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F I S C A L I M P A C T R E P O R T
SPONSOR Larranaga
ORIGINAL DATE
LAST UPDATED
1/23/2007
2/9/2007 HB 87/a HJC
SHORT TITLE Prohibit Under 21 Lottery Participation
SB
ANALYST Schuss
REVENUE (dollars in thousands)
Estimated Revenue
Recurring
or Non-Rec
Fund
Affected
FY07
FY08
FY09
($3,400.0)
Recurring
New Mexico
Lottery
Authority
($1,100.0)
Recurring Lottery Tuition
Fund
(Parenthesis ( ) Indicate Revenue Decreases)
SOURCES OF INFORMATION
LFC Files
Responses Received From
Gaming Control Board (GCB)
State Racing Commission (SRC)
Higher Education Department (NMHED)
New Mexico Lottery Authority (NMLA)
SUMMARY
Synopsis of Amendment
The amendment will allow individuals ages eighteen and over to become a lottery retailer; in
addition to selling or distributing lottery tickets. This amendment also removes the provision that
an individual under twenty one may not sell or possess a pari-mutuel ticket or certificate.
NMLA reiterates that individuals between the ages of 18 and 21 account for approximately 6.3%
of the NM adult population and just under 3% of lottery sales. Based on FY ’06 figures, this
would have resulted in $4.5 million less in lottery sales and $1.1 - $1.3 million less in the return
to the state for the Lottery Tuition Fund.
pg_0002
House Bill 87/a HJC – Page
2
Synopsis of Original Bill
House Bill 87 prohibits persons under the age of 21 from selling (this includes acting as a
retailer) or purchasing state lottery tickets. This bill also prohibits persons under the age of 21
from selling, purchasing or possessing a pari-mutuel ticket or certificate.
FISCAL IMPLICATIONS
The New Mexico Lottery Authority (NMLA) states that the fiscal implications of passage of this
bill are two-fold. Increasing the age at which employees can sell lottery tickets places a burden
on retailers to hire and maintain employees 21 years of age or older. Many retailers may see this
change as a hindrance to their daily business operation, which may result in terminating their
contract with the lottery authority and decreasing the lottery’s distribution points for selling
lottery tickets, resulting in a decrease in lottery sales and in revenues to the Lottery Tuition Fund.
As to the purchase of lottery tickets, according to the NMLA’s high-tier redemption rates this
age requirement change will affect just under 3% of lottery players. Based on FY ’06 figures,
this would have resulted in $4.5 million less in lottery sales and $1.1 million less in the return to
the state for the Lottery Tuition Fund.
The State Racing Commission states that currently there is no system in place at any New
Mexico racetrack for tracing any age group, ultimately there is no way to determine what kind of
affect this would have. Although, race tracks are currently trying to attract a younger crowd to
continue the growth of New Mexico’s racing industry. Passage of this bill could hinder these
efforts.
SIGNIFICANT ISSUES
The Higher Education Department (NMHED) notes that in an Albuquerque Journal article dated
January 12, 2006, it was reported that as many as 108,000 New Mexicans may be problem
gamblers. Governor Bill Richardson commissioned the study, which confirms that problem
gamblers are a serious social problem in New Mexico and that treatment capacity is inadequate.
NMHED has also provided the following chart which reports the gaming participation in New
Mexico according to a 2006 study done by Gemini Research
Lifetime
Participation
(2850)
%
Past Year
Participation
(2850)
%
Monthly
Participation
(2850)
%
Weekly
Participation
(2850)
%
Lottery
64.0
51.7
14.1
5.8
Casino
64.0
36.6
3.9
1.4
Pari-mutuel
29.9
7.0
0.4
0.1
Sports
25.7
14.7
2.9
1.0
Private
24.9
13.3
2.3
0.9
Non-casino bingo
17.6
5.5
0.8
0.2
Non-casino gaming
machines
17.6
5.5
0.4
0.2
pg_0003
House Bill 87/a HJC – Page
3
Other
16.0
9.4
1.0
0.3
Non-lottery numbers 3.1
1.3
0.1
0.1
Internet
1.8
1.4
0.8
0.5
Total
85.0
67.6
19.8
8.6
The study also notes that nearly one-fifth (17.9%) of the respondents in the New Mexico survey
only acknowledge having gambled on one activity in their lifetime. The majority of these
respondents (N=374) are casino and lottery players. Over half of these respondents (57%) have
played the lottery and 42%have been to a casino. Much smaller percentages of this group
(between 3% and 7%) have gambled on private games, sports, horseracing, non-casino machines
or other activities.
ADMINISTRATIVE IMPLICATIONS
The NMHED states that restricting the age limit for those who could sell the tickets could force
changes in hiring practices for retailers.
OTHER SUBSTANTIVE ISSUES
The Gaming Control Board notes the Bingo & Raffle Act, §60-2B-1 thru §60-2B-14 NMSA.
Bingo and Raffle are defined as games of chance. The act does not establish a participant age
limit.
BS/mt