Commission Meeting for 7/16/2013
 
Time, Date and Place:

The 180th meeting of the Idaho Lottery Commission took place on Tuesday July 16, 2013 at 10:00 AM at 1199 Shoreline Lane, Boise, Idaho 83702.

Attendees:

Commissioners Present:

Chairman, Roger Jones

Commissioner, Craig Corbett

Commissioner, Jim Rehder

Commissioner, Mel Fisher

Commissioners Present Via Teleconference

Commissioner, David Keyes

Lottery Staff Present:

Executive Director, Jeffrey Anderson

Chief Operating Officer, Becky Schroeder

Deputy Director of Security, Amber French

Deputy Director of Sales, Shannon Newhouse

Deputy Director of Marketing, Sherie MoodySt. Clair

Chief Financial Officer, Jay Prickett

Management Assistant, Jennifer QuinnoMiller

Public Information Specialist, David Workman

Others Present:

Sara Chase, Drake Cooper

Zeke Chemodurow, Intralot

Brad Surkamer, CLM

Ryan Belveal, Gamco International

1. Meeting Called to Order

Meeting called to order by Commissioner Jones at 10:00 AM.

2. Approval of the Minutes

Commissioner Fisher motioned to approve the minutes from the May 30, 2013 meeting. The motion was seconded by Commissioner Corbett. The vote was unanimous for approval.

Commissioner Fisher motioned to approve the minutes from the June 28, 2013 teleconference. The motion was seconded by Commissioner Rehder. The vote was unanimous for approval.

3. Director Update

Director Anderson reminded the Commissioners of the NASPL Annual conference coming up in September in Rhode Island.

He provided an update on Internet Gaming explaining that there is a subcommittee taking testimony from consumer groups on the expansion of internet gaming and the regulation of it. NASPL attempted to get on the witness list but we were denied. However, we will have representatives there. There is also a bill moving through the House of Representatives similar to last years’ bill with the Federal Regulation of Gaming. We still have a big issue with this as gaming still to this day remains a States issue. We are trying to formulate a “Plan B” on what we would be willing to accept should we have to compromise. We have not landed on those details yet, but internet gaming is currently illegal in Idaho, and we do not anticipate that changing, nor do I anticipate us bringing anything to the Commission to suggest we try and change that.

We are presenting our dividend check to Governor Otter today. There have been some questions in regards to the Bond Levy Equalization Fund from Commissioners, and that provision sunsets after this current fiscal year, FY14. At that time it will revert back to the 50/50 split between public schools and the Permanent Building Fund. Speaker Bedke was very wise in having that sunset. The Governor has little to no interest in trying to tap into that money for other things going forward. Since this split began, this is the first year that the public schools and the Permanent Building Fund received more than the $34 million minimum due to the large dividend we were able to turnover.

Lastly, Director Anderson discussed a previous meeting where the Commission voted Commissioner Fisher to serve as a “Vice Chairman” of the Commission. In reviewing the Statues of the Lottery and how a Chairman of the Commission is chosen, he reminded the Commission that there is no formal provision for a Vice Chairman of the Lottery Commission. He wanted to clarify that the designation of a Vice Chairman in no way supersedes the Governors ability to appoint a Chairman and this informal vote was to merely bring forward the fact that there may be instances where the Chairman is not present at a meeting and the Commission needs to have a plan going forward that establishes who would run the meetings should that happen. The best way to determine that was by tenure, which Commissioner Fisher has the longest, so it makes sense he is given that designation, but this is an internal title and proceeding only and not an official designation with the Governors approval. He explained that it is the responsible thing to do to designate a Commissioner who will preside over the meetings should the Chairman not be present. He also suggested that because there can be a quorum of three Commissioners and still conduct business, that it would be wise to consider a conversation about a “Second Vice Chairman”, should the Vice Chairman and the Chairman both be absent. Based on tenure, that would be Commissioner Keyes. That way, if there are only three Commissioners present for a meeting, someone would always be there and prepared to preside over the meeting.

