A Message from CEO Terry Rich:

The Iowa Lottery had a successful, record-setting performance in fiscal year 2009. I'm extremely proud to report that our preliminary figures for the year show the Iowa Lottery increased the overall amount of proceeds it sent to the state and provided key support for veterans' causes through the Iowa Veterans Trust Fund.

The Iowa Lottery raised more than $60.6 million for state programs in its latest financial year, which ended June 30. That's the highest profits total from the sale of lotto, instant-scratch and pull-tab games since the lottery's start in 1985.

Preliminary figures show that lottery proceeds to the state in fiscal year 2009 increased 7.2 percent from a year earlier, although lottery sales were down during the same period. Unaudited figures show that lottery sales totaled $243.3 million in FY 2009, down 2.4 percent from sales of $249.2 million in fiscal year 2008.

Another highlight of the FY 2009 results was the $2.8 million the lottery raised for the Iowa Veterans Trust Fund. Legislation dedicating some lottery proceeds to veterans' causes was signed into law by Gov. Culver in March 2008.

When the idea of games dedicated to veterans was initially discussed, the lottery estimated it could raise $2 million to $3 million annually for the Iowa Veterans Trust Fund. The total for FY 2009 reached the upper end of that range and demonstrates Iowans' support for the cause. Our thanks go out to our players for recognizing this important cause and helping us provide a stable, ongoing source of revenue for the Iowa Veterans Trust Fund.

It's clear that Iowa Lottery employees deserve a lot of credit for this year's success. This was a challenging year for workers everywhere and I'm proud of the success achieved by the lottery team.

The lottery's authority status also played a key role in the positive proceeds results for the year. In 2003, the lottery was remade from a state agency into the Iowa Lottery Authority, a corporate-model lottery with the business flexibility to function as an entrepreneurial enterprise.

As the Authority, the lottery for the first time was able to purchase property, and did so in 2004 by issuing revenue bonds to purchase both its headquarters building in Des Moines and the vending machines currently used to sell instant-scratch and pull-tab tickets in retail locations across the state. The long-term savings achieved by the purchase of property and the decreased annual property costs that took effect this year would not have been possible without creation of the Iowa Lottery Authority. Our state's leaders should be commended for providing the lottery with the tools it needed to increase profits at this critical time.

The lottery's business flexibility also allowed it to move quickly to develop the "Keep Your Ticket Handy" campaign this spring with the Iowa Tourism Office, which helped raise awareness not only of the Lottery, but travel destinations across the state.

Due to the 2008 floods and the national economic recession, lottery sales and proceeds early in FY 2009 had trailed results from the year before. The work of producing the travel initiative was just one of the many ways that lottery staffers were able to respond to make a big improvement in the numbers as the year continued.

The Keep Your Ticket Handy initiative really demonstrated how the lottery can expand its reach by utilizing its huge promotional power to help other businesses in Iowa. We've been gratified to help build homegrown success in our state. And, we will continue to investigate new game ideas and innovative projects to drive player interest so the lottery will remain a strong source of optional revenue for the state of Iowa.

The lottery's positive impact in Iowa also extends beyond the proceeds it provides for state programs. Iowa businesses received nearly $15.3 million in commissions from the lottery for their daily work in selling lottery products in FY 2009, and the state of Iowa received $1.2 million in withholding tax revenue from lottery prizes.

While we're excited about this fiscal year's accomplishments, we must continually look ahead. As we move forward, our business focus is on profits: to maximize revenues and minimize expenses for our state; while our game focus will be on new entertainment for our players. Both have bottom-line impact. We will continue to evaluate and adjust plans to do our best to meet our FY 2010 proceeds goal in these tough economic times.