The 6 Best State Lotteries in America

Map of the US on Left Lottery Tickets on Right

At the time of this post, 45 states plus DC run some form of lottery.

The US lottery landscape is varied. Some states lean heavily on instant win games; others favor draw games and multi-state contests, which have lower overhead and can be shared with neighboring state governments.

The way each state program deals with revenue, paying winners, and rewarding merchants are a little different, though there are some regional similarities in administration.

I wrote this post to highlight six amazing lottery programs, all very different from one another, but all operating under the umbrella of the US lottery.

1 – The Most Successful Lottery Program – New York Lottery

The New York Lottery is the financial behemoth of the American lottery scene. Average sales cracked $10 billion a year in 2018 and show no signs of slowing. Considering four US lottery programs have sales of less than $100 million a year, NY Lottery sales are outlandishly large and worthy of a spot on any list of the best US lottery systems.

New Yorkers spend about $538 a year per person on lottery games, which include ten draw games and more than 100 instant win games.

The system’s contributions to state education funds are equally large. New York Lottery sends a little more than $3.5 billion to the state’s county education agencies every year. The entire budget for that department is $37.8 billion, meaning the NY Lottery represents 10% of all education spending nationwide.

New York was just the second US state to launch a modern lottery, and their 55+ years as lottery administrators have paid off in huge sales figures and big boosts to state school coffers. That’s a success by any definition.

2 – The Best Multi-State Lottery Game – Powerball

I’ve picked Powerball as the best multi-state game for a few reasons. Powerball is available in more places than any other multi-state game: 45 states, DC, Puerto Rico, and the US Virgin Islands. Powerball’s overall odds of winning are slightly better than the other big multi-state games in the country.

There’s also the fact that Powerball was responsible for more huge jackpots than any other multi-state game.

Let’s talk about those odds. Based on average jackpots, the odds of winning the Powerball jackpot are slightly lower than Mega Millions – 1 in 292.2 million vs. 1 in 302.5 million. For that reason alone, Powerball is usually the better game. I say usually because there have been times where the difference in the game’s jackpots shifted the odds slightly in Mega Millions favor.

Powerball Loterry Ticket

All told, 6 of the largest 10 lottery payouts of all time have come from Powerball, including the largest ever. As for those record jackpots, the largest single lottery prize in history came from Powerball. In January of 2016, three tickets (sold in California, Tennessee, and Florida) split a jackpot of $1.58 billion.

Preference for one multi-state game over another comes down to personal choice. For my money, and based on game odds and past payouts, I’d pick Powerball over Mega Millions every time.

3 – The Best Instant Win Lottery Tickets – Vermont Lottery

Vermont’s lottery program is relatively small, with sales of just about $140 million a year. Vermonters enjoy a high payback rate – just over 70%, indicating a healthy lottery program with low costs and an efficient payment structure. But that’s not why they made this list.

Vermont Lottery has a massive library of instant win scratch-off lottery games, especially considering the relatively small size of their lottery program in general.

Let’s put Vermont’s collection of about 100 instant win tickets into perspective. The Texas Lottery, among the top-5 lotteries in terms of revenue and payouts, currently has 71 tickets in their scratch-off library.

Lottery Scratch Off Card

Texas lottery sales are around $6.5 billion a year, that’s more than 46 times the size of Vermont’s program. For Vermont to have more than 25% more instant win games in their library is noteworthy.

If you watch the Vermont Lottery instant win library over time, you’ll be impressed by the frequent addition of games, many with holiday themes, keeping things fresh. It almost makes you get over the fact that Vermont has one of the highest lottery tax rates in the country.

4 – The Most Lucrative Lottery Program – Idaho Lottery

Idaho ranks near the bottom of the pack in terms of overall sales, but they have an incredibly valuable lottery program thanks to some frugal spending and hardcore budgeting.

Idaho may seem like a strange choice for the most lucrative lottery program, but they’ve managed to create a low-cost system that pays out a significant percentage of revenue to players. In terms of keeping lottery expenditures low, so that more cash can be passed on to retailers and players, there’s no state better than Idaho.

As of the last year, they reported their financial details, 2020, the Idaho Lottery pays 78.53% of all income back to winners in the form of prizes and promotions. How big a deal is that? The average US lottery program payout is just under 65%. Three US state lottery programs – Oregon, South Dakota, and West Virginia – pay out less than 20% of revenue to winners.

To say Idaho’s lottery program is sleek and inexpensive is an understatement. Over the three decades of their program’s existence, they’ve paid out more than $1 billion to the state’s education funds, all while spending less than 1% of total revenue on its administration.

5 – The Best Small Lottery Program – Rhode Island Lottery

Rhode Island reports the 26th-highest sales figures of any US state lottery program. That doesn’t sound impressive until you consider that Rhode Island is the 45th-largest state in the country by population. How’d a tiny state get such a big lottery program?

The answer is per capita spending. The average Rhode Islander spends more than $626 a year on lottery games. Only one state’s citizens spend more money per capita on lottery games than Rhode Island. Why are people in this small New England state so lottery-spendy?

Lottery Balls on Left and Lottery Tickets on Right

Rhode Island was among the first US states to embrace the lottery. They were part of a lot of firsts in the industry, helping launch multi-state games and popularizing instant-win scratch-off games nationwide. It’s also worth pointing out that Rhode Island spends more lottery revenue per capita than any other US state – $349.71, about five times more than the average US state.

I like to think that the people of Rhode Island are well aware of the lottery program’s benefits to the state and support it all the more because of those much-needed public funds.

6 – Honorable Mention – Mississippi State Lottery

I wanted to honor Mississippi State Lottery as the newest program in the country, launched in November of 2019. They’ve already created a robust program, with three state-based draw games and participation in two multi-state games, Powerball and Mega Millions. The state currently offers 45 instant win tickets across five denominations.

I like a few things about Mississippi’s program besides their impressive (for a new program) game library.

For starters, their age to purchase tickets is 21. While 18 and 19-year-olds may sneer at this, I think it’s important for lottery programs to honor their local politics. Neighboring state Louisiana also has a 21+ restriction. This is part of how the bill that launched the lottery got passed.

I also like the unique structure for lottery revenue distribution. The first $80 million in revenue go directly to repairing and creating infrastructure statewide; after that, all revenue will go to the state’s education system. This was also a major selling point for legislators considering the bill.

The passing of lottery legislation in Mississippi was unthinkable just fifteen years ago. With the right approach, pro-lottery groups in the state got the bill passed with little effort.

The five remaining US states without a lottery program probably won’t budge without considerations like these. In Alaska, Alabama, Hawaii, Nevada, and Utah, pro-lottery groups and legislators will need to overcome local traditions and feelings about games of chance.

In Summary

In America, when the lottery is successful, it’s a huge boon for states facing budgetary shortfalls and sliding educational statistics. The six states covered here do the best job of leveraging lottery entertainment into infrastructural improvements.

I don’t think it’ll be long before the lottery is a nationwide affair. Hawaii may be a long holdout – the state’s citizens work hard to protect their island paradise from outside interference, and no form of gambling is currently legal in the Aloha State. But the examples of successful lottery programs in this post should serve as a how-to guide for states looking for a new source of revenue.