RICHMOND, JAN. 29 -- Virginia lawmakers are considering a reduction in the share of state lottery revenue that goes for prizes so that more lottery profits could be given to local governments for transportation and education.
Currently, the state keeps 35 percent of lottery revenue and winners get 50 percent. Under the proposal by Del. Mitchell Van Yahres (D-Charlottesville), the state's share would rise to 40 percent, and winners would get 45 percent as prizes. The remaining 15 percent would continue to go to agents who sell the tickets and to pay for administrative expenses.
At a hearing Monday before a House Finance subcommittee, lottery officials warned that cutting the winners' share would discourage people from playing the lottery, resulting in lower ticket sales and, consequently, a reduction in state lottery proceeds.
Shifting 5 percent of the lottery money would increase the state's take by $35 million to $40 million a year, according to Van Yahres.
Lottery Director Ken W. Thorson told lawmakers to "resist this sirens' song because surely it will bring the lottery close to the rocks." He said other state lotteries have been brought "close to collapse" by cutting the winners' share of the revenue.
However, after three weeks of slashing budgets, squeezing programs and holding the line on taxes, the proposal got an enthusiastic reception from House Finance Committee members, who clearly believe it can create a new pot of money without violating Gov. L. Douglas Wilder's pledge not to raise taxes.
"Are you saying we'll do substantial violence to the lottery by passing this innocuous little bill?" asked a skeptical Finance Committee Chairman C. Richard Cranwell (D-Vinton).
"I guarantee it," Thorson said.
"We may test it to see if your guarantee is valid," Cranwell responded. "I've never had anyone complain about the percent of distribution . . . . People tell me all the time to put the money back to localities and education."
The subcommittee is expected to make a recommendation on the proposal on Wednesday.
The additional money that the proposal would bring to the state is about equal to the $40 million a year that was denied to local governments when the state reneged on a promise to give jurisdictions a bigger share of real estate filing fees. About half the annual fees, which were to be used for transportation and education, would have gone to Northern Virginia.
House Speaker A.L. Philpott (D-Henry) said he likes the idea of using lottery proceeds to replace the real estate filing fee money.
"I was opposed to the lottery anyway," Philpott added, explaining why he doesn't mind giving the state a bigger chunk of the receipts at the expense of the players.
Although lottery revenue originally was to be used for building projects such as roads and schools, much of the money has been diverted to pay for operating programs to make up for the state's $1.9 billion budget shortfall.
In other action today:
The bottle bill, sent to the Senate Finance Committee for a second hearing after having passed the Agriculture Committee for the first time in eight years, was approved on a vote of 7 to 6. The surprise outcome means the proposal, which would impose a 10-cent deposit on most beverage containers, will be voted on by the full Senate this week.
Sen. Joseph V. Gartlan Jr. (D-Mount Vernon) lambasted the Fairfax County Board of Supervisors for supporting a proposed constitutional amendment that would allow the General Assembly to set a limit on increases in annual real estate assessments. "This would undermine local government accountability," Gartlan said, adding that local governments "could come here every year to raise or lower the cap on assessments."
The House approved and sent to the Senate a bill raising from 16 to 18 the legal age for buying tobacco products. The bill would remove criminal penalties in the law and increase civil penalties for violations from $25 to $50.