V.I. Lottery wants to give less to government
Published: October 14, 2013
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ST. THOMAS - V.I. Lottery officials are asking senators to reduce the amount Lottery must give to government funds and programs.
V.I. Lottery Executive Director Conrad Francois said after all the mandated contributions, the agency is left with little to no money for its own operations.
The agency, which is self sustaining and actually gives money to the General Fund, updated the Senate Finance Committee on Friday about its budget and operations.
The V.I. Lottery is an instrumentality of the government and is overseen by a seven-member Lottery Commission. The commission promulgates rules and regulations governing lottery games in the territory. Those games currently include the traditional lottery, scratch tickets and games operated by V.I. Lottery contractors, including Powerball, and video gambling machines.
The Lottery's mission is to raise revenue by offering gaming products to generate profits for the territory's General Fund and sponsor public service programs.
Francois said the Lottery's revenues remained flat in 2013, and the legislative mandates are too high to leave anything left over for the operation of the agency.
In Fiscal Year 2013, the V.I. Lottery paid a total of $1.6 million to the Educational Initiative Fund; $1.6 million to the Pharmaceutical Assistance Fund; $1.1 million to the Government Employees Retirement System for retirees' bonuses; $150,000 to the Office of Veterans Affairs; and $331,491 to fund horse racing.
For FY 2014, the V.I. Lottery projects total operating revenues at about $19.9 million.
The bulk of the agency's revenue, about $11 million, comes from video lottery terminals, and the traditional lottery, which brings in about $8.8 million. The rest comes from licenses and fees.
Francois said he is anticipating about $15 million in operating expenses for FY 2014: about $8 million for prizes, printing, drawing operations, dealer bonuses and incentives, and about $7 million for salaries and benefits, advertising and promotion, professional services, and other operating expenses.
About $4.8 million is estimated to be contributed to the various mandated funds and programs, leaving the agency with only $19,466 left over, Francois said.
Lottery expects to give the General Fund $1,947 in FY 2014, according to the Post Auditor.
He recommended eliminating the GERS contribution entirely and reducing the mandated percentage for the Education Initiative Fund from 15 percent to 10 percent of VLT revenues.
If the two changes are made, Francois said the Lottery's net income before its General Fund contribution would be about $1.6 million. That would allow for a $333,637 General Fund contribution, he said.
- Contact reporter Aldeth Lewin at 714-9111 or email email@example.com.