Senator persists, wants lottery on session agenda

Jermaine Gines cleans tables Wednesday at the Old State House in preparation for the House to convene in the historic chambers during next week’s special session.

Jermaine Gines cleans tables Wednesday at the Old State House in preparation for the House to convene in the historic chambers during next week’s special session.

Thursday, June 26, 2014

A state senator said Wednesday that he gave Gov. Mike Beebe a list of 65 state representatives who want the governor to add proposed legislation to ban the lottery from offering electronic monitor games to the agenda for next week's special session.

But Beebe spokesman Matt DeCample said the governor's office has been "given a number of lists" about representatives who support the legislation by state Sen. Jimmy Hickey, R-Texarkana, and the governor wants to discuss the matter further before he decides whether to add the measure to the special session's agenda.

On Tuesday afternoon, Beebe called for a special session to convene starting Monday to consider bills to provide more funding for the state's public school employees health insurance plan and to open about 600 more prison and jail beds.

Even as the governor considered Wednesday whether to add the lottery legislation to the agenda, the Arkansas Lottery Commission met and advised lottery Director Bishop Woosley not to negotiate with lawmakers to possibly restrict where the lottery plans to begin offering the electronic monitor game, called quick-draw, starting Sept. 29. Woosley had asked whether he has the authority to negotiate with lawmakers if Beebe adds Hickey's proposed legislation to the special session's agenda.

Commission Chairman John "Smokey" Campbell of Hot Springs said the lottery has had the legal authority to offer such electronic monitor games since the Legislature approved the state's lottery law in 2009 and lawmakers could have changed the state law anytime during the past five years.

"We played our hand. Let's play it and see what happens," he said.

Two months ago, the commission authorized the lottery's staff to proceed with implementation of electronic monitor games -- a day after a majority of the Legislature's lottery oversight committee, led by Hickey, declared its opposition to such games.

A year ago, lottery oversight committee co-chairman state Rep. Mark Perry, D-Jacksonville, urged the commission to consider offering these games to boost declining ticket sales and net proceeds raised for college scholarships.

Revenue continues to drop

Also Wednesday, Woosley told the commission that he expects the lottery to raise about $80.5 million for college scholarships in the fiscal year ending June 30. That's short of his initial forecast for $89.5 million and his reduced forecast, made in February, for $82.78 million, he said. He attributed the decrease to lagging lottery ticket sales.

Arkansas lottery started selling tickets on Sept. 28, 2009, and raised $82.7 million for scholarships during a nine-month period in fiscal 2010.

It generated $94.2 million for college scholarships in fiscal 2011, its first full fiscal year, $97.5 million in fiscal 2012 and $90.2 million in fiscal 2013. More than 30,000 students have received scholarships during each of the past four fiscal years.

During the first 11 months of fiscal 2014, the lottery's ticket sales have totaled $380.6 million -- a $27.4 million decline from the same period in fiscal 2013 -- according to Woosley' report to the lottery commission. During the first 11 months of fiscal 2014, the lottery's net proceeds for college scholarships have totaled $74.6 million.

The lottery's proposed budget for fiscal 2015 forecasts ticket sales of $428 million with $81.2 million collected for college scholarships, including about $12.5 million in ticket sales revenue and about $3.5 million in college scholarships generated by a quick-draw game.

Supporters of the quick-draw game said it's similar to Powerball and Mega Millions, except drawings will be held every four minutes and results would be shown on monitors similar to television screens set up in participating locations.

Woosley has said he hopes to initially have about 250 retailers selling tickets for the quick-draw games, which some people call keno. By June 2015, Woosley hopes to have 400 lottery retailers showing the drawings.

Hickey and others who oppose the electronic monitor games maintain that Arkansans didn't envision such games when they approved a constitutional amendment in 2008 authorizing the Legislature to create a state lottery for college scholarships.

But supporters of the games counter that some other state lotteries offer such games and the Legislature explicitly authorized the lottery to offer these games when it approved the state's lottery law in 2009.

After meeting with Beebe on Wednesday morning, Hickey said that afternoon that he is "still waiting to find out" whether the governor will add his legislation to the agenda for the special session.

"There is way over the majority [of the House] that would vote to eliminate the games," he said.

House Speaker Davy Carter, R-Cabot, said he previously had been advised that fewer than 60 representatives support Hickey's legislation in the 100-member House.

The differences in vote counting on Hickey's proposed legislation may be because some representatives are changing their minds and he's trying to figure out "what the real numbers are for support [of the measure]," he said.

Carter said he still hopes Beebe doesn't add Hickey's proposed legislation to the call for the special session, although he doesn't know what the governor plans to do.

"I think it is way more complex and controversial than [opponents of the monitor games] may be thinking" and is better suited for the 2015 regular session, he said.

"It is just going to turn into a firestorm. There are strong opinions on both sides of it," Carter said.

Commissioners: Don't negotiate

Woosley asked the commission about the possibility of negotiating with lawmakers who want to ban electronic monitor games if the governor adds that to the agenda for the special session.

Commissioner Julie Baldridge of Little Rock, who formerly worked for the lottery, said the lottery shouldn't agree to restrictions on where the lottery's monitor games can be sold because the limits would be counterproductive.

She said the lottery's ticket vending machines through which lottery players can purchase tickets "were going to be the end of the universe as we knew it" according to their opponents, and "now we see that they are just like Coke machines" that some lottery players use and some don't.

Woosley needs to be able to tailor the electronic monitor games based on market conditions after the games sales start, said Baldridge. The lottery will take "the same amount of push-back" no matter where the electronic monitor games are located, she said.

"If [lawmakers] want to forfeit [lottery] revenue, then so be it. But I don't know that we ought to hamstring ourselves," Baldridge said.

Woosley said "we cut our own nose off despite our face in [ticket vending machines] and never really recovered," adding "that program has suffered dramatically." He has estimated that ticket sales through the vending machines are about $4 million a year, far short of former director Ernie Passailaigue's projections. The lottery has ticket vending machines at 78 retailers, according to the lottery's website.

Commissioner Mark Scott of Bentonville said lawmakers who oppose the electronic monitor games "seem to want it all or nothing."

The electronic monitor games are "a thoughtful way" to increase the lottery's revenue to make sure scholarships are provided to all sorts of students, he said.

Commissioner Bruce Engstrom of North Little Rock said if some lawmaker wants to propose restrictions on monitor games, "it's perfectly OK" for them to come to a commission meeting and discuss whether that is in the state's best interest.

A section on 06/26/2014