The New Jersey Lottery recently introduced a new scratch-off game with promises of more than $13.6 million in prizes. However, the ambitious new game was met with widespread confusion over the rules, causing the Lottery to hastily pull the game from shelves.
Three days is all it took for High Card Poker to be withdrawn from Lottery sales locations. This marks the latest blunder for a state Lottery run by a private operator hired to attract more profits and improve the technological quality of one of NJ’s greatest revenue sources. The private operator, Northstar New Jersey, has had difficulty fulfilling its promises and has even come under fire from local legislation for its poor performances on sales and marketing.
State Lotteries are at an all-time high with Powerball levels reaching upwards of $500 million. New Jersey paid NorthStar $275 million in fees and expenses over the course of the last 3 fiscal years. However, the Lottery profits since Northstar’s takeover have not justified the cost. New Jersey residents can buy lottery tickets online, and it is unclear if this may be impacting revenue for the state.
High Stakes Poker was created as a means to help increase revenue, and as of August 7, more than 1 million tickets hit the shelves. The $5 game had a grand prize of $150,000. Players must beat the dealer’s hand in order to claim the top prize. Questions began to arise regarding misunderstandings on the game’s winning scenarios. According to reports, the winning scenarios are stated on the back of the ticket, but there had been enough complaints to justify recalling the scratch-off game.
Robert Chalet, a local who played the game, apparently had a winning hand consisting of 5-6-9-J-Q, while the dealer had 4-6-7-10-Q. PokerStars verified that in a real-life game, a tie with the high card would push the result to the second-highest card, which in this case would mean Chalet won. However, when Chalet went to cash in his ticket, he was told he did not win. According to the directions on the scratch-off, ties are not considered. Judy Drucker, a Lottery spokesperson, said that the Chalet story was inaccurate and that all winning tickets would be honored. With over 40,000 tickets claimed by players, NJ looks like they have a lot of paying off to do.
Lottery workers had to travel across the state gathering tickets and even going so far as to cross out advertisements with Sharpie. According to the Lottery website, over 4 million tickets were printed. Drucker surmises that about a quarter of those were sent to retailers.
Northstar has pushed out several different scratch-off and instant games to help stimulate their bottom line. Big-ticket sales like Mega Millions have reportedly missed the mark on expectations, and New Jersey online lottery tickets don’t seem to be making a dent in the state’s figures. Northstar recently put out a Keno quick draw game throughout bars and restaurants, where players could bet on a new game every 5 minutes. These instant games have smaller profit margins and have resulted in revenue streams below the intended budget. Speaking of budget, Northstar has cut theirs by $1 billion over the course of their 15-year contract. Their projected $965 million in revenue is far less than the expected $1.7 billion, a sign of how things have been going.
Carole Hedinger, Executive Director of the NJ Lottery Commission, remains optimistic that while the NJ Lottery may not be the best among other states, it will post one of the better revenue results. Any proceeds garnered through the Lottery are going to fund the public employee pension fund as opposed to education and social-service programs. Projections for 2018 are higher with a mark of $1.4 billion, but more mishaps like this could set the Lottery back further.
