Scratch-off games being scratched
By Lisa Sandberg - Express-News
January 17, 2009

AUSTIN — The Texas Lottery Commission is set to cut several poorly performing scratch-off games, even though more than $25 million in advertised jackpot prizes have yet to be awarded or claimed by winners.

Though its Web site advertises “9 prizes from $1,000,000 to $5,000,000” for one of its priciest scratch-offs, a $50 ticket called $130 Million Payout Bonanza, the game will close next month and as of Thursday, only three of the nine jackpots had been claimed by winners.

Another game, $130 Million Spectacular, the state's first $50 game that became the nation's priciest ticket when it was rolled out in May 2007, is due to close at the same time, though only $10 million of its $21 million in top prizes has been doled out.

“If we knew we didn't have a chance to win the top prizes, we wouldn't ever buy them,” said Tom Edmundson, a semi-retired Houston attorney who dropped as much as $60 a week on Texas scratch-off tickets until he realized some of his favorite games were closing before all jackpot prizes could be claimed.

Now, he's as irate as he was nearly two years ago, when he learned the Texas Lottery was selling some scratch-off tickets after their top prizes already had been redeemed — a practice they've since stopped.

Edmundson calls the early closings the “flip side of the same problem” players had two years ago.

Lottery officials say the soon-to-be-closed-games are not selling well and take up valuable shelf space in the stores where they're sold.

But lottery spokesman Robert Heith concedes his agency has no set criteria for closing games.

Since early 2007, the commission has allowed itself to close games for any one of three reasons: its sales were sluggish, its top prizes had been claimed, or 85 percent of its total prizes had been claimed. Earlier this month, the commission relaxed the rules, authorizing game closings for reasons that don't fall into the previous three categories.

“It could be anything,” Heith said.

Michael Anger, the director of the agency's operations division, said flexibility is critical if the agency is going to give players games they want.

But Gerald Busald, a math professor at San Antonio College and frequent lottery observer, notes that not having specific criteria for closing games could be used by the commission to the disadvantage of players. For instance, the commission conceivably could look for games whose top jackpots remain unclaimed, and close them just to avoid paying out big prizes.

“You ought to have procedures for doing anything,” he said.

Dawn Nettles, a lottery watchdog who runs a Web site for players on Texas lottery games, believes the commission may close games knowing full well that its winning tickets have, say, never left its Austin warehouse.

Heith scoffs at any suggestion that the lottery commission knows where its winning scratch-off tickets are — or that it holds them back.

“That question is one which always bothers me,” Heith said. “We do not know where the winning tickets are located.”

Though an encrypted report from the games' manufacturer carry information for each ticket, Heith said the information data is, naturally, unreadable.

“We know they're winning tickets when they're claimed,” he said.

Anger said he hoped a new slate of scratch-off games, to be released over the next few months, would allay the concerns of even the harshest critics.

A new $20 game, for instance, will carry a whooping half-billion dollars in possible prizes, including 50 prizes of $1 million. The game is expected to have a longer run than usual, say of a few years. The agency is ordering 33 million tickets printed for the game, as opposed to 3 million or 4 million for a typical scratch-off game.

Whether that game closes before reaching its second birthday would depend, Anger said, on “the success of the game.”