New Hampshire Lottery Commission
September 5, 2007
Meeting Minutes:
NEW HAMPSHIRE LOTTERY® COMMISSION
14 INTEGRA DRIVE, CONCORD, NEW HAMPSHIRE 03301
MINUTES OF COMMISSION MEETING
THURSDAY, SEPTEMBER 5, 2007
PRESENT:
Richard J. Campbell, Jr., Chairperson
Paul J. Holloway, Commissioner
Arthur P. Klemm, Jr., Commissioner (by teleconference)
Rick Wisler, Executive Director
Diane Campbell, Administrative Assistant I
Georges Roy, Administrator III
Robert Preston, Games Manager
Maura McCann, Programs Information Officer
Patrick Griffin, Griffin York & Krause, Inc.
Rose Longo-White, Griffin York & Krause, Inc.
Travis York, Griffin York & Krause, Inc.
Moe Pepin, SGI
Liz Dimmick, SGI
Barry Bodell, Administrative Services
Commissioner Campbell called the meeting to order at 1:45 p.m.
1. ACCEPTANCE AND SIGNING OF PREVIOUS MINUTES:
Patrick Griffin requested a revision to the #4 Advertising section, paragraph 3 in the July 19, 2007 Commission meeting minutes. Mr. Griffin quoted the section which read 'Within the next 2 to 3 years, the media will not be as available or affordable as in the past." Mr. Griffin indicated he would like the minutes to reflect that media will not be as available or affordable as in the past, mainly through the primary and election year, since it will be difficult clearing spots and rising advertising costs. Mr. Griffin quoted the last sentence in paragraph 3 "Television and radio advertising are going to be more and more obsolete". Mr. Griffin stated he would like to clarify the intent of this sentence to reflect that the media is changing, radio and television won't be obsolete, but obviously they are going to have to be taken in turn with on-line marketing.
Commissioner Holloway made a motion, seconded by Commissioner Klemm, to approve the July 19, 2007 commission meeting minutes, conditional upon revising the above referenced section of the minutes as requested. So voted, unanimous.
2. TRI-STATE REPORT:
Commissioner Campbell reported on the last Tri-State Commission meeting held on August 3rd . Commissioner Campbell stated the Fiscal Year 2007 year end sales increased by $4 million which equaled a 6.16% increase over Fiscal Year 2006 year end sales. The Fiscal
Year 07 net profit increased by $2.2 million which was a 10.8% increase over Fiscal Year 2006. The Millionaire raffle rules were approved by the Tri-State Commission. The request for an additional $700,000 for Tri-State advertising in New Hampshire was also approved by the Tri-State Commission. The next Tri-State Commission meeting will be held on September 7, 2007 in Maine.
Commissioner Holloway asked for an update on game changes. Maura McCann responded that a "library" of fast play games was being developed to download into the system. Four new fast play games are near completion and will be reviewed by Tri-State at their next meeting. Ms. McCann stated an agenda item for the next Tri-State meeting will be continued discussion on Megabucks and Paycheck. Research will be done to determine why the $2.00 Paycheck game seems to be so popular and ways to improve the games' sales. The upcoming raffle game is on target for a November 1st launch.
3. ADVERTISING:
Rose Longo-White stated the ad agency had been working closely with lottery staff to meet three major project initiatives. Ms. Longo-White stated phase one of the jackpot alert application was complete. The development begins today with a projected live date of October 26th. Creative advertising for the jackpot alert application will be through television, radio, bitmap, point of sale and newsletter. Ms. Longo-White stated the second initiative was the NH Star Program and approval was received on the Information Architecture and due to present design to the staff on September 18th. The third initiative, the Lottery's website, is also being worked on, beginning with the site map and development of a schedule.
Travis York reported on Replay program statistics. Mr. York stated Replay activity boosted during the recent estimated Powerball jackpot run of $300 and even after the jackpot was hit. Mr. York stated from August 8-August 14, approximately 280,000 tickets were played through Replay; increasing to approximately 294,000 tickets played the following week; increasing to approximately 323,000 tickets played the week of the drawing. There were over 1,000 new registrants the week of the high Powerball jackpot. The Replay database is almost 106,000 registrants.
Maura McCann gave a brief update on the two week bonus time promotions offered through Replay for specific products. The results have had a positive effect on sales, ranging from approximately $5,000-$10,000 higher. Travis York stated in year one of Replay, about 16%-17% of all tickets played were replayed through the program. Mr. York stated about $42 million worth of tickets played out of $250 million dollars revenue generated.
Travis York announced that the Jackpot alert initiative and the NH Star initiative are both packaged and positioned as add ons to the Replay program. A brief discussion was held on possibilities for the Ultimate Replay prizes.
A discussion was held on the legality/possibility of the New Hampshire Lottery Commission offering the Replay program to out-of-state residents. Director Wisler responded the Attorney General's office is reviewing a current lawsuit filed by an out-of-state resident against the lottery regarding being unable to participate in Replay.
Ms. Longo-White stated the advertising budget had been reviewed again and additional media dollars will be used toward advertising the $30 instant ticket on television and radio the weeks of 10/15 and 10/22; television the week of 11/12; and television and radio the weeks of 12/10 and 12/17. Point of sale advertising was also mentioned.
4. OTHER BUSINESS:
Georges Roy announced the KPMG Audit Firm had completed the fiscal audit at the Lottery on August 30th, a period of 45 days. A brief discussion was held regarding the possibility of offering financial rewards to lottery sales staff. The SEA has suggested this go through the State Division of Personnel to advise whether we can negotiate it through a sub- unit agreement. Director Wisler stated the request had been submitted to the Division of Personnel for review and comment, with no response received to date.
Director Wisler stated approximately $3,500 worth of lottery tickets were sold during 2 days at Lancaster Fair. Lottery staff sold approximately $20,000 worth of lottery tickets at the Hopkinton Fair.
Director Wisler stated a change needed to be made to the Lottery's rules for validation of tickets. Director Wisler presented two instant tickets that were received at the lottery for payment and explained the reasons behind the requested change. The instant tickets received were only partial tickets, about ¼ to ½ of the entire tickets, including enough information on the tickets to validate and pay the prizes, contrary to the Rules which state the tickets must be intact to be eligible for prize payment. Director Wisler recommended to the Commission that the prizes be paid and the rules be changed. Commissioner Campbell requested that the draft rule change be reviewed by the Attorney General's office. Director Wisler stated once the Attorney General's office has reviewed and approved the rule change, it would be presented to the Commission for their approval.
A discussion was held on the sales department business plan for Fiscal Year 08 regarding scheduling retailer training sessions at lottery headquarters. This plan will be beneficial to the lottery by educating retailers on upcoming lottery changes such as the introduction of a $30 instant ticket and raffle game.
Georges Roy stated the end of June, 2007 net revenue estimate of $77.5 million resulted in an actual unaudited net revenue amount of $77.8 million. Mr. Roy stated the projected net revenue for Fiscal Year 2008 is $85.8 million. In August, $5.9 million for the month of July was transferred to Education. Mr. Roy stated he projected approximately $8 million for the month of August to be transferred in September.
Director Wisler updated the Commission on a recent legislative meeting held on regarding allowing video lottery terminals in New Hampshire.
Commissioner Campbell requested that the Commission be added to the distribution list to receive the retailer newsletter.
5. NEXT MEETING:
Commissioner Holloway made a motion, seconded by Commissioner Klemm, to adjourn the meeting at 2:25 p.m. So voted, unanimous.