Michigan Lottery

The Michigan Lottery has been in existence for 35 years as of 2007, with annual sales of over $2 billion for that fiscal year.  Over 1/3rd of that total, almost $750 million, was paid out to the state School Aid Fund, a fund created in 1972 to support public education throughout the state.  That payout accounts for 100% of the net profit that the lottery generates.  Michigan Lottery retailers received commissions of just less than 10% of total sales, and prize payouts accounted for $1.3 billion, nearly 2/3rds of the total sales.  Other expenses that the commission incurs are operating expenses, direct game expenses (tickets, distribution, and the like), and an annual $1 million contribution to the compulsive gambling hotline.

While $750 million sounds like, and is, a huge amount of money to contribute to the state school system, in the big picture it’s only a fraction of the Michigan Department of Education’s annual operating budget.  In fact, based on a 180 day operating schedule, $750 million would pay for less than 20 days of operating expenses in 2007.  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 players, 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 include Millionaire Raffle and Super Raffle, and many second chance and raffle opportunities.

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

Retail Commission Structure

Michigan Lottery retailers receive a 6% commission on all tickets sold.  There is a somewhat-involved earning structure on winning tickets sold, the highest being a Mega Millions winner at a $50,000 commission for the retailer.  Depending on the game and the size of the payout, commissions can either be a percentage or a flat rate.

Online Lottery

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

Claiming Prizes

Prizes up to $600 may be claimed at your local lottery retailer, while prizes above 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.