Governor Tom Corbett is set to unveil the 2014 state budget next week. One area in desperate need of money is programs for seniors. “Without additional revenue these programs we will face serious funding shortfalls as the baby boom generation retires, and more 65 and older citizens start to take advantage of the programs that Pennsylvania offers,” said Senator Mike Brubaker, Chair of the Senate Finance Committee.
Lawmakers are looking to fix the deficit by expanding the Pennsylvania Lottery. One game we could soon see added is Keno (in the form of terminals).
Wednesday members of the Senate Finance Committee held a hearing to talk to various stakeholders and get clarity on some of the details behind expanding the lottery.
“We have consistently heard about the growing needs for some assistance for our seniors. The lottery, despite its extraordinary performance and the resources made available to the commonwealth, we still have difficulty meeting that demand. I think the dialogue today will be how do we address that going forward,” said Senator John Blake, Minority Chair of the Senate Finance Committee. “There has been a ruling by the independent review regulatory, indicating that this is allowed, that the lottery can do this, but we want to be careful.”
One concern brought up at Wednesday’s hearing is the pace at which the Pennsylvania Lottery is expanding gaming.
Lottery officials are also asking lawmakers to look at adjusting the long-term margin rate. “We are asking for margin relief of less than 27%. If they went back to a 30% level, it could mean $350 million in losses in net profits. The most successful lotteries throughout the country hover around that 24- 25% level. We know by lowering it to 25% we can drive those profits more,” said Dan Meuser, Secretary of the Pennsylvania Department of Revenue.
Lawmakers wanted assurance of where the money would go if they do adjust margins. “I know that there’s concern that if they don’t have the margin change that they can’t implement a plan that would be effective. If we do margin relief there needs to be an absolute belief that any incremental dollars do stay in the fund and do in fact benefit older Pennsylvanians. And that we don’t do a shell game here,” said Senator Blake.
According to Meuser, Pennsylvanians could see Keno by the end of the year.
“The first year the idea is to bring on 1,000 retailers, 500 of such are already lottery retailers, so it would be 500 in addition to that. And 500 retailers additional each year after that, up to 3,500. We expect $40 million incremental increases each year,” said Meuser.
“The legislation has been passed for the promulgation of terminal based games by the lottery. So this is a terminal based game. Granted it’s a different set of retailers, played more frequently. It’s fits within the current statutes that exist. One can certainly glean from that , yes a terminal based game can be promulgated through regulatory means. Nevertheless the stated, there is no line in the sand. We’re here to work with all stakeholders and we’re open for ideas on how to best serve older Pennsylvanians,” said Meuser.