Bettors will have to wait to buy Wyoming lottery tickets

2013-07-01T00:15:00Z 2013-07-03T06:00:16Z Bettors will have to wait to buy Wyoming lottery ticketsBy JOAN BARRON Casper Star-Tribune The Billings Gazette
July 01, 2013 12:15 am  • 

CHEYENNE, Wyo. — Wyoming's lottery bill becomes law today. However, eager bettors will have to wait a few months before they can walk into a retailer and purchase their first tickets.

The best bet for a start date, officials say, is January. Some 300 to 400 retailers, from convenience stores to bingo parlors, are expected to provide sales.

But first, officials must establish the framework for Wyoming's first lottery.

The first step is for Gov. Matt Mead to announce his appointments to the lottery's nine-member board of directors. State Rep. David Zwonitzer, R-Cheyenne, the main sponsor of the lottery bill, expects those announcements to come quickly. The appointments will mark the end of the governor's involvement in the lottery.

The initial task for the board is to hire a chief executive officer.

Together, they must find the money to operate the lottery given that the Legislature allocated zero state dollars for the venture.

Nephi Cole, policy adviser to the governor, said the Legislature deliberately established the lottery corporation to be separate from state government.

"This lottery will have to sink or swim on its own," Cole said.

A lot will depend on how motivated the board members are, he added.

The way the law reads, Wyoming can participate in any or all multistate lotteries, such as Powerball. Additionally, the board could decide to have a state-only lottery or have both state and multistate lotteries, he said.

After the board members get set up and raise some money, their next job is to develop a network of retailers who will sell the lottery tickets to the betting public.

The directors won't be totally adrift.

Outside help

Mead earlier arranged for the board to receive help from the North American Association of State and Provincial Lotteries. David Gale represents the organization. He said it's a nonprofit whose membership includes every government-sanctioned lottery in North America.

"What we're able to do is sit down with them and present them information," Gale said. "We have no authority over any lottery. We just try to provide information about trends and products."

The association also has helped new lotteries find staff and prepare monthly publications.

Gale said there is no charge for the service. The organization is supported by annual dues paid by the member lotteries.

Chuck Strutt, executive director of the Multi-State Lottery Association, and others in the business say Wyoming should have no problem raising money because "lotteries make money."

Wyoming is the 44th state to authorize a lottery. The modest version adopted by the state Legislature this past winter survived only because it does not include any gambling that offers so-called instant gratification.

“That was the only way we could get that passed,” Zwonitzer said. “We’re not into scratch tickets or any kind of video lottery — anything that might be considered instant gratification."

The new state law prohibits instant lotteries, scratch-off tickets, video lottery terminals or any other electronic game involving physical contact between players and machines.

All sales for tickets or shares must be cash only -- no checks, credit cards or charge cards.

Prizes will be limited to $600 but the lottery board may allow a limited number of retailers who can pay prizes of up to $5,000.

Retailers are to be paid no less than 6 percent of gross sales.

The first $6 million in annual profits go to the state's general fund. Profits over $6 million go to the common school account within the permanent land fund.

The board can use unclaimed prize money up to $200,000 annually to develop programs for the treatment of compulsive gambling disorders in consultation with the Wyoming Department of Health.

Compared to North Dakota

Gale, with the North American lottery association, said it's important for the board members to do some networking and share information, because they have to set up the lottery from scratch.

"You're starting from ordering the pencils, finding desks and office space and hiring staff," he said. "It's definitely a ground-floor opportunity."

And there's no right or wrong way to do it, he added.

Retailers are key to the lottery business, Gale said.

"We are vying for space in a retail store just like Coke or Pepsi is," he said.

Once the board gets an office, staff and financing, it can send out requests for proposals from lottery companies, or vendors, that provide the machines and technical support.

The vendor's job is to come in and build the central gaming system and the terminals.

The three big online vendors in the United States are Scientific Games, GTECH and INTRALOT.

Randy Miller, director of the North Dakota Lottery, said vendors know what is needed to set up a lottery and they also can give the states sales projections.

Wyoming's lottery has been compared to North Dakota's in scope.

Yet North Dakota's lottery was established in 2004 with some state money. It is now self-supporting. Another difference is the North Dakota Lottery is under that state's attorney general's office while Wyoming's isn't tied to any state agency.

The North Dakota Lottery, with a staff of six, returns a profit of $6 million to $7 million per year. The money goes to the state's general fund.

Each quarter, North Dakota transfers $50,000 to a compulsory treatment fund to help the state Department of Human Services deal with problem gamblers.

Miller said gambling addiction hasn't been an issue with the state lottery because it doesn't provide instant gratification to the bettor, unlike pull tabs or casino gambling.

Vendors and retailers

Strutt, of the Multi-State Lottery Association, said someone has to write the request for proposal for a vendor and make a judgment on which is the best vendor for the state lottery.

Someone also must decide the game rules and contracts that license the retailers.

The vendors ultimately license the retailers, Strutt said, and the contracts with the vendors determine how much work they perform. In some case vendors do a lot of work, including marketing and sales support, which means they deliver ticket stock to the retailers.

His association is a nonprofit operated by the lotteries that join the organization.

"We design the games and handle the movement of money between the states and we conduct the drawing, develop a common security platform and rules," he said.

Martin Witt is a manager at Mills Bingo in Natrona County.

He intends to apply to become a lottery retailer when the time comes and expects brisk sales.

"People aren't talking about the lottery yet," Witt said.

He noted it took years of failed efforts before the lottery bill passed the Legislature.

"It's still got a ways to go," he said. "Anything that involves the government doesn't happen overnight."

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