Is promoting video lottery really the best idea Pierre can come up with for boosting state revenues?
Back on April 30, 1991, the South Dakota Lottery Commission adopted a declaratory ruling that limited marketing promotions by video lottery establishments. On Thursday, the commission tried to repeal that ruling. The vote was 3-2 in favor. The commission has seven members. Two weren’t at the meeting. The validity of that vote is now in question.
The Lottery Commission is trying to increase video-lottery play. That means players lose more money. Net machine income is split between state government and the private owners of the machines and establishments. The commission is looking for ways to allow the establishments to encourage people to bet more money — and lose more money. That’s not meant as criticism, but that’s how video lottery works [Bob Mercer, "Lottery Commission Splits over Video Lottery Promotions," Pure Pierre Politics, 2014.04.11].
Imagine a candidate for Governor or Legislature making this statement on the campaign trail: "Let's hand out cheap beer and t-shirts to lure people into playing games that they will lose!" Does that sound like a bold vision for building prosperity in South Dakota?
By the way, the lottery commission's vote is in question because two members of the seven-person board were absent, and commission counsel ruled that decisions require a majority vote of all members, not just those present. Ah, by-laws....
After all these year of legalized gambling in South Dakota, the state gaming commission and lottery officials fail to realize that they way to raise gaming revenue is to raise pay outs.
Until than, fools and wishful thinkers will taken advantage of by the state.
Want economic development, renewable economic development - think harder:
http://www.acoel.org/post/2014/03/31/Innovative-Renewable-Energy-Project-Starts-Up-in-Wisconsin.aspx
How about this: "Higher stakes can be approved as long as the bill includes the provision that 75% of all proceeds go directly to funding education in SD."
The big national and state lotteries increased payouts and participation has risen significantly.
Deb,
Back in the 1980's when video lottery was being sold to the public and a referendum was held for its approval, the largest selling point was that proceeds from the game were going to be used for education.
Somewhere along politicians changed that and some of the powers that be decided profits would not go to education. I don't know who made that decision, but it obviously duped the state's citizens.
I would like to see this as another referendum, demanding that every penny earned from video lottery go into lock box for education.
Video Lottery
Revenue generated by video lottery play is called Net Machine Income (NMI). NMI is calculated as cash put into the machines minus prizes cashed out (cash in – prizes out = NMI). The state currently receives 50% of NMI. The private machine owners (licensed operators) receive the other 50%.
The state’s share of NMI is currently transferred to the Property Tax Reduction Fund (49.5% of NMI). A small amount is kept by the Lottery for operation costs (0.5% of NMI).
Revenue from video lottery play has raised more than $1.66 billion for the Property Tax Reduction Fund.
The state’s share of NMI was originally transferred to the General Fund. The current distribution to the Property Tax Reduction Fund began in state fiscal year 1997.
Revenue from video lottery has raised nearly $276 million for the General Fund.
The problem with the figures you cite, Mike, is that all the expenses are not included. Incarceration costs for those who blow too much money. In addition, there is unpaid child support, poverty, theft, embezzlement, and other financial crimes. Those numbers shot up after video lottery began in SD. Add in unpaid medical bills, local and state government assistance.
The answer shows that gambling is not a cash cow for governments. In fact, it's a loser!
Deb-I just pasted part of a report to support Roger's post above mine about where video lottery proceeds go(not for education) and when they changed sending the proceeds to education.(1997) This was neither an endorsement for or indictment of lottery/gambling. Personally,I agree that there are too many negative aspects that come about because of gambling.