A group on Thursday said it is opposing Monday's kickoff of two new Michigan lottery games because the games might let Indian casinos stop paying the state a share of their profits.
The group -- Worried Residents Opposing Neighborhood Gaming, or W.R.O.N.G. -- said the state could lose $30 million to $40 million that Indian casinos contribute each year to the state's Strategic Fund, which encourages economic development.
It says the new games, Club Keno and Pull Tabs, would let the tribes off the hook for the payments. The games are being rolled out in about 1,000 bars and restaurants and are intended to help the state raise $50 million for public education.
"The interest in club games could be way overestimated. The initiative could leave the Lottery on the hook for lost revenue," Detroit Democratic Sen. Buzz Thomas said in a news release.
But state Lottery director Gary Peters said Thursday that both games already exist in a slightly different form, so there shouldn't be any reason for the tribes to argue they don't have to share their profits with the state.
"They knew about Keno when they signed the compacts" setting up the payments, Peters said. "We don't believe there are any new legal issues involved that jeopardize these funds."
The new lottery games are part of Gov. Jennifer Granholm's plan to balance the budget. The $50 million the games are expected to raise this year is especially important given that the school aid fund has a $325 million deficit.
Lottery revenues added $585 million to the roughly $12 billion school aid fund in the fiscal year that just ended, Peters said.
The Club Keno and Pull Tab tickets will go on sale for the first time Monday. The state hopes to expand the games to more than 2,000 bars and restaurants over the next year, and dventually have them available at 3,000 such places.
Peters said the state has been running a Keno game for 12 years. The only difference is that now the drawings will occur every five minutes between 6:05 a.m. and 1:45 a.m. instead of once a day at 7:29 p.m.
He also said the state has allowed pull tab games at veterans and fraternal organizations for several years.
But members of W.R.O.N.G. say Lottery officials should hold off on rolling out the new games until the matter is resolved with an opinion from state Attorney General Mike Cox.
"We need clarity before moving forward," said state Rep. James Koetje, R-Walker. "An opinion from the attorney general will set the record straight."
Peters said the attorney general's office has been involved with the games from the start and has foreseen no problems with tribal casino compacts.
Cox spokesman Stu Sandler said the attorney general hasn't been approached yet to give his opinion on the situation.
W.R.O.N.G. said in its news release that the new club games could create thousands of mini casinos across Michigan overnight.
A small group of adults and children on Thursday held signs opposing gambling outside the Capitol conference room where the Lottery unveiled the new games.
Despite such opposition, the new games were welcomed by Jerry "Bird" Smith, president of the Michigan Licensed Beverage Association, who said they should help draw more customers to bars and restaurants.
"Club games will be a win for Michigan's children, for the state and for small business owners in Michigan," he said.