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Florida Lottery pressing to expand its scratchoff vending machines

TALLAHASSEE — The Florida Lottery hopes to raise more revenue from an extra 250 scratchoff ticket vending machines that are included in budget proposals being finalized in the Legislature.

The lottery expects the new machines to more than pay their nearly $1 million cost and also return $9.7 million to a fund that goes toward education.

Last year, the lottery began renting 1,000 vending machines — generating $20 million since they were rolled out in the fall.

"The first 1,000 have more than outperformed anyone's expectations," said Lottery Secretary Leo DiBenigno.

Lottery officials credit the vending machines, along with the rollout of the multistate Powerball game, for stanching losses during the recession. The lottery is projected to send $1.2 billion to education this year, or about $124 million less than last year. Scratchoff tickets are the only type of game to exceed sales projections by state economists.

The vending machines allow people buy tickets themselves instead of from a clerk. They have a kill switch letting the manager shut them off if some a juvenile tries to buy tickets.

The lottery leases the machines from GTECH Corp., a West Greenwich, R.I., company represented by high-powered lobbyist and Republican fundraiser Brian Ballard.

Besides the initial group of new vending machines, the lottery also could ask for another 750 if it signs an agreement with a chain such as Walmart or Walgreens. To get those machines, the lottery would have to prove to state economists that they generate more education money.

DiBenigno said there is a "slow ramp up" of new machines, but Florida could potentially add many more. He noted that Pennsylvania, with about 5 million fewer residents than Florida, has 4,000 machines.

"We don't think we're anywhere near the point of diminishing returns," DiBenigno said.

Calling the machines "gambling boxes," Sen. Carey Baker, R-Eustis, initially rejected them from the lottery budget. He and other conservatives decry the state's newfound push for gambling and the social ills it brings.

Earlier this month, lawmakers approved a $1.5 billion gambling compact with the Seminole Tribe. In exchange for annual payments to the state, the agreement gives the tribe the exclusive right to operate blackjack and slot machines at its casinos.

Other lawmakers point to the revenue that gambling brings during an austere budget year. Supporters say that the machines don't necessarily increase the amount of tickets the lottery produces, they only make it more convenient for buyers.

Sen. Dennis Jones, R-Seminole, wants to allow the lottery to explore "electronic scratchoff tickets," a video version of the paper tickets.

"It's just a different form of selling tickets and saving trees," he said. "This would be another tool for the lottery to essentially look to the future."

Lawmakers must be careful not to encroach on the Seminole compact. One provision allows the lottery vending machines. Machines that emulate slot machines would reduce the money the Seminoles pay the state. Jones said he structured his proposal so it wouldn't infringe on the agreement.

Jones' bill has not yet cleared the Senate, and its fate is uncertain. Rep. Bill Galvano, the lead negotiator on the Seminole compact, said he is unlikely to push any more gambling bills the rest of session.

Florida Lottery pressing to expand its scratchoff vending machines 04/23/10 [Last modified: Friday, April 23, 2010 10:01pm]
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