Category Archives: Lottery/Gaming

Daniels suggests lottery as way to fund scholarships

Source: By Tim Evans, Indianapolis Star (IN), Posted: August 14, 2008

A plan from Gov. Mitch Daniels to help more Hoosiers get into college was hailed Wednesday by Republican and Democratic leaders, but there could be a fight over how to fund the estimated $50 million annual cost. Daniels, who announced the Hoosier College Promise scholarship program in April, revealed more details and two potential funding sources — including privatizing the Hoosier Lottery — during an appearance Wednesday at Terre Haute.

…… A similar proposal to privatize the lottery — with revenue used for college scholarships, life-science research and police and fire pensions — died in the Democrat-controlled House in 2007 after narrowly passing in the Senate.

Is selling the state lottery worth the gamble?

Source: By Benjamin N. Gedanm, Providence Journal, Sunday, February 10, 2008

For five decades, state governments have maintained a stranglehold on lotteries, reaping huge gambling profits from the monopoly.

That tradition could be coming to an end, as cash-strapped states consider selling their games to private operators. The sales would generate a windfall to pay for roadway and school construction or to erase unfunded pension liabilities, while drying up annual lottery revenues that have been propping up state budgets.

For global lottery operator GTECH Holdings Corp., however, the potential changes would likely boost yearly profits.

……. GTECH executives have been meeting with state legislators across the country to discuss privatization and to project the potential growth in lottery revenue. Their message: squeamish state governments are surrendering millions in gambling winnings.

States consider privatizing lotteries

Source: By Dave Gram, Associated Press, January 21, 2008

Betting on the state lottery for some quick cash? Get in line: State governments across the country are thinking the same thing. Courted by Wall Street investment houses, Vermont is one of more than a dozen states where proposals have been floated to lease state lotteries to private investors.

…… But some fear that private companies would be more focused on profits than people, introducing addictive games that prey on compulsive gamblers.

….. Lehman Bros., Goldman Sachs, UBS Investment Bank and others — lured by the prospect of millions of dollars in fees for bringing states and private lottery operators together — are expected to keep knocking on state capital doors.

State joins list of others tapping into lottery

Source: By Joseph Spector, Ithaca Journal (NY), January 11, 2007

Gov. Eliot Spitzer’s announcement this week to explore a lease of the state lottery puts New York among a number of states looking to roll the dice on getting an infusion of cash to pay for services.

But from constitutionality questions to concerns about the social consequences of putting the gambling operations in private hands, no state has yet to adopt the potentially lucrative deals.

Lawmakers and gaming experts Thursday questioned whether New York would face the same issues as it explores either selling future lottery revenue in a lump sum or leasing it to a private entity for possibly up to 40 years.

Governor drops lottery privatization

Source: Associated Press (IN), November 21, 2007

Gov. Mitch Daniels said today he won’t make a renewed pitch in the upcoming legislative session for his proposal to privatize the Hoosier Lottery, saying lawmakers will be too busy considering property tax reforms.

During the last session, Daniels proposed leasing the lottery to a private operator and said one company was willing to pay $1 billion plus $200 million in annual payments for the 30-year lease.

Group pushes to privatize lottery / 4 GOP senators to file bill today

Source: By Andrea Estes, Boston Globe (MA), October 22, 2007

As Governor Deval Patrick’s casino bill is being debated on Beacon Hill, a group of Republican lawmakers is pushing another way for the state to reap a large gambling windfall: privatizing the Massachusetts lottery.

…….. Though several states have debated lottery privatization, none has approved it. California and Texas would probably be the first to close a deal, according to investment bankers and others who have pitched proposals around the country. The state would solicit proposals from bidders, who would have to pay $1 million to have their proposal considered, the bill says.

Some States Consider Leasing Their Lotteries

Source: NELSON D. SCHWARTZ and RON NIXON, New York Times, Sunday, October 14, 2007

…. Like shoppers at convenience stores who can’t resist placing bets when lotto jackpots get big enough, government officials in at least a dozen states are considering lottery privatizations — what would collectively amount to the biggest privatization of a government enterprise in American history.

Wall Street, positioned to play an important role in orchestrating these deals, is looking at some very big prizes itself. If privatization plans now being considered in four large states — California, Illinois, Texas and Florida — were to go through, Wall Street could conservatively reap a minimum of $250 million in fees alone.

Would Lottery Lease Be State's Winning Ticket?

Source: By JEROME R. STOCKFISCH The Tampa Tribune (FL), Sep 27, 2007

…… Now, the state lottery and a handful of toll roads and bridges are drawing the interest of private investors who are putting a price tag on those assets and want a piece of the action.

Facing a $1.1 billion hole in the state budget because of an economic slowdown, the state is listening.

This summer, major Wall Street firms approached Florida, as they have other states, with the prospect of leasing the state lottery.

Crist suggests taking lottery, roads private

Source: John Kennedy, Orlando Sentinel (FL), September 5, 2007

Looking to plug a $1.1 billion hole in the state budget, Gov. Charlie Crist said Tuesday that he is considering lots of options — including turning the state lottery over to private vendors.

The Republican governor also said the state might draw more money into the treasury by allowing private companies to build, service and maintain some Florida roads in exchange for a share of toll revenue.

Teacher fund to invest in lottery privatization?

Source: By Robert Elder, Austin American Statesmen (TX), Thursday, August 9, 2007, 02:28 PM

A handy “deal log” is issued at almost every meeting of the Teacher Retirement System board of trustees. It lists the system’s current investments in private equity and real estate and which firms the trustees are considering for future investments.

The most recent deal log includes an intriguing reference under “further due diligence:” A potential $300 million investment in a massive fund from a firm called Colony. Its strategy, according to the deal log, is “privatization of state lottery.”

…… Gov. Rick Perry in January floated the idea of selling the Texas lottery to private interests to boost the budget surplus, but the plan went nowhere in the legislative session.