Lawmakers hesitant to gamble on lottery

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Almost 25 years after a majority of Mississippi voters lifted the Constitutional ban on a state lottery, Mississippi still does not have the game.

And as Alabama looks poised to take the next step toward adopting a state lottery this week, Mississippi might be left behind again.

Should Alabama lawmakers this week and voters in November say yes to a lottery, Mississippi would be just one of five states – and the only one in the Southeast – without a lottery.

State officials are hard-pressed to narrow down one reason the state has not adopted a lottery. Among the culprits: Political maneuvering, fears that a lottery would pull revenue from a reliable casino gaming industry, and the influence of religious convictions, so often an issue in the heart of the Bible Belt.

Still, dozens of lawmakers, both Republican and Democrat, have recently expressed interest in creating a lottery. In the past 10 regular legislative sessions, 42 bills that would create a state lottery have been introduced. All 42 died in committee.

Attorney General Jim Hood, who is eyeing a 2019 gubernatorial bid, pitched a lottery to fund pre-kindergarten in his Neshoba County Fair speech in late July. In the 2016 session, the House passed a bill with an amendment tacked on that would allow the Gaming Commission to establish a lottery.

No state official who spoke with Mississippi Today for this article has sponsored a study or knows a group that has sponsored a recent study to determine the potential economic impact of a lottery in Mississippi.

Rep. Greg Snowden, R-Meridian

Mississippi House

Rep. Greg Snowden, R-Meridian

“I’m not ready to die in the ditch, necessarily, but I’d have to be guaranteed the benefit of a lottery would outweigh the costs of it,” said Rep. Greg Snowden, R-Meridian, the speaker pro tempore, underscoring why some legislators are hesitant to go the lottery route. “And I’d definitely need to be assured where the money would go and how we’d spend it.”

Mississippi is operating its current fiscal year with a potential deficit of at least $135 million, Treasurer Lynn Fitch said. Last fiscal year, Gov. Phil Bryant raided reserve funds and slashed budgets two different times to offset lower-than-expected revenues.

If Alabama Gov. Robert Bentley’s lottery proposal is adopted, he claims that $225 million a year would be pumped into Alabama’s general fund to offset major departmental debts.

“The economic question that must be answered: Would a state lottery add to the economic pie or would it simply shift Mississippians’ disposable income from one outlet to another?” Lt. Gov. Tate Reeves said.

Recent support for lottery

The door for adopting a lottery in Mississippi is wide open, at least by law. In 1992, just two years after dockside casinos were legalized in Mississippi, 53 percent of Mississippi voters lifted the Constitutional ban on the game. Thus, the Legislature and governor could choose at any time to adopt a state lottery on their own merit.

This year alone, state officials on both sides of the aisle have flirted with adopting a lottery. Hood, D-Houston, said at the Neshoba County Fair that a state lottery would garner $160 million for pre-kindergarten education. That $160 million figure was pulled from a self-calculation from Rep. Tommy Reynolds, D-Charleston, who used the figure on the House floor when he successfully proposed an amendment that would have established a state lottery.

On March 29, Reynolds scribbled a 33-word amendment to an online fantasy gaming bill on a piece of paper and handed it to the House clerk. The amendment would have allowed the Mississippi Gaming Commission to establish a statewide lottery – half the proceeds would go to public education, half would go to the maintenance of county and city roads.

The House approved it – 38 Republicans and 43 Democrats voted for the bill, while 34 Republicans and three Democrats voted against it.

The bill was later altered by a joint conference committee of six Republicans who, following normal procedure, were selected by Reeves and House Speaker Philip Gunn, R-Clinton. The lottery amendment was omitted from the final draft of the bill.

Rep. Tommy Reynolds, D-Charleston

Gil Ford Photography

Rep. Tommy Reynolds, D-Charleston

“Mississippi needs it much worse than most of the other states that have it,” Reynolds said. “We’re going to soon be in the position that we are alone in not taking advantage of a stream of revenue that’s out there. Even if we only got $100 million a year from a lottery, that’s $100 million more that we didn’t have yesterday that we could really, really use for tomorrow.”

Five measures that would have created a state lottery were introduced in the 2016 regular legislative session. All died in committee:

• Sen. Tommy Gollott, R-Biloxi, sponsored a bill that would establish a state lottery to supplement the Mississippi Adequate Education Program and the maintenance of roads and bridges.

• Rep. Richard Bennett, R-Long Beach and chairman of the House Gaming Committee, sponsored a bill that would allow multi-state lottery games to be played inside existing gaming establishments.

• Rep. Mark Baker, R-Brandon, introduced a Concurrent Resolution that would have suspended rules and allowed the drafting of a bill to establish a state lottery.

• Rep. Alyce Clarke, D-Jackson, introduced two separate bills that would establish a state lottery to fund higher education.

As recently as two years ago, Reynolds did not support adopting a state lottery. As Powerball jackpots skyrocketed the past two years, he heard that his own constituents were traveling dozens of miles north to the Tennessee border for a chance to win millions.

“If people are going to leave our state to spend their money on this to begin with, why aren’t we putting ourselves in the position to see some of that in Mississippi?” Reynolds asked.

Rep. Alyce Clarke,

Gil Ford Photography

Rep. Alyce Clarke, D-Jackson

Clarke, who has served in the Mississippi House since 1985, has sponsored lottery legislation each regular session since 2004. She told Mississippi Today that “all the tags across the river” are Mississippians buying lottery tickets, and she hears from her constituents “nearly once a week” about adopting a lottery in the state.

But others in the Legislature remain unconvinced.

“I would be against a lottery every single time,” said Rep. Vince Mangold, R-Brookhaven. “You’re going to have folks that would use their hard-earned money on a chance, and they really should be buying something for their family. My religious and moral views just don’t support it. No way.”

