By Nathaniel Meyersohn | CNN Business
The Powerball lottery jackpot is expected to hit $1.9 billion — whenever the delayed drawing takes place — making it the largest lotto prize ever.
But in 1987 when Lotto America, the precursor to Powerball, was introduced, organizers prohibited jackpots of more than $80 million.
“There were concerns about what you could do with that money — like buy a small country or something,” Ed Stanek, director of Lotto America, said at the time.
Lottery frenzy had taken hold in the 1980s as more states introduced lotteries to collect revenue for education and social programs, but some smaller states’ jackpots couldn’t keep up with more populated states.
Oregon, for example, was losing players to Washington and California, which offered jackpots of up to $20 million.
So officials in Rhode Island, Oregon, Missouri, Iowa, Kansas, West Virginia and Washington, D.C. joined together to create Lotto America as a way to pool money and offer larger prizes. They also hoped the bigger pots would entice first-time players.
”Our motivation is to offer Oregonians a chance to play in games they could play in one of the big states,” then-Oregon Lottery director James Davey said.
The interstate lottery was modeled after those in Canada and the US Virgin Islands.
Officials hoped Lotto America would offer average weekly jackpots of $3 million to $5 million, with the possibility of higher prizes after a year or two. Expenses for running the drawings and profits from ticket sales were split among the jurisdictions in proportion to each state or district’s ticket sales.
”This is a whole new ballgame” Lotto America spokesman Jack Ratigan said at the time.
Lotto America initially offered players a chance to choose seven numbers from a field of 40 for a minimum bet of $1.
Players whose numbers matched those selected in a weekly drawing would win a jackpot determined by the total number of tickets sold.
The odds of winning the top prize were about 1 in 19 million, compared with odds of about 1 in 8 million in most state lottery games, officials said.
An Iowa farmer who had gone bankrupt was the first Lotto America winner in 1988. He said he would use the $3 million prize to save his family’s farm.
A year later, Lotto America changed to selecting six numbers from a field of 54. That year, it offered a $20 million jackpot and in 1991, …read more
Source:: The Mercury News