April 17, 2008

Oppose SB 2099 - Internet Lottery Pilot Program

SB 2099 is an expansion of gambling to the Internet. SB 2099 would expand legal gambling in every home and office with a computer. Charitable organizations have donated computers to low-income families to help their children in school. Many children and poor families now have access to a computer. SB 2099 would target these same people with the false hope of winning the Lottery by purchasing tickets on the Internet.
SB 2099 requires the Department of Revenue to seek a clarifying memo from the federal Department of Justice that it is legal for Illinois residents and non-residents to purchase and a private company to sell lottery tickets on the Internet on behalf of the State before beginning the program. This information should be clarified prior to passing legislation to legalize Internet gambling!
SB 2099 allows the state to enter into a contract with a private vendor, separate from existing lottery contracts, to set up a pilot project to sell Lottery tickets on the Internet. How many private vendors meet the qualifications to apply for this contract? Was this legislation written for a specific vendor with the "expertise, technical capability, and knowledge of the Illinois lottery marketplace to conduct the program"?
SB 2099 requires the pilot program to be in place for 3 or 4 years. This could be very profitable for the lucky vendor who is chosen to run this pilot program.
The legal age to gamble on the Lottery is 18. SB 2099 would appeal to young people who have grown up using computers and making purchases on the Internet with credit/debit cards. The rate of gambling addiction is higher for teens than for adults. Expanding gambling on the Internet could lead to an increase in gambling addiction among teens and adults.
People buy Lottery tickets, regardless of the odds. A national study found that 5% of the people who purchase Lottery tickets purchase 51% of the tickets. These are gambling addicts, who continue to buy tickets regardless of the small chance of winning. Young people do buy Lottery tickets. A few years ago when our organization tried to raise the age to gamble on the Lottery to 21, the Illinois Lottery estimated this would impact sales. Approximately 5% of Lottery sales are from young people 18-20 years of age.
SB 2099 requires the Department to establish an age verification procedure to set up an on-line Lottery Account. There are no safeguards in place to prevent children from gambling on the Internet. Internet age verification procedures used by alcohol companies have been ineffective in keeping anyone under 21 from going to their web sites. Teens and computer savvy individuals know how to get around these restrictions. A teen could ask an older friend or relative to cash in a winning ticket.
SB 2099 says the department shall set a limitation on monthly purchases that may be made through any one individual's lottery account. Addicted gamblers could set up more than one account and have many credit cards. New Zealand set a limit of $300 a month for Lottery purchases on the Internet. The people there are outraged that the limit was set that high. That is a lot of money for a low-income person to spend on Lottery tickets.
SB 2099 says only Lotto and Mega Million games to be offered on the Internet at this point. About 25 to 33% of Lottery tickets fall into this category. This is a "foot in the door" approach. If this bill passes, the sponsor, contractor, or Department of Revenue could come back later to legalize additional lottery games for the Internet program. Half of Lottery sales come from Instant Lottery tickets. Instant Internet Lottery games are very colorful and fast. It appears that you are playing a video game rather than purchasing a Lottery ticket for real money.
The National Gambling Impact Study Commission recommended a ban on Internet gambling. The Commission also recommended that states curtail the growth of new lottery games, reduce lottery advertisement, and limit locations for lottery machines.

Vote NO on SB 2099