Texan Lotteries

The Texas Lottery was established in November 1991 with the passage of HB54, which amended the State Constitution to allow lottery ticket sales. Tickets went on sale in May 1992. The State Comptroller's Office ran the Lottery until May 1993, when the legislature passed HB1587, creating the Texas Lottery Commission (TLC). The TLC was mandated to seat three commissioners serving six-year, staggered terms. On 3 December 1993, when a transition agreement was signed, the functions of the Lottery were officially transferred from the Comptroller's Office to the TLC. Before 1997, Lottery proceeds were allocated to the General Revenue Fund. Since 1997, Texas Lottery proceeds have been transferred to the Foundation School Fund to support public education.

In March 1992, a contract to operate the Texas Lottery was awarded to GTECH to handle warehousing and distribution of tickets, retailer training and field support, telecommunications, and computer systems. The first Lottery game offered on 29 May 1992 was a scratch ticket – Lone Star Millions – that broke U.S. ticket sales records.

In 1997, passage of HB4 placed a limit on the prize payout for the state lottery and dedicated the unobligated lottery balance, which had previously been allocated to the general fund, to the Foundation School Fund. Average allocations from gross lottery proceeds are: prizes, 59%; administration, 7%; retailer commission, 5%; and the Foundation School Fund, 29%.

In June 1999, Gov. George W. Bush signed HB 844 into law, removing the cap on the prize payout percentage and restoring the discretion to establish the payout to the TLC.

In July 2000, the TLC increased the payout from 50% to 55% for the Lotto Texas game.

In December 2003, the Lottery had its first multi-state Mega Millions drawing and on 31 January 2010 offered Powerball tickets for sale.

In December 2010, GTECH Corporation was awarded a nine-year contract for lottery operations and services. The new agreement can potentially save the state $160 million over the life of the contract.

In October 2022, International Game Technology (IGT) signed a new 10-year scratch ticket printing and services contract with the Texas Lottery Commission. Since the two parties already had a partnership this new contract will run through August 2034.