Tri-State Lotto Commission
April 4, 2008
Meeting Minutes:
TRI-STATE LOTTO COMMISSION
New Hampshire Lottery Commission
April 4, 2008, 10:30 a.m.
Present: Richard J. Campbell, New Hampshire Lottery Commission
Thomas Scala, Vermont Lottery Commission
Orland McPherson, Maine State Lottery Commission
Rick Wisler, New Hampshire Lottery Commission
Alan R. Yandow, Vermont Lottery Commission
Dan Gwadosky, Maine State Lottery Commission
Maura McCann, New Hampshire Lottery Commission
Robert Preston, New Hampshire Lottery Commission
Kassie Strong, New Hampshire Lottery Commission
Hadley Melendy, Vermont Lottery Commission
Mary Cassani, Vermont Lottery Commission
Rich Sperlazzi, Maine State Lottery
Lisa Rodrigue, Maine State Lottery
Chris Nichols, NL Partners
John Ripley, NL Partners
Jen Cartmell, NL Partners
Rose Longo-White, Griffin York and Krause
Liz Dimmick, Scientific Games
Karl Fortman, Scientific Games
Moe Pepin, Scientific Games
Carole Lacasse, Vermont Lottery
Chairman Campbell called the meeting to order at 10:30 a.m.
RATIFICATION OF ACTIONS TAKEN AT PREVIOUS MEETINGS:
December 28, 2007: Commissioner McPherson made a motion to ratify a motion to adopt Policy No. 19 – Funding Promotional Raffle games. Motion was seconded and voted in the affirmative.
January 14, 2008: Commissioner Scala made a motion to ratify a motion to approve the last available one-year extension for audit services at a cost of $42,000 with Berry, Dunn, McNeil. Motion was seconded and voted in the affirmative.
January 14, 2008: Commissioner McPherson made a motion to ratify a motion authorizing the Finance Committee to negotiate a contract with Zalinger, Cameron and Lambek of Montpelier for legal services for the Tri-State Lotto Commission. Motion was seconded and voted in the affirmative.
February 1, 2008: Commissioner Scala made a motion to ratify a motion to approve the $1,900 emergency visit from Smartplay to look at the Criterion/Megabucks machine. Motion was seconded and voted in the affirmative.
February 1, 2008: Commissioner Scala made a motion to ratify a motion 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.
March 7, 2008: Commissioner Scala made a motion to ratify a motion to have the Development Committee explore alternative price points on Fast Play games with approval needed by the Commission for implementation. Motion was seconded and voted in the affirmative.
A motion was made to ratify actions to accept the Committee Reports for January 14, February 1 and March 7, 2008. Motion was seconded and voted in the affirmative.
ACCEPTANCE OF MINUTES FOR JANUARY 14, FEBRUARY 1, AND MARCH 7, 2008
A motion was made by Commissioner McPherson to accept the minutes for January 14, February 1 and March 7, 2008. Motion was seconded and voted in the affirmative.
FINANCE COMMITTEE – Mary Cassani
Gross revenues for Tri-State through February 2008 have increased $3,120,975, or 7.03% compared to last year. Of this increase, Megabucks sales are up $1,076,862, or 5.12%; Daily Numbers sales are down $1,129,432, or 7.11%; Paycheck sales are up over Triple Play sales from last year $771,005, or 41.74%, the promotional Fast Play games are down $308,600, or 11.68% from last year.
Total Expenses so far for FY08 are up over last year $1,364,807. This represents an increase in cost of sales of $2,442,054 and a decrease in operating expenses of $77,247.
Net Profit through February 2008 increased from last year $729,315, or 4.83%.
All contingency funds are in the positive at the end of February and expired unclaimed prizes are over $1.6 million at this time.
The Engagement Letter for Audit Services by Berry, Dunn, McNeil and Parker is ready to be signed by the Commission. Audit staff will be coming in to start pre-audit work the week of April 28th.
The Finance Committee requests the approval of the revised budget presented at the last commission meeting. No changes have bee made since last presented. (Adjustments were made to Raffle sales and prize expense for all three states to better reflect the results of the actual Raffle. New Hampshire adjusted sales on other games bringing their total sales estimates from $27.4 million to $26.3 million. Vermont sales and prize expense for Fast Play were also adjusted. None of the operating expenses were adjusted at this time.)
