Illinois Is Putting Lottery on Block for Quick Payoff
...
"
Lotteries used to be highly profitable," said Michael Jones, who ran the Illinois lottery from 1981 to 1985 and is now the director of Independent Lottery Research in Chicago. "
Nowadays, that profitability as a percentage of sales has declined dramatically."
Taking lotteries out of state hands, however, could raise tricky policy issues as private operators strive for maximum revenue.
"
As a government agency, lotteries are bound by the duty of care that a government has to its citizens," said Rachel Volberg, director of Gemini Research, based in Northampton, Mass. "A private operator is not bound by any duty of care." Private lottery operators could be more likely to advertise aggressively, Ms. Volberg said, particularly among people susceptible to gambling addiction and those who can ill afford to spend money on lottery tickets.
Gov. Rod R. Blagojevich of Illinois, a Democrat, first floated the idea of privatizing the state's lottery while seeking re-election last May. At the time, Mr. Blagojevich estimated that the sale's proceeds would finance a four-year building and education plan for schools. Under the proposal, $6 billion would be set aside to provide the schools with $650 million a year for the next 18 years, slightly more than what they received last year in lottery income.
At the time he made the proposal, Illinois Republicans charged that his real motivation was to keep State Senator James Meeks, an independent from Chicago, from entering the gubernatorial race. Mr. Meeks, an influential black leader, had threatened a challenge if education financing was not increased.
Selling the Illinois lottery would require approval from the state Legislature, which, in turn would determine how the proceeds are spent.
...
