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Lottery Profits Built on Dreams of Poor

"But it has the effect of a tax paid in disproportionate amounts by those with the most to lose -- people in the state's lowest-income neighborhoods, The Indianapolis Star found.

"The Star's analysis of lottery sales from 1999 and 2000 at nearly 5,200 retail outlets showed:

"- Residents in lower-income neighborhoods throughout the state spent about six times more, proportionately, on lottery games than those in higher-income areas.

"- About 11 percent of all lottery revenue generated in Indiana in the past two years came from the poorest neighborhoods -- those where the median mortgage is $40,000 or less. About 5 percent of the revenue came from the wealthiest neighborhoods.

"= The gap in rich and poor lottery spending is even wider in Marion County, where more than $225million was spent on lottery games in the past two years. Players in poorer areas spend almost seven times more, proportionately, than those in the highest income areas.

"…A 1999 University of Chicago nationwide survey of gambling behavior mirrored The Star's findings -- people in lower-income households spent a greater portion of their income on lotteries.

"…Hoosier Lottery Director John M. Ross dismisses the notion that the games amount to a voluntary tax on poor people.

"`I think it's being rather judgmental to say that poor folks are being exploited,' he said. `They make their own decisions on entertainment, voluntarily.'

"…Ross is not surprised at the findings in The Star's analysis, however. He said the lottery's own market studies show that certain games, particularly daily draws, are more appealing to players in urban areas. That's because they are similar to the illegal numbers games that have thrived in some of the state's poorest neighborhoods.

"…For Indiana, the Hoosier Lottery is far more than entertainment. It's a serious source of needed cash.

"Part of the lottery revenue has paid for community projects through the Build Indiana Fund, which came under fire this year after at least $40 million was spent on projects that didn't exist or personally benefitted some lawmakers.

"Lottery money also has reduced the excise tax that all Hoosiers pay on their vehicles and helped finance the pensions of firefighters, police officers and teachers. This is money that would have been paid from the state's general fund, which comes from everyone's tax dollars…"

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