The Texas Legislature abolished the Texas Lottery Commission in 2025, in part, on the theory that the game had been captured by bulk buyers, and handed the whole thing — lottery, charitable bingo, 400-odd employees — to an occupational licensing agency. On Sept. 1, one day after that first fiscal year closed, the agency came to a budget hearing and reported the result: sales essentially flat, and roughly $1.6 billion out the door to public schools.
“We ended the year very close to last year’s sales and transfer amount,” Executive Director Courtney Arbour of the Texas Department of Licensing and Regulation told the panel. “We will actually transfer more to the school fund than last year, which we were very excited about in our first year. With all the policy changes, we wanted to make sure that we met or exceeded that, and we came very close in overall sales, less a little bit over half a percentage point lower in overall lottery sales for the year.”
That is the answer to the question that drove the 2025 fight, and it deserves to be reported carefully, because three separate things in it are not yet verifiable and one of them is already wrong.
The transfer numbers are for eleven months, not twelve. Arbour was precise about this and the precision matters: “Our transfers to the state totaled approximately $1.64 billion, approximately $1.61 billion of that will go to the Foundation School fund. Approximately $28.7 million went to support Texas veterans.” She had said a beat earlier that these were “the FY 26 revenue transfers through July 31st of this year.”
All three figures match the lottery’s published monthly transfer document to the dollar — $1,606,842,851 to the Foundation School Fund, $28,749,832 to the Texas Veterans Commission, $1,636,032,125 in total. The August line on the document is blank, because transfers are due by the fifteenth of the following month and August’s had not been made when she spoke.
The school fund claim cannot be verified yet, and the arithmetic is tight. Fiscal 2025 sent $1,777,877,819 to the Foundation School Fund. To beat it, August alone would have to deliver about $171 million against a fiscal-2026 monthly average of roughly $146 million. That is not impossible — August 2026 carried a large Powerball run — but it is not established, and no published figure supports it as of Sept. 2.
The sales figure was stale when she said it. “A little bit over half a percentage point” was accurate through late July, when the lottery’s weekly summary showed fiscal 2026 running 0.64 percent behind. The most recent published weekly summary, for the week ending Aug. 22, puts the gap at 0.26 percent — $7.694 billion against $7.714 billion — with scratch tickets down 3.1 percent and draw games up 12.5 percent.
Arbour listed the statutory changes it stood up in year one. “We implemented the statutory requirements of 3070, including limitations on draw ticket transactions, 100 tickets per per sales transaction, and vending machines. The, the amount you can sell per vending machine and the number of vending machines you can have in any one retailer.” Then the sentence that names the reason: “The idea was to not ever again have bulk purchasing in that same way.”
Those are the provisions of Senate Bill 3070 that answer the 2023 Lotto Texas jackpot bought out by a syndicate through a courier operation, and they are now in statute: no more than 100 tickets to one person in a single transaction, a Class B misdemeanor to exceed it; and rules capping vending machines at any one retailer, defaulting to five if no rule is written. The bill also required a lottery advisory committee, which Arbour said “was established, and they held their first meeting in July,” and set the first annual report to the Governor and the Legislature for Dec. 1.
The merger is not finished, and she said so. Asked from the dais whether anything had gone badly, Arbour named one thing. “One other thing I would mention is the only thing we didn’t see coming as part of this latest integration of the Lottery Commission staff is the need to have. Well, we knew we would need to merge the Microsoft tenants, but it was far more complex. And the amount of data and the complexity of moving all of that into our system was more than we first thought.”
The practical state of it, a year on: “for right now, we still have some people that are kind of straddling two different networks and two different sets of cyber tools.” The agency first thought it would need supplemental money for the fix and now expects to cover it from savings.
The most consequential number Arbour read is one nobody asked about. TDLR’s base request is “approximately $402.3 million in each fiscal year, for a total of $804.6 million for the biennium” — and “roughly 80% of that biennial base, approximately $658.1 million, is funded through the dedicated lottery account.”
The agency that regulates Texas electricians, elevators, barbers and tow trucks is now four-fifths funded by ticket sales. Chapter 466 and the lottery program are set to expire Sept. 1, 2029 unless the Legislature continues them.
When
Tuesday, Sept. 1, 2026, Room E2.026, Capitol Extension, Austin. Joint budget hearing of the Legislative Budget Board and the Governor’s office on FY2028-29 legislative appropriations requests, posted 2:00 p.m. to 4:00 p.m.; the broadcast archive runs 1:12:50. TDLR’s segment falls at video position 48:33 to 1:12:06 and closed the hearing. Two other joint budget hearings were held the same day — Article VIII health licensing agencies at 9:00 a.m. and the Commission on State Emergency Communications at 9:30 a.m. No votes are taken at these hearings.
Archived video
Joint Budget Hearings: Articles VII & VIII Agencies, Texas House Capitol Events archive, Sept. 1, 2026, 2:00 p.m.