NC lottery director says it can't meet House goal

The Associated Press

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RALEIGH, N.C. (AP) — The North Carolina lottery cannot generate all the extra profits for teacher pay that the House sought in its state budget, the lottery's executive director told senators Wednesday.

Alice Garland also said later she told the House's top budget writer the same thing last week before the chamber passed its spending plan, which envisions collecting another $106 million following several lottery advertising changes.

Garland noted the new requirements on ad content and placement restrictions that legislators also have inserted in the budget would lower the net increase to $59 million.

"We will not be able to hit the $106 million with those restrictions," Garland told the Senate Appropriations Committee, which was reviewing the $21.1 billion budget approved by the House last week.

The Senate and House are now positioning themselves for final budget negotiations.

Rep. Nelson Dollar, R-Wake, senior co-chairman of the House Appropriations Committee, later Wednesday defended the lottery provisions and projections in the budget.

He said a 2013 fiscal analysis found that such ad restrictions, previously inserted in a separate bill, wouldn't reduce lottery sales. Garland told senators that lottery officials were not consulted when last year's analysis was assembled.

Dollar also said that even if lottery revenues are not enough to cover teacher raises, the state has a large pot of reserves it can tap.

"We can meet our budget target," Dollar said.

While the House bill would double the cap on advertising expenses to an amount equal to 2 percent of sales, it also would ban lottery ads during college sporting events, which Garland said would eliminate a wide audience of potential players.

The bill also would require billboards and 3,000 jackpot signs at stores to include two amounts for multistate jackpots — one if the winner accepts yearly payments and another if the person takes a smaller lump-sum payout.

Such a provision not only would cost a lot of money over time, it also would confuse people and push business away, Garland said.

"We absolutely believe that we would be pushing sales to other states because other states wouldn't have this dual message," she said.

House Democrats said earlier in the week lawmakers should have been alerted to the downgrade in additional profits before the vote. Senate budget committee members from both parties used Garland's appearance to criticize the House lottery provisions as ill-conceived. Sen. Jerry Tillman, R-Randolph, call the ad restrictions "silly," while Sen. Tom Apodaca, R-Henderson, said "it's just foolishness."

"It's very difficult in my opinion to gamble on gambling to pay teachers," said Sen. Joel Ford, D-Mecklenburg. "To me it's fiscally irresponsible."

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