Op-Ed: Hoosier Lottery's gamble with cell phone games is a bad bet
The Hoosier Lottery, and its service provider, IGT, have recently announced plans to bring lottery games to your cell phone. And apparently without the informed approval of Indiana lawmakers.
Throughout the last decade, Indiana lawmakers have appropriately debated and defined the state's gaming laws. But under the lottery's logic, legislators will be sidelined as we stand on the cusp of another transformational advancement of gaming in the Hoosier state.
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Instead, lottery officials rely on a statute enacted under Governor Evan Bayh in 1989 to authorize slot-like games on every Hoosier cell phone, tablet, and computer. Does any Hoosier believe that legislators some 31 years ago envisioned the type of technological possibilities that exist today? Unlikely, since that was nearly two decades before Steve Jobs introduced the first iPhone.
The state's convenience store industry has enjoyed a strong partnership with Hoosier Lottery and its United Kingdom-based partner IGT. After all, convenience retailers sell up to 90% of lottery tickets purchased in the state. To protect Hoosier businesses and the nearly 50,000 Hoosiers our industry employs, we must ask that lawmakers step in to determine whether this policy is in the state's best interests.
Over the last 20 years, we have seen a significant change in the retail marketplace as online sales advance. Staying viable is difficult enough without the state making "scratch" offs available electronically.
If the Hoosier Lottery wants to modernize, we urge them to first look to the antiquated 6% commission structure with retailers. This compensation has failed to keep pace with skyrocketing labor costs and other realities in today's retail environment.
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Selling lottery tickets is an expensive proposition. Not only do retailers give up valuable shelf space to display lottery products, but it is very labor-intensive. Aside from processing transactions, employees must also inventory after every shift change the 30+ different lottery tickets offered for sale. And because almost two-thirds of customers purchase tickets with credit or debit cards, the already meager retail commission is cut in half by bank transaction fees. And if there happens to be theft, the retailer is responsible for the value of the stolen tickets.
Given that the state is on a solid financial footing, with more than $4 billion in reserves, there is no need to hastily enact this program without the legislature examining key policy questions. How will these online games impact Hoosier-owned businesses? What steps will be taken to ensure those under 18 will be prevented from playing? (In the retail world, clerks must check identifications.)
Will more Hoosiers develop gambling addictions because scratch-offs have appealing animation and music, and can be played in a matter of seconds?
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These are just some of the issues that need to be thoroughly vetted by Indiana lawmakers before allowing such a monumental change. And it is rightfully the purview of elected officials to investigate something that will have far-reaching implications for local businesses.
Since its inception, the Hoosier Lottery has raised billions of dollars for state programs, becoming a valued state asset. Millions of Hoosiers enjoy playing the lottery, and it may very well have a place in the online world. But we cannot be fully assured of this until lawmakers undertake their due diligence to ensure everyone is a winner.
Scot Imus is Executive Director of the Indiana Food & Fuel Association, the statewide trade organization representing the vast majority of the 3,000 convenience stores in Indiana.
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This article originally appeared on Indianapolis Star: Hoosier Lottery brings Indiana gambling to cell phones
