Educators urge lower lottery profits for bars
By BRAD CAIN
Associated Press
Wednesday, October 28, 2009 10:07 AM PDT
SALEM — Education advocates are pressing the Oregon Lottery Commission to reduce what they say are overly generous payouts to bars and taverns that host the state’s video gambling machines.
They plan to be on hand Friday when the commission decides on a recommendation by Lottery Director Dale Penn to retain current compensation rates for video lottery retailers.
Stand for Children and other groups say the lottery has provided excessive profits to those retailers, at the expense of schools and other programs that receive lottery dollars.
‘‘The lottery was created to maximize benefits for schools and other public purposes, not to subsidize bars and taverns,’’ Holly Pruett, executive director of the group, said Tuesday. Pruett’s comment came a day after Penn issued a recommendation calling for no changes to the way bars and taverns get paid for hosting video gambling in their new six-year contracts.
Bars and taverns now get an average of about 24 cents for every dollar that gamblers leave behind in the lottery’s machines. Retailers used to get 35 percent, but the lottery has steadily cut the rate.
Stand for Children says the rate should be gradually reduced to 16 percent. The group says compensation rates could be cut substantially and still allow retailers a reasonable profit.
Lottery spokeswoman Mary Loftin said lottery retailers have had their sales hurt by the double whammy of a statewide smoking ban that took effect Jan. 1 and a sour economic climate.
Reducing retailers’ compensation might put some of them out of business and reduce the amount of revenue going to education and other programs, Loftin said.
‘‘Right now, the economy is fragile, and our retailers are still struggling,’’ she said.
According to the lottery’s figures, lottery profits came in at $787 million in the fiscal year ending that ended in June, down from $895 million the year before.
In the same period, average annual commissions kept by video lottery retailers fell from $82,676 to $71,220.
The Legislature authorized state-sponsored video gambling in 1992. Currently 2,368 retailers around the state host a total of 12,317 video terminals, according to the latest lottery figures.
Jef wrote on Nov 6, 2009 4:48 PM:
Yeah, the schools should just put them in the teachers lounge and stop complaining about money that isn't theirs. "