Got your favorite 7 numbers memorized yet?

The Lottery passed the Senate 24 to 24, Chapel Hill citizen and Lt. Gov. Bev Perdue cast the deciding vote.

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Comments

From the Salisbury Post:

"Having chosen to go this route, those who pushed the measure (lottery) through should take steps to assure that their opponents' worst fears won't be realized. That means providing an ironclad mechanism guaranteeing that lottery revenue will not simply replace existing funds but will actually boost funding for school construction, scholarships, class-size reducation and preschool programs, as Easley has promised. That means establishing a squeaky-clean lottery operation insulated from sticky-fingered politicians and corporate gambling's inherent sleaze. That means avoiding the advertising onslaught to which other states have resorted when ticket sales start to flag, as they inevitably will once the novelty wears off.

And, finally, while promoting the lottery, the state should devote equal promotional time to a public-service campaign about the dangers of gambling addiction and provide a state-sponsored hotline telling people where to find help. It's only fair that we help provide treatment for the disease we're now enabling."

We can't undo what was done on Tuesday, but we can all vow to be vigilant observers of future budgets to ensure that supplantation does not occur.

We're off to a good start with the lottery! Corruption already!

http://www.newsobserver.com/politics/lottery/story/2829303p-9279337c.html

"State lottery commissioner Kevin Geddings of Charlotte resigned Tuesday, hours before lottery vendor Scientific Games disclosed that he worked for the company this year as lawmakers hashed out the state's new lottery.

Scientific Games is expected to seek the multimillion-dollar contract to handle the most visible part of the $1.2 billion-a-year lottery -- overseeing the instant ticket and lotto numbers games. Lottery commissioners will decide who gets contracts."

It's interesting to read how Geddings' mind works. If I rob
a bank and get caught and the newspaper publishes that I
robbed the bank, I should blame the newspaper?
What a mindset these lottery proponents, both the companies
and the politicians, have!

There's plenty of dirt on this deal, it appears. I personally cannot believe that Jim Black had so little sense as to have an "unpaid" political advisor and not know more about how she paid her bills. I do not think he is that blind.

Is there any way we could have a lottery without financial malfeasance and corruption? I doubt that's possible.

Just add this to the long list of reasons I oppose a state-run lottery.

Ellie Kinnaird saw this coming a mile away, BEFORE the shady dealings came to light. Strong opponents of the lottery (myself among them) got a large whiff of bad news to come when the final vote was engineered so cunningly.

Ellie, meanwhile, argued forcefully against the lottery from the get-go. It's predatory, it's fiscally unwise, and it's ugly with hideous billboards and outlet signage.

Ruby,

I don't think there is a human institution that is immune from malfeasance and corruption. Take, for example, the Really Really Really Free market.

At least it's given The N&O the opportunity to do some fantastic journalism. When they get hold of an issue, they really do get hold of it.

Yah great journalism -- my favorite was this story
http://www.newsobserver.com/politics/dome/story/2820869p-9268383c.html
headlined "Black's office ignored warning about lottery bill" that I had warned the Speaker's office about something and the Speaker's office had done nothing, The only problem with the entire story is that I NEVER talked to anyone in the Speaker's office, the person I sent the emails to was a staff attorney in one of our nonpartisan divisions. Later in the session she was hired by the Speaker's office. One of my jobs as a legislative editor is spotting problems in bills after they pass one house -- I send emails suggesting corrections in legislation all the time. When I called the N&O after the story ran to let them know their headline (and the basic premise of the story) was TOTALLY incorrect, they ran a correction the next day that basically said I had stopped beating my wife.

I've been hanging around the General Assembly since 1971 -- I lobbied for Common Cause that session while in grad school at Carolina. (and no, I didn't register, since Common Cause was tooo poor in 1971 to reimburse my exenses, and you only have to register if you are being paid in some way.)

Nobody's perfect. But I think their reporting on the vagaries of the lottery has been aggressive and, in many respects, led to the revealing of the malfeasance we all suspected was coming.

The other "fact" that I've been chasing around was that Scientific Games somehow had exclusive access to some part of the process to the exclusion of others. That line was picked up by the DTH edit on October 19
http://www.dailytarheel.com/vnews/display.v/ART/2005/10/19/4355c13f7ba5f...
"Black said other companies were brought in to consult — but if consultation, not connections, was really the goal, then why were no other companies writing parts of the legislation?"

IIn fact, what Black was referring to was me -- I personally talked to GTechs lobbyists (the other major national vendor) and invited them to submit language on the SAME paragraph of the bill that Scientific Games had suggested modifications to. There finally has been some press on this.

I've been posting less recently as my son's ( he is a UNC-Charlotte senior) roommate was shot through the chest in front of their apartment while someone was trying to carjack his car. We had to get both of them moved out to another place in Charlotte after the shooting. His roommate lost 3 liters of blood, but is making a good recovery.

Very sorry, Gerry. Hope all recover well.

More lottery drama: "We've got a real problem here."
http://www.heraldsun.com/state/6-665206.html

"Scientific Games and rival GTECH Corp. are the two primary suppliers of scratch-off tickets and lottery software. Refusing to accept bids from Scientific Games for what's likely to be a multimillion dollar contact could leave the state at the mercy of GTECH, which had some legal problems of its own in the 1990s.

Allow Scientific Games to bid, and any contract it wins will be followed by complaints of manipulation.

"The immediate knee-jerk reaction is all but to avoid Scientific Games," said John Hood, with the John Locke Foundation, a Raleigh-based conservative think tank. "But Scientific Games and GTECH are the only companies in the country with experience at this high level of starting a lottery of this size from scratch.

"We've got a real problem here." "

Gerry, what an awful experience for all of you. Lottery-related malfeasance is nothing compared to the crimes committed with handguns in this country every day.

