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Minnesota Lottery posts record $100 million profit

Jul 20, 2004, 7:56 am

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Minnesota LotteryMinnesota Lottery: Minnesota Lottery posts record $100 million profit

Seven months after a critical audit report and the suicide of its director plunged it into turmoil, the Minnesota State Lottery posted a record contribution to the state for the fiscal year 2004 -- $100 million.

"This is really good news," said Gov. Tim Pawlenty at a news conference at the Dodge Nature Center in West St. Paul on Monday. "The Minnesota Lottery has been through some difficult months."

The appointment of acting director Mike Vekich after George Andersen's death resulted in "bold, dramatic and swift changes" that helped boost profitability at the lottery, Pawlenty said.

In addition to a 9 percent increase in ticket sales, Vekich said, the lottery cut costs by at least $7 million and reduced staff by 39 percent -- nearly 50 positions -- in recent months.

Among the expenditures axed were a cable TV show about lottery winners and an 18-wheel truck used for promotions.

Pawlenty said Vekich's time as acting director was drawing to a close and that he would name a new director in coming months.

He said he wanted Vekich to continue, but "he's not able to do that."

Pawlenty also made his strongest statement to date regarding future gambling expansion in Minnesota, saying that unless Indian tribes agree to contribute some casino profits to the state, "we will explore other gaming options" in the 2005 legislative session.

He said there had been "some communication" with tribes recently, but "I would not describe it as progress."

Since his State of the State address last year, Pawlenty has not been shy about saying that he wants Minnesota Indian tribes to share their gambling revenues. Tribes have resisted, saying the existing state-tribal agreements should stand. Meanwhile, non-Indian interests have made their hardest push to break that hold, with proposals that include slots at Canterbury Park and a Las Vegas-style casino at the Mall of America.

The increased profitability of the lottery may whet Pawlenty's appetite further for other streams of gambling revenue. By generating $100 million for the state -- $26.4 million of which goes to the environmental trust fund -- lottery revenue could ease budgetary pressures in a state that still faces a projected $400 million deficit for 2006.

Star Tribune

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