Record Powerball Lottery Jackpot Backing West Virginia Bondsby
Multi-state game has a Saturday drawing for $800 million pot
Florida, Oregon among states that issue lottery-backed bonds
Buying a Powerball ticket gives you a shot at a $496 million cash windfall this weekend. It will also help fund school improvements in West Virginia.
The Mountain State’s school building authority plans to issue $21 million of tax-exempt debt as soon as next week for capital improvements, according to offering documents released late Thursday. The bonds are backed by lottery revenue transferred to the school building debt service fund from games including Powerball, which will have a drawing Saturday for an estimated $800 million, an unprecedented amount.
States across the U.S. funnel lottery proceeds into their coffers after paying out prize money, financing schools, transportation and other infrastructure projects. Florida and Oregon are among the few that have joined West Virginia in issuing bonds backed by games of chance to fund construction.
West Virginia in November issued almost $64 million of lottery debt, data compiled by Bloomberg show. The bonds have a AAA rating from Standard & Poor’s, which raised its outlook to stable from negative in October. The Florida and Oregon securities have the same top grade.
The ratings haven’t budged as Powerball’s popularity has declined. Sales slipped last year by $5.4 million, or 13.7 percent, compared to 2014, which, in turn, was down 18.9 percent from 2013. Sales depend on how high the jackpot grows, according to offering documents. Saturday’s prize has a $496 million cash value, according to the Powerball website.
West Virginia brought in $34 million in revenue during the year ended June 30 from participating in Powerball, offering documents show.
Winning the jackpot requires correctly picking five white-ball numbers, which range from 1 to 69, in addition to the red Powerball, which ranges from 1 to 26. The odds of winning the grand prize are 1 in 292,201,338, according to the website.