North Carolina Lottery: Senators question components of N.C. lottery bill
Senate committee members unmoved by House thread to kill lottery bill
Members of an N.C. Senate committee raised questions yesterday about a bill passed by the House that would create a state lottery — including whether it would allow video poker, slot machines and online gaming.
"It's not likely that it will be approved in the form it's in now," said Sen. Tony Rand, D-Cumberland, the chairman of the Senate committee set up to review the House lottery bill.
The bill that the House passed 61-59 two weeks ago would let the state run lottery games that include "online games, games played on video terminals or other devices and other games ... that have been conducted by any other state government-operated lottery."
Rand said that the Senate would frown on such games if they include video poker — which the Senate has voted several times since 2000 to ban statewide.
"I want to know, is that just another name for video poker?" he said. "The Senate would not approve that."
Supporters say that the bill would create a low-key lottery in North Carolina. Its ban on any advertising other than that at stores where tickets are sold would effectively prevent the state from participating in Powerball and other multistate games, they say.
But other members of the committee questioned the types of games that the House bill would allow.
"It does indeed seem to open the door to video gaming of all types," said Sen. Dan Clodfelter, D-Mecklenburg, a lottery opponent. "I have problems with that.
"It does not require you to purchase a ticket," Clodfelter said. "It does seem to authorize online computer gaming at home — of all kinds."
Though the Senate has approved bills to put a lottery to a referendum in the past, the current bill — which creates a lottery without a vote of the people — could face an uphill battle in the Senate.
All 21 Republicans and five Democrats in the 50-member Senate are believed to oppose the lottery as currently proposed in the House bill.
And even Rand — a lottery supporter — raised questions about the bill yesterday.
The bill would let any unclaimed prizes be used to increase future prizes or go to school construction, college scholarships or other educational purposes. But Rand questioned whether that use would violate provisions in the state constitution that require unclaimed property to go to the state's escheats fund.
"It certainly belongs to someone," he said. "It is something that's been bought, so someone owned it."
Under the House bill, 50 percent of the money would go to counties to build school buildings.
But Rand said he wants to clarify whether counties must use the lottery money only for new debt, or whether they can use the money to pay existing debts on bonds that the counties have already approved.
If some counties use the money to pay off existing school bonds, "I wouldn't like that," he said.
Sen. Martin Nesbitt, D-Buncombe, said he considers a lottery an inefficient way to raise money because the state would have to take $1 billion or more out of the economy to raise $400 million in revenue.
A lottery would also give the public a false sense of confidence about school financing, Nesbitt said.
"You're sending a signal to the people of this state that we're taking care of education. It will not take care of education this year or in the future," he said. "We could go backward in education very quickly."
This year alone, he said, legislators are considering $300 million in cuts to education programs, not counting the new scholarship and school-construction programs that the lottery bill would create.
Rand said that the Senate lottery committee would meet again next week.
A lottery bill might not go to the floor of the Senate for three weeks or so, he said, and Senate leaders have not decided whether to insert lottery legislation in the state budget that they hope to approve by the end of the month, as some have proposed.
"Sure we have the votes for a lottery bill. Which one? ... You don't know until you see all variations," he said. "People have fairly strongly held views.... But you know it's a hard year, tough times — people have to make tough decisions."
Despite House Speaker Jim Black's warning that the House probably can't pass a lottery bill if the Senate makes changes in the House bill, Rand didn't rule out changes yesterday.
"Very seldom does any significant legislation pass one house just as the other house sent it to you," Rand said. "That's the way the sausage factory works."
Informed of the senators' objections to the House bill, Black replied: "Well fine — kill it. Any change at all would probably kill the bill. If there was some kind of problem with it, they can fix it with future legislation. They know how to do that."
As for the proposals to insert legislation creating a lottery in the state budget, "I don't see how that would work," Black said. "It would make it easier for people to bail out. It might make it harder to pass the budget."
But Rand said that senators are not trying to doom the lottery in the House.
"We're not in the dooming business," he said. "We're not messing with it just to mess with it. We're trying to do the best possible job we can."