Albritton's lottery bill passes
If House approves, voters will decide
May 2, 2019
After passing what has been referred to as a "clean lottery bill" through the Senate last week, bill sponsor Sen. Greg Albritton said when his bill reaches the floor of the Alabama House this week it will likely be met with opposition. But despite opposition to the bill, Albritton says it has a chance of being approved by the House of Representatives with changes.
"The bill has a really good chance in passing the House. There are really only two, maybe three, issues that are in argument on it and we should be able to work this out," Albritton said.
He went on to note in an interview that interest in expanding gaming in the state could kill the bill altogether.
"The reason that a lottery never gets done is that there are so many hands in the pie from people who want to increase gambling in Alabama,'' Albritton said. "An example of that was the word-solver in my bill. The bill talked about multi-sovereign lotteries, which we had included in the bill to allow our state to participate with other states in a multi-state lottery like the Mega-Bucks and Power Ball. The opponents of the bill wanted the use of the term sovereign cut out because they think that it has to do with the Poarch Creek, but I don't think that is it at all.
"I think they don't like the fact that we are trying to maintain what the state already has and we are not trying to harm anyone. We want the people who already have gaming to continue to have gaming. I think the opponents' intent is that they want to remove the clause of sovereign so it will allow each county and each small group, like White Hall, to tie into the Power Ball like the other states do."
Senate Bill 220, as presented by Albritton, proposes a paper lottery for the state, much like the programs currently offered in Alabama's neighboring states of Florida, Georgia and most recently Mississippi.
As introduced to the Tourism Committee, SB 220 proposes a constitutional amendment to authorize the establishment of an Alabama Lottery which would offer common paper tickets for intrastate and multi-state games as well as instant tickets, commonly referred to as scratch-offs.
Funds from the lottery, as proposed by supporters of SB 220, have indicated the Alabama Lottery could generate as much as $166.7 million annually, which would be after the payments are made for prizes and all administration expenses have been paid. According to the presentations of the bill, the estimated gross $166.7 million would be deposited into the Alabama Trust Fund and used to repay approximately $183,956,703 for funds transferred from the trust fund and into the state's general fund during the fiscal years of 2013, 2014 and 2015 to cover shortfalls.
When the loans are repaid to the Alabama Trust Fund, SB 220 will have the profits from the Alabama Lottery divided with half of the lottery proceeds being transferred into the Alabama Trust Fund and the remaining balance being transferred into the state general fund. As noted in the committee report, "This could increase annual receipts to the Alabama Trust Fund and the state general fund by an estimated $83 million per fund."
Funding allocations are said to be one of the areas members of the House of Representatives will call into question with some desiring to have a portion of the profits from the lottery transferred to Alabama Education Trust Fund, a move the sponsoring senator says he does not support.
"They (members of the House of Representatives) want to move the money to the Education Trust Fund. The reason that I have not included that in my bill - funding from the lottery to go into the ETF - is that the biggest threat to the ETF is an anemic, sick and poorly funded general fund," Albritton said. "Right now, when we have a lot of demands for funds, the only place we can get it is from the ETF, so my goal is to stop the need to have to borrow funds from the ETF. All the money from my bill, after paying back the money we have borrowed before, would go to the state general fund."
Some of the added demands for funds that Albritton referenced as a reason to put the money in the general fund include the federal mandates of repairing the state's prison system and fully funding Alabama's Children's Health Insurance Program.
"Some might say that we can't afford that ( funding prisons and CHIPS) and right now we can't, so we have to take it out of the ETF, so there is an argument that if we will or if we won't and that is $35 million that must be paid from somewhere," Albritton said. "The following year the funding will likely increase from $35 million up to $80 million so in two years we have to come up with $125 million dollars in new money just to maintain CHIPS and All Childs, which does not expand the program at all. This is just the amount the federal government says the state must pay for a premium.
"What the lottery, the way I have presented it, would do is allow the state to not only fund the needs of the general fund to pay for these needs but to also give us a little bit of a cushion. On prisons we have, in the last two years we have put $71 million into the state prisons to try to increase the number of guards and employees."
According to Albritton, Alabama lawmakers still owe approximately $175 million to the state's ETF because of borrowing from it to clear budget downfalls in previous years.
"My bill has the bulk of the profits from the lottery going to pay that loan off first and I think we can get that paid back in one year and then allow the funding to go to the general fund," Albritton said. "I think the House will change that completely."