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Tuesday, December 27, 2011

Arkansas Lottery Georgia Powerball ticket unclaimed

Posted by Max Brantley on Tue, Dec 27, 2011 at 10:14 AM

Says here that nobody claimed the $77 million Powerball ticket sold at a Georgia highway stop six months ago, so the money will be distributed to participating states based on percentage of tickets sold on that drawing in each state (about .8 percent in Arkansas.)

I still don't have a clear answer on where this $600,000 or so will wind up in Arkansas. At the urging of then-director Ernie Passailaigue, the 2011 legislature amended the Arkansas lottery law to allow up to $2.5 million in unclaimed winnings to be used each year to promote the game and add to prizes (the theory being this would enhance play overall and increase profits for scholarships.) I have an inquiry out on where the Arkansas lottery stands on using existing unclaimed money and what will become of this windfall. I have been led to believe the $2.5 million is already set aside and this would amount to overage that could go to the scholarship fund. I hope to find out more.

UPDATE: Julie Baldridge, interim Arkansas Lottery director, said she hadn't yet received official confirmation the prize money had not been claimed or a figure on what Arkansas's share would be. My .8 percent estimate comes from this tally of multistate lottery ticket sales. She added:

However, I will recommend to the Commission that the amount go directly to unclaimed prizes and from there to net proceeds and to the Education Trust Fund. It is possible that ADHE may use a part of that for administrative costs, but I expect the Commissioners to prefer to commit all of it to scholarships.

Baldridge adds that my estimate of around $600,000 from total sales could well be reduced by other prizes, commissions and vendor costs on overhead in that particular drawing.

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“…nobody claimed the $77 million Powerball ticket sold at a Georgia highway stop six months ago…”

Lordy, let’s hope the ticket holder never finds out. Anybody else recall the young Hot Springs woman who spent her last $4 on a Powerball ticket? Didn’t know she’d won $1 million till several days later after reading in the paper that the winning ticket had been sold in Hot Springs. Said she was gonna buy a house, set up a trust fund, and make charitable donations. I pray she did.

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Posted by Durango on 12/27/2011 at 10:34 AM

The windfall should go to the enrolled students, not to promote the game. The lottery's intent was to promote college education for citizens, not to promote gambling and large salaries for board members. Arkansas has too few college graduates. That is why we were the most solidly red state in the South in the last presidential election.

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Posted by Farkleberry on 12/27/2011 at 10:49 AM

Is it true that the colleges and universities went up on tuition because of the lottery scholarships?

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Posted by Farkleberry on 12/27/2011 at 10:51 AM

Farkl
Colleges and universities went up every year since the 70's so I doubt it was the cause.

The question is will the leg punish the schools and not keep similar funding levels because the lottery "windfall".

The schools did not get more funding, just more students which increased revenues.

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Posted by Citizen1 on 12/27/2011 at 11:19 AM

Durango

If the young lady did spend her last 4 bucks on a lottery ticket, with logic like that I would wager she did not find the intelligence to do the house and trust fund thing let alone the charitable giving thing.

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Posted by Citizen1 on 12/27/2011 at 11:24 AM

Quick question, did the retailer which sold the ticket still get their cut if it was never claimed?

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Posted by Citizen1 on 12/27/2011 at 11:25 AM

I think the money should go to the Tea Party to determine distribution of such.

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Posted by Cato on 12/27/2011 at 11:36 AM

RE: The Hot Springs $1 Million Winner. Lottery employees bumped into her at a Hot Springs business about six months after she won. She had bought a house outright, paid her bills, and set up a fund for her son's college as well as a personal trust to help support herself down the road. She had just bought a lottery ticket when we saw her.

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Posted by Lottery Inside Source on 12/27/2011 at 12:45 PM

RE: Retail Sales bonus for the store that sold the $77 Million ticket: That comes out of the pocket of the Georgia Lottery and not out of the Powerball fund. So it is irrelevant to Arkansas whether a bonus was paid to a store in Georgia. For the record, the Arkansas "selling bonus"(1% of prize amount up to maximum of $50K) paid to Arkansas retailers who sell big prize lottery tickets is not paid unless and until the ticket is cashed.