Lottery incentives

By Chris Fitzsimon
Most of the lottery news lately has been about the rush to start the game, the hiring of Lottery Director Tom Shaheen and his push to get tickets in stores by April to earn a large bonus. There has been criticism of Shaheen's plans to pay top lottery executives more than the Governor makes.

A group of citizens may file a lawsuit this week claiming that the House and Senate violated the state constitution in passing the lottery without voting on it on two separate days. They seem to have a case.

Governor Mike Easley says the lottery does not meet the constitutional definition of a tax and is confident the lawsuit will fail. It is beyond dispute that legislative leaders twisted, distorted, and rewrote legislative rules to pass the lottery. A court will have to decide the constitutional question.

Easley and other state leaders continue to dismiss all the ethical problems with the initial appointments to the lottery commission and the ongoing investigation of House Speaker Jim Black and his former staff member and political director Meredith Norris. Easley wants to move on and talk about how the lottery will help North Carolina schools.

Nobody wants to talk about how the lottery will work, how it will raise money and who it will raise it from. Lottery commissioners and state officials ought to read a study of the New Jersey lottery conducted recently by the New Jersey Star-Ledger.

The paper looked at five years of lottery data by zip code and found that ticket sales were directly related to the income level of the geographic area. The poorer the zip code, the more tickets that were sold.

Similar studies in other states have been criticized by lottery supporters who claimed that the studies did not take into account middle class people who work and buy lottery tickets in poor neighborhoods

The Star-Ledger study adjusted for that, using Census Bureau information to come up with "daytime populations," and also analyzed the addresses reported by lottery winners. The conclusion did not change. Poor people play the New Jersey lottery more than middle class and wealthy people.

The paper also looked at where lottery tickets are sold. There are 6,000 retail outlets in the state. There are twice as many outlets per capita in zip codes where the average income is less than $52,000 than there are in zip codes where incomes average more then $100,000.

No matter how you look at the numbers, poor people in New Jersey play the lottery more than anyone else. By the way, New Jersey's advertising budget for the lottery has grown from $8 million to $19 million in the last six years

The reaction to the study by lottery officials was bizarre. The lottery's executive director, Michelline Davis, was "personally offended" by the paper's findings. Apparently, she is not offended that the people in New Jersey who can least afford to spend money on lottery tickets are buying them the most often.

Davis also told the paper that "every dollar provided by the lottery is one less dollar needed in the form of state and local taxes." In other words, every dollar the state can convince the poor to waste on a lottery ticket is another way to avoid making wealthy people in New Jersey pay more taxes.

The New Jersey study offers a preview of what's to come in North Carolina. Don't be surprised if Shaheen's next incentive is based on how much money the lottery brings in, which gives him a financial incentive to target the poor, the folks most likely to play. Government by exploitation.

None of this should come as a shock. The same issue was raised in North Carolina during the lottery debate and not only by lottery opponents. House Speaker Jim Black himself initially said he didn't want the lottery to advertise or target people to encourage them to play.

But that is what's happening in New Jersey and what will happen soon in North Carolina. If the lawsuit fails and we are stuck with a lottery, how about creating one that restricts advertising and provides incentives based on who is buying tickets, not how many they buy? Let's try to raise money and preserve at least a shred of our humanity in the process.

The worst thing is that once lotteries have been established, it's almost impossible to put that genie back in the bottle. Does anybody know if there's ever been a case where a state has dismantled a lottery?

It's heroin for state governments.

I don't know of any states that have dismantled a lottery David although I know plenty of educators who were supposed to be the beneficiaries of state lotteries that would like to dismantle them.

I was reading somewhere that selling tickets is a huge hassle for business owners. Does anyone know of any local businesses that are looking forward to selling tickets? Any that have refused? I would love to see our local governments put out statements discouraging businesses from participating.

Not a fun topic. As we've seen already right here in NC, the potential for misconduct in the lottery industry is great. Few of the anticipated several hundred lottery workers will make executive wages. Most of them will spend all of their time on the road supporting ticket sellers -- training, advertising, general maintenance and accountability.

I don't know of any incentives for a business owner to offer lottery tickets apart from the gambling attraction. There's no percentage in it, is there?

Allow me to retract my earlier question. Apparently there is a percentage in it -- actual dough in exchange for turning your convenience store into a money pit.

David, I'd like to think that as long as the infrastructure hasn't been rolled out, and especially with the hog farm like stench already permeating the initial organization, we still have an opporturnity to nip this in the bud.

Catherine, if we structure our program like Georgia's, where vendors get %5 for a typical ticket, %7 for a Cash 3's (whatever the frick that is) and kickbacks on winning tickets, there is an economic incentive for dealing with the hassle. Some studies show incidental purchases driven by lottery ticket sales (cigs, candy bars, etc.) make the per-square-counter-inch sales of this product fairly lucrative.

Georgia is also an interesting case in failing by suceeding. Besides the fairly good chance their HOPE scholarship and associated educational programs will be bankrupt by 2007, their proceeds are in decline. You might want to take a quick look at the 2004 Special Audit to see how their program is progressing. From '94 to '04 their payouts as a percentage of sales has exceeded the legislated minimum of %45 but have also increased from %51.6 to %58.1 of total net proceeds. I assume this is to compete with other operations. At the same time funds going to the State have been below the legislated limit of %35 (by using the "as nearly as practical" loophole), with a decrease from %33.8 in '94 to %30.6 in '04. The remainders go to administrating the program and renumerating the vendors.

BTW, in Chris' article he quotes Davis “every dollar provided by the lottery is one less dollar needed in the form of state and local taxes.” Not quite. If we follow Georgia's bouncing ball, we see that actually $1 to the lottery "costs" the taxpayer more than $1 in straight taxes.

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