The Connecticut State Lottery is moving a step closer to bringing back vending machines to sell its instant ticket games.
Earlier this month, the Connecticut Lottery Corp. put out a request for proposals, asking potential vendors to submit bids to sell or lease instant-ticket vending machines, or ITVMs, to the state.
In the request, the state lottery said it intends to buy or lease about 200 machines initially, but it may eventually acquire up to 1,000.
Proposals are due to the lottery by Feb. 2.
In May, Connecticut Lottery Corp. President and CEO Anne Noble told the Hartford Business Journal that the lottery was planning to install a limited number of vending machines, mostly in chain stores, as a pilot program.
More than 200 machines peddling instant ticket scratch-off games were originally removed from Connecticut retailers after a two-year run in 1999 when anti-gambling forces raised concerns that the machines encouraged minors to gamble.
Noble told the HBJ in May that the vending machine technology has improved greatly over the past 10 years, and many now include an automatic shut-down feature that can be triggered by an employee when a minor approaches the machine.
In the state’s RFP, the lottery wrote, “It is vitally important to the success of this program that lottery retailers are able to disable the ITVM quickly and easily to stop a sale or when the machine is malfunctioning or not being used lawfully.”
The lottery also may require an age-verification control, such as a magnetic stripe reader that could read a driver’s license and verify a player’s age, the RFP said.
The state lottery declined to make substantive comments on the instant-vending machines while they are out to bid.
But in a statement, the agency said it “is pleased-to-date with the progress of this initiative.”
“Lottery retailers have expressed eagerness to partner in this endeavor, and we look forward to a successful implementation of [ITVMs] that will ensure enhanced contributions to the state’s General Fund,” said Diane Patterson, the lottery spokeswoman.
It’s not clear how much revenue the machines could generate, but with Connecticut facing a $500 million budget deficit, state officials are looking for ways to raise money.
The state lottery board recently voted to add Mega Millions, a popular multi-state lottery game, to its roster of lottery and scratch-ticket offerings, and last year lawmakers considered adding Keno — a continuous electronic lottery game played typically at bars, bowling alleys and restaurants.
About 30 of 42 states that sell lottery tickets offer some form of self-service machines, and some have found them to be profitable.
The Michigan Lottery, which added vending machines in 2003, saw instant-ticket sales rise about 15 percent among its high-volume retailers — those who sell more than $2,000 per week.
The Maryland Lottery, which already generated 25 percent of instant-ticket sales through vending machines, added 1,000 more in November 2008.
Concerns About Minors
In Connecticut, the faltering economy caused lottery sales to fall about 1 percent in fiscal 2009, to $991.3 million.
The drop-off was caused by a $9 million decline in scratch-game sales and a decrease of $6.1 million in Powerball games sales.
The lottery contributed $283 million to the Connecticut General Fund in fiscal 2009, the same amount as in the prior fiscal year, which tied for the second highest level of profits ever achieved.
Marvin Steinberg, executive director of the Connecticut Council for Problem Gambling, said vending machines were removed nearly a decade ago primarily because they allowed greater exposure to minors to buy lottery tickets.
Then lottery president George Wandrak, also said that the vending machines produced insignificant revenues for the state.
Steinberg said he still has concerns about underage gambling, even if there are shut-off mechanisms on the machines.
“Even if all machines are in site of the retailer, the question is how distracted will they be?” Steinberg said. “I would hope that the lottery would be planning to monitor these machines to determine whether or not minors are purchasing or attempting to purchase them.”
Initially, lottery officials hoped to get out an RFP for the vending machines in the middle of last year. Although it’s not clear why there was a delay, state Sen. Andrea Stillman, D-Waterford, said lottery officials told lawmakers recently that there have been some “glitches” in the process.
“They were hoping to put machines in supermarkets and big-box stores, but apparently some of those stores weren’t eager to play,” said Stillman, who speculated that the glitch pertains to the stores’ ability to dedicate an employee to keep an eye on the machines at all times.
