Tri-State Lotto Commission Teleconference Meeting
February 1, 2008
Richard Campbell, New Hampshire Lottery Commission
Thomas Scala, Vermont Lottery Commission
Orland McPherson, Maine State Lottery
Rick Wisler, New Hampshire Lottery Commission
Alan Yandow, Vermont Lottery Commission
Dan Gwadosky, Maine State Lottery
Maura McCann, New Hampshire Lottery Commission
Robert Preston, New Hampshire Lottery Commission
Mary Cassani, Vermont Lottery Commission
Hadley Melendy, Vermont Lottery Commission
Lisa Rodrigue, Maine State Lottery Commission
Rich Sperlazzi, Maine State Lottery Commission
Karl Fortman, Scientific Games
Moe Pepin, Scientific Games
Liz Dimmick, Scientific Games
Rose Longo-White, Griffin, York and Krause
Chris Nichols, NL Partners
Jennifer Cartmell, NL Partners
John Ripley, NL Partners
Russ Leonard, NL Partners
Carole Lacasse, Vermont Lottery Commission
The meeting was called to order, delayed in original starting time.
Ratification of Actions taken at previous meetings.
No action taken at this time due to this meeting also being conducted via teleconference due to the weather.
ACCEPTANCE OF JANUARY 14, 2008 MINUTES
There were no comments on the minutes, action was tabled until the next commission meeting.
FINANCE COMMITTEE REPORT – Mary Cassani
Gross revenues for Tri-State through December 2007 have increased $3.1 million, or a 9.24% increase over last year. Of this increase, Megabucks sales are up $440,817, or 2.66%; Daily Numbers sales are down $962,864, or 7.82%; Paycheck sales are up over Triple Play sales from last year $1,444,659, or 49.53%; the Promotional Fast Play games are down $165,186, or 12.67% from last year; and the New Year Millionaire Raffle game sold $2,470,800.
Total Expenses so far for fiscal year 2008 are up over last year $2,773,756. This represents an increase in cost of sales of $2,569,067 and an increase in operating expenses of $204,689.
Net Profit through December 2007 increased from last year $338,418, or 2.83%.
All contingency funds are in the positive at the end of December and expired unclaimed prizes are almost $1.6 million at December 31st.
The Finance Committee is working on a revised budget with updated sales figures for Commission approval at the next meeting. This is in accordance with Tri-State Policy No. 10.
MARKETING COMMITTEE – Maura McCann
Maura reviewed the press clip report and will forward them to the Commissioners after today’s meeting.
Vermont had numerous clips pertaining to the privatization of the Vermont Lottery. Maine and New Hampshire had light news clip coverage.
A news clip company, Meltwater, has contacted Maura. She is comparing the two companies and checking pricing. They can offer the news clips via email.
DEVELOPMENT COMMITTEE– Maura McCann
The Development Committee has met twice since the last Commission meeting. One meeting was by teleconference and the other was yesterday at the New Hampshire Lottery.
Yesterday, the committee reviewed the Raffle game, i.e. what was not in our favor, what could be done better and a discussion on whether or not to offer another Raffle game. The committee has asked SGI to build some models for the commission, models with a lessor price Raffle ticket of $10.00 accompanied by promotions, keeping in mind that non-holiday periods and subsequent raffle games offered by states normally don’t do as well.
There was a review of the Tri-State Paycheck game as it’s now one year old. Games are generally on the market for 18 months to 2 years. The committee has asked SGI to look at enhancements or possible replacements games. The committee has asked for some models with three or more drawings per week, taking the $600 prize and dropping it to a more palatable $500 prize. Maura has asked if we go to three drawings a week, if we could take a $6.00 bet and make it $5; the idea has been tabled. The committee is moving forward with the offer of more than two drawings a week and dropping the $600 prize amount. If this is done, the committee will check to see how that affects the profit line.
SGI gave a presentation on some new game concepts and resurrected some previous game concepts. The committee asked SGI to send the concepts to the Development Committee members via email allowing more time for review.
The committee then moved into a closed session with Battelle to discuss the upcoming RFP release schedule. Due to time constraints, the group was not able to complete their agenda yesterday. They would like to further discuss the Megabucks game, the possibility of offering promotions, and to look at the Pick 3 and Pick 4 games.
DRAW COMMITTEE – Maura
Recently there was a problem with the compressor on the Megabucks machine. This machine has been in use since 1988 and two years ago the compressor was replaced. Last Saturday night there appeared to be a problem and Maura made an emergency call to Smartplay at a cost of $1,900. The emergency call was made on Monday and Smartplay was there Tuesday. There is a backup unit if needed and in the future we will have the new RNG unit as a backup as well. The compressor was fine but they did add a piece of equipment to the new compressor which would increase the amount of pressure from 5 pounds to 20 pounds.
GLI report: GLI reviewed the software for the RNG for MUSL. At a previous meeting, the Commission approved $5,900 to certify the randomness of the RNG by Gaming Laboratories Inc. The actual cost was $2,500 more than the estimate because of three issues GLI caught with the RNG software. Maura is now requesting an increase of $2,500 to cover the additional cost. The total amount would be $8,400.
Maura has received an invoice for the hardware for the RNG. At a previous meeting, the commission had approved between $10,000 and $11,000 to purchase two separate RNG units with the price coming in at $5,410, approximately 50% from what we thought we would be paying.
Maura is looking for the GLI Contract and will provide the commission with the language from the contract pertaining to these additional costs.
A motion was made by Commissioner Scala to approve the $1,900 emergency visit from Smartplay to look at the Criterion/Megabucks machine. Motion was seconded and voted in the affirmative.
A motion was made by Commissioner Scala to approve the $2,500 increase to the original GLI bid of $5,900 bringing the total to $8,400 to certify the RNG software. Motion was seconded and voted in the affirmative.
OPERATIONS COMMITTEE – Rich Sperlazzi
Scientific Games is still working on developing the SRSs discussed last month. Once this is done, the committee will begin working on them.
SCIENTIFIC GAMES – Karl Fortman
Nothing to report at this time.
ACCEPTANCE OF COMMITTEE REPORTS
A motion was made by Commissioner Scala to accept the committee reports as presented. Motion was seconded and voted in the affirmative.
The next meeting is scheduled for 10:30 a.m. Friday, March 7, 2008, at the New Hampshire Lottery Commission in Concord, NH.
A motion to adjourn was made at 11:30 a.m.
Richard J. Campbell, Chair