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Posted by Lottery Inside Source on 12/27/2011 at 12:50 PM

thanks Lottery Inside.

Since the advertised PowerBall and other jackpot amounts are actually the total amounts paid out over a series of future payments (20 yrs) what is the discount factor used to determine present value?

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Posted by eLwood on 12/27/2011 at 1:01 PM

Elwood

Check USA Today's lottery page for the present and future values.

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Posted by Bob R. on 12/27/2011 at 2:26 PM

Dubious.

If she were "down to her last $4" I doubt that in 6 months she had navaigated the legal mumbo jumbo and had been able to set up a trust fund for her son.

Bought a home outright.

set up for her support down the road.

Current interest rates don't allow much of a "trust fund" type set up since no growth doesn't lend it self to "living off the interest" thing.

Can't proove it is true, can't proove it is bs but I doubt it.

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Posted by Citizen1 on 12/27/2011 at 2:52 PM

Citizen, most would be amazed to learn how many lottery winners file for bankruptcy.
Last time I saw the numbers it was staggering but I think it was in the 1980s.

I knew a thirty-something woman in Fayetteville during the 70s whose hubby had taken out a $50K life insurance policy with my company. He was killed in a car wreck and the other party coughed up another $25K. In a year she was broke. She told me she had never had any money before and she and her son had a really good time. $75K doesn't sound like much today but in the 70s in Fayetteville would have bought a couple of nice homes.

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Posted by eLwood on 12/27/2011 at 3:01 PM

Yes Elwood, it seems a stretch that:

#1 Lottery officials which are mostly in LR bump into the girl in Hot Springs. Million buck winnings are picked up at the headquarters.
It could happen.

#2 Within 6 months a person that is of the position to be down to last 4 bucks would be able to find a home and complete a realestate transaction.
It could happen.

#3 Couldn't find it on AR Lottery site but feds require tax withholding on large winnings 28% minimum but when into the millions opt for the highest bracket, currently 39.5%. State would withhold $70,000 on a million, that I did find on their website. $395,000 + $70,000 leaves only a little over half a million at the git go. A small house would set you back at least 100g's so now we are at $400,000. Then college is 100g's if he isn't going to have to work full time. Then $300,000 to support momma means $30,000 per year for 10 years?
It could happen.

All of this done by a woman that had been down to her last 4 bucks sounds a bit of a stretch.

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Posted by Citizen1 on 12/27/2011 at 4:30 PM

Just curious: Why is anyone concerned whether the woman who reputedly won $1 million actually did what she is reported to have done--or not?

And why all the effort at calculation, when you don't have the details of the payout. Did she take a lump sum, or an "annuitized" payout?

And we don't really know what "down to her last $4.00" really means.

And we've known some very highly educated people who've been thrown out of work, lost their homes, etc., etc., etc.

"Could have happened." What difference does it make to anyone on this blog whether it did or didn't?

Just curious.

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Posted by SkyPilot on 12/27/2011 at 5:38 PM

RE: eLwood's question: Since the advertised PowerBall and other jackpot amounts are actually the total amounts paid out over a series of future payments (20 yrs) what is the discount factor used to determine present value?

Tonight, if someone hits Mega Millions jackpot, the winner will have the choice of a $204 Million payout spread over 29 payouts--one immediately and one each year afterwards (29 years total) of about $7 Million a year OR a lump sum payout of $152 Million. The formula is affected by interest rates and cost of annuities, etc, so it is not an absolute percentage. But this is an example. These payments are guaranteed even if the winner dies--they go to the estate.

Lottery legend has it that no winner has ever picked the annuity. Financial experts, what would be the upside and downside of taking the annuity? The lump sum?

RE: Citizen1--Taxes withheld by lottery on prizes $5K and above: 7 per cent state and 25 per cent federal.

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Posted by Lottery Inside Source on 12/27/2011 at 11:58 PM
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