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The state Senate and House passed a bill allowing the Lottery to use more of its earnings on player payouts — boosting the number of games it sells with big-ticket prizes across Pennsylvania.
The bill, introduced by state Rep. Melissa Shusterman (D., Chester) and backed by Lottery officials and Gov. Josh Shapiro, has been touted as a way to bring in millions of additional dollars for programs benefiting senior citizens, such as low-cost prescriptions and rent rebates, that Lottery profits fund.
Shusterman said the move will help improve the quality of life of older Pennsylvanians.
“This change will allow the Pennsylvania Lottery to more effectively compete with other forms of entertainment, and put the Lottery on better financial footing,” Shusterman said in a statement.
Offering more of the higher payout traditional games — particularly the popular $30 and $50 scratch-offs — will attract more customers and rake in more profit, officials argued, although the likelihood of winning on any given ticket would remain the same.
But selling more tickets requires more cash for payouts, and the Lottery is required to make at least a 20% profit on traditional games for senior programs. That means it needs to be conservative about how much revenue it devotes to payouts, its biggest expense.
Now, the Lottery will only be required to make a 10% profit on traditional games if the bill is signed into law. Originally, the bill would eliminate the profit requirement entirely, but the Senate Aging & Youth Committee amended it.
Lowering the profit requirement gives the Lottery more flexibility with payouts, said Diana Dietz, deputy communications director for the Lottery.
“Reducing the profit margin requirement will allow us to modernize our games responsibly, stay competitive in today’s gaming market, and continue generating vital funding for programs that benefit older Pennsylvanians,” Dietz said.
And it’s a step toward a change Lottery officials have wanted for years. Over a decade ago, officials suggested a reduction in the profit requirement. In recent years, they’ve asked for it to be eliminated entirely, which Shapiro supported in his preliminary budget proposal.
The bill passed the state Senate with 49 votes to pass and a single no from state Sen. Doug Mastriano (R., Franklin). It’s now waiting to be signed into law by Shapiro.
It would take about six months from signing to begin implementing changes to games and around two fiscal years to fully implement, Dietz said.
A state House fiscal note estimates that reducing the requirement to 10% would bring in around $102 million from this fiscal year through fiscal year 2027-28. Eliminating it entirely would bring an increase of $1.24 billion over 10 years, according to the latest Lottery profit report.
“We will continue to evaluate whether fully eliminating the profit margin requirement could help modernize our products and keep the Pennsylvania Lottery competitive in today’s saturated gaming market,” Dietz said.
As of May, the Lottery had a profit margin of around 23.6% for the 2024-25 fiscal year, Dietz said.
Abigail Hakas is a reporter for Next Generation Newsroom, part of the Center for Media Innovation at Point Park University. Reach her at abigail.hakas@pointpark.edu.
