Even as players lined up across North Carolina last week to drop their dollars on chances at a big Powerball jackpot, officials acknowledged the new state lottery has a $200 million problem.

Overall sales for the games' first fiscal year are expected to miss the goal by at least that much, adding significant financial pressure to education programs that the lottery was created in 2005 to support.

With half the fiscal year over, officials have blamed lower-than-expected sales on months of small Powerball prizes, high gas prices, a tight economy -- even the chemical fire in suburban Apex last year.

"It's up to the people now," lottery director Tom Shaheen said in an interview. "It really is. And they're either going to play or they're not going to play."

It is clear, after nine months of sales, that North Carolinians are not buying tickets at the rate people do in other states with lotteries, a review by The News & Observer shows.

To be sure, players have spent more than $700 million on the lottery in North Carolina since it launched March 30.

But compared with players in the Southeast and across the nation, people here are not trying their luck. Per capita sales of scratch-off instant tickets, the sales leader for any lottery, are less than half of those sales in South Carolina and Georgia, for example. Overall sales have declined steadily from month to month, even as new games have been offered.

Although lottery officials mostly cite economic reasons for slow sales, an analysis of state and national lottery data by The N&O shows a more fundamental issue at play: By several key measures, when compared with adjoining lottery states or those with comparable sales or population, the North Carolina lottery has a weaker foundation.

The N&O's review shows there are fewer outlets here, lower prize amounts and lagging interest in Western North Carolina.

Other factors include criticism over how lottery proceeds will be spent and scandals that have surrounded the games' start.

"Cumulatively, it [all] has served to take the wind out of the sails," said John L. Rustin, a lobbyist for the N.C. Family Policy Council, which opposed the games.

Gov. Mike Easley championed the lottery even before he took office in 2001 to pay for some of his favorite education efforts. Polls showed widespread support for starting the lottery.

Easley pushed for the games on a pledge that they would support an existing day-care program for at-risk 4-year-olds, called More at Four; pay for more teachers to keep class sizes small; supplement college scholarships for the needy; and help with school construction across the state.

His office predicted sales of $1.2 billion in the first year. But because of slower sales, Shaheen said, $1 billion is the new target.

The shortfall will be felt. Instead of returning $425 million to education in the first year, the lottery is expected to bring in closer to $350 million for those efforts.

Legislators and the Easley administration haven't outlined how they will deal with the shortfall.

"It's too early to panic," said Dan Gerlach, Easley's senior budget adviser.

N.C. prizes, outlets lag

It is difficult to pinpoint why sales are off the mark. Lottery officials mostly cite economic reasons.

Shaheen said, though, he is surprised at how poor sales have been. Lottery play in other states has generally been solid. This month in Georgia, for instance, officials trumpeted another period of record growth. Tennessee did, too. Ohio's lottery just posted a 5 percent gain.

Shaheen, a past president of the national lottery association, said North Carolinians seem to be spending instead on heating bills, groceries, new cars, cell phones and more. Lottery tickets are discretionary dollars, he said: "A lot of 'em have gone to cell phones."

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