scratchersprizes and sales again increase significantly.2005-06 Sales reach a record level at just under $ 3.6 billion.California Lottery 2007–2010 Business Plan – 43 –