Could it work?

Without a Mississippi-specific impact study, it is impossible for anyone to know if a lottery could help provide economic relief. But Arkansas, a lottery state with a nearly identical population size to Mississippi, is perhaps the most appropriate case study to consider.

Last fiscal year, Arkansas gathered $409 million from ticket sales and retailer fees. Subtracting expenditures and other items like prize payouts and salaries, the state transferred $72.6 million to public education funds. That figure is down slightly from Arkansas’ first year with a lottery, fiscal year 2010, when $82 million was transferred into education funds.

Jake McGraw

Rethink Mississippi

Jake McGraw

“That’s not pocket change, but it’s hardly a windfall,” said Jake McGraw, public policy coordinator at the Winter Institute at the University of Mississippi. “It would increase the general fund budget by a little over 1 percent. We are already facing a fiscal year 2017 budget deficit twice that size. Even if the revenue were earmarked for a worthy program like college scholarships or pre-K, it’s hard to imagine the Legislature would leave it intact while they wring every drop out of the rest of the budget.”

Louisiana, a state with around 1.5 million more people than in Mississippi, earned $184 million for public education and public health entities. Tennessee, which has around 3.3 million more people than Mississippi, raked in $335 million for college and K-12 education.

“It’s hard to know if a lottery would work here or not,” said Allen Godfrey, executive director of the Mississippi Gaming Commission. “I don’t even know how you could estimate what you’d make on it. Do you look at population? Location? Median income levels? I don’t even know how they generate those numbers. I just don’t know how I would come up with a guess.”

Numerous national studies have been conducted, drawing parallels between state lotteries and poverty levels. According to 2014 U.S. Census statistics, Mississippi ranks at the bottom of the country in median household income and median per capita income, while it ranks at the top of the country in poverty rate by household income.

McGraw strongly opposes the adoption of a state lottery, likening the game to one in which “the benefits are oversold and the costs are underappreciated.”

“In the poorest state in the country, we should want people to put their scarce resources to the greatest effect for themselves and their families,” McGraw said. “Buying a piece of paper that will almost certainly become worthless within minutes or days is a particularly poor investment. The less Mississippians spend on lottery games, the better, and the simplest way to reduce lottery spending is to refuse to create one.”

Some lawmakers echoed McGraw’s sentiments.

“It’s going to encourage people, perhaps, to use food money for lottery tickets,” Snowden said. “There is a definite social cost to it, in my mind. There is that downside. It’s going to encourage some people to be more actively involved.”

Political and social barriers

A three-fifths legislative vote is required to pass any revenue or tax measure, meaning a simple majority vote can’t cut it.

While recent political support from both Republicans and Democrats in Mississippi has been expressed, lotteries in Southern states have generally been introduced under Democratic control. The campaign to lift the Constitutional lottery ban was launched by Democratic former Gov. Ray Mabus in 1990. By the time the vote occurred, Republican Gov. Kirk Fordice, publicly against a lottery, had taken the reigns of government.

Arkansas adopted its lottery in 2009 under former Democratic Gov. Mike Beebe. Tennessee adopted its lottery in 2003 under Democratic former Gov. Phil Bredesen. Louisiana adopted its lottery in 1991 under the control of former Gov. Buddy Roemer, who served his first term in office as a Democrat before serving his second term as a Republican.

“It makes sense to (Democrats) because it provides more funding for their priorities, namely education, while placating the red-state aversion to tax increases,” McGraw said. “However, Fordice’s election in 1991 forestalled the viability of a lottery, and governors Barbour and Bryant have shown little interest in the idea. If the tide ever turns back to the Democrats, expect a resurgence in support for a lottery.”

Casino gaming is one of Mississippi’s greatest revenue makers, bringing in $2.1 billion in fiscal year 2015. Reeves, when asked about the potential for a state lottery, expressed concerns that a lottery might pull cash out of existing gaming pools.

Lt. Gov. Tate Reeves speaks with reporters April 21 at the Mississippi Capitol about his impressions on the legislative session.

Rogelio V. Solis, AP

Lt. Gov. Tate Reeves

“If one’s goal is to increase revenue to the state, the question that must be answered: Would any perceived increase in revenue from a lottery be offset by reductions in sales tax collections and gaming receipts?” Reeves said.

Godfrey echoed Reeves’ concerns, though he did not dismiss any perceived positives of adopting the game. He said there has not been “a major appetite from lawmakers” during his time as director of the commission. However, he said the commission will receive requests from citizens to adopt a lottery, particularly when Powerball jackpots are high.

The Pew Research Center has labeled Mississippi the most religious state in the nation. Clarke, who said she regularly speaks with other officials in the state, believes Mississippi has not adopted a lottery because of the religious nature of many state politicians.

“They hide behind religion as to why they don’t want it,” Clarke said. “How many of those individuals go to church and then go play bingo? When you play bingo, you take a chance. There’s no difference in playing bingo and the lottery.”

As Alabama lawmakers consider the issue this week, it might be up to voters there in November. Without recent lottery studies, and with political, social and economic factors in play, Mississippians who want to play the lottery might forever have to travel to state lines to play the game.

“The biggest discussion I’ve heard, at least over the last two or three years, is that we may have missed our window of opportunity to do it,” Snowden said. “The amount of money, if we did our own, may not be worth the trouble. I’m not completely convinced there’s as much there as we’d like to think.”

  • Charles Pearce

    There was no lottery hesitation by the Legislature in 1827. The trustees of Mississippi Academy in Clinton were authorized to raise $20,000 by holding a lottery. Three years later that institution of higher learning became none other than Mississippi College. Get over it — dozens of laws were passed by the Legislature during our early statehood and territorial period to benefit individual schools through lotteries.