For a moment, it looked as if South
Carolina had dodged a bullet. Then, suddenly, with a little political
jockeying, North Carolina had its lottery.
Last week, the North Carolina state Senate adjourned with no lottery.
Five Democrats and 21 Republicans had opposed it, and that looked like
the end of the story, for this year anyway.
But on Tuesday, with two Republican opponents absent, Senate leader
Marc Basnight resurrected the lottery, which received a tie vote. Then
Lt. Gov. Beverly Perdue broke the tie, siding with most of her
Democratic colleagues. Now, only Gov. Mike Easley's signature is
required, and Easley has been lobbying for a lottery for five years.
This is not good news for South Carolina, especially counties along
the state border. York County, for example, has long been one of the
leading lottery ticket sellers in the state, largely because of its
proximity to North Carolina. Now that the Tarheel State has its own
lottery, South Carolina is certain to lose at least some of its
across-the-border customers.
South Carolina lottery officials say they are not unduly worried
about competition. They say they already have plans for stepping up
marketing.
But that is not entirely good news, either. To date, South Carolina
has managed to operate a successful lottery with relatively low-key
marketing. We hope lottery officials don't plan to inundate the airwaves
and the roadsides with new pitches to buy tickets.
Generally, heavier marketing is a sign that interest in the lottery
has begun to wane. That has been the experience in a number of other
states whose lotteries have been around for a while. In this case, more
lottery ads and billboards would be a response to the initiation of
North Carolina's new lottery. But it also is a sign that, with
competition, there will be no more easy pickings from across the state
line.
About 12 percent of South Carolina's lottery sales are to customers
from across the state line. Ernie Passailaigue, executive director of
the South Carolina Education Lottery, estimated earlier this year that
the state could lose about $100 million annually once North Carolina's
lottery is up and running.
But that is not necessarily a reason for doom and gloom. South
Carolina has enjoyed more than $2 billion in sales since the lottery was
established in 2002, and in-state ticket sales should continue to be
healthy. When South Carolina began its lottery, sales of Georgia's
lottery tickets dropped off somewhat, but the eventual impact on sales
in the Peach State was minimal.
It also is likely that players will go where the jackpots are. As
long as South Carolina continues to create big pots, North Carolinians
will cross the state line to play here. (Of course, that can work both
ways. South Carolinians can cross state lines in search of big jackpots,
too).
Finally, we might worry less about lottery proceeds if we regard them
for what they are, extra cash that might not be there tomorrow. As long
as we don't become too reliant on the lottery or use profits to fund
recurring expenses, we can rest easy.
