Lottery advertising changes approved by NC House

RALEIGH, N.C. (AP) -- The state House voted Thursday to place new marketing restrictions on North Carolina's state-run lottery — seven years after its first tickets were sold — by prohibiting ads at college sporting events and requiring commercials to disclose the longer odds of winning top prizes.

The chamber voted 99-12 in favor of legislation co-sponsored by nearly half of the House's 120 members, including those who voted for and against the creation of what became the North Carolina Education Lottery in 2005.

"This bill does not repeal the lottery," said Rep. Paul Stam, R-Wake, one of the chief sponsors and a lottery opponent. "It just makes it a little bit more honest."

The measure would prohibit lottery ads or sponsorships with high schools and universities and require advertising to include the odds of winning a game's largest prize, not the overall odds of winning a prize. Other ads — primarily billboards that trumpet the jackpots for the multistate Mega Millions and Powerball drawings — also would have to disclose that big jackpot winners receive less if they take their winnings as a lump sum.

Stam, who would prefer to see the lottery repealed, called lottery games on the whole "a scam" in part due to the long odds of winning. State lottery officials have never faced allegations of wrongdoing in operating the games and publicized a recent outside audit that called the lottery's performance "exceptional."

Rep. Rick Glazier, D-Cumberland and another chief bill sponsor, said the lottery has done well the job legislators directed it to do but supports the changes. He voted for the lottery bill in 2005 but says he now regrets his decision because lottery proceeds are being used to replace current education funds, instead of supplementing them.

Rep. Larry Bell, D-Sampson, voted for the lottery in 2005 and called it one of the toughest votes he's ever had — it passed the House by a vote of 61-59 and needed a tiebreaking vote by then-Lt. Gov. Beverly Perdue in the Senate for final approval. But he voted against Thursday's bill, saying the state should allow enough advertising to generate maximum revenues for education.

"I don't want to see a successful lottery get jabbed to the point of where it would become ineffective," said first-term Rep. John Bell, R-Wayne.

The lottery already doesn't advertise at high schools and returned to college advertising this fiscal year after a hiatus of several years. Lottery officials contracted $625,000 in advertising at 10 public and private schools this year, according to a document from the legislature's fiscal researchers.

Lottery officials have said the bill would make it more expensive to advertise on billboards because it may require the installation of additional electronic boxes to display more jackpot information to passers-by.

The bill also directs the University of North Carolina system to develop optional instructional materials for the public schools that explain the probabilities of winning games and to study who plays the state lottery.

The lottery sold nearly $1.6 billion in tickets during the last fiscal year and transferred almost $460 million in net profits to the state. Nearly all the money has been spent on class-size reduction in early grades, pre-kindergarten programs for at-risk children, public school construction and college student aid.