Commissioner Corbett nominated Commissioner Keyes for the position of Second Vice Chairman. Commissioner Fisher seconded the motion. The vote was unanimous for approval.

4. Quarterly Current Sales Report

The sales report is entered into the minutes as an attachment.

5. Security Division Update

Deputy Director French reported that the Warehouse move has been completed and everything is in great shape. The new packing lines are working great and has made everything more efficient.

In regards to Charitable Gaming, Angie is looking at setting up small educational sessions to help nonprofit organizations understand how to operate Bingo’s and Raffle’s and how to do a fund raising event. She informed the Commission they are all invited to attend a session in their area.

6. Marketing Division Update

Deputy Director MoodySt. Clair spoke about current promotions. BBQ Bucks in our current campaign and we have our Hot Lotto Summer Sizzler promotion right now helping to bring some awareness to the jackpot. So far we are up almost 75% on the game for the year.

We just launched our new Tap Scratch product, too. We sent some retailer kits to all retailers launching the product consisting of tshirts, coasters, bottle openers, etc. These are all located in age controlled environments.

Our next campaigns coming up are Frogger, starting August 1 running through the Fair season so it will be our featured game for those events and we also have Fantasy Blackjack coming.

The last couple of things, we are heading in to Fair Season, we have a couple new Wooh Crew members and have the Boise Music Festival and Coeur d’Alene Street Fair coming up.

7. Sales Division Update

Deputy Director Newhouse reported that the last fiscal year finished very strong and they have already hit the ground running to try and beat it this year. She explained that of the 50 Tap Scratch Game retail locations, they have sold nearly $6000 in the games in just two days. So we have high hopes with this product and what it might do. The feedback from the field has been fabulous and the players are responding well.

All four Denny’s locations are installed and up and running. This is new for us because we haven’t been in this environment, plus they are selling Scratch Games and Draw Games.

She reported that while Region 3 (Ada County, Canyon County and the outlying areas) typically has the highest increase in sales, North Idaho had the largest comparative sales increase year over year this year with a 16.5% increase this year.

She reminded them that if they are interested in taking a tour with a Sales Rep to let her know and she can set it up.

We are still watching what is happening in Wyoming with the startup of their lottery. It looks like it is going to be a slow process and not too intimidating to us over the next couple of years. But, we are watching it very diligently.

Lastly, she described that when she took over the position, they decided not to fill the Sales Manager position she vacated with the thought they could operate without it, and so far, they are. There is no plan at this point to fill that position as everyone is handling everything just fine.

Chief Operating Schroeder reminded the Commission of the Nez Perce Compact. We pay them annually 12% of the sales on the reservation per the compact from 2008. We track it every quarter and report to them and each year at the end of July we send them a payment that reflects the four quarters. She showed them the tracking spreadsheet and pointed out their sales are steadily increasing.

Director Anderson informed the Commission that we will be holding our annual Strategic Planning Sessions coming up in August. Also, he mentioned the great job that Ryan and his team from Gamco have been doing with the TouchTab products. The TouchTabs are up $6$7 million over the previous year. We have been exploring a way to make the TouchTab games more engaging for the consumers in the establishments by considering an option that includes tablets that players can take to their table and play as opposed to sitting at a kiosk. We fully believe this is a legal product as it is nothing more than a TouchTab device on a tablet you can take to your table. We feel it is a proactive step that Gamco has taken and we believe it will be helpful to their sales averages.

8. Set Future Commission Meeting Date

The next meeting has been tentatively set for November 21, 2013. Becky agreed to send updates about the dates.

10. Adjournment

Commissioner Fisher moved to adjourn, seconded by Commissioner Rehder. With the vote unanimous, the meeting was adjourned.

Certification:

I hereby certify that the foregoing minutes are a true and correct record of the actions and decisions made by the Lottery Commission.

Jeffrey R. Anderson,

Executive Director

Lottery Commission Secretary