Arkansas Scholarship Lottery reports $580 million in FY25 revenue; FY26 budget projects lower receipts and increased transfer obligations

The Arkansas Scholarship Lottery reported fiscal 2025 revenue of about $580,000,000 and a transfer of $111,000,000 to the Arkansas Department of Higher Education, the lottery's executive director told the ALC Lottery Oversight Subcommittee. For fiscal year 2026, the lottery presented a budget that projects lower revenue at $463,800,000 and a transfer to ADHE of $105,700,000.

Sharon Strong, executive director of the Arkansas Scholarship Lottery, said, “we closed out fiscal year 25, about a month ago on a strong note, generating approximately $580,000,000 in revenue and transferring a 111,000,000 to the Arkansas Department of Higher Education for scholarships, which was the third highest since the lottery's inception.” She added that the performance occurred in a year with only one jackpot prize that exceeded $1,000,000,000, and that FY26 revenue projections were set slightly lower in line with national trends.

Strong told members the legislature passed an “access bill” during the 2025 session that “increased the lottery's fiscal responsibilities by approximately $22,600,000.” The lottery said it will address the change while aiming to maintain the stability of scholarship funding.

On product mix, Strong said Arkansas instant ticket sales continue to represent the large majority of state sales: “Arkansas instant ticket sales make up about 82%.” She noted, however, that draw games such as Powerball and Mega Millions can still exert a disproportionate effect on revenue when large jackpots occur.

In a separate director's report for July 2025, staff reported monthly results better than budget by 1.7%, an early transfer to ADHE of $48,000,000, $6,662 in child-support setoffs, and $269,812 in income taxes withheld. Pulaski County was the highest revenue-generating county for the month at $9,300,000. The lottery launched four new instant games in July, including a Jurassic World ticket.

Committee members asked routine clarifying questions. Senator Hill asked what happens to unclaimed prizes; Strong replied that unclaimed prizes remain in a pool during the year and are transferred to net proceeds at year-end. Senator Patty asked whether “instant” referred to scratch-off tickets; Strong confirmed it did and that instant sales are the bulk of Arkansas ticket sales. Representative Hawk asked whether third-party courier services such as Jackpocket are treated as retailers; Strong replied that such services are licensed as retailers and “have to pay the same fees as any other retailer.”

No formal vote was taken on the FY26 budget during the meeting; the subcommittee received the presentation and asked follow-up questions.