Tuesday, Nov. 3, 2009 , 8:54 a.m.
Mega move to Tennessee

By:
Adam Crisp

Lottery executives have said for years that many casual players only take part in the multi-state big games when jackpots reach $200 million or more.

So Tennessee, trying to lure more lottery players from the couch to the corner store, decided Monday to sell tickets for both Mega Millions and Powerball. It’s a bid to always have retailers selling at least one game with a huge jackpot, lottery officials said.

“This is like bringing Pepsi to a state that only had Coke,” said Rebecca Paul Hargrove, president and chief executive of the Tennessee Lottery Corp. “Our players will now have the opportunity to play both games, and that will generate more dollars for the education programs we fund.”

The move could generate as much as $30 million to $40 million more in revenue in the first full year. Ms. Hargrove said, which translates to about $10 million to $15 million more for lottery-funded scholarships.

LOTTERY SALES

Tennessee

2008 — $1.05 billion*

2007 — $1.07 billion*

Georgia

2008 — $3.5 billion**

2007 — $3.4 billion**

* calendar year

** fiscal year

Source: Tennessee and Georgia

ANOTHER GAME

Lottery players may notice the addition of Mega Millions in the first quarter of 2010. More than 43 other states are considering the move.

Georgia Lottery spokeswoman Tandi Reddick declined to comment on whether Georgia will join Tennessee in selling both games.

The North Carolina Lottery Commission also voted Monday to allow both games. Georgia’s lottery commission won’t meet again until January.

Before October, both big games barred states from selling both Powerball and Mega Millions. Negotiations to allow cross-selling have been ongoing over the last year, and all 43 states that have lotteries are considering the move, said Ms. Hargrove, who was CEO of the Georgia Lottery until she came to Tennessee to help start its lottery in 2003.

Tennessee players could notice both games in stores as soon as the first quarter of 2010, Ms. Hargrove said.

“There are people who say they only play the lottery when the jackpot is over $200 million,” said Tennessee Education Lottery Commission Chairman Jim Hill, of Signal Mountain. “So as statistics have it, you will always have one big game that is in the hundreds of millions and the other that isn’t if you offer both games.”

Over the last two years, Powerball, which is played in 31 states, including Tennessee, has had no $300 million-plus jackpots, although it has hit $200 million a few times. Its largest jackpot ever was $365 million in 2006.

Staff Photo by Lesley Onstott
Caitlin Eilders buys a Powerball lottery ticket Saturday at On the Go gas station on Jenkins Road. Powerball, which was at $54 million, may be joined in Tennessee by the Mega Millions lottery, which is currently in Georgia.

But Georgia, which sells Mega Millions, has seen several jackpots higher than $300 million, including $336 million in August. Mega Millions is played in 12 states.

Georgia and Tennessee’s top lottery retailers sit on the state’s shared border. Ms. Hargrove says that market may decline now that Tennessee will sell essentially the same line-up as Georgia.

“Now, when there is a big Mega Millions jackpot, the folks in Chattanooga won’t cross over into Georgia, so the Tennessee retailer will see increased sales there,” Ms. Hargrove said. “That will more than counter-balance the people from Georgia not crossing over when Powerball had a big jackpot.”

Randy Black, who operates five MegaStar Food Mart stores in North Georgia, led the state in lottery sales over the last few years. He said he’s not worried about the future of his business.

Both states still claim strong sales on the Alabama border, which is one of seven states that does not offer a state lottery.

“I don’t think it will have much impact,” Mr. Black said. “We do great business, but I think things will just even out some.”

At least one Chattanooga lottery player saw the move as a positive. Timothy Anthony, 46, made multiple trips to Georgia over the summer for a chance at grabbing a portion of a $300 million-plus Mega Millions jackpot.

“So now I don’t have to waste money on gas while I waste money on a ticket, too,” he said. “My wife will be happy.”