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Odds are lottery interest will continue to wane


WHAT in the world is happening to Maryland's state lottery? It has become yesterday's news.

Gone are the days when Marylanders flocked to purchase daily tickets. "You've Gotta Play to Win!" -- a lottery slogan of the 1970s -- struck a chord with this state's citizens. News stories about lucky winners appeared with amazing frequency.

It has been 26 years since the legal lottery returned to Maryland. The game no longer is a novelty. It has reached middle age and is showing signs of wear and tear. How can it compete against high-speed games on the Internet and electronic slot machines?

Falling sales

After a record year in fiscal 1998, Maryland lottery sales are down nearly 2 percent for the first half of this fiscal year. Hit particularly hard has been the original game, Pick 3. Sales have plunged $13 million. It's an inner-city street game -- the old numbers racket -- and the players are either dying off, moving to the suburbs or choosing other action.

Even the agency's Lotto game is hurting, with sales dropping $11 million. It has been victimized by the public's ardor for multi-state, mega-jackpots.

Lottery players aren't interested in heavy wagering these days unless they spot a $20 million jackpot -- an impossible dream. The odds of winning the Big Game: 1-to-76 million.

People want to gain millions quickly. For example, look at the insane stock-market craze over Internet stocks.

That's one reason the state lottery is limping. It's too slow for a fast-paced computer age.

Only the agency's Keno game (an electronic form of bingo), rub-off tickets (which are easily promoted and provide instant gratification) and mega-jackpots are proving popular.

There's more competition for the public's gambling dollars, too: Slot machines and horse racing at Charles Town, W. Va., slots and ponies at Delaware tracks; telephone horse wagering from Pennsylvania; full-blown casinos in Atlantic City, N.J., and a slew of other lottery games in surrounding states.

What's a lottery director to do?

Buddy Roogow, the Maryland director, is craftily trying to tread water. He has targeted instant lotteries as an area where clever advertising and gimmicks can boost sales. There also is plenty of room to expand instant lottery vending machines in retail outlets.

He knows that more and faster Keno games will appeal to younger adults who like casino and Internet types of entertainment.

He knows that a few obscenely gigantic jackpots will mean a whopping payday for the state.

But it will never be as good as when the Maryland lottery was young; then, revenues grew at a double-digit pace.

Lottery critics warn that government should not rely on gambling to balance its books -- it's now Maryland's third-largest revenue generator.

Revenue projections

Yet it took an extra $2 million in advertising last year just to keep the lottery even with the governor's revenue expectations of $400 million. Despite Mr. Roogow's creative efforts, he'll be lucky to hit this year's target of $389 million, or next year's target of $391 million. And that's with a strong economy. Imagine the lottery falloff in the next recession as folks cut discretionary spending.

To remain competitive, the day is coming when state lotteries will come close to mimicking electronic slot machines. Fast action is what players want. Soon cable television networks will permit wagering from your home.

In a free-market gambling environment, state lotteries are blocked by government from being entrepreneurial. Legislatures and governors cut lottery budgets and react angrily if lotteries get too aggressive.

Are state lotteries beginning to run their course?

Public interest may wane as faster gambling entertainment appears. But now that governments have tied their budgets to lottery revenue, don't look for this state-owned and operated enterprise to vanish. Elected officials have a vested interest in persuading citizens to take a chance: If folks don't play, Maryland government can't win.

Barry Rascovar is a deputy editorial page editor.

Pub Date: 2/10/99

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