Iowa Lottery officials say they’re researching lottery games which would be played over so-called “smart phones” because other states are considering moving into that market, but key legislators say it’s not a smart move for the state.
Iowa Lottery C.E.O. Terry Rich told the Legislature’s Government Oversight Committee that up to a dozen states may offer lottery games over “smart phones” by the end of the year.
“It’s coming fast to all the states around us,” Rich said. “It’s my belief that when it does come…people will be looking across the border, being able to do things we can’t and we want to evaluate it, investigate it, but that’s all I’m suggesting at this point.”
In 2006, Iowa legislators voted to outlaw the Iowa Lottery’s TouchPlay machines which used devices that looked and sounded like slot machines to dispense tickets. According to the lottery’s current C.E.O., his agency has the authority to start offering smart phone lottery games without legislative approval, but they don’t plan to do so.
“It’s our opinion that we could do that,” Rich told legislators, adding if they were to do so, “politically, we’d be crazy.”
Representative Chris Hagenow, a Republican from Windsor Heights, says that’s the right answer.
“Iowans clearly said, ‘We don’t want TouchPlay’ and similarly, I’ve yet to hear any sort of large voice saying, ‘We want to have on-line gambling or we want to have gambling on smart phones,'” Hagenow says. “…I think it’s a dead issue.”
Senate Democratic Leader Mike Gronstal of Council Bluffs also doubts legislators will give a green light to the idea.
“Does anybody remember TouchPlay?” Gronstal asked rhetorically when reporters asked about lottery games on smart phones. “…The last time they ventured into that world it was a pretty messy place and pretty hard for the state for the state to get out of it in the end, paid millions of dollars in settlements.”
Businesses that had invested in TouchPlay machines sued the state for millions.
Senator Tom Courtney, a Democrat from Burlington who is co-chair of the Legislative Oversight Committee, says legislators have “no interest” in allowing the Iowa Lottery to create games for smart phones.
“If we thought TouchPlay was bad, this would be super, super bad,” Courtney says.
Rich describes the Iowa Lottery as “an off-line business in an on-line world” and he pointed to lotteries in Canada and Europe which are running online games.
“For most people, it’s not this huge expansion of gaming when they’re doing internet today, or smart phones,” Rich told legislators on the Government Oversight Committee. “What is it is replacement of the people who are 21 to 35 who do their business by electronic delivery.”
Rich cited estimates that Iowans are illegally wagering as much as a billion dollars in online lotteries or sports betting services, and legislators may want to capture some of those dollars through new “apps” from the Iowa Lottery. Representative Hagenow says it’s a philosophical question.
“If you have illegal gambling taking place, is it the responsibility of the legislature to try and capture that economic activity and bring it in or is it to stop the illegal activity all together?” Hagenow says. “And I think there’s a big distinction right there that has to be addressed.”
Another legislator on the Oversight Committee said the federal government should beef up the F.B.I,. to go after Americans who illegally gamble off-shore or place illegal bets on sporting events.