Missouri report shows increased spending on lottery advertising, reduction in money transferred to education

JEFFERSON CITY, Mo. (KQTV) -- A new report from Missouri State Auditor Scott Fitzpatrick shows increased spending on advertising for the state's Lottery program, which has coincided with a reduction in the amount of money transferred to education.

According to a news release from Fitzpatrick, the new report gives the Missouri State Lottery Commission (Lottery) a "good" rating while noting additional trend analysis is needed to determine if continued advertising for lottery purposes is effective in driving lottery sales.

A 2023 report found that lottery proceeds increased significantly, even as the funding for the Lottery's advertising budget diminished significantly.

The previous report found the advertising budget decreased by approximately $16.7 million from 2018 to 2023, while transfers of Lottery proceeds to education increased by more than $53 million in the same period of time.

The report released Tuesday found a significant increase in advertising expenditures of approximately $5 million for Fiscal Year 2024, but saw total revenue generated by the Lottery decrease by more than $49 million and transfers to education decrease by more than $18 million.

"The amount of money generated by the Lottery for our system of public education is the best way to gauge whether the program is succeeding. In this case, we've seen transfers to education increase while advertising budgets were nearly non-existent and then seen transfers diminish when the advertising budget was increased significantly. I realize there are a number of factors at play when looking at these trends, but the information in our report should be helpful to lawmakers as they determine the amount they want to appropriate for advertising in the coming fiscal year," said Auditor Fitzpatrick.

According to the news release, national lottery data shows that Missouri's 2024 fiscal year advertising budget of 0.31% of sales ranks 44th out of the 46 stations that sponsor a lottery.

For Fiscal Year 2023, the Lottery had an advertising budget of 0.02% of sales, which was the smallest advertising budget of any of the 45 states that sponsor a lottery, including the District of Columbia.

Lottery officials indicated that the changes in advertising expenditures are not the only factor affecting lottery sales.

According to Lottery officials, the size of the national jackpots is a significant factor in lottery sales, with jackpots exceeding $500 million drawing more media attention and generating higher revenue.

The report found total lottery jackpots for the national jackpot games that Missouri participates in increased by 33% in Fiscal Year 2024 compared to Fiscal Year 2023; however, draw game ticket sales and overall lottery revenues stayed essentially the same, only decreasing slightly in Fiscal Year 2024.