Texas Lottery Spared: Four-Year Extension Clears Legislature

• Texas lawmakers passed SB 3070, extending the state lottery for four more years.
• The Texas Lottery Commission will be dissolved and oversight transferred.
• A $95M jackpot won by a European syndicate sparked intense scrutiny.

The Texas Lottery has been offered a four-year reprieve after the state legislature sent a bill to Gov. Greg Abbott’s desk in favor of legislation that would have abolished the lottery entirely.

On Friday, May 30, the Texas Senate approved House amendments to SB 3070, which now awaits Abbott’s signature. The bill would do away with the beleaguered Texas Lottery Commission (TLC), which has been heavily criticized over its management of the state-run game.

Instead, the lottery will continue to operate for four more years under the oversight of the Texas Commission on Licensing and Regulations. After that, its fate will be decided by the Texas Sunset Advisory Commission, a 12-member legislative body tasked with identifying and eliminating waste, duplication, and inefficiency in state agencies.

Immediate Abolition Quashed

The bill was first passed by the Senate on May 15 and approved by the House, with amendments, May 25. On the same day, House members struck down a competing bill that would have abolished the lottery altogether on September 1.

One of the House amendments was to extend the period of grace for the lottery to four years from the two years initially approved by the Senate.

The TLC has faced intense scrutiny from lawmakers after a controversial jackpot win raised concerns about the commission’s ability to ensure the game’s integrity.

While Texas law prohibits the sale of lottery tickets by telephone and online gambling is illegal, lottery couriers argue they fall into a legal loophole because they do not “operate” gambling – they merely provide a delivery service for lottery tickets.

The TLC is accused of embracing the gray-area courier industry as a way to increase sales, and by extension of allegedly enabling – or at least failing to prevent – the syndicate’s scheme.

Senate Bill 3070 aims to curb large-scale lottery ticket purchases by banning courier services from operating in Texas and setting a limit of 100 tickets per individual transaction. Tickets must be purchased in person at licensed sales locations during normal business hours.

Nothing New

The scandal involving the syndicate’s bulk-buying scheme coincided with a routine state review requiring legislation to extend the game’s existence. Despite the furor, legislation aiming to disestablish the lottery is not entirely unusual in Texas.

Since it began operations in 1992, there have been numerous efforts from socially conservative lawmakers to reform or abolish the lottery, citing concerns about morality, gambling addiction, and its impact on low-income communities.

The lottery contributes approximately $2 billion annually to the state treasury, primarily supporting public education.