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Overview of the Michigan Lottery

Jul 23, 2008
The Michigan Lottery has been around for 36 years as of 2008, with ticket sales reaching over $2 billion in 2007. The public school system, the main beneficiary of the Michigan Lottery, received almost $750 million in proceeds last year. This fund was created in 1972 to support public education statewide. That payout accounts for 100% of the net profit generated by the lottery. Michigan Lottery retailers received commissions of almost 10% of the total ticket sales, and jackpot payouts accounted for $1.3 billion, nearly 2/3rds of the total ticket sales. Other expenses that the commission must account for in their budget are operating expenses, direct game expenses (tickets, distribution, and the like), and a $1 million contribution to the Michigan compulsive gambling hotline.

So that's great - the Michigan Lottery supports public education with a huge amount of money every year, right? Well, while $750 million seems like a huge amount of money (and it is), in the big picture it's only a small part of the Michigan Department of Education's annual operating budget. In fact, based on a half-year operating budget, $750 million paid for less than 20 days of operating expenses in 2007 for the public school system. Now don't get me wrong, 20 days is better than nothing, and there's no arguing that it's a significant sum of money, but don't believe that the public school system is funded exclusively by the Michigan Lottery. The remainder of the education budget is funded through the state's sales tax, income tax, and property taxes that are specifically earmarked for education.

The Michigan Lottery offers eleven direct-games for lottery players. These include Mega Millions, Classic Lotto 47, Fantasy 5, Keno!, Daily 3, Daily 4, Millionaire Raffle, Super Raffle, Club Keno, Pull Tabs, and Instants. Online-only games are Millionaire Raffle and Super Raffle, and many second chance and raffle opportunities.

The majority of revenue (over 60%) for the Michigan Lottery comes from two main sources: Daily Games and Instant Games. Following at a distant second and third are Club Keno and Mega Millions, which combined account for about 30%.

Commission Structure
Michigan Lottery retailers are paid a 6% commission on all tickets sold at their location. There is a semi complicated earning structure on winning tickets sold, the highest being a Mega Millions winner with a payout of $50,000 for the retailer. Depending on the game and the dollar amount of the jackpot, commissions can either be a percentage or a flat rate.

Online Lottery Games
The Michigan Lottery has an online lottery site called Player City. They offer many games there, including both first and second chance. They claim almost 150,000 users of the website, which includes coupons offers, chat opportunities, and member rewards.

Claiming Jackpots
Prizes up to $600 may be cashed in at your local lottery retailer, while prizes greater than that must be claimed at your regional lottery office. These can be found in Detroit, Lansing, Saginaw, Wyoming, Sterling Heights and Dearborn Heights. If your prize is greater than $50,000 you must claim it at the Michigan Lottery headquarters in Lansing.
About the Author
Allen Wright is a freelance writer who covers any topic that interests him. See more information here on the Michigan Lottery.
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