MOTION
A motion was made by Commissioner Scala to accept the revised budget as presented at last month’s commission meeting. Motion was seconded and voted in the affirmative.
MARKETING COMMITTEE – Maura McCann
The press clip report was distributed.
DEVELOPMENT COMMITTEE – Maura McCann
Following last month’s meeting, Maura met with Director Wisler and sketched out a timeline as to when changes need to be made, to what game, and what we hope to accomplish, etc.
A list of game concepts was distributed. Three games being explored: Work Day Lotto: A 5 of 31 and 1 of 5 game. Players would choose 5 numbers from a field of 1 through 31 and for the 1 of 5, we could have the 5 days of the work week; Yahtzee, or Roll ‘Em: Five dice randomly displaying 1 to 6 spots and one of the six distinct letters in the work “Yahtzee”; Payroll: a lotto style game, the jackpot amount would be based on sales and the remaining prizes would be “set” prizes. If someone matches all the winning numbers, that person would win the jackpot. If no one matches all the winning numbers, the money allocated for the jackpot would “roll down” to all the other prize levels; Payday Extra: A lotto style game of 5 of 39. Match all 5 winning numbers, you hit the Payday Cashpot. Drawings would be held twice or three times per week.
All these games are at a $2.00 price point. Scientific Games is developing some designs and will come back to the committee soon. A teleconference call is scheduled for next Thursday, April 10th. Focus Group testing has been requested by Maine and Vermont with time being blocked out for the end of April or the first of May. The committee would like to schedule a game proposal for the June Commission meeting which will allow for a January, 20009 implementation. The committee would then move on to the next game (Megabucks) to be enhanced or changed.
The committee has designated July 13–26 for a Pick 3/Pick 4 promotion.
It was noted that 72% of sales are for the evening drawing and 28% for the day drawing. The aim would be to increase sales for the day drawing. Plans are to award a cash prize to every nth qualifying ticket. The qualifying ticket is a ticket valid for both a day and evening concurrent drawing. That ticket may be for any number of day and evening drawings from a minimum of 2 to a maximum of 14 consecutive drawings. The cash prize and the nth award to be determined by each participating state lottery.
Commissioner Scala inquired if promotions were tracked. Maura replied that they are and a spike is seen in sales. Director Wisler asked if a summary of recent promotions and results could be put together and distributed. It was pointed out that no matter what promotion is done, you never get back dollar-for-dollar. The overall perception of the lottery is greater by having promotions; there are more sales, but it can’t be tracked. A report will be put together.
DRAW COMMITTEE – Maura McCann
Nothing to report at this time.
OPERATIONS COMMITTEE – Rich Sperlazzi
With the change in direction, not much has been happening.
SCIENTIFIC GAMES – Karl Fortman
They are working on the games.
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.
OTHER BUSINESS
Battelle Contract: The Battelle contract was presented to the commission for signature.
Daily Numbers appeal from Victoria Shouldis for an expired Pick 3 ticket. After a review of the various correspondence from Ms. Shouldis, Robert Preston, Games Manager, NHL; Executive Director Wisler, NHL; Commissioner Campbell, NHL; and Leonard Mannino, Chief Security Officer, NHL, the Tri-State Lotto Commission elected to decline the request for payment.
MOTION
A motion was made by Commissioner McPherson to deny payment on the expired Pick 3 ticket. Motion was seconded and voted in the affirmative.
Random Number Generator (RNG): Director Yandow expressed his desire to discuss the general use of our recently purchased RNG. Perhaps a policy decision should be made in light of new games being planned. Director Wisler brought up the fact that Tri-State has a contract with MUSL for emergency drawings; however, MUSL drawings would be done by an RNG. Tri-State now has their own RNG which could be used in emergency cases. Maura noted that the arrangement with MUSL should be kept in light of the fact that something could happen to the New Hampshire Lottery building, thus the drawings would have to conducted elsewhere.
Commissioner Scala asked if perhaps the subject of RNG drawings should be brought before a focus group. Some time back this was brought before a focus group and they wanted the drawings to be conducted the way they currently are. Perhaps this could be a question during a focus group.
The next commission meeting is scheduled for May 2nd at 10:30 a.m. at the New Hampshire Lottery in Concord, NH.
A motion to adjourn was made at 11:26 a.m. by Commissioner Scala.
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Richard Campbell, Chair