Lottery privatization an option for Senate committee

By Matthew Patane

JEFFERSON CITY – The Missouri Lottery will begin talks with the state Senate starting in April about moving control of the lottery from the government to the private sector.

Lottery Executive Director May Scheve said it was difficult to comment on the issue because the Missouri Lottery is currently ascertaining the opinion of state vendors on the matter; privatization was only recently brought up by the Senate’s Rebooting Government initiative.

“We really haven’t engaged in conversation with the Senate,” Scheve said. “But beginning in April we will work with the Senate to provide as much information as we can.”

Sen. Jim Lembke, R-St. Louis County, said he moved back a hearing on privatizing the lottery because none of the vendors working with the lottery are willing to testify until after they are finished with the lottery. Lembke is the chairman of the Senate Governmental Accountability Committee, which is to hold a hearing on lottery privatization once the process begins next month.

“The lottery has to be kind of reserved with their comments since it might affect some of the [answers],” Lembke said. “My concern and interest in the lottery is I’m looking at all areas of state government to find out how we can become more competitive.”

Lembke called the proposed hearing a “fact-finding mission” because there is not much previous information for the committee to look at. He also said that researching ways to change government procedure is important to help lawmakers learn how to take better care of the state.

“If we can be better stewards as to the way we manage resources, then that means more money goes to education, which is where the lottery is earmarked to go,” Lembke said. “There really hasn’t been that much to compare it to, so we don’t have that much data, so this is just a fact-finding mission.”

President Pro Tem Sen. Robert Mayer, R-Dexter, sent a letter to Lembke requesting that he investigate the effects that privatizing the lottery could have on state funds. Mayer was unable to be reached for comment but provided a written statement on the matter.

“I have asked the Senate Committee on Government Accountability to investigate the privatization of the Missouri Lottery and the potential cost savings of doing so,” Mayer said in the statement. “Some states have taken steps to privatize their lottery or some lottery services including online or instant ticket printing and other services…I anticipate companies that provide these services will appear before the committee.”

Talks about privatizing the state lottery came soon after a neighboring state, Illinois, passed a bill allowing a private company to take control of the state’s lottery. The bill is currently under review by the Illinois Supreme Court after the state appealed a decision by a state appeals court that claimed the bill was unconstitutional.

It is currently illegal under federal law to completely privatize a state’s lottery, which is one reason why no states outside of Illinois have attempted to pass such legislation, Scheve said.

Lembke said he expects to be able to give a report on his results to the General Assembly by the end of April, and that he hopes to find the most efficient ways to help the state.

“My hope on any area we look at is to find efficiencies and savings and ways to meet all of the priorities of the people of the state,” Lembke said.