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N.Y. Gov. vows to review Lottery operations

Jan 30, 2007, 7:36 pm

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New York LotteryNew York Lottery: N.Y. Gov. vows to review Lottery operations

New York Governor Eliot Spitzer is pledging to review the New York Lottery's operations amid bipartisan calls for reform prompted by a media report revealing that billions of dollars in bets were kept off the Lottery's books.

Several state legislators said yesterday that the Lottery Division needed to fully account for all the cash generated by its video lottery terminals, after it was reported that only a portion of wagers was included in the Lottery's financial reports.

"This is a little frightening," said Assemblywoman Aileen Gunther, D-Forestburgh, whose district has 1,500 machines at Monticello Raceway. "I think that transparency is important, and I think that we really need to be transparent at this point in time, because our constituency expects the truth, the whole truth and nothing but the truth."

Unlike some state lotteries, the New York Lottery does not routinely disclose the total amount of wagers on its video games, or the prizes they paid. Instead, the Lottery reports only "net machine income" — the money left over after prize payments.

Under New York law, video gambling prizes must average at least 90 percent of bets.

In response to repeated requests from the newspaper, the Lottery Division on Saturday released data showing that almost $11.9 billion in "credits played" — called the "handle" — was tallied between Jan. 28, 2004, and Jan. 20 of this year. More than $10.9 billion in "credits won" was distributed as prizes.

In its 2005-06 financial statement, the Lottery reported $316 million in net machine income. Saturday's data showed that the $316 million was the remainder from $3.9 billion in "credits played" and $3.6 billion in "credits won."

Assembly Minority Leader James Tedisco, R-Schenectady, said, "Taxpayers deserve no less than total and full transparency in regard to income and expenses derived from those VLTs."

"It looks like they need a new accountant over there," said Tedisco, whose district has more than 1,300 machines at Saratoga Gaming and Raceway. "I mean, we're asking all this of 'member item' money now, and some of the slush funds out here, and we're trying to do major reforms, and it's got to reach out to agencies like (the Lottery.)"

Assemblyman Michael Spano, R-Yonkers, whose district will soon have 5,500 machines at the Yonkers Raceway, likewise favored "making the necessary changes so that people feel comfortable."

"I'm not an accountant, so when I look at this I just want to know how much money is going in and how much is being paid out in prizes," Spano said.

Lottery Deputy Director Susan Miller, the division's acting spokeswoman, did not return e-mail and telephone messages yesterday.

Brad Maione, a spokesman for Spitzer, said Spitzer's office and the Lottery Division would review several issues raised by the newspaper in a series of articles on the Lottery that concludes today.

Other reports addressed the growing share of ticket sales that goes to prizes and the heavy reliance on lottery income by poorer school districts.

Frank Mauro of the labor-funded Fiscal Policy Institute, a tax and budget think tank, was hopeful the Lottery would begin publicly disclosing the VLT data.

"I would be disappointed if they didn't report it on a regular basis," he said. "Now that they've revealed this, I don't see any benefit of not disclosing it on a regular basis."

The Journal News

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