Lottery bill could slash education payouts by up to $235 million

Floridians turned to scratch-offs during the pandemic.

A bill aimed at prohibiting online lottery ticket sales could have an unintended side effect.

According to the Revenue Estimating Conference, a provision in Bradenton Rep. Will Robinson’s HB 629 could reduce the Florida Lottery’s annual deposits into the Educational Enhancement Trust Fund by up to $235 million a year.

The reductions stem from a provision in the bill and its Senate companion, SB 1264, that would require warning labels  on every lottery ticket, from pick sixes to scratch offs.

The warning label idea is nothing new — lawmakers cleared a bill adding warnings to Florida Lottery tickets in the 2017 Legislative Session with near unanimous votes, though the measure was vetoed by then-Gov. Rick Scott.

That bill would have rotated through six warnings with an average length of six words. An example: “WARNING: GAMBLING CAN BE ADDICTIVE.”

The warning mandated in the 2019 bill, however, is much longer and must fill 10 percent the real estate on the tickets front side.

The wording of the proposed 2019 warning label reads as follows: “WARNING: PLAYING A LOTTERY GAME CONSTITUTES GAMBLING AND MAY LEAD TO ADDICTION AND/OR COMPULSIVE BEHAVIOR. THE CHANCES OF WINNING A BIG PRIZE ARE VERY LOW.”

No other state has proposed a warning label as large as the one in HB 629/SB 1264, so the Revenue Estimating Conference turned to studies conducted for other vices.

A University of Pennsylvania study on tobacco warning labels found about 7.4 percent of smokers tried to quit cigarettes within five weeks of viewing the text only labels on the side of their packs.

Similarly, a University of Cambridge study found warning labels on sugary drinks prompted 13.4 percent of the study’s sample to cut those out of their diet.

If the lottery ticket warning label turned out to be half as effective as those on cigarette packs, the Revenue Estimating Conference says the Florida Lottery’s total sales would drop by $249 million next fiscal year and its check to the EETF would be $63.2 million lighter.

If the proposed label turned off 7 percent of lotto players, Florida Lottery sales would drop $500 million and its EETF payment drop $126.5 million. If it hit the high watermark in the sugary drink study, the EETF could be shortchanged by $235 million a year.

The low-end figure amounts to more than 5,000 Bright Futures scholarships, which pay out about $12,000 apiece for higher education tuition. The  top-end figure equates to about an eighth of the $1.86 billion the Florida Lottery expects to deposit into the EETF this fiscal year.

The Revenue Estimating Conference said those impact estimates don’t account for `the online sale ban, saying it would be “impossible to calculate.”

HB 629 cleared the Gaming Control Subcommittee back in February and is pending a hearing in the Government Operations and Technology Appropriations Subcommittee. SB 1264 has not yet been heard in committee.