Governor signs state lottery changes

Tj 2-24tr-2 Tj state

LITTLE ROCK -- Gov. Asa Hutchinson signed legislation Wednesday eliminating the Arkansas Scholarship Lottery's $200,000-a-year contribution to compulsive gambling treatment and educational programs, increasing the amount of money available for scholarships.

Senate Bill 404 -- sponsored by Sen. Alan Clark, R-Lonsdale -- also will reduce the lottery's payments to the state Department of Higher Education for administering the lottery-financed Arkansas Academic Challenge Scholarship program to "only direct expenditures of the department to administer scholarship funding."

Clark said the bill would ensure the lottery isn't paying for indirect expenses.

Clark said he expects the law will raise as least $600,000 more a year for Arkansas Academic Challenge Scholarship program by axing the the payment for problem gambling programs and cutting the lottery's payment to the state Department of Higher Education by $400,000 a year.

Lottery Director Bishop Woosley said the lottery paid the department $751,556 last year for administrative expenses, compared to $794,015 in 2013, $846,108 in 2012 and $1.17 million in 2011.

Harold Criswell, deputy director for the state Department of Higher Education, estimated the department would lose between $275,000 and $350,000 a year from payments from the lottery under the measure.

Clark introduced the bill Feb. 17. It dashed through the Senate on March 25 in a 34-0 vote and the House of Representatives on April 2 in a 79-2 vote with only Little Rock Democratic Reps. Fred Love and John Walker voting against it.

Clark said he introduced the bill at the request of a former lottery commissioner, who thought the lottery's spending on the certain programs was being wasted and should go to scholarships instead. He declined to identify the commissioner.

Former Commissioner John C. (Smokey) Campbell of Hot Springs frequently complained about the payments to the state Department of Higher Education for administering the Arkansas Academic Challenge Scholarship program and the Division of Legislative Audit for auditing the lottery.

Campbell couldn't be reached for comment Wednesday afternoon.

Clark said he expected "some kind of outcry" about elimination of the contribution to problem-gambling programs, but it didn't materialize.

"No one ever contacted me. No one ever came to a committee [meeting] to oppose it," he said. "I thought all along it would have to come out [of the bill]."

He said the lottery financed a problem gambling hotline that didn't receive many phone calls from Arkansans and he didn't talk to anyone who thought the hotline "was doing any good."

The lottery also financed various groups in Arkansas to combat problem gambling, Clark said.

"I know there are gambling problems, but it does not seem to be addressing them," he said. "We might need to do something about problem gambling in the future."

Family Council President Jerry Cox, who is an opponent of the lottery, said his group "is neutral regarding the elimination of the $200,000 to fund a problem gambling hotline.

"The meager $200,000 per year being spent on the gambling hotline is an insult to the real problem of gambling addiction," Cox said in a written statement.

"The lottery, Oaklawn and Southland [racetracks] need to be required to put millions of dollars into a comprehensive program that really addressed the problems that their industry creates. Some of that money needs to be used to educate young people about how unwise it is to gamble in the first place. The amount of money being spent on this problem is a drop in the bucket, so if they're not willing to put real money behind really addressing the problem, why bother? Anything less is just window dressing."

Officials at Oaklawn Park in Hot Springs and Southland Park Gaming and Racing in West Memphis couldn't be reached for comment about Cox's remarks Wednesday.

The $200,000 a year from the lottery has been spent on the gambling hotline, comprehensive outpatient treatment and services as well as establishing a prevention and education program to increase public awareness about gambling problems through community-based prevention program specialists and organizations, said state Department of Human Services spokesman Amy Webb.

The department paid the Louisiana Association on Compulsive Gambling $16,069 to operate the problem gambling hotline in 2014, she said.

"We will no longer operate a gambling hotline," Webb said.

A spokesman for the Shreveport-based Louisiana Association on Compulsive Gambling couldn't be reached for comment Wednesday.

According to reports on the Arkansas lottery's website, the "problem gambling helpline" reported receiving several hundred phone calls each month during the past year.

In February, the helpline reported 786 phone calls, including 296 calls about the lottery, 223 calls about casinos, 129 calls that were "hang ups" and 119 that were the "wrong numbers."

Clark said he took out a provision in his bill requiring the Division of Legislative Audit to audit the lottery for free, after some lawmakers and division officials objected.

The lottery has paid the division more than $700,000 the past three years, including $325,720 for auditing lottery draws, and "as of February we are no longer involve in lottery draw observations," said Deputy Legislative Auditor Jon Moore.

Sen. Jimmy Hickey, R-Texarkana, said "we just see [SB404] as another avenue to correct" the scholarship program's "deficit spending" when it temporarily taps its $20 million lottery reserve fund. The fund is designed to help the program through temporary cash-flow shortfalls.

NW News on 04/09/2015

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