State lawmakers from both political parties are calling for an investigation of how the Illinois Lottery managed scratch-off games in response to a report showing the lottery didn't award many of the biggest prizes in the biggest games.
"I just don't think we should promise people things we don't deliver," said state Rep. Lou Lang, D-Skokie. "And if we say we have a game that's going to pay X and it doesn't pay X, then we've lied to the people who bought the tickets."
Lang was joined by state Sen. Terry Link, D-Waukegan, state Rep. Scott Drury, D-Highwood, and state Rep. David McSweeney, R- Barrington Hills, in calling for legislative hearings after the investigation was published Friday.
(See Investigation: Illinois Lottery didn't award 40% of scratch-off grand prizes, Lottery Post, Dec. 9, 2016.)
Illinois handed over management of its lottery in mid-2011 to a private firm, Northstar Lottery Group, and the Tribune studied the 17 biggest-prize instant games that were begun and ended in the five years since.
Reporters found most of those games did not award all of their grand prizes and some did not award any. In all, those games awarded less than 60 percent of their grand prizes — a rate lower than other states studied by the Tribune, and lower than when Illinois managed its own lottery. The Tribune also found that, because of how the games ended, the lottery often paid a lower percentage of revenue than the games were designed to pay.
One $30-a-ticket game, for example, pitched the biggest instant grand prize in Illinois history: $46 million in periodic payments. But it was pulled from store shelves before it awarded either of its two grand prizes. Its designed payout rate — nearly 78 percent of sales — ended at 61 percent of sales. Had it paid out at its designed rate, players would have won an additional $10 million, the Tribune found.
McSweeney said hearings would provide players "a full explanation of what happened."
"The bottom line: It's for the integrity of the games," he said.
The Tribune found that under Northstar the number of tickets printed for games dramatically increased, allowing the lottery to offer bigger and better prizes for games. That helped entice players to buy more instant tickets than ever. But as sales dropped in many games, Northstar pushed to end those games' ticket sales before all, or sometimes any, of the grand prizes were awarded.
Other states told the Tribune they typically print only as many tickets as they reasonably believe they can sell in a game to be able to award all the grand prizes. Neither Northstar nor the state provided the Tribune sales forecasts showing how many tickets they expected to sell for those 17 games.
Drury said he hopes hearings will better determine Northstar's intent in printing so many tickets.
"When these games were ended early, what was the motive behind that and what was the intent?" he said. "Was there any intent at the times that the games were developed to end them early? Because, if so, that is extremely problematic."
Northstar is owned by two longtime vendors who continued to do work for the lottery, International Game Technology and Scientific Games. The firms were paid more from the increased sales. But they pointed out the state made more money, too, and the firms told the Tribune that they acted only in the best interest of players and the state by replacing lower-performing games with more popular ones.
The firms said that even if all grand prizes were not awarded in games, the odds of winning were the same for each individual ticket.
Scientific Games said it welcomed any state review of its performance as a vendor and partner firm of Northstar.
"Scientific Games has served the State of Illinois for more than 40 years, generating billions of dollars for its citizens," company spokeswoman Susan Cartwright said in a written statement Monday. "Scientific Games encourages any review by the responsible public officials of state-regulated gaming operations and pledges its full cooperation with any review."
Officials from IGT could not be reached for comment.
A lottery spokesman declined to address calls for hearings but referred the Tribune to its previous statement that the agency is committed to running the games fairly and transparently.
In written statements, House GOP leader Jim Durkin, of Western Springs, and Senate Republican leader Christine Radogno, of Lemont, did not call for hearings. Rather, they said they had faith in Gov. Bruce Rauner's administration, as it works to replace Northstar, to address what Durkin called "very troubling" issues raised by the Tribune.
"The integrity of the Illinois Lottery, at all times, must be maintained to the highest level," Durkin said.
Link said a thorough state investigation was "long overdue" about Northstar's tenure, considering the years of bitter arguments between the state and Northstar over Northstar missing the profit targets it pitched in its bid to win the management deal. Both the Quinn and Rauner administrations pushed to end the deal, with the Rauner administration inking a deal with Northstar to replace it as early as next year.
"My client is the state of Illinois," Link said. "I want to make sure that we're getting the money we're supposed to be getting, and those people that are playing are getting what they deserve and really do have a chance of winning."
Lang said he did not have enough information to say whether anything "nefarious" happened, but wanted to track who made the decisions, why and where the money went.
"We do need to account for when somebody buys a lottery ticket and thinks they have a shot to win $1 million, that they have a shot of winning $1 million," he said.