Meetings

Agendas and Minutes

Tri-State Lotto Commission
September 5, 2008
Meeting Minutes:

 

TRI-STATE LOTTO COMMISSION
New Hampshire Lottery Commission
September 5, 2008, 9:30 a.m.

Present:        Thomas Scala, Vermont Lottery
                    Orland McPherson, Maine State Lottery
                    Richard Campbell, New Hampshire Lottery Commission
                    Alan Yandow, Vermont Lottery
                    Dan Gwadosky, Maine State Lottery
                    Rick Wisler, New Hampshire Lottery Commission
                    Mary Cassani, Vermont Lottery Commission
                    Hadley Melendy, Vermont Lottery Commission
                    Rich Sperlazzi, Maine State Lottery
                    Lisa Rodrigue, Maine State Lottery
                    Denise Garland, Maine State Lottery
                    James Dearman, Maine State Lottery
                    Maura McCann, New Hampshire Lottery Commission
                    Kassie Strong, New Hampshire Lottery Commission
                    Karl Fortman, Scientific Games
                    Doug Parker, Scientific Games
                    Liz Dimmick, Scientific Games
                    Moe Pepin, Scientific Games
                    Mary Wdowin, Scientific Games
                    Diane Connell, Scientific Games
                    Leslie Badger, Scientific Games
                    Patrick McHugh, Scientific Games
                    Darrell Frecker, Scientific Games
                    Alan Lyman, Scientific Games
                    Jen Cartnell, NL Partners
                    Chris Nichols, NL Partners
                    Rose Longo-White, Griffin, York and Krause
                    Carole Lacasse, Vermont Lottery

The meeting was called to order at 9:30 a.m. by Chair Scala.

ACCEPTANCE OF THE AUGUST 1, 2008 MINUTES
          A motion was made by Commissioner Campbell to accept the August 1, 2008 minutes as distributed.  Motion was seconded and voted in the affirmative.

FY08 AUDIT REPORT BY JEFF WALLA, BARRY, DUNN, MCNEIL AND PARKER
          Mr. Walla explained the purpose of the review and described the audit.  There were no audit adjustments and he noted there have been no audit adjustments in the past three years.  There was one reclassification to reclassify the interest related to the short-term portion of the annuities which is payable in the coming year.  The reclassification impacted only the balance sheet and had no impact on operations.  It was not recommended by Mr. Walla that management make this reclassification for internal financial statements.  The reclassification is only necessary for the audit report.  There have been no signs of difficultly working with various lottery staff members and that the audit went very smoothly.  Mr. Walla noted there was one item missing in an agent’s file last year which was still missing this year.  It was noted that the missing item has been added to the agent’s file since the audit report was issued.  

FINANCE COMMITTEE – Mary Cassani
          Gross revenues for Tri-State for July 2008 have decreased $1,058,210, or 17.29% compared to last July.  Of this decrease, Megabucks sales are down $887,436, or 26.45%; Daily Numbers sales are up $60,212, or 3.29%; Paycheck sales are down $204,546, or 27.25%; the Fast Play games are down $26,440, or 14.22%.  It should be noted that in July 2007 the Megabucks jackpot was $8 million compared to the $2 million jackpot in July 2008.

          Total Expenses for July 2008 are down from last July $635,453.  This represents a decrease in cost of sales of $648,572 and a decrease in operating expenses of $13,119.

          Comparing what we have budgeted for July, our sales are behind forecast in all three states a total of $133,170.  Due to decreased sales, cost of sales is also under budget by $92,941.  All three states have under spent their operating budgets this year by a total of $308,121.  Of this $290,864 is for advertising.

          All contingency funds are in the positive at the end of July.  Expired,  unclaimed prizes are approximately $1.2 million.

          The Finance Committee met yesterday to discuss two issues.  In September 2003, the commission voted to transfer $900,000 from the Designated Prize Reserves to fund Contingency Funds for Pick 3, Pick 4 and guaranteed Megabucks jackpots.  At this time, the Pick 4 Contingency Fund has over $1.4 million.  The committee would like to request  commission approval to transfer the $250,000 used for Pick 4 back into the Designated Prize Reserves.

          The second issue discussed concerned the status of the legal contract being negotiated to deal with prize assignments.  The commission had approved negotiations with a law firm following a bid process that stalled.  The law firm was given a copy of the contract in February and had also requested a waiver for other cases they may have against the State of Vermont.  This firm was advised to speak to the Attorney Generals’ Office about this and finally, after repeated calls, returned the signed contract in June.  In the meantime, our previous lawyer, Barbara Prentice, who had been working on the assignments, has shown interest in working for us again.  She is no longer working for a law firm and has taken a job with Banking and Insurance for the State of Vermont, hence the reason we began looking for another lawyer.  Since we have had concerns that arose during the negotiations with timeliness and reliability, we asked Barbara Prentice to send a proposal.  The rate she is offering is less than the original law firm.  However, since she is not associated with a law firm any more she is not covered by insurance and would have to get coverage.  The coverage is about $1,000.  Barbara is the only lawyer Tri-State has ever engaged with other than the Attorney Generals’ office.  She is reliable, at a lower rate and will spend less time on her work.  We feel it is in our best interest to hire her and to pay for the insurance, reimburse her with proof of coverage and payment. 

The Finance Committee would like to negotiate with Barbara Prentice for legal services to include covering the insurance cost.

          MOTION
A motion was made by Commissioner Campbell to approve transferring $250,000 from the Pick4 Contingency Fund back into the Designated Prize Reserves Fund.  Motion was seconded and voted in the affirmative.

          MOTION
A motion was made by Commissioner Campbell to authorize negotiations with Barbara Prentice to deal with prize assignment issues.  Motion was seconded and voted in the affirmative.

MARKETING COMMITTEE – Maura McCann
          The press clip report was distributed.

          We are getting ready to launch Weekly Grand.  New Hampshire shared their point-of-sale material. 

          The palm card brochure, which will be produced from the online terminals, is just about ready. 

DEVELOPMENT COMMITTEE – Hadley Melendy
          The Fast Play game, Fish4Cash, is doing quite well.  Lucky Numbers is scheduled for a November launch.

          Hadley reported on the success of Double Draw Dollars on Pick 3/Pick 4 sales.  Sales also indicate a residual effect from the promotion.

          Weekly Grand is scheduled for a February 1, 2009 launch.  Various state promotions are scheduled.
          Vermont and New Hampshire are offering an “nth” ticket promotion with the purchase of Powerball and Megabucks tickets. The player will receive a Weekly Grand ticket.  New Hampshire is extending their promotion to include the purchase of a Hot Lotto ticket.

          The New Hampshire Lottery requested permission to use a portion of their funds in the offering of a Weekly Grand ticket for Megabucks, Powerball and Hot Lotto ticket purchases.  

          MOTION
A motion was made by Commissioner Campbell to expend funds from New Hampshire’s share of the $1.4 million from the expired, unclaimed prize fund for a promotion of Weekly Grand with the purchase of a Megabucks, Powerball or Hot Lotto ticket purchase.  Motion was seconded and voted in the affirmative.

          VERMONT A Cash for Gas promotion is scheduled for September. Every “nth” Powerball or Megabucks ticket of $5 or more will have a $100 instant win.

          Maine – With the purchase of a Weekly Grand ticket, players will receive a raffle number.  The winning number will be drawn using the Random Number Generator (RNG).  With every “nth” $5 Powerball or Megabucks ticket, there will be a $100 instant win.  There will also be a Homestead promotion.  This promotion is sponsored by MUSL.  The winner will attend NASCAR races in Florida.  A Powerball promotion is scheduled in November and a Holiday promo in December.

          In September, Focus Groups will be utilized in developing Megabucks game enhancements. The Commission was given the schedule to review.

          The last game to be reviewed for a possible change is Daily Numbers.   A date of early November 2009 has been set as a target date for changes/enhancements to the games.

DRAW COMMITTEE – Maura McCann
          Smartplay has completed their preventative maintenance to all the drawing machines.


          MOTION
A motion was made by Commissioner Campbell to purchase six (6) sets of balls numbered 1 – 35, three sets color white and three sets color green.  The figure is printed six times per ball; figure underlined.  Each set is closely calibrated for size and weight.  They come packed in lockable, foam lined plastic cases.  Per set cost is $526.75.  Six sets would cost $3,160.50.  Motion was seconded and voted in the affirmative.

OPERATIONS COMMITTEE – Rich Sperlazzi
          Nothing to report at this time.

SCIENTIFIC GAMES – Doug Parker
          Doug was pleased to report that things are moving along very well with Powerball and everything is on schedule.

          Doug expressed SG’s appreciation for the opportunity to give a game presentation yesterday. 

ACCEPTANCE OF THE COMMITTEE REPORTS

          MOTION
A motion was made by Commissioner Campbell to accept the committee reports as presented.  Motion was seconded and voted in the affirmative.

OTHER BUSINESS

          Director Yandow presented a request for payment of a winning Pick 4 ticket from an agent in Vermont.  Tickets were purchased and misplaced by the agent and may have been thrown away. 

          MOTION
A motion was made by Commissioner Campbell to deny payment and cited Tri-State Policy No. 6. Prize Verification –“No one may claim a prize without presentation of a valid ticket issued and authenticated by a state and/or Tri-State, along with the proper identification as required by the individual states for all tickets worth $500 or more as required by the individual party states.”  

Motion was seconded and voted in the affirmative.

          The next commission meeting is scheduled for October 3, 2008 at 10:30 a.m. at the New Hampshire Lottery Commission in Concord, NH.

A motion to adjourn was made at 10:15 a.m.


                  

                                                                   ___________________________
                                                                   Thomas Scala, Chair