Faced with a burgeoning state budget deficit problem, Connecticut Governor M. Jodi Rell is banking again on keno as an option to raise additional revenue for the state. Gov. Rell(R) proposed permitting keno-a lottery type form of gaming often enjoyed in bars, restaurants and convenience stores-in her new budget as an option to raise $20 million in 2011 and $60 million in the following years.
This latest push for the approval of keno comes 7 months after Gov. Rell first suggested the game and Attorney General Richard Blumenthal suggested to the General Assembly to modify the state memoranda of undestanding with the two federally recognized tribes in Connecticut, whose casino facilities offer keno, before offering the game all over the state.
If not, Attorney General Blumenthal said that Connecticut could risk the $400 million that the two tribal-owned casinos provide the state yearly in slot machines revenues. Under the compact between Connecticut and the two tribes, no other person within the state has the right to manage a "commercial casino game". Blumenthal said that the state law is not clear whether a state-run keno would be considered a "commercial casino game".
Despite Attorney General Blumenthal's warning. Gov. Rell is pushing ahead. A spokesman for Gov. Rell's budget office, Jeffrey Beckham, said on February 8th, 2010 that the administration believes keno is consistent with the state's deal with the Indian tribes and that the Connecticut Lottery Corporation could offer keno without any conflict.
Rell's budget staff based its revenue calculations on sales from keno revenues in the state of Massachusetts and Rhode Island and then adjusted them to the population of Connecticut. According to industry estimates, keno produced $3.8 billion in sales from 2004-2008 in Massachussets, $42.45 million in sales from 2004-2008 in Rhode Island and $2.38 billion in sales from 2004-2008 in New York.
Thirteen lotteries across the US operate keno. Robert Genuario, Gov. Rell's budget director, said that keno's fate in the state will be decided by the General Assembly. Genuario said that if the legislature prefers another way to solve the budget deficit. Blumenthal said on February 5th, 2010 that he stands by his legal opinion regarding the issue from June 2009.
Representatives from the Mashantucket Pequot tribe and the Mohegan tribe said that their officials had not yet reviewed Rell's proposal. The executive director of the Connecticut's Division of Special Revenue, which regulates gaming in Connecticut, said that he disagrees with Blumenthal's opinion and it is clear keno is a lottery-type game that the state can offer.
Young also said that he believes that the lottery can start offering the game without any legislative action. It is expected to take a few months to get the game up and running. Young said that the Lottery Corporation would have to decide whether to permit existing lottery licenses like convenience stores and gas states to offer the game or look for new locations, which would have to be officially licensed. In 2008, the total lottery sales in the state were nearly $988 million.
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Louis Blechdom
