Tough luck

October 10, 1991

As lawmakers in Annapolis search for ways to plug the $450 million state budge deficit, you can be sure someone will come up with the idea of trying to squeeze more money out of the state lottery games. Last year the games generated more than $813 million in gross revenues, a tidy sum even though the net revenue to the state was only $315 million.

Lotteries, widely instituted among states during the 1970s and '80s, appeal to lawmakers precisely because they are relatively painless sources of income -- and more acceptable to voters than higher taxes. But the games are a mixed blessing.

That's because although proceeds initially mount sharply from year to year, eventually they peak and may actually begin to fall as players become bored with the games. By the time the inevitable fall-off occurs, however, most states -- including Maryland -- already are hopelessly addicted to the additional revenues.

Last year's net proceeds from the Maryland games represented a $20 million drop from the previous year. That has pushed lottery officials to devise ever more enticing games -- like the new Match Five game introduced last week -- in order to keep players betting. The bottom line is that lotteries are unreliable revenue generators -- and no substitute for sound fiscal management.

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