Since the Montana Lottery sold its first ticket in 1987, it has transferred more than $162 million to the State of Montana.

Since 1995, following legislative action, Lottery proceeds have gone to the state’s General Fund. The General Fund provides money for state programs which do not have dedicated revenue sources, such as education, health, and public safety, to name a few. Where Lottery proceeds go is a function of the Legislature, not the Montana Lottery.

For fiscal year (FY) 2009, which ended on 6/30/09, the Montana Lottery’s transfer to the General Fund was slightly over $10 million.

Here’s an illustration of fiscal year 2009’s performance, based on total revenue of $43.8 million:

Prizes: By law a minimum of 45% of all sales must be paid in prizes. Since 1987 through FY 2009, the Lottery has paid over $355 million in prizes.

Retailer Commissions: Retailers earn 5% on all ticket sales and have the opportunity, through their Scratch ticket sales, to earn up to an additional 5%. To date, retailer commissons total more than $40.5 million.

Ticket Costs: They include the costs for printing Scratch tickets and the fee–for–ticket (Lotto and Scratch) paid to our Lottery operating system vendor.

Operations: The Montana Lottery is responsible for the marketing and sales of all Lottery products; for public and media relations; for the security of all aspects of the Lottery; for warehousing and inventory control; and for Lottery operations, which include accounting, fiscal management, and information technology.

Proceeds to the state's General Fund: Beginning July 1, 1995, Lottery net revenue has been transferred on a quarterly basis to the state’s General Fund. In fiscal year 2009, the Lottery provided the General Fund slightly over $10 million. Through FY 2009, the Lottery has transferred over $110 million to the General Fund.

Product costs such as retailer commissions and ticket costs are directly related to ticket sales. As sales increase, these expenses increase accordingly.

Over the years, the Montana Lottery has shown efficiency in the area of non-product expenses such as personnel, advertising, rent, and other administrative expenses. The chart below shows these expenses over the past five fiscal years, both in dollars and as a percent of total revenue.

	FY 2005	FY 2006	FY 2007	FY 2008	FY 2009
Admin. Expenses /$	$3,252,095	$3,245,884	$3,135,349	$3,545,581	$4,194,636
Admin. Expenses /%	9.60%	8.13%	7.54%	8.09%	9.56%

In addition to controlling expenses, over the same period, the Montana Lottery's transfer to the State general fund and its percentage to revenue has been:

	FY 2005	FY 2006	FY 2007	FY 2008	FY 2009
Transfer to Gen. Fund/$	$6,222,555	$9,110,455	$11,420,242	$11,028,563	$10,126,308
Transfer to Gen. Fund/%	18.39%	22.82%	27.47%	25.16%	23.09%

Our Annual Reports contain more detail. If you want additional information about the Lottery’s finances, please